Archive for January, 2010

POSTED: Assessor candidates debate

An mp3 audio file of the debate is now (February 2, 11 PM CST) available for download here.  At least two of the candidates  (Robert Grota and Sharon Strobeck-Eckersall, of the Green and Republican parties respectively) will be on the November ballot.  The two Democrats, Ray Figueroa and Robert Shaw, may (according to incomplete returns) have been defeated by a third candidate, who did not participate.

Inconveniently, the debate was held less than five days before the election, and it took our co-sponsor  more than four days to produce the audio file. Perhaps next election we will achieve better scheduling. It is also possible that most voters would not choose to listen to a 101-minute discussion on this subject, but at least we had hoped to provide the opportunity.

I will have some comments on the content of the debate subsequently.

Going to the candidates’ debate

Cook County Assessor candidates, that is. Five folks will be on the ballot, 3 Dems (one of whom will emerge from next Tuesday’s primary), one Green and one Repub.  Can you say “pandering to real estate homeowners?” Of course people hate to pay taxes, but whose burden is hardest to bear, those who own real estate or those who must rent their abodes? What it comes down to, of course, is that homeowners vote, and real estate tax bills have big black numbers.  Whereas renters are much less likely to vote, and are nickled and dimed (make that $5 and $10) by sales tax and income tax that are harder to see.

Anyhow, the debate is this Thursday, at the Union League Club (65 W Jackson), 4:30 PM.  It is open to the public without charge, but you must register in advance (by calling 312 435-5946) and you must dress in nothing less than business casual attire.  A bit more detail here.

Housing cost trends around the world

A great little interactive tool compares house price trends to income trends and general price levels for twenty countries. Be warned that it is flash-based.  Most series seem to go back to 1990.  Relative to incomes, Holland and Belgium show the greatest increases, while the big decliner was Japan.  Thanks to Steve Keen for finding it and providing the link, originally from The Economist. And of course we know that house prices mainly represent the cost of land (including the cost of permission to build).

Gaffney Interview

Mason Gaffney, author of After the Crash, interviewed by Kevin Press (part 1 and part 2).  Also available as a pdf.  Book was reviewed earlier  here.

Car price trends

I don’t have a car, don’t want one, can’t afford one, always figured they are just way too expensive for intelligent folks to waste money on.  But someone close to me has “always” had a car, and when her twelve-year-old one became less reliable and more expensive to maintain, decided to get a new one.  Same make, essentially the same model, a Toyota Sienna van.  Of course, over twelve years there were some changes, mostly improvements and extra features (power doors, stability control).  To me, the amazing part was:

  • Cost of new car in 1998: $27,370
  • Cost of new car in 2010: $27,133

The above are current dollars, include all taxes and invented fees, and were the result of negotiation by an informed customer. . Now, in 1998 this was a new model, they were hard to get.  By 2010, production was more in line with demand, inventories at local dealers were limited but there was some choice of color.  The 2010 price was net of a $1,000 rebate, which of course is just Toyota’s way of cutting prices temporarily..

It turns out that this does reflects the general state of the auto industry:  Our friends at the Bureau of Labor Statistics say that car prices in November (the latest available) were 2.8% below the 1999 annual average (Earlier figures apparently aren’t available on weekends.)

Of course, auto manufacturers have a big investment sunk into their plants, and prefer to lose a bit of money to keep them active, rather than taking a bigger hit by closing them down.

It would be interesting to compare these figures to the cost of transit rolling stock.

Rentiers are welcome in the U S

Some Americans may not be aware that U S Citizenship– or at least, lawful permanent residency– has long been for sale, legally and aboveboard. It’s called the EB5 program, and essentially provides that any foreigner “investing” $500,000 to $1 million in a U. S. business can become a legal permanent resident.  And, of course, entrepreneurs have found the niche market, setting up businesses in which foreigners may invest, without taking an active role in management of the enterprise.

A Chinese and American joint venture is “converting the dormant Northridge mall in Milwaukee into a regional shopping center featuring merchandise from Chinese retailers” according to Milwaukee Business Journal.  Presumably, each of the 200 Chinese retailers expected could support one or more EB5 visas.  300-500 local residents are expected to be hired, tho I think it’s a bit imaginative to suggest that these jobs would be “created” by the project.  Rather, like most economic development incentives, they are simply shifted from elsewhere.

A China Daily report on the project indicates that the Chinese investors might not be familiar with primitive North American travel conditions.  Milwaukee “is only an hour away from Chicago,” says the developer. Maybe someday.

Of course, the poor would-be immigrant has no similar opportunity.  She cannot say “I will work to build a business that will employ Americans,” nor even “I will borrow a half-million dollars to invest,” as the program doesn’t permit this.

So, as existing Americans, are we better off inviting a bunch of rentiers, or a bunch of hardworking laborers?  Too many people believe that the latter will drive down American wages– which may appear to be true, only because we fail to consider what the immigrants can produce.

If we insist on inviting rentiers, we have chosen an inefficient way to do it.  Instead of requiring $500,000 invested in a business, when plenty of American entrepreneurs are already able to supply capital, we could simply require $500,000 paid toward reduction of the Federal debt.