This is a CU Colorado Springs student blog for the following courses: Economic Freedom, and Power & Prosperity.
Sunday, December 16, 2007
Controlled burns causing sprawl???
What the program manager is implying is that in ecosystems, in natural growth and destruction, cycles, fire serves the purpose of a destroyer, of a crop thinner, of a wheat-from-chaff separator. In addition they say that this natural function it provides is a good one to make sure that things do become overgrown or that things don't grow, or "sprawl" where they shouldn't.
The problem I have though, is that these burns are meant to r3educe the amount of fire that is actually in it's natural role. Controlled burns get rid of the fuel for the growth-inhibiting fires. If regions are deemed safe by way of controlled burning, then people are more likely to sprawl into them, not only hurting themselves, but ruining and crowding the forest.
Yes, fire has a natural role, but controlled burning does not let it do its natural job. It takes the natural role out of nature's hands.
Saturday, December 15, 2007
City Sprawl and Gasoline Prices
However, we can objectively agree that when gasoline prices go up, consumers have less disposable income to spend on everything else. An important point to make: it would most likely be represented as a parallel shift (a decrease) in the consumer budget constraint line on an indifference curve mapping.
Given that the demand for gasoline is quite inelastic in the short run, in the long run consumers will be more likely to switch to alternative means of transportation such as public transportation in densely populated metropolitan areas. But what about cities like Colorado Springs where public transportation grids are not as dense? Given that sufficient gasoline price increases will significantly affect consumer budgets, a family that might have otherwise moved out away from the core of the city to the city outskirts may defer doing so due to anticipated high costs of commuting. That leads to my question: is there a tradeoff between the gasoline prices and “horizontal” growth rate of cities? Do high gasoline prices cause less sprawl? If yes, how can we conclusively measure it?
Friday, December 14, 2007
perfect storm
In this article, Steve Fraser argues that a “perfect storm” of
economic disasters is steadily advancing on the U.S. economy, and it will be
hitting us right around the 2008 presidential election. This storm is
comprised of three main factors: bad business practices due to deregulation,
the collapse of the housing market, and the devaluation of the U.S. dollar
due to drastic increases in oil prices.
The collapse of the housing market is likened to the bursting of the
dot-com bubble, brought about by poor lending decisions by banks and rampant
borrowing from under qualified borrowers. Will the effects of this will be
bad for construction industry and the lending industry, the worse of it will
be felt by the general collapse of the credit structure which has “shored up
consumer capitalism for decades.” The vanishing equity in houses will put a
crunch on a lot of people, as well as lifelines of credit that have allowed
Sunday, December 09, 2007
Bumper to Bumper Traffic
Another reason for the congestion, aside from an increase in the population that lives outside the city limits, it that the original planning of the roads and highways was not intended for such high volumes of traffic. “We’ve used up the capacity that had been bequeathed to us by a previous generation, and we haven’t replaced it. The study summed it up this way: ‘Too many people, too many trips over too short of a time period on a system that is too small.’” Although there has been a decrease in optional driving, there has not been a substantial decrease in the number of people and vehicles that commute to work.
Increased city size, and greater amounts of urban growth mean longer commuting times for most people. A fairly simple solution to the problem is to focus on ways to make public transportation in and out of congested urban areas more convenient, efficient and easy to use.
Jenna Cluley
Fear of Foreigners
The arguments over the benefits of immigration are fairly complicated. Immigrants themselves clearly gain, since they move usually in order to work for higher pay than they can get at home. There is some evidence that European economies that have taken in many migrant workers have also benefited, not only in total output but also in terms of GDP per head. However, some native workers, such as fruit-pickers, builders and waiters, obviously lose because immigration holds down their wages. Even this has an upside, since it has helped to hold down inflation in places like London.
There is an obvious advantage to the workers who migrate to Western Europe, but are the advantages enough to out weigh the perceived and real problems? Many times the workers only come to the area to make some more money and then return to their native country to begin their own businesses and to help boost their own economies. Some immigrants also work for a while and then return to where they came from because there is a shortage in the labor supply in their own country.
The article from the Economist online also points out that there will be and is a slowing of the population growth in Western Europe. The additional people and migrant workers may actually be necessary in order to keep the economy as it is and has been. According to the article, acceptance is key and political policy and persuasion will play a huge role in whether or not immigration will continue to work at the same rate as it has been. Many feel that it will become necessary to help to integrate immigrants into the Western European culture by helping them with language skills, and improvement on infrastructure that will then allow for a larger population. Whether or not these things will happen is all up to the people, and ultimately government intervention.
JENNA CLULEY
Tuesday, December 04, 2007
Dubious homeowners and the Congress
But now I have been made aware that Secretary of the Treasury Henry Paulson is pushing the Congress to do something about it (effectively shifting the blame for anything that may happen). I'm not sure about the details, but I know that both Paulson and the Congressmen on Capitol Hill think it a good idea to further regulate the mortgage industry.
But I gotta ask, what's with the regulations? Didn't the people who signed up for these dumb loans read the fine print?
Oh, that's right, they didn't. Because most of them weren't responsible enough and didn't possess the means to purchase a home. And now they're paying the price. Beefing up regulations is not going to make things any better, either. Consider the following: In the 1990's, the wonderfully benevolent Congress set their attack dogs (regulations) on the mortgage industry and 'encouraged' them (yes, through regulation) to not 'discriminate' against those who borrow at the subprime level (in other words, those who probably shouldn't be buying a house).
So that's why they gave so many loans to unworthy borrowers. In any case, we know that the borrowers shouldn't have accepted the loans in the first place by the simple fact that most of them are defaulting on loans before they have even readjusted. That means the 'initial' rate that the sneaky mortgage people tricked these unwitting, poor people of the lower classes into signing off on were not affordable in the first place.
But what will regulations do? Hard to say, really. My guess is that, as usual, they probably will increase the cost of doing business, and maybe prevent mortgage companies from giving out as many loans, thus diminishing their capabilities of making profits. Mortgage companies will undoubtedly raise interest rates on their mortgages (or perhaps the initial fees they charge-again, hard to say). Either way, the Congress will probably see to it that not nearly as much borrowing happens in the coming decade, and less homes will be bought, at least in this lower income level.
Well, maybe since all the poor people will be moving back into apartments, we'll see increases in density. That should keep the anti-sprawlers at bay for a while.
Friday, November 30, 2007
Kentlands: A Model of New Urbanism
http://www.washingtonpost.com/wp-dyn/content/article/2007/11/01/AR2007110102849.html
Kentlands community, located near
How to "own" land in Boulder
In the city of Boulder Colorado a Judge recently ruled that the owners of a 4,700 square foot parcel of land must give one-third of this land to adjacent property owners. The "rightful" owners (Kirlin) of this land had owned the land for 23 years and had plans to build their dream house on this property. In the time they had owned this land they had paid property taxes along with Home Association Dues (HOA) on the vacant land. The adjacent property owners' (McLean & Stevens) had been using the land during this period as a resting place and for a pathway to the back of their home. The judge ruling for the McLean & Stevens (plaintiff) was as follows: "Plaintiff's attachment to the land is stronger than the true owners' attachment. Whereas the Kirklins were unaware of plaintiffs' use of the land during virtually their entire period of ownership, plaintiffs have efficiently used the land on a daily basis. Given this history of use, the equities favor transfer of title."
It is hard to imagine a life without individual property rights, rule of law or common sense. All these have been thrown aside with this with this judges ruling. I find little equity in the transfer of ones property rights to another strictly on a unauthorized use of the property over the last 23 years. I see no efficiency in the use of an others property without their consent. The final slap in the face is McLean and Stevens are seeking to have their attorney's fess paid for by the Kirklins. This is a sad period for the "People's Republic of Boulder and the State of Colorado.
Hawaii loves to conserve!
There are many people out there that would love to conserve nature and would finance this, but I know many more that would pay a lot of money to be able develop the land. This is kind of a classic example of the government not trusting the people to do the right thing. Instead of finding a way to buy the land and conserve it, the task force is looking to the government to do it for them. I wish that these task force people would see that it is also in the interest of developers not to ruin the islands, because if they did, less and less people would want to visit and they would loose business. Hawaii depends a lot on tourism and can't afford to stifle the growth of that industry, in the end it will mean more unemployment and a failing economy. Taxing the land that is bought by developers if they are ruining the land, is much more effective than just saying they can't develop at all!
Thursday, November 29, 2007
Goodbye balcony
The article references that these urban condos are geared to singles who want to experience all the great amenities that come with living in the city. Personally I think it is good that more high rises are being built. Let’s keep the young singles who like to have fun in the middle of the city where all the action is. This way, we can save the edges of the city for the older people with families who probably like driving an hour to work everyday to escape their screaming kids.
Colfax and New Urbanism
From an economic standpoint if people thought there was a bright future for Colfax the government would not have to step in and blight areas. These areas would be bought at a price that both the buyer and seller would agree upon. Some one would have all ready seen the incentive to redevelop that area--not government. Crime is also a big concern for redevelopment along Colfax. The city has increased police and crime has dropped, but that did not make anyone want to move there. The people who all ready live in that area are aware of the crime. I think it is something they factored in before they decided to live there. The city can try all it wants to make Colfax Main Street America, but the reality is people have all ready decided what they want and it is not Colfax. They have moved away and have realized they are better off for the decisions they have made.
Wednesday, November 28, 2007
Why live in a new urbanism community?
After a semester of discussing this subject I thought it was about time that I asked the question “why live in a new urbanism community?”. While the advantages of new urbanism are clearly staggering (at least if you are a supporter of it), there are also blatant disadvantages. But are the advantages great enough to outweigh the disadvantages?
Without going into too much detail, the major advantages are being within walking distance to most major activities (work, school, shopping), and more neighborhood activities. While all of these advantages derive from preference, let’s assume they all are desirable.
The advantages that come from being within walking distance to most major activities stems mainly from
The presence of more neighborhood activities presents more advantages as well. With more people being involved in the community it could be expected that the crime rate will be lower then in other areas. By getting to know your neighbor it is likely that they will look out for you and your family. They might even let you stash Christmas presents at their place or let you borrow some flour Christmas Eve so you can make cookies for Santa, saving you a brisk walk to the store that would be closed because it was a mom and pop store.
While there are many disadvantages to a new urbanism community (narrow streets, small lot sizes, short driveways, being able to say hi to your neighbor during your morning pee) I will focus on one, which I feel is the biggest, personal liberty. What bothers me most about new urbanism communities is not how they are set up or any of the disadvantages listed above, but that it is someone’s idea that everyone should live that way and desires to use the coercive power of the government to see it happen. When someone tells you what to do and how to do it, they are taking away your voice in the market, which would ultimately reduce the efficiency with which the market operates.
I guess there is no easy answer to the question “why live in a new urbanism community?”. Will the advantages outweigh the disadvantages in your specific case? If so, I would say you should CHOOSE to live there. But keep in mind that choice is not what these communities are about and don’t be surprised if the home owners association requires you to own only a certain type of dog or face eviction.
Tuesday, November 27, 2007
Liberty vs. Stupidity
Pierce says, “The overall package would have raised the area's carbon-dioxide emissions by 18 million to 28 million tons over the next 50 years” and “already, notes Sims, as many greenhouse gases are emitted in Washington State as the Philippines, which has 12 times Washington's population. Metro areas, he says, can't claim they're expanding for economic efficiency "and then go down to Brazil and say please don't cut your tropical rain forest””.
First, I cannot say for certain, but Ron Sims is not clairvoyant or psychic in any way, and therefore, he cannot make claims about future carbon monoxide emissions because he DOES NOT KNOW. The cars made in the next 50 YEARS will be noticeably different in the amount of emissions and may not emit carbon monoxide at all. Second, the analogy between Washington State and the Philippines is certainly not equitable. The GDP per capita (PPP) in the Philippines is 5,000 (US dollars) and in Washington State alone is more than 53,000 (US dollars). The number of roads in the Philippines that are paved is only 10%, and its national GDP is measured only in the billions. There is no comparison between Washington and the Philippines, especially economically. Third, advocates for economic efficiency do not waste time worrying about Brazil. The irony, is that those individuals who support “growth limits — tighter, denser communities”, also try to infringe on the economic freedoms of people in Brazil.
The socialist rhetoric and twisted values purposed by Peirce do not end with Brazil. He says:
“No one should have to commute more than a half-hour from home, Sims suggests."The human body," he said, "was not designed to be pounded from the stress and strain of long commutes." Plus, he said, we all need "time with our families, to live." That translates too into time for a mix of exercise and sociability, walking and biking and talking with neighbors — which reasonably compact communities make easier””.
Wow! Finally, a doctor, a psychic, a family psychiatrist, and an economist all in one! I find this statement as ridiculous as it is flawed. My freedom to NEVER meet my neighbors or walk my dog is worth the so called “problems”. In no way should anyone listen to Ron Sims or Neal Peirce and we are all a little more stupid for having done so already.
Saturday, November 24, 2007
Urban Spral = Global Warming
This increase in people wanting to move away from pollution and overpopulation is only recreating the same problem further away. The government is then of course not only responsible for urban sprawl and its solution but also the impact it is having on global warming. If the government would implement smart growth boundaries then development could be quarantined to a much smaller area, allowing preservation if open space. Advocates are suggesting solutions such as an increase in land use planning, the development of public transportation that is accommodating to a greater range of people and housing that would place community members closer to school and jobs and homes that are more energy efficient. The problem with this is that many of these solutions to not consider that most of these solutions do not accommodate the lower class. Those that are already living paycheck to paycheck cannot afford the rent in housing close to the city core that is impacted by the rent gradients. The increased upfront cost for a hybrid is not in the budget for many as well as the higher cost for energy efficient windows or better insulation. If you choose to recycle through your garbage company, you actually have to pay them. Many of these options are just not an option for a family with a limited budget. So, until it is affordable to Go Green, environmentalists can continue to blame the government for urban sprawl and its contributions to pollution rather than the market that is making a big buck off of the consumer efforts to conserve.
http://www.sierraclub.org/sprawl/globalwarming.pdf
Thursday, November 08, 2007
Inner Economist

Wednesday, November 07, 2007
Creative Construction
Zoning and controls can make construction and development very difficult. In an article from Economist.com, the author suggests a circumstance where zoning could be used to hinder construction of a Planned Parenthood building in Aurora, Illinois.
Aurora’s battle nominally centered on a permit and how Planned Parenthood obtained it… When Planned Parenthood applied for permits in Aurora last year, it used the name Gemini Office Development, a subsidiary, hoping to keep the project quiet for as long as possible. When pro-life activists learned of the building’s true purpose in July, they were furious, claiming that Planned Parenthood had committed fraud… The lawyers found no wrongdoing, however, so the clinic opened just two weeks late.
The construction of the building has caused controversy, not because of where it is being built, but because of the types of services and procedures that it provides. The most controversial procedure offered by the clinic being abortion. The controversy in Illinois is not the first and certainly will not be the last for Planned Parenthood. In 2003 a similar situation arose in Austin, Texas. The main contractor pulled out and after boycotts from many subcontractors, and Planned Parenthood stepped in to assume the contractors role. The same problems may arise in Denver where another Planned Parenthood is scheduled to start construction in November.
Although the question of zoning has not been raised in the battle in Aurora, Illinois it has been used to deter and to prevent businesses to be built where they were initially planned. Fortunately, for the Planned Parenthood in Aurora the area is zoned for medical use, and can not be barred from being built based on zoning requirements. Zoning regulations seem to hinder development in many areas, but are put in place to enhance, or help guide the direction of growth and economic development. The case of Planned Parenthood wanting to move in seems to be a classic example of how zoning laws and regulations may be used to help certain parties while they hinder others. Whether or not it is fair seems to be subjective based on whether you win or lose.
JENNA CLULEY
Source: http://www.economist .com/world/na/PrinterFriendly.cfm?story_id=9946963
Thursday, November 01, 2007
Smart Growth??
According to the 2007 growth and transportation survey ¾ of people surveyed claimed they feel smart growth is important and the way of future city growth. The main solution listed was to improve public transportation and current roads, and to stop building new roads. This smart growth is supposedly the answer to city traffic and congestion. Half of the people surveyed would push for public transportation to be improved. However in our own city the public transportation system is struggling. The city is increasing the rates for mass transit due to a decline in users. This system is good in theory, but people are ultimately going to be unwilling to change their preferences. Driving is a preference and it has been proven in cities that have implemented mass transit over expansion to increase traffic and congestion. The misconception is that everyone will change their preferences in order to move towards this idea of smart growth, but that has not proven to be the case.
Wednesday, October 31, 2007
Only you can prevent forest fires
However, the real culprit is government. Government will bail these people out and thereby distort local knowledge and these distortions will cause further stupid behavior. For example, if it wasn't the government maintaining the levies in New Orleans, a private firm would have the incentive to ensure the levies never failed. They would also have the incentive to charge a high price to balance out the risk associated with maintaining the levies.
Before blaming a ten year old boy, entire communities of adults should ask themselves why they lived in a place where the hand of fate resembles the Ritalin riddled digits of a ten year old with matches.
Credit Card Debt, Whose Fault Is It?
A lot of attention is currently being paid to credit cards and the evil policies that surround them and the innocent and unknowing consumers that are affected. The overwhelming problem of credit card debt and the steadily increasing rate of debt has caused Congress to focus heavily on this issue and consider passing several bills to further regulate the growing problem.
One practice being investigated is that of universal default. Universal defalut is currently a legal practice that allows your credit card company to increase your interest rate based on the status of any of your other accounts. Exceeding your credit line (even by just a few dollars), carrying a debt to income ratio that is deemed too high, utilizing more than 50% of your available credit on other accounts, excessive number of inquiries on your credit report, making a payment that is rejected for non sufficient funds or taking out an additional loan with another lender are all consumer actions that can result in universal default. Fair? It's legal. All of this information is provided to you at the time of application. Who reads all that fine print, right?
Now, while all of these practices can simply be avoided by mainintaing a good grasp on your finances and making sure you make timely payments on all accounts, Congress is posing the question; "Are the penalties too high?" Sure, the information is available to us and yes we do have the option to educate ourselves before signing anything but when we don't or when we make a mistake, who is responsible? Not the consumer, of course not! How could we possibly be held responsible for our actions when the price to pay is so steep. So Congress says that rather than hold consumers responsible for their actions, the government must intervene. The 850 billion dollars that Americans owe in revolving debt is said to be leading this country into a downward spiral as more and more families are turning to bankruptcy for freedom from debt. Is this something that the government should place more emphasis on and provide more rules for everyone to follow and if so at what point do we point to the consumer and say "Stop Spending!"
Saving traditon... or stuck in the past.
The problem is that they cannot buy or rent new cropland. The cost of land in the area around these farms is prohibitively high.
Using economic reasoning to examine the situation,I would conclude that the reason the cost of land on the outskirts of these towns is sky rocketing is because there is a greater numer of highly valued uses. More and more people are bidding the land up.
If the goods and services offered by these small family farms were highly valued, they would be profitable. If they were profitable, then they ould be able to afford more land for expansion.
In short, these family farms are not valued because there are more efficient ways of producing food. There desire for a preserving of their way of life I equate to a sliderule maker wishing to maintain his way of life. It is the same as the postal sevice wishing the internet and email had not taken a lot of its business.
On the surface it may seem tragic, but it is not. Things come and things go. New, better ways of doing things are devised and champions of the old ways find themselves with skill sets that are now obsolete, in this case running a small farm.
These farmers would probably be best to cash out, sell their valuable for the top dollar for which it would undoubtably sell and retire, living luxuriously.
Sometimescertain ways of life go out of style or a very small sub sect of the economy for the benefit of the whole. Fighting to preseve them is usually not for the economic value, but for the novelty value of preserving these relics. It is an uphill battle. Sorry family farm, it might be time to join your friends in the buggywhip business.