• Bons Secours Extends “Good Help” to Land Use

    Here’s a twist on real estate development: A medical complex could provide the nucleus for urban-style growth in Chesterfield County. The St. Francis Medical Center complex, which is part of the Bons Secours Richmond Health System, has unveiled a New Urbanist vision of mixed uses, pedestrian boulevards and grid streets in a 130-acre tract just off the Powhite Parkway.

    The 10-year plan calls for creating an island of urbanity in the untamed sprawl of disconnected, low-density, single-use development of Chesterfield County. The grid streets, walkable streetscapes, mixed use and ground-level retail are all part of what we’d expect from functional, urban-style development. Here’s what’s unique about the project: Housing, which encompasses a quarter of the site, would be first reserved for medical center employees.

    There’s a novel concept: Employers providing housing so employees could live close to where they work!

    Not only that, but this employer plans to build an entire community around the employment center at the medical center includes many of the critical elements of daily life.

    What the plan doesn’t discuss — at least the article by Wesley P. Hester in the Times-Dispatch doesn’t discuss it — is how to integrate the 130-acre community into the regional transportation system. Insofar as people live, work and play in the development, they will generate less traffic on stressed-out Chesterfield County roads. That’s a good thing. The article did note that a number of changes to the county road plan would have to be implemented, but wasn’t clear what they are.

    However the details shake out, the trend toward the urbanization and rationalization of human settlement patterns in dysfunctional Chesterfield County is to be applauded.


  • Class Warfare Always Gets Worse

    Take a look at this graph of income distribution. When I was leading the Army 21 futures study for 2005-2015, this is precisely what the economists from the Library of Congress (under our contract) predicted. No surprise to me that there is a “wage gap.”

    The reason for the gap today – again predicted in 1990-92 – is the changes the transformation to the Information Era would make. This includes the growth of the global economy.

    The graph indicates the “Have Nots” – as we characterized them in our study – would not gain much. The pressures on wages in a global economy suppress wages for the lower skills earners.

    The Haves have a lot more. That is why you see the McMansions, etc. around Virginia. There is more demand and opportunity for folks to earn more if they have key skills or talents. I can add another graphic that shows that most of the wealth of top earners comes more than ever from wages – not dividends or interest.

    So, what, if anything, should be done about the wage gap?

    In the early 90s I wrote (for myself) thoughts about a “greed cap.” The greed cap would be the ratio of highest to lowest earnings (from all sources and perks) in a business. It should be set by collective bargaining (Yes, this Republican means unions) at whatever they see as fit – and doesn’t kill the golden goose that creates capital. It could be 7:1 or 12:1 or whatever.

    More dollars could be paid above that ‘cap’. But for every dollar that is paid to the executive above the cap another dollar is paid into a common pot that supports everyone’s retirement, health, legal, etc benefits.

    The principle behind the idea is this: The profit of a company is directly attributable to the management and the workers. Much profit can be traced to management decisions, but all profit comes from everyone doing their jobs. Hence, separating workers from the profit sharing and letting it all go to the top of the organization is fundamentally an inequitable distribution of gain. Workers know the risk if the company goes down or under. They share in risk and should share in profit.

    Except, I don’t want the damn government dictating this to anyone. I see it as a future strength of the unions – a meaningful purpose, if they can clean up their own management to gain some integrity back.

    Where government can help with the wage gap is to use the forced savings of wage earners to create the INDIVIDUAL savings accounts FDR promised. If the Feds won’t do it, then Virginia should move ahead (see my pieces on Virginia Trust Accounts). The lower 505, Have Nots, get by and will get by. But, their retirement, health and

    Fast forward to 2009. The government bailing out any business and taking ownership – and dictating wages is feel good class warfare in its earliest phases. It is awful for what it does to the economy. It is worse for what it does to our Constitutional Republic.

    It portends worse if it is allowed to go further.

    When you read Ayn Rand’s “Atlas Shrugged” you see the same language today about fairness, greed, etc. Actually, you are reading the fictionalized version of what she saw after the Bolsheviks took over in Russia. Now, you see the same signs of class warfare, dressed up in Obama’s rhetoric, in America.

    Class warfare always gets worse. Consider the French Revolution and the successor Russian, Chinese Communist and Cuba revolutions, Communist takeovers in Vietnam, Laos, Cambodia, and Nicaruaga, and the Nazi takeover in Germany. Everytime the Human Secularists engage in class warfare – whether their preceding adjective is Communist, Nazi, Socialist or Liberal – it goes badly sooner or later for liberty. For individual rights.

    Search the U.S. Constitution for the power of the federal government to do what it did this fall under Bush and now seeks to do under Obama. Not there.

    Search the economic data for proof that government spending and taxing and regulationg wages improves the economy. Not there.

    Search the history of class warfare since the French Revolution. Awful things happen.


  • Feb. 2, 2009 Edition of Bacon’s Rebellion E-zine

    Like Asking for a Show of Hands
    The Employee Free Choice Act does far more than “merely level the playing field” as Mr. Lawrence Frame’s editorial suggests; in fact, it tips the scales in favor of unions. This is especially bad news for Virginia as our largely union free workforce is a primary reason that we are annually ranked as a top state in which to do business.
    by Clinton S. Morse

    Don’t Mess with Virginia’s Biennial Budget System
    Legislation being proposed by Delegates Pollard and Saxman to adopt an annual rather than a biennial budget process needs to be rejected. Under the current format a more realistic budgetary picture is presented to the public and longer range planning is encouraged, two things that go a long way in making Virginia the best-managed state in the union.
    by Patrick McSweeney

    Time for Non-Partisan Redistricting
    With the process of redistricting just around the corner, the time for passing legislation that reforms the system is now. Virginia can’t afford another round of partisan redistricting that results in incumbents going unchallenged.
    by Olga Hernandez

    Fairfax County – a Case Study on Government Excess Spending
    Growth in government spending and new programs play a larger role in the financial hardships faced by Virginia and its localities than many our elected officials are letting on. To combat this we need to increase budget transparency by getting the checkbooks online and look towards competitive bidding and privatization to save money and increase efficiencies.
    by Mike Thompson

    In Defense of Private Enterprise
    The increasingly frequent calls for community service are not bad, and a national focus on that front is probably desirable. However, our attention and support really needs to be focused on free enterprise and capitalism, specifically the ethical and responsible applications thereof.
    by John Palatiello

    Fix Virginia First – What to do after an economic bubble bursts
    With the Democrats in Congress set on doing the exact wrong things to turn out ailing national economy around we must focus our attention on fortifying the Virginia economy. That means tax cuts, spending cuts and entitlement reform.
    by James Atticus Bowden


  • MORE BAD REPORTING

    On 24 March 2008 BaconsRebellion published EMRโ€™s column # 118 titled โ€œGood News, Bad Reporting.โ€ That column was about:

    Good news: The Regional, nation-state and Global economic slowdown provided a chance, with intelligent management, to achieve a sustainable trajectory without a crash.

    Bad reporting: MainStream Media scaring citizens into thinking that carefully backing away from decades of Mass OverConsumption fueled by public and private debt, international borrowing and burning through natural capital was a bad thing and would lead to a crash.

    On 3 February 2009, GM reported vehicle sales at 1982 levels.

    The way the MainStream Media spun that you would think this was bad news.

    There were quite a few vehicles sold in 1982. Citizens do not NEED a lot of new cars. What they NEED are functional human settlement patterns with Accessible and Affordable housing so that citizens of the US of A can be happy and safe and not NEED a lot of new Large, Private Vehicles.

    If cheap money is pumped into the economy so citizens can buy lots of new cars, the cost of imported energy would go back up and then there would be a real crash.

    EMR


  • Fix Virginia First

    What to do after an economic bubble bursts.

    The economic crisis is an economic bubble. Itโ€™s a very big bubble. But, it isnโ€™t an economic meltdown or the end-of-capitalism-as-we-know-it, hysterical hyperbole. Even if politicians, the news people, and losing special business interests bleat that it is so. Yet, a 24 month adjustment – tops โ€“ can become a disaster if the politicians use the statist and socialist tools which made the Great Depression worse โ€“ and longer. Since it appears that President Obama and Democrat majority in Congress will do, precisely, what is wrong economically and right politically โ€“ then we need to fix Virginia first. Cut taxes, cut spending, reform entitlements to build individual savings.

    This isnโ€™t rocket science. Nor, is it the inscrutable intricacies of high finance. It is Economics 10. Niall Ferguson nails the past, present and makes interesting suggestions about the future in his โ€œThe Ascent of Money.โ€ He calls todayโ€™s crisis as it was unfolding in 2007. His book is a tour de force about economic history that is readable, understandable, and incredibly prescient. Itโ€™s history at its best โ€“ the past providing prologue for the present.

    The guidance is simple. The best way forward is painful in the short term, but rewarding as soon as possible. Obey the laws of economics like following the laws of physics. Donโ€™t jump off a building in physics = no financial institution is too big NOT to fail in economics. Oops, since itโ€™s too late to let the losers on Wall Street and in Detroit fail, we, The People, are out at least $1 trillion. Or, rather, the debt load on the next generation has increased by more big bricks. So, whatโ€™s Virginia to do when the Federal government mangles the market and bungles the economy?

    Follow the laws of economics in this market of 7 million persons.

    Our Commonwealth exists in our unique economy that has evolved since civilizations started in 4000 BC. Virginia is an evolving place in time with a traceable history. The economy is constantly changing โ€“ and will into the future. The basis of this economy is capital. Money.

    Capital is to a family what the farm, the fishing boat, or hunting party was to our ancestors. Itโ€™s the basis of our survival. Itโ€™s the means to whatever materialism we pursue. Available capital is the measure of individual economic opportunity that has become essential and intertwined, like a helical of DNA, with individual freedom.

    Yes, America was for the most part poor and free for much of its history. But, the dislocation of labor from the farm with industrialization era and urbanization โ€“ and the fragility of employment with the information era and globalization โ€“ makes individual capital = the family farm.

    Farmers can provide for their family and make some profit based on the certainty of what their labor produces โ€“ and subject to the uncertainty of weather. Most Virginians have a job and a savings account instead of 40 acres. The security of the soil must be replaced by more security in savings. Growing capital as a crop is essential to provide for the Good People of Virginia. Every Virginian can, and must, have personal savings.

    Government canโ€™t create capital or jobs. Virginia must protect the free functioning of the marketplace just as it is supposed to protect individual freedoms. This is limited government, not laissez-faire, in action. It serves the individual sovereign of the state โ€“ while defending the working person from abuse and the environment from damage. It turns government from serving special interests as Virginia does now.

    We must fix Virginia, first, for more, better economic opportunity โ€“ to enable, expand and enhance personal freedom for the individual to chose where and how he works, lives, plays and raises a family.

    Cut taxes. Cut personal and corporate taxes.

    Cut spending. Stop un-Constitutional spending.

    Cut market interference in the production of energy โ€“ without sacrificing the environment.

    Reform entitlements, like Virginiaโ€™s formula for Medicaid.

    Reform mandates, like Virginiaโ€™s Standards of Quality for education. The SOQs have been updated, but they need to be reformed.

    Encourage individual savings. Provide the tax incentives. Take the โ€™04 half percent sales tax sham and convert it into Commonwealth Trust Accounts for each Virginian. Focus the accounts as health savings accounts now. Expand their uses later as they grow.

    Elect the politicians who can tell Virginia โ€“ before the โ€™09 election โ€“ what taxes and spending they will cut, how they will reform entitlements and grow individual savings.

    Finally, know that an โ€˜economic adjustmentโ€™ = hard personal hardship for families. Their pain is real. The healing medicine includes incentives for charity and tough love, not government handouts. Government generosity makes matters worse โ€“ slows the recovery of the economy โ€“ and, sooner or later, punishes every family getting back on their feet.

    Letโ€™s fix Virginia first. Now.


  • Fasten Your Seatbelts, It’s Going to Be a Bumpy Ride

    Military spending propelled economic growth in Virginia during the past decade. Now that rocket fuel has run out. Fox News reports that the Obama administration “has asked the military’s Joint Chiefs of Staff to cut the Pentagon’s budget request for the fiscal year 2010 by more than 10 percent — about $55 billion.”

    It’s not clear how much of that will come of Virginia, but we can make an educated guess. Last year, the Department of Defense spent $56 billion here. If we absorb our “fair share,” we stand to lose $5.6 billion yearly.

    Meanwhile, the Times-Dispatch notes that Virginia could receive as much as $5.8 billion in the Obama administration’s proposed “economic stimulus” package — about as much as we lose from the defense cutbacks. That pinata of pork would provide a one-time injection of some $750 million in transportation funding, $550 million for Medicaid, and $1.58 billion over two years as part of a fiscal stabilization fund. Then the money dries up and we’re back to Business As Usual.

    Bacon’s bottom line: Virginia is hosed. Defense cutbacks will be long-term, while the “stimulus” package will provide only a short-term palliative. We will encounter real hardship.

    We can deal with this bad news in a chronic crisis-driven mode, taking a series of stop-gap measures, or we can start dedicate ourselves to fundamentally reinventing our economy, our human settlement patterns and our governance system to make us more competitive over the long-haul.

    Crisis-driven thinking, or long-term thinking? Which do you think will prevail? Hah! What a foolish question.

    Update: Fox News might have gotten the story wrong. According to CQ Politics, the “cuts” are cuts only in the sense that they are reductions from some astronomical number some DoD bureaucrats had lobbied for. In actual dollars, measured against actual dollars spent last year, the Obama administration would match what the Bush administration recommended, which would be an actual increase.
    So, before any one panics, we should make a point of ascertaining who’s got the story straight.

  • VOCABULARY AND THE MIDDLE CLASS

    Today, the President and Vice President launched a task force on โ€œthe middle class.โ€

    Here is what EMR said last month in a draft of Chapter 26:

    A 2009 PERSPECTIVE ON THE IMPORTANCE OF VOCABULARY

    There is a larger context for understanding the importance of Vocabulary. The Shape of the Future, Chapter 1. employs statements made during the decade of the 1990s by senior elected leaders to illustrate the importance of an understanding of human settlement patterns and need for a robust Vocabulary to discuss the topic. When the book was completed in 2000, 20-20 hindsight provided a crystal clear way to compare statements of the intent of the Clinton / Gore Administration with the results over the following 8 years. Chapter 1. provides the perspectives and goals of President Clinton and Vice President Gore in their own words and then evaluates progress on those goals.

    Now the US of A stands on the cusp of a new Administration. With no hindsight upon which to rely, a robust Vocabulary โ€“ a prerequisite of getting the issues โ€œrightโ€ โ€“ becomes even more important due to the diminished resource reserves that remain after 35 years of intentional Mass OverConsumption to fuel โ€œgrowthโ€ and prosperity for a few at the top of the Ziggurat.

    There is a broad range of specific problems that citizens who voted for โ€˜changeโ€™ hope the new administration will address. The broad topic which the obligatory Vice Presidential Task Force will address is: โ€œStrengthen the Middle Class.โ€

    At first blush, strengthening the Middle Class would appear to address a number of hot button issues:

    1. The economy
    2. Job creation
    3. Energy independence
    4. Affordable health care
    5. among others

    It might be obvious that โ€œstrengthening the Middle Classโ€ must address the Mobility and Access Crisis, the Affordable and Accessible Housing Crisis and the Helter Skelter Crisis. However, without a functional Vocabulary that reality will be missed by even those with the best of intentions.

    The meaning and intent of โ€œstrengtheningโ€ should be clear to all: Improving the economic, social and physical well being of…

    … of the โ€œMiddle Class,โ€ of course. But there is the rub.

    What is the Middle Class?

    The Wikipedia discussion of โ€œmiddle classโ€ opens with this statement: โ€œThe term โ€œmiddle Classโ€ has a long history and has had many, sometimes contradictory, meanings.โ€ Well put!

    The bottom line is that almost no one believes that the classic Middle Class still exists. That Middle Class existed after the dust settled following World War II. It was articulated and confirmed by C Wright Mills, David Riesman, Robert and Helen Lynd and others. While Middletownโ€™s Middle Class has changed and some say it does not exist, the term โ€œMiddle Classโ€ is still used even though it has morphed to become a prime candidate for listing as a Core Confusing Word.

    The Wikipedia discussion of โ€œAmerican Middle Classโ€ focuses on three academic โ€œclass modelsโ€ to summarize current scholarly classification of social class. Although there are three separate models, they divide the post 2000 social structure into four broad groupings that are remarkably similar. The four classes (with three sets of titles and percentages of the population) break down this way:

    Class 1. Capitalist Class (1%) // Upper Class (1%) // The Super Rich (0.5%) and The Rich (0.5%) โ€“ percent total of the class is 1 percent in all three models.

    Class 2. Upper Middle Class and Lower Middle Class (45%) // Upper Middle Class and Lower Middle Class (46%) // Middle Class (46%) โ€“ percent total varies from 45 to 46 percent in the three models.

    Class 3. Working Class (30%) and Working Poor (13%) // Working Class (32%) // Working Class (40-45%) โ€“ percent total ranges from 32 to 45 percent in the three models.

    Class 4. Underclass (12 %) // Lower Class (14-20%) // The Poor (12%) โ€“ percent total ranges from 12 to 20 percent in the three models.

    The totals for those below โ€œMiddle Classโ€ range from 42 to 65 percent. Note: The totals do not equal 100 percent within any single model.

    In the three models selected by the Wikipedia authors the academics have remarkably similar categories and percentage distribution. The biggest variation are in the names and allocation of population of the lowest two classes.

    In this โ€˜compositeโ€™ view of the Ziggurat, it seems there is not much room at the top. However, one percent of the population is about 3,060,000 citizens or something over 1,000,000 Households. These fortunate few would fill the largest NFL stadium about 37 times. While they compose a minuscule percentage of the population, this class provides โ€“ directly and indirectly โ€“ the majority of the funding for ideologically oriented Institutions (aka, think tanks or โ€˜Belief Tanksโ€™) and support for the two major political parties. See THE ESTATES MATRIX for discussion of the impact of Institutions (especially Belief Tanks) in the New Third Estate. Also see Supercapitalism noted in Chapter 36. โ€“ Fireside Reading

    It is significant that Class 1. (Upper) plus Class 2. (Middle) no longer make up a majority of the citizens of the US of A as they did in 1960 and in 1973. This raises the first question about the Vice Presidents Task Force:

    Who needs โ€œstrengtheningโ€ most?

    Vocabulary becomes even more important when one digs a little deeper. The core concern according to Vice President-Elect Bidenโ€™s own statement is โ€œWorking Families.โ€

    Here is a โ€˜two-ferโ€™ with respect to Vocabulary:

    First, โ€œfamily:โ€ For reasons spelled out in GLOSSARY, the term โ€œfamilyโ€ itself has become a candidate for Core Confusing Word status. This is due to disaggregation of the settlement pattern and to the constant changes now experienced within almost all Households / Dwelling Units.

    Second, and even more important, if it is โ€œworkingโ€ citizens that are of concern from a social structure perspective, those are folks is a different place in the Ziggurat (and in a different class) than โ€œthe Middle Class.โ€

    There is no question those individuals and Households who are productive members of society (aka, working) and who have been slipping further and further behind since the mid-70s NEED to be the focus of attention if democracy is to be preserved.

    As emphasized in Chapter after Chapter of TRILO-G the widening Wealth Gap is anathema to, and incompatible with long term stability of democratic processes and to market economies.

    So if Vice President-Elect Biden is to โ€œstrengthen the Middle Class,โ€ the first thing to do is to define what it is he and the task force are talking about. There is no way to โ€œstrengthen the Middle Classโ€ unless the Task Force understands reality and embraces a realistic Vocabulary.

    There is a second point in this context with respect to โ€œThe American Dreamโ€ of working citizens and expanding home ownership. A fair allocation of location variable costs will make it very clear that from 60 to 70 percent of the population can never afford Single Household Detached Dwellings. That does not rule out โ€œhome ownershipโ€ but it does impact the settlement pattern. Further, most of the urban citizens who can not afford Single Household Detached Dwellings also cannot afford Large, Private Vehicles to secure Mobility and Access in dispersed settlement patterns.

    This is not a matter of policy or preference, it is a matter of physics and economics and also requires an understanding of human settlement patterns. See THE PROBLEM WITH CARS.

    EMR


  • Needed: More Regulation and Less Bitching

    One perpetual and frustrating riff I hear on this blog and throughout the conservative elements of Virginia is the bug-a-boo about government regulation.

    Everyone from the Gipper on down has told us that we need to get the government off our backs, that government is the problem. I think the opposite is true. We need government to actually do its job.

    Ask people who eat peanut butter.

    According to The Washington Post, Lynchburg-based Peanut Corporation of America shipped contaminated peanut butter from a plant in Blakely, Georgia 12 times in the past two years. The firm’s plant has been linked to a recent outbreak of salmonella that has killed eight people and sickened 502 in 43 states across the country, according to the Centers for Disease Control.

    Closely-held Peanut Corporation of America doesn’t make the types of peanut butter who find on grocery shelves. Instead, it sells its product to foodmakers such as Kellogg, Trader Joe’s and Little Debbie which put in their products.

    Federal investigators have found four strains of salmonella at the Georgia plant. One strain was found next to a washroom, which isn’t surprising since salmonella is spread by animal feces. It seems possible that some plant workers didn’t wash their hands thoroughly as instructed after using the toilet.

    The firm isn’t required to share internal testing results for samonella with regulators. But there sems to be a problem with the lack of regulation. The Food and Drug Admininistration is tasked with plant inspections but in this case gve the job to Georgia state authorities. How come? FDA says it just doesn’t have enough regulators to go around.

    State regulators inspected the plant most recently in October. Lo and behold, that’s when the contaminated batches of peanut butter this time around were being produced. But the Georgia regulators somehow didn’t test for salmonella. State authorities are investigating why they didn’t.

    Getting hard-pressed state regulators to do the jobs of hard-presssed federal regulators has been the modus operandi for years. Here in Virginia, too-few state regulators actually do the heavy lifting for the feds by investigating hazardous chemical waste sites and air and water pollution control as mandated by federal laws.

    The right-wing General Assembly is loath to spend much money on regulation because we just love that “pro business” moniker. We also go for loopey self-regulation. So, we really don’t have many regulators compared to other states which take public health and the environment more seriously.

    Not many might remember but I sure am reminded of Kepone which polluted the James River back in the 1970s. The carcinogenic pesticide was made at a converted gas station through a scheme operated by now-defunct Allied Chemical. The idea was to somehow shield the chemical giant legally by having a little sub-company make the stuff at the Hopewell site. Waste ended up in Hopewell’s water sewage system and since it’s a chlorinated hydrocarbon that doesn’t break down, it retained its toxic potency for years after it was flushed into the James River.

    So where were the state regulators? Probably off keeping the state safe for profits and business interests.

    So next time you are bitching about government regulation or reading the pathetic new “Bacons Rebellion” e-zine operated by the dogmatic “Thomas Jefferson Institute” with its whining about the need for limited government, think peanut butter.

    And think that half of the people affected by the peanut butter poisoning were children. They could be yours.

    Peter Galuszka


  • SHELTER FOOLS GOLD

    On 26 January NAHB reported that existing home sales INCREASED in December: โ€œExisting-Home Sales Spike As Bargains Glut Market: Sales Up a Surprising 6.5 Percent in December.

    This was the only โ€œgoodโ€ economic news in weeks:

    24 January 2009 WaPo: โ€œDownturn Accelerates As It Circles The Globe: Economies Worse Off than Predicted Just Weeks Ago.โ€ Record losses in jobs, defaulting banks, defaulting nation-states, riots in Eastern Europe, Autonomobile and retail closings, the four largest print media Enterprises in the US of A lost $18.3-billion in market value in just a year, the new federal administration scrambling for ways to expand bail-outs, consumer confidence at an all-time low, …

    The 2001 Nobel prize winner in economics and former chairman of the Council of Economic Advisors Joseph Stiglitz suggested to CNNPolitics that the US of A follow Swedenโ€™s lead: Agencies should take over failing banks โ€“ wiping out owner and bank investor interests โ€“ instead of just loaning them money or buying preferred stock.

    The existing home sales news was apparently what kept the gambling venues (aka, Dow Jones, et. al.) from tanking during the first part of the last week in January because other news from the shelter sector not good:

    On 24 January it was reported that Freddie Mac will ask for $35-billion more in taxpayerโ€™s money and on 26 January that Fannie Mae will ask for $16-billion more. On 24 January FHA reported that the number of FHA-backed loans in default were rising.

    There was some good news: The Newton Bank of Nigeria is offering loans to all comers over the Internet.

    And almost as foolish, Bill Bolling who wants another term as Lt. Governor of Virginia has a โ€œlegislative agendaโ€ that includes a $2,500 per person ($5,000 per couple) โ€œtax creditโ€ for Virginianโ€™s buying homes with no location related criteria โ€“ such as qualifying for location efficient mortgages.

    Perhaps most scary of all was the front page of WaPoโ€™s Real Estate section on 24 January. The feature was a puff piece on green building (this story has already been cited in prior comments): โ€œSeeking a Smaller Footprint: Builders Scale Back House Sizes as Buyers Commit to Energy Efficiency.โ€

    Why is this scary? Check out the photographs of the featured buildings! If there were real standards for journalistic decency this would be stamped โ€œPORNOGRAPHY!โ€ It is well known that even those committed to energy efficiency will not walk forever. These dwellings are said to be โ€œnear Winchester.โ€ But from the pictures it is clear they are not THAT near. Where are the Jobs and Services needed to achieve Balance?

    Somewhat Better Size House, still in the Wrong Location.

    But what puts the December rise in existing house sales in the deception category? The real estate industry is using the percentage drop in home value during the Depression when looking for the โ€œbottomโ€ of the market.

    There are major differences in the unsustainable runup in house prices over the past 35 year, and especially the last 15 years with the Roaring 20s and the Depression Era drop of around a third in value. Here are some:

    Far lower percentage of homes with mortgages

    Far fewer homes

    Far more dwellings with two or more generations in a unit.

    This later point is critical. These occupants could work to help make ends meet. Multi-generational occupancy was especially prevalent in detached dwelling and detached dwellings were mainly in the Countryside. The occupants of detached dwellings were far more likely to be able to depend on the land for the needs of everyday life.

    Then there is the fact that the housing bubble built up over the 20s was a far smaller bubble and it was not nearly as leveraged nor were the mortgages packaged, securitized and peddled around the globe. Home mortgages were a Community and a Regional activity.

    If one wants to look for levels of property value declines they need to look not at nation-state wide percentages of owner occupied dwellings but at the bursting land speculation bubbles in Florida, California and elsewhere.

    While NAHB reports that sales were up โ€œa surprisingโ€ 6.5 percent in December, CNNMoney was reporting: โ€œFlood of foreclosures: Itโ€™s Worse Than You Think.โ€ โ€œBanks are moving slowly to list repossessed homes for sale, which could mean that housing inventory is even more bloated that current statistics indicate.โ€

    Of course most of these not yet listed dwellings are Wrong Size House in the Wrong Location โ€“ see โ€œTHE TRAGEDY OF TRICKLE DOWN.โ€

    The bottom is not yet in sight. December sales numbers are Fools Gold.

    And still new units are being built in the Wrong Locations, and the wrong dwelling type, even if somewhat closer in size and energy consumption.

    EMR


  • Did Eric Cantor Know that Diane’s Bank Got a Federal Bailout?

    Here’s a curious tale that you’re not likely to see in the Richmond Times-Dispatch or other Media General outlet.

    Diane Cantor, a veteran finance industry official and wife of GOP Congressional wunderkind Eric Cantor, is an executive of a bank that got a $267 million federal bailout even though conservative Cantor has at times publicly opposed the federal bailout program.

    According to the investigative journalism Website propublica.org, New York Private Bank and Trust was the beneficiary of a Treasury Department purchase of $267 million work of the bank’s preferred stock to shore it up. The bank is the holding company for Emigrant Bank with 35 branches mostly around New York City. Diane Cantor runs the Virginia branch of Emigrant’s wealth-management division, Virginia Private Bank & Trust, which targets wealthy clients.

    Diane Cantor is also a director on the board of Media General, which owns the Times-Dispatch whose editorial staff gushes constantly about how wonderful Cantor, now House Republican Whip, and his wife are. The newspaper does note Mrs. Cantor’s association with the board, but as far as the newspaper’s editorial and news staffs go, “never is heard a discouraging word” about the Cantors. The TD acts as Cantor’s personal PR machine since he is seen as an up-and-coming young Republican leader destined to re-energize the now-hapless GOP leadership left in shambles after eight years of Bush-Cheney-Rove.

    Prorepublica.org did talk with Cantor’s office which says that Eric did not know about the bailout of his wife’s bank and did notihng to intercede for it.

    If that’s the truth, then Cantor is in a somewhat better position than Rep. Barney Frank, the outspokenly liberal chair of the House Financial Services Committee. Frank, a Democrat, admits he did intercede to get OneUnited Bank of Boston federal bailout money. Frank insists it was a legitimate attempt to help the minority-owned bank, according to The Boston Globe.

    Even so, the news puts Cantor in an awkward position. Last summer, when the Bush Administration’s proposal for a $700 billion bailout of troubled financial companies was introduced, Cantor initially pushed for an alternative structure so taxpayers wouldn’t have to pay for it. Cantor suggested using investors on Wall Street to fund the bailout.

    He ended up up supporting the program which has ended up giving Diane’s bank taxpayer money. More recently, he voted against releasing the second tranche of the funds.

    What’s next is up for grabs. There has been plenty of criticism of the $700 billion bailout program which former Treasury Secretary Henry Paulson introduced in a spare, two-and-a-half page long proposal so vague that it wouldn’t get an Average Joe an auto loan. Paulson initially suggested the bailout be used to buy up toxic loans, but since it has been used for just about everything else, from stock buys of banks, to funding bank acquisitions, to helping auto companies and their finance firms.

    Barack Obama’s team is ready to propose major restructurings and major re-regulation of the Bushies’ giveaway that has benefited lots of Wall Street insiders as well as Diane whether Eric knew of it or not.

    It isn’t clear if anything was done wrong here. The sad part is that because of Media General’s corporate monopoly over news coverage in much of the state, not many Virginians are likely to learn of what is a legitimate news story at all. And that’s a damned shame.

    Peter Galuszka


  • The Missing Element in Kaine’s Green Jobs Initiative: Private Capital

    Earlier this month, Arlington-based Positive Energy raised $14 million in a second round of venture funding. Positive Energy has developed a software analytics platform that it sells to electric power companies implementing demand-response programs to encourage energy conservation and loading shifting. As the company web site explains, it’s one thing to adopt time-of-use pricing and similar peak-demand initiatives, it’s quite another to persuade consumers to use them. The company contends that its solutions can bridge the gap between economic theory and marketplace reality.

    Positive Energy is expanding — it is currently trying to fill 13 positions in IT, sales, finance and product development.

    Does Gov. Timothy M. Kaine, who touted his “green jobs” initiative in his state of the Commonwealth speech, understand where green jobs come from? Does he understand the role played by entrepreneurs, angel capital, venture capital and the entrepreneurial support network?

    I’m not sure he does. If he does, it’s not apparent in his speech. While Kaine advanced some good ideas like retrofitting state buildings to green energy standards (See “Kaine’s ‘Green Jobs’ Initiative“), he resorted to a pretty stale package of proposals on the economic development front.

    University research. Kaine has created an “interagency task force” for energy project recruitment to “build the case” for renewable energy-related businesses to invest in Virginia. “Virginia has a tremendous natural advantage in this area through the research being done at Virginia colleges and universities,” Kaine explained. “Every institution in Virginia is working on innovative new energy projectsโ€”transportation fuel cells at Virginia Tech, energy-efficient buildings at UVA, algae-based biodiesel at ODU, and new energy crops at Virginia State University.”

    Terrific. How do we take advantage of all that research? Says Kaine: “Technology-based economic development organizations” (does that mean the Center for Innovative Technology?) will build a single Internet portal where investors can access information about the research. Wow. Back off, California, Virginia’s building a web site!

    Tax incentives. No economic development program would be complete without grants, tax incentives and regulations. These include:

    • Expand an existing incentive for solar manufacturers to include new plants that make other alternative energy equipment and products.
    • Enact a requirement that biodiesel should comprise 2% of diesel fuel sold in Virginia.
    • Enact an income tax credit of up to $8,000 on solar photovoltaic, solar thermal, and wind-power electric generators installed in homes or businesses in Virginia.

    Unfortunately, the Kaine package doesn’t do anything to promote companies like Positive Energy. Silicon Valley venture capital is transforming the economics of renewable energy, electric vehicles and energy conservation by underwriting a wave of technologies, some of which are already entering the marketplace. (More on that in a week or two.) The Washington-area venture capital network isn’t as deep as Silicon Valley’s, but it’s one of the strongest on the East Coast. And it’s well positioned geographically near the seat of national government, where all manner of “green” boodle and pork will soon begin flowing. If Virginia is to develop an economically sustainable “green” industry, critical financial support and human capital will come out of NoVa.

    There’s nothing wrong with pursuing green industry (other than the fact that every other state in the country is vying for the same market). But it’s going to take a lot more than a web site and a smattering of tax incentives lacking strategic focus to do so.

    If the governor wants to do something useful during his last year in office, he should convene a “green industry” summit that brings the established energy/environmental companies, would-be entrepreneurs, financiers, university researchers, intellectual property attorneys and other supporting professionals into the same place at the same time so they can begin networking and deal making. Ultimately, it’s all about putting the right people together.


  • VOCABULARY OF SETTLEMENT PATTERN

    Well down in the post titled โ€œThe Intellectual Pretensions of Suburb Bashingโ€ Peter G. said:

    โ€œEMR,

    โ€œIt’s so frustrating. I can never win. Just when I think I come up with a really good post, you tell me I got the vocabulary all wrong. If I get the vocabulary right, you’ll say my point is all wrong.

    โ€œGeez!

    โ€œPeter Galuszkaโ€

    Peter:

    EMR did not intend to be critical in any way. As many other comments following you post suggest, settlement patterns that have evolved since 1940 are different things to different people.

    All we say is to understand why patterns are functional or dysfunctional everyone must speak the same language. If you do not like ours, come up with your own.

    Here is a little exercise for readers:

    Take the original post by Peter, Jim Baconโ€™s 6:59 AM post (good to see Jim up early!) and Grovetonโ€™s posts of 12:13 PM and 12:59 PM. Print them out and circle all the times that โ€œsuburbโ€ and โ€œsuburbanโ€ are used. No look at those circled words and see how many different things they describe, especially in the context of the many different experiences noted in the other comments โ€“ some good, some bad; some accurate, some โ€˜adjustedโ€™ to fit preconceived ideas and agendas.

    Peter: I have not visited or lived in some of the places you have. But I do know something about one place you visited. My office / studio at North Lake Cluster in the Fair Lakes Neighborhood of the North Village in Fairfax Center, VA.

    Was that place โ€œUrbanโ€ or less than urban?

    To refresh your memory the residents of North Lake Cluster live at 30 persons per acre โ€“ yes even with that great view of the lake and the Openspace from the windowns and decks. You may recall the Four Seasons photos of the very large Swamp Maple from the front porch that could have been taken in Sherwood Forest.

    It turns out that if one half the Clusters in an Alpha Community were at that 30 pn acre density, then 25 percent could be Multi-Household dwellings (at 40 to 60 per acre) and 25 percent could be Single Household Detached Dwellings on quarter to half acre lots (at 10 persons per acre) and achieve 10 persons per acre at the Alpha Community Scale.

    That distribution of dwelling unit types was the original plan for the almost Alpha Community of Greater Reston. The ratio could have been 30 / 40 / 30 as it is in Village-scale Burke Centre and in the still Beta Community of Columbia, MD, Peachtree City GA, etc.

    The density of the Cluster of Single Household Attached Dwellings listed above is just what our current dwelling is, here in Menlough Cluster next to the Clear Edge (the Town and County leaders word, not just EMRs) around Greater Warrenton-Fauquier.

    Fairfax Center was designed to have a relative Balance of J / H / S / R / A and 55,000 residents on 5,500 acres. Given its context it has not done badly but for some unfortunate rezonings that undermined the Neighborhood Center service idea — everyone could walk to get weekly necessities in a 100,000 sq ft Neighborhood center, etc. Today it would have lots of live-work units…

    Fairfax Center is still not that bad even with traffic from US Route 50, I – 66 and Fairfax Parkway running through the middle and is one of the three Beta Communities we choose to visit inside the Clear Edge. The worst โ€œdevelopmentโ€ in Fairfax Center? The Fairfax Government Center, hands down.

    During the Blueprint process, the Coalition for Smarter Growth came up with some good ideas to evolve Fairfax Center into a great Alpha Community: Fairfax โ€œCityโ€ would become the third Village and the Fair Oaks Mall would be reconfigured to span both US Route 50 and I-66 and both the Core of Fairfax City and the new Core Village would be served by an extension of METRO.

    But no, the economic activity was scattered across the R = 20 to R = 40 Radius Band and at far greater TOTAL cost.

    Oh yes one other thing: Larry do you have no shame?

    โ€œ…and it occurred to me that even after a gazillion tomes from EMR – I still don’t have a feel for what he thinks is an optimal density level for a balanced community.โ€

    First, EMR has written one Tome and working on a second.

    But more important, when reading this post do you not recall seeing the 10 Person Rule [10 Persons per Acre at the Alpha Community scale] at least 50 times in last two years? If TJI had not screwed up the BR archive, EMR could cite you the number of times it was mentioned.

    Look, there are only Five Natural Laws of Human Settlement Pattern. You can write them on your arm with a Sharpie and refer to them when you get confused.

    And on the Tysons issue. How many times has EMR suggested you read Column # 25, โ€œThe Shape of Richmondโ€™s Future,โ€ 16 Feb 2004 for the overall regional evolution process? And while you are at it # 65 โ€œBalanced Communities,โ€ 23 Aug 2005 which Jim Baconโ€™s header describes as โ€œ… Herewith is a primer on what they are and how to create them.โ€

    EMR


  • Bacon’s Rebellion E-zine

    The Jan. 19, 2009, edition of the Bacon’s Rebellion e-zine has been published.

    Virginia and the Employee Free Choice Act
    The panic over the Employee Free Choice Act is overwrought. Here’s why it isn’t as big a deal as partisans on both sides would have you believe.
    by Lawrence H. Framme III

    Lowering the Costs of Virginia’s Prison System
    Has the time come where conservatives need to cast the same wary eye at our prison budget that they do at every other item in the state budget?
    by Pat Nolan

    Virginia Needs More Charter Schools
    Overall, Virginia does a good job with public education, but that doesn’t mean we can ignore the failure of public schools in some parts of our state. Instead of more bureaucracy we need to give parents what they want, more choice in what school their kids go to.
    by Christian Braunlich

    Stimulating Job Creation
    Obama’s stimulus bill may help the economy, but only if we make sure that it doesn’t let the government try to compete against the private sector.
    by John Palatiello

    Presentism in Virginia Politics
    When Virginians recoil in horror from a Southern symbol like Lee-Jackson Day, just as a vampire shrieks at the Cross, they engage in “presentism.” This affliction of the mind pollutes the spirit and poisons the body politic.
    by James Atticus Bowden

    This Holiday Means Help for the Economy
    America’s small businesses are hurting. Here’s how we can help them get back on their feet.
    by Todd Stottlemyer


  • The Intellectual Pretensions of Suburb Bashing

    Saturday night my wife and I went to see the movie โ€œRevolutionary Roadโ€ starring the Titanic team of Leonardo and Kate. Itโ€™s sharp, intelligent and deeply depressing fare by the same director of that gem โ€œAmerican Beautyโ€ but without much of the satiric humor.

    The film brought to mind the concept of suburbs and just how intellectuals despise them, often for good reason. This is true at Bacons Rebellion (at least the original one) where such keen-eyed observers as EMR and Jim Bacon and Larry Gross take apart the problems of the car-centric suburbs that have overwhelmed Virginia since about the 1930s when the New Deal brought lots of new federal workers to Washington and many flocked to the cheap housing in Arlington.

    I, too, have done my dissing of suburbs, although I lived in some as a child and some of my earliest memories are not of cities, but of station wagons on Rockville Pike north of Bethesda and Congressional Shopping Center, a converted civil airport, where I used to buy my plastic models. Later, I lived in true small towns and in the country. During my adult life, I tended towards residing near the centers of cities, including Norfolk, Richmond, Washington, Chicago, Moscow and New York.

    Like Frank and April in the movie, marriage and two children brought me to the suburbs which are where I am now. But I start to wonder, why does everyone hate the suburbs so much? Is it really fair, since suburbs have been a huge part of the American experience since at least the 1950s? Are we really the worse for it as the EMRs and Baconators would have us believe? I mean, Ed and Jim, are we all really so worthless?

    There is a certain pretension in โ€˜burb-bashing. Consider this excerpt from the New York Times which was riffing off the upcoming release of โ€œRevolutionary Road:

    โ€œIn the last couple of decades, the antisuburban film has become as much a staple of Hollywood as the Serious Crime Drama With an Incomprehensible Plot. A few prominent examples: Todd Haynesโ€™s โ€œSafeโ€ (which has suburban people inexplicably bleeding from every pore of their bodies); the 2004 remake of โ€œThe Stepford Wivesโ€ (where Viking range + Sub-Zero refrigerator = robotic wife, death of feminism and extinction of human rights); โ€œThe Ice Stormโ€ (just in case you ignored the urgent alarm sounded by the antisuburban novel by Rick Moody on which the film is based and moved to Larchmont); the British Sam Mendesโ€™s very own โ€œAmerican Beautyโ€ (of which โ€œRevolutionary Roadโ€ is simply a reiteration โ€” take a sprinkler, add a dollop of anomie, and presto! youโ€™re an authentic American filmmaker).โ€

    So, let me see if I am getting this right. The โ€œautonomobileโ€ + โ€œdysfunctional settlement patternsโ€ + boredom = hopelessness + self-abortion (see the movie). But I think that is terribly harsh and negates such much of what has been good about U.S. culture at least when I have been alive (I turned 56 last week).

    The fact is that for years hardly anyone has lived in the extremely-densely packed neighborhoods where I resided in Brooklyn for four years when I worked at a magazine in Manhattan. I spent fascinating weekends inspecting brownstones and redbricks, studying the sub-society on tenement roofs and on fire escapes and marveling at the incredible ethnic diversity of the place. My Soviet-born wife loved New York with a passion and was disappointed when we ended up in a nice suburb. She ought to know — she teaches the children of suburban families and knows their issues very well.

    Suburbs are alien worlds to her so her viewing of “Revolutionary Road” was a bit clinical. As a child, she lived for a while in a city in a โ€œkommunalkaโ€ or apartment where as many as a dozen families lived on one floor and shared one kitchen and bathroom. Talk about properly dense housing patterns! Think of it as Risseโ€™s ideal world on steroids with a vodka chaser!

    It wasnโ€™t that her family was poor โ€“ everyone was. Her mother worked at a partly-underground factory that made, among other things, surface-to-air missiles of the type used against U.S. aircraft in Vietnam. Back then in the Urals, such housing wasnโ€™t so much a factor of far-sighted urban planning, Rather, it was because the nation was still getting over the effects of World War II which killed millions of Russians.

    Anyway, back to the movie. Leonardo and Kate do a fine job of playing out their enormous frustrations at being alive in the 1950s suburbs and they really seem to want to get on to Paris and make like Kerouac or Ginsberg. I liked the movie but really admired โ€œAmerican Beauty,โ€ another gutting of suburbia, but more of a satire thanks to Kevin Spaceyโ€™s wry and brilliant humor.

    I guess I subscribe to the intellectual pretension of โ€˜burb-bashing because I am so much a product of it.

    Peter Galuszka


  • WHO IS IN CONTROL?

    There seems to be an intentional attempt on this blog to distort EMRโ€™s views of governance and the achievement of Fundamental Transformation in human settlement pattern, governance structure and the global economic structure.

    Darrell โ€“ Chesapeake dismisses EMR as just another socialist.

    Larry Gross somewhere got the idea that it will require a philosopher king to manage society. He has not bothered to read THE ESTATES MATRIX.

    Nova Middle Man recently said:

    โ€œEMR and You (Jim Bacon) seem to have similar goals but totally different ways of getting there. EMR’s plans only work with massive government regulation. Am I missing something?โ€

    Yes!

    โ€œEMR probably would want 100% control in the typical liberal elite I know best mentality. In reality what would this look like.โ€

    Where does this foolishness come from?

    Not from anything we have written. Not from any lecture we have delivered. The primary source of this foolishness appears to stem from readers not understanding the Fundamental Transformation means FUNDAMENTAL TRANSFORMATION.

    Since inquiry is part of a chapter we will be editing soon and we have not specifically addressed this issue before in this forum we will try to summarize:

    Management at the Cluster scale is critically important since the Cluster is largest organic component with realistic potential to have effective direct democracy. This observation is base on years of Community management experience and on the study of group dynamics as well as the physical constraints of meeting space that is available at times and in locations when all the citizens of a Cluster can assemble.

    So that means at least 2-million โ€œleadersโ€ and if there is any delegation of responsibility about 10-million.

    The New Urban Region is the smallest Organic Component of human settlement that can achieve sustainability (and may also be the largest but that is another issue). To lead New Urban Regions, citizens need thousands of โ€œleaders.โ€ There are also Subregions and Urban Support Regions so let us say there is a need another 250,000 to manage at the Regional scale.

    Above the New Urban Region โ€“ MegaRegions, nation-states, trading-blocks, continental and global scales there are many who would like the have roles. These are the one now hears about as โ€œleadersโ€ but they should have worked up through to ranks and they should be among those already tabulated.

    Of course there are more than just Agencies in need of leadership. Many Enterprises and Institutions will be managed by those who also participate in the governance structure. The difference between now and a sustainable future is that in 24-7 Sunlight, everyone will know of the multiple roles and the conflicts can be eliminated.

    At the other end of the spectrum of Organic Components is the Unit occupied by the Household. It is clear that to be a functional Household there must be at least one informed โ€œleader.โ€ If part of Household activity is to raise children there need to be at least two. So there is another 130-million more or less leaders.

    The Dooryard, Neighborhood, Village scales components need leaders too but almost all will also be among those already identified.

    So far we are up to 140,250,000 leaders. In a true democracy everyone has a vote so even those who are not in a leadership position at any given time role have a say.

    So where is the central committee, the philosopher king or the liberal elite? Pure fantasy on the part of those who do not want to understand Fundamental Transformation.

    Will such a system work? So far the field tests say yes โ€“ if citizens understand their role and take responsibility for their actions.

    There need be no central committee and no philosopher king. No liberal elite, no pseud-conservative Belief Tank, no Tri-lateral commission, no messiah, no caliph, no dictator, no Darth Vader. Just citizens making informed decision in the market and in the voting booth.

    As we suggest in posts over the last three months that focused on achieving a sustainable trajectory for civilization, creating an AntiParty and the upcoming change of administration โ€“ for example โ€œThanksgiving Perspectiveโ€:

    The problem citizens face is massive over expectation that any one person or the team any one person assembles can โ€œsolve the problem.โ€

    Larry Gross again:

    โ€œBut EMR has failed repeatedly and miserably IMHO to lay out a clear and articulate path for citizens to understand what a Balanced Community is (and is not) – and what changes they should support via elections and referendum and current development proposals (like Tysons) to move in that direction.โ€

    No, Larry, you have failed โ€œrepeatedly and miserablyโ€ to bother to read what EMR has written on these topics. For some reason you expect that every time a question occurs (or reoccurs) to you, that EMR has the obligation to drop everything and try to again answer it. That is especially a problem when you appear to only listen / read / understand what supports you preconceived notions which lack a comprehensive Conceptual Framework or a Vocabulary to articulate that framework.

    That is why a sustainable trajectory requires hundreds of millions of citizens who are โ€˜responsibleโ€™ and informed so democracy and the market can work.

    So far Jim Bacon is the only one who has grasp just how profound โ€œFundamental Transformationโ€ โ€“ in settlement patterns, governance structure and economic systems โ€“ must be to obtain a sustainable trajectory.

    The central tragedy is that the market and the vast majority of citizens indicated that they WANT that change but are thwarted by those who now benefit from special privileges under the existing system.

    That is exactly what Niccolo M. said thwarted change…

    EMR