Friday, January 25, 2008

Troubles with the LA Neighborhood Councils

Commissioner Diane Middleton resigned from the Board of Neighborhood Commissioners recently. Her parting shots suggest that there are many problems that need to be dealt with in the future to ensure a better council system.

There are two things that she said that stand out for me, however. Her statement that the councils are dominated by homeowners groups and otherwise have poor participation is important. As more communities (and a majority of new residential developments) feature homeowners associations there is a shift towards private governance. Considering this trend, what is the role of the neighborhood councils? The councils may be duplicating some of the activities of homeowners associations. Of course, neighborhoods with a high share of renters, who are not part of homeowners associations, may be better served by a city sponsored council. Renters are a notoriously difficult group to get involved in local politics for a variety of reasons, so any new representation of renters interests is probably good. Certainly representation for the economic interests in a neighborhood (local business, etc.) is worthwhile.

The second thing she said in that there is a bias towards saying no:

“There has been a woeful lack of positive input and a focus on saying NO,” she complained, “NO to affordable housing, NO to economic development, NO to fees that pay for needed services, NO to outreach to community based organizations.”

One of the goals of the neighborhood councils was to improve local vision and get positive input. Local groups have a long history of using veto power to block projects. This power is related to NIMBYism and gathered legitimacy during the period of urban renewal, freeway building and early environmentalism. If the only thing that the neighborhood councils accomplish is to veto city development and block change the councils are a failure. I suspect that one reason that the councils focus on blocking things rather than creating things is that the councils are still left out of the planning process to a large degree. For instance, councils have no control over zoning, but giving them at least some of that authority would be a good move, especially for the councils that want the power.

Friday, January 18, 2008

Don't be fooled by false precision

In the latest New Yorker, James Surowiecki writes about the trouble with gaging the health of the economy only through the two sets of employment figures reported by the government each month. His point is that even though these monthly estimates are well constructed and reasonable, commentators tend to focus on the false precision of the jobs number and ignore the margin or error and other sampling techniques that are also part of the estimate. Unfortunately this problem is not limited to the chattering classes, who can be expected to get basic statistics wrong for whatever reasons. False precision is everywhere, including in fields where people should know better.

Donald Shoup has written about how false precision harms public policy. Here is his abstract:

Transportation engineers and urban planners often
report uncertain estimates as precise numbers, and
unwarranted trust in the accuracy of these precise
numbers can lead to bad transportation and landuse
policies. This paper presents data on parking
and trip generation rates to illustrate the misuse of
precise numbers to report statistically insignificant
estimates. Beyond the problem of statistical insignificance,
parking and trip generation rates typically
report the parking demand and vehicle trips
observed at suburban sites with ample free parking
and no public transit. When decisionmakers use
these parking and trip generation rates for city planning,
they create a city where everyone drives to
their destinations and parks free when they get

In his research he looked at transportation planning and argues that is is better to be roughly right than precisely wrong. I think this holds for employment statistics and financial markets as well.

Thursday, January 10, 2008

I think it's time to pay attention to Tata Motors

Recently Tata Motors has been in the news a lot. First, the Indian company bought Jaguar and Land Rover from Ford. Then the company announced plans to sell a $2,500 car called the "Nano ." (There is now stiff competition in the low cost Indian car market as Bajaj just introduced a $3,000 car built with the help of Renault.) But now Tata, who may want a PR firm that will space out these big announcements, uncorks a car that runs on compressed air. This car goes for an estimated $7,000 and can travel about 125 miles on $3 worth of air.

From a mobility standpoint, cheap personal transportation is a very good thing. As more people can afford to travel where they want to when they want to, beneficial economic activity and improved employment situations should result. Of course, will the benefits of personal mobility be outweighed by the costs of all those extra cars on the roads? Any of the small cars are going to be relatively clean and efficient compared with the average American vehicle, but there are far greater problems than simply fuel consumption or emissions. Who will pay for the parking spaces for all of these vehicles in poor areas? They can't just park them in their living rooms. The road congestion is another problem. I don't know how roads are financed in India, but increasing the number of vehicles will certainly crimp available road space, and at a time when roads should be shifting towards a user pays financing system it's probably not the best idea to add vehicles to heavily subsidized infrastructure. Lastly, who will teach all the new drivers how to drive? China is having trouble with this as it is. I can't imagine what might happen if the roads become flooded with new drivers.

In any event, Tata Motors is now a major player in the world of automobiles. I don't care one way or the other about who owns Jaguar, but tiny, cheap cars are an important innovation for personal transportation in much of the world. Compressed air is another fuel that may have some limited applications if anyone can be convinced to try it. One advantage that compressed air has for crowded and poor cities is that I suspect air tanks and refueling stations will be much easier to site than conventional gas stations. After all, many of the poor who will be the target of the Tata Nano live in communities where a rapid rise of gas powered vehicles will probably break what little fuel infrastructure exists. In many developing nations it is common to see stands on the side of the road selling liters of gasoline to fuel the motorbikes and such. I doubt these stands could or should handle the increase in consumption that many new cars will bring.

Wednesday, January 9, 2008

The fuel of the future, once and always

Jalopnik dredged up an old article about the fuel of the future from 1936. The proposed fuel was radio-fuel that powered an electric engine. I like old articles like this because they show that the problems we are dealing with in today's transportation world are not new. This brings up all kinds of questions about why we are still working through the solutions to 100-yar old problems. The internal combustion engine is dominant for many reasons above and beyond the relative efficiency of power generation from gasoline. What ever happened to electric cars? If we had spent the same amount of effort engineering electric engines as we have gasoline engines, we would certainly have far better electric options than we currently do. Who knows if they would be superior for power.

We should probably be happy that the radio-fuel car never took off, though. Stringing towers emitting electric and magnetic fields over all out roads might cause greater incidences of child leukemia and other cancers. Though some of those adverse health effects would be offset by improved air quality from fewer emissions, resulting in less asthma and other respiratory illnesses.

Do red light cameras work?

Or, more importantly, what are red light cameras supposed to do?

This recent post by the National Motorists Association points to a number of studies that claim that red light cameras increase accidents. I haven't read much about red light cameras, and I am ambivalent about them in general, but I don't think that accidents are the main cause rationale for their installation. I know in some cases accidents are the main concern, but from the perspective of Los Angeles traffic, the main benefit is in traffic flow. Red light cameras deter cars from cruising through the intersection at yellow as well as they probably have some type of positive effect on gridlock conditions.

There is no doubt that red light cameras are not a panacea for many traffic problems. They have been declared unconstitutional (at the state level) in Minnesota on two levels. First, the city cannot enforce traffic laws that are not consistent with the rest of the state (I think this ruling deserves further thought about it's implications). Second, the court ruled that the law violated the presumption of innocence because the driver may not be clearly identified. Whether this case affects the remainder of the country in unclear.

Perhaps the takeaway point from all of this is that greater consideration should be given to employing traffic cops at busy intersections. Having people direct traffic works very well and limits scofflaws and accidents. How to pay for the traffic cops is another story, but if the goal is to improve traffic flow they should be considered. If the goal is simply to raise revenue, as the NMA argues, then rather than red light cameras each city should charge a toll on the roads on at their borders.

Tuesday, January 8, 2008

1 in 8 drivers arrested for DUI

According to this article in the Minneapolis StarTribune, 1 in 8 Minnesota drivers has been arrested for DUI. The state patrol estimates that there are more than 500,000 drivers licensed by the state who have been arrested. This is an incredible figure. I can't think of any other law that is broken so frequently in light of the amount of information and enforcement efforts. This is particularly striking because the consequences of a DUI are quite severe, and for many people the costs of driving after a DUI conviction are prohibitive. And I can't imagine that drivers don't know this before they drink and drive.

The article also states that the average blood-alcohol concentration was .17, or more than twice the legal limit. These arrests are clearly not the case of overzealous enforcement against moderate social drinkers. These people shouldn't be on the road.

However, I'm skeptical of the claim of 500,000 offenders. During the month of December, which was a coordinated month of extra heavy enforcement, there were 3,350 arrests. If there were that many arrests each month-which isn't the case, obviously-that would take almost 13 years to reach 500,000. I also wonder how many of the 500,000 are repeat offenders. I suspect that quite a few are. As most of the booze is bought by a relatively small group of drinkers, I suspect that most alcohol related crimes (including DUI) are committed by a small group of offenders.

Alternately, if it is true that 1 in 8 Minnesota drivers have been arrested for DUI (though there is no claim for how many have been convicted, though I am sure it is a smaller number), what does this say about the policy? It seems that driving drunk is popular (though not advised). A more acceptable policy critique is that the education against drunk driving only works so well. We may have hit the end of the road for getting the social drinkers off the road as they are likely to have responded to the threat of arrest and punishment. The remaining drunk drivers have decided to continue their bad habit. Perhaps increased enforcement is the most cost effective way to achieve results.

One last point is that since most of these arrests were of people who were way above the limit, I think there is little to be gained and a fair amount to be lost by continuing to lower the legal limit of BAC. Further reductions would negatively impact restaurants and other desirable activities but will likely have little impact on worst drunk driving offenders. A lower BAC will greatly increase the potential number of offenders, however. But the policy is probably not improved by going after those who test between .04 and .08. The people who blow .17 are a much greater danger.

Monday, January 7, 2008

Self driving cars are closer than you think

This week at the Consumer Electronics Show, the head of GM will talk a bit about the company's plans for self-driving cars. What GM is proposing seems a bit less audacious as the DARPA Challenge vehicles, which are completely automated. The GM cars will be dual mode, where they are driven normally and the auto-pilot is turned on for certain travel segments such as on the freeway.

It strikes me that moving towards automated driving is the most desirable way to improve our transportation systems. For political, financial and practical reasons I don't think that developed countries will completely replace existing infrastructure and replace it with new infrastructure for new modes of travel. I also doubt that transit will ever be able to replace a large share of personal travel, largely because transit will never match the convenience and overall mobility and accessibility offered by cars. Transit is very good at certain types of trips, such as short trips and many commute trips. But we don't really design local area transit systems, rather we design regional systems which have a limited potential ridership and effectiveness for reducing auto use.

Other proposed solutions to our transportation issues often involve brand new infrastructure. Light rail is an example of this, as is Personal Rapid Transit. That these proposals call for new facilities isn't surprising as that is traditionally how new transportation systems are deployed. Streetcars were replaced by buses, County Roads by Interstates, etc. In many ways the new systems and facilities made sense because they replaced aging and inadequate systems. How to deal with aging systems is a very important issue, but my short answer is that at some point we have to re-orient some of our transportation investment into existing system maintenance.

Getting back to the automated cars, their biggest advantage is that they takes advantage of the existing roadways. They will be able to more efficiently use the existing space, thus reducing congestion. I'm skeptical that there will be energy and environmental advantages from a fleet of automated cars. I think energy and environmental benefits are largely a result of the car size and engines. If we automate a bunch of Smart Cars, great. If we automate a bunch of Suburbans, well, the results will be better than if the Suburbans are driven regularly but that's about it.

The last point to make is about financing. Previous attempts to automate driving have focused on automating freeways. This approach is expensive and requires, again, replacing the entire infrastructure (or at least adapting it), then replacing the vehicles so they are able to take advantage of the technology. Automating the cars only is a much better and faster way to achieve the same results, and the extra costs are borne by the consumer of the automated cars. There will still need to be some type of reserved road space for the automated cars, but perhaps this is a way to introduce variable pricing on some of the existing roads.

Friday, January 4, 2008

What Conservapedia gets wrong about the Coase Theorem

I just stumbled across the conservapedia entry on the Coase theorem. It starts off fine, just like a text book might describe the idea. Then the entry veers off into the wilderness, stringing together a bunch of statements that exhibit an extremely shallow understanding of what Coase was arguing.
First, there is nothing conservative or liberal about what Coase said. His theorem (and he never actually called it a theorem) builds from his important work on the nature of the firm, which he extended to the problem of social costs. Firms are in part created to internalize transaction costs of production. Think about firm creation in terms of vertical or horizontal integration for examples. The reason that his work has not been widely embraced is that Coase's ideas do not lend themselves to straightforward quantitative research. Economics and the other social sciences turned heavily towards statistical analysis, econometrics and other mathematical tools for analysis, and transactions costs by their very nature are hard to define and measure. This limited the influence of Coase in a classroom, not the politics of his statements.

Second, Coase never claimed there were no transaction costs. He only said that if transaction costs were zero, bargaining would produce an efficient outcome. Two things about this that are important are that economic efficiency does not guarantee the most fair outcome (the importance of fairness is a separate topic), and that clearly defined property rights will reduce transactions costs and increase the liklehood of efficient bargaining. In this latter case there is a clear role of the law and government in preserving property rights through recognition and protection.

The last point about this misguided entry on the Coase theorem is that who is part of the bargaining (and who gets the 'wealth' as conservapedia puts it) is critical to an efficient outcome. It is simply wrong to say that it doesn't matter who owns property or wealth. If the property rights are not distributed in a way that allows for bargaining, then an efficient outcome is impossible. This is the crux of the Coase theorem. Externalities, such as air pollution, are problems precisely because no one owns the polluted air. Assignment of rights over the pollution in the air are extremely important for achieving clean air for everyone. It is inefficient for a coal plant to negotiate a settlement with everyone affected by it's pollution (just like it is impossible for a driver to compensate each individual that is delayed by the driver's presence on the road). It is inefficient because of transaction costs. Only the law (and government) currently have the institutional structure and power to internalize these costs and allow for bargaining and proper compensation.

The Coase theorem is gaining in popularity, and I hope that more academics and policy folks pay attention to it. I also hope that it is not thought of as a weird "conservative" truth because such a label will diminish the power and universality of Coase's ideas.

Wednesday, January 2, 2008

Neighborhood councils and zoning in Los Angeles

Almost ten years ago Los Angeles established neighborhood councils to improve the flexibility and overall responsiveness of City Hall. This experiment in sub-local governance has not been an overwhelming success, though it hasn't been a failure, either. Today the LA Times reports that some neighborhoods seek to improve the function and promise of the councils through land use powers. This would actually give the councils meaningful authority over how their neighborhoods develop.

In the article, Valley Industry and Commerce Association argues that sub-local control will increase the costs of development. Another developer counters this by saying that by working with the neighborhoods directly the communities will come to trust developers in a way that is not likely to occur through conventional, City Hall oriented processes.

I side with the developer who thinks this is a good idea. Right now, neighborhood councils have enough power to make the development process unpredictable. Neighborhoods hold a right to veto projects (through environmental concerns and other established ways to object in the public process) but have no real authority to make it easier for developers to build the types of projects the neighborhood wants. In addition, zoning is a dull tool in the regulatory toolbox in part because it is such a hard thing to change. Zoning codes are written to apply to the entire city (there are exceptions, of course), and localized concerns (about traffic, design, retail uses, etc) are hard to incorporate into the code. By giving some land use power to neighborhood councils, developers will work more closely with the community interests. This will effectively trade the effort put into working through City Hall and addressing neighborhood concerns for working directly with the neighborhood councils. Communities will get more of what they want, City Hall will be able to shed some of the redundant bureaucracy and developers will have a slightly easier time of gaining approval. Of course, none of this matters if City Hall won't relinquish their land use power in the first place. While it is probably a good idea, I wouldn't bet on it.