Smart Decline vs. Smart Growth

While America continues to grow at a fast rate, some older more urban cities have declined in population. For example, Richmond VA, has lost over 50,000 residents in the last 35 years. And according to the US Census 11 of the 100 largest US cities fifty years ago now have less than 100,000 residents. There are a couple of factors that have led to this decline, primarily the use of automobile transportation and the incredible growth of suburbs.

Few Utah cities are addressing issues of population decline (however, there are some), but I found this article in USA Today interesting: As Older Cities Shrink, Some Reinvent Themselves. Ther article quotes Terry Schwarz, senior planner at Kent State University's Urban Design Center of Northeast Ohio, "Everybody's talking about smart growth, but nobody is talking about smart decline, there's nothing that says that a city that has fewer people in it has to be a bad place."

Portrait of the Average American

The Census Bureau just released their 2007 Statistical Abstract. The abstract contains over 1,300 tables creating a fascinating portrait of what Americans look like (fascinating to those who love data and tables). Here are some interesting results from the Census Bureau data:

• Americans are the most overweight people on the planet
• Average American consumes 52 gallons of soda a year and 23 gallons of bottled water
• Average American spends 4 ½ hours a day watching TV; 50 minutes a day reading the newspaper.
• 68% of American households have cable TV, up from 19% in 1980
• 207 million have cell phones, only 5 million in 1990
• In 2005, 75% or college freshman said their primary objective was to be financially very well off
• In 1970, 79% said their goal was developing a meaningful philosophy of life
• In 1980 only 12% of doctors were women, today 27% are.
• 25% of households under the age of 25 own homes up from 8.5% from 1985
  
• Of those Americans with Internet access:
• 97 million get their news online
• 91 million buy or make travel reservations
• 39 million read someone else’s blog
• 13 million created their own blog

Check here to read a recent New York Times article quoting Robert Putnam regarding this data. You might remember Putnam, the author of Bowling Alone, who spoke at our 2004 Annual Conference. Oh and I must note (due to my Idaho heritage) that potatoes still remain the most consumed vegetable by Americans.

What about expenses Tad?

According to a recent article in the Deseret News, written by Tad Walch (Utah County bureau chief) Utah's cities and towns are flush with cash. However, Tad does not once in his article mention the rising expenditures that are often linked to a growing economy and society. For example, with growth come increased infrastructure needs.

True, Utah's cities and towns are benefiting from a booming statewide economy (like the State govt) however, this strong economy is not occurring with static service needs. According to a recent Utah League of Cities and Towns survey responding cities indicated the following:

• 91% report an increase infrastructure need from FY05 to FY06
• 44% anticipate a significant increase of infrastructure spending needed FY07
• 86% report an increase cost of employee benefits for FY06
• 73% report increase service needs for new development for FY06

These statistics illustrate the challenges that many cities and towns are faced with. Can cities better address these challenges during good economic times? Definitely. But does that mean cities and towns are flush with cash? Definitely not.

"Weird" Is Good, Right?

So what makes city a successful city? Well according the CEOs for Cities it takes a combination of talent, innovation, connection, and a distinctive nature. A recent presentation at the CEOs for Cities conference in Miami attempted to measure the top 50 metropolitan areas based on these for dimensions. Here is a review of the indexes included for each dimension.

The TALENTED City: a)College attainment, b)Creative Professionals, c)Young & Restless residents, d)Traded sector talent, and e)International talent.

The INNOVATIVE City: a)Patents, b)Venture Capital, c)Self-employment, and d)Small businesses

The CONNECTED City: a)Voting, b)Community Involvement, c)Economic integration, d)Transit use, e)International students, f)Foreign travel, and g)Internet connectivity

The DISTINCTIVE City: a)Weirdness index, b)Culture, c)Restaurant Variety, and d)Movie variety.

So where does Salt Lake Rank?

• 1st -- community involvement (Minneapolis 2nd)
• 2nd -- 'weirdness index' (San Francisco 1st)
• 1st -- 'movie variety' (New Orleans 2nd)

Check here for more information: City Vitals Presentation...let me know what you think.

Making Better Communities (ULCT Focus Groups)

This is a recent focus group video regarding 'making better communities.' The video is a collection of comments from four focus groups across the state of Utah regarding the quality of life in our neighborhoods and polices that are important to maintaining/improving this ideal. Groups were moderated by Dan Jones & Associates, commissioned by ULCT. The video is around 14 minutes long, but just takes a minute or two to download.

Sad Day...Milton Friedman Passes Away

Milton Friedman died today, at 94 years of age.
The New York Times described Friedman as "the grandmaster of conservative economic theory in the postwar era and a prime force in the movement of nations toward lesser government and greater reliance on free markets and individual responsibility."

Hoover Institute press release
New York Times article

I'm including a great video of Friedman's interview with Richard Heffner on The Open Mind, December 7, 1975. The video is around 30 minutes and takes a minute to download, but trust me it is worth it. Great interview. Check here.

Is Greenspan to Blame for Housing Bubble?

What should be the role of the Federal Reserve? Should the Reserve be more transparent to the general public? Will there be a policy shift from Alan Greenspan to Benjamin Bernanke? And is Greenspan to blame for the latest housing bubbles that seem to be emerging nationwide?

I found this recent article in Reason extremely interesting, exploring these questions and more. Reason asked five key Fed watchers to assess these Federal Reserve issues.

• Milton Friedman is a Nobel Prize–winning economist.
• Rep. Ron Paul is a libertarian Republican representing the 14th District of Texas.
• James Grant is a columnist for Forbes.
• Bryan Caplan, an associate professor of economics at George Mason University, was a student of Bernanke's at Princeton.
• Jeff Saut is chief investment strategist for the investment firm Raymond James Financial. He fears that Greenspan's seemingly excellent record built hazards into the economy of which investors need to be wary.

Check here for the full article: Can We Bank on the Federal Reserve?

Restrictive Public Finance Initiatives Fail

While attorneys, candidates, pundits, etc. count votes in Montana and Virginia the real policy analysts have already started to look at the results of key initiatives and referendums from around the nation. Americans indicated significant frustration with federal government incumbents, but seemed unwilling to restrict local and state government spending and taxing authority.

According to NCSL election analyst Jennie Drage Bowser, “They (Americans) were reluctant to approve measures to reduce government power but receptive to conservative-leaning measures. Liberal-leaning measures received mixed results.” For example:

• Major tax cuts, along with tax and spending limits in six states all failed. Voters in Maine, Nebraska and Oregon rejected tax and spending limits and while voters in Oregon, South Dakota and Washington decided against significant tax reductions.

For more detail of these initiatives access the NCSL review.

What is the Public Perception of Taxes?

It is interesting that citizens do not know more about their local government taxes. Citizens are using local government services daily (water, sewer, garbage, libraries, roads, parks) yet, they have no idea how these services are funded. And a better question is, do citizens change their tax preferences with increased knowledge? This graph illustrates data from our Dan Jones conducted Tax Survey that indicates, that yes tax preferences do change with increased knowledge.

This is the issue Brian Roberts and I explore in our paper Citizen's Blank Check. We presented the findings of our study last week at the APPAM (Association for Public Policy Analysis and Management) conference in Madison. The response to the data and paper was excellent. Our session titled, Understanding Taxes and Tax Incentives, was attended by 20 to 25 academics and bureaucrats. The session included a panel of three papers, with each presenter taking 15 minutes to present, then discussion and Q & A. There was significant interest in the ULCT tax knowledge and perception data. It is surprising to most that public perception isn't greater regarding local taxes. I guess the idea that we know what is closer more is not consistent when it comes to local taxes.

One interesting suggestion was to explore whether new homeowners have better property tax knowledge than "seasoned" homeowners. The logic is individuals who have made a recent home purchase have looked closely at their property tax bill for the new property. I'm not sure what the results would be, I'm inclined to say that it wouldn't matter. Maybe it will be something we'll look to explore more. In the meantime (if you are very inquisitive or love taxes) you can read our paper here.

A couple of other interesting conference sessions...

• Obesity and Public Policy (here)
• Married and Poor (here)
• Neighborhood Economic Development (here)

Remember to Vote

300 Million Americans -- 2.42 Million Utahns

America reached a milestone at the end of October, 300 million Americans. TIME magazine provided a recent breakdown of America "by the numbers." Their data provided some interesting descriptions on who we are today as Americans. For example FOR EVERY 1000 AMERICANS...

• 568 live in the state they were born
  
• 455 are employed
  
• 341 drive to work alone
• 173 speak a language other than English at home
• 126 live in poverty
  
• 122 are 65 and older
  
• 1 are in kindergarten
  

But what about here in Utah? FOR EVERY 1000 UTAHNS...

• 900 are white
• 630 were born in Utah
• 140 speak a language other than English at home
• 100 live in poverty
  
• 80 are over the age of 65
• 2 are in kindergarten
  

How much is the economy slowing?

Did anyone see this article in the recent Economist? Third quarter GDP indicate the economy grew at a 1.6% annualized rate. Which is much less than most predicted and a full point lower than the previous three months. Decline in homebuilding accounts for a large portion of this GDP decline, with residential homebuilding declining by 17% this most recent quarter. According to The Economist the declines in house building accounted for two-fifths of the quarterly fall in GDP growth. See the full article here.

So what does this mean? According to the FDIC (Federal Deposit Insurance Corporation) Utah is experiencing some slowing housing growth, but not at the rate of the rest of the nation. In addition, FDIC reports that while some western states have recently experienced slowing job growth Utah's employment growth has increased by 3.6% from last year. Largely this growth is in construction related occupations. However, FDIC also concludes, "Recent declines in permit and sales activity point to slower residential construction activity in the months ahead, with possible adverse implications for overall job growth and the demand for construction financing." Something for analysts to keep a close eye for the next quarter.

New website

Okay, so after months of anticipation (by whom you might ask) the League of Cities and Towns is launching a new website....and along with that a new blog for me. We'll see how long this lasts. Kind of feels like a New Year's resolution, I'm going to be more optimistic that this lasts longer than one week. I'm hopeful that this blog will remain up to date and provide some utility to those visiting our website.

And some utility in allowing me to discuss ideas, solicit feedback, and sort through some important policy questions.