more trouble with infrastructure

This story by Mark Paul at newamerica.net makes an interesting point about investment in infrastructure. Beyond NIMBYism, bureaucratic stalemate, and a flagging s-curve, there is yet another barrier to infrastructural investment and that’s the way its financed. It’s heartbreaking to see my former hometown in L. A. obsess about light rail and subways again precisely at a point when it isn’t coming anytime soon. How we think about infrastructure needs to be completely rethought. More on that soon…developing.

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place doesn’t pay

You’d think that if anyone could make place pay, Drupal could, but technologies are social artifacts. People will post anything at all on social networking sites, but not where they are. Or at least not yet. That said, place-based social networker Dodgeball is dead. I’m not surprised at all. When I logged on years ago the busiest user hadn’t been on in days. 

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Obama’s first plan

The House Appropriations Committee introduced its version of the Obama administration’s American Recovery and Reinvestment Plan of 2009 yesterday. The New York Times reports that this is expected to be in the final stimulus bill. See the Committee Chairman, Wisconsin Representative David Obey’s memo here

The executive summary of the memo below, with my comments in red. An expanded version of the memo can be seen at the above link.  

Overall, my assessment is that the suggestion that this is a WPA-style return to infrastructure is mistaken. On the contrary, what we are seeing is a funding bill aimed at dealing with many important but neglected programs. As far as infrastructure, however, do not expect to see any great changes. As the memo points out, the funding is minor compared to what the government estimates to be needed in a series of key areas.        

The lessons of the Infrastructural City continue: we’ve hit the top of the S-curve for growth in virtually all forms of hard infrastructure. Spending more is going to do little more than keep us afloat. The Obama administration understands that, but can they propose anything in its stead?    

The economy is in a crisis not seen since the Great Depression.

Credit is frozen, consumer purchasing power is in decline, in the last four months the country has lost 2 million jobs and we are expected to lose another 3 to 5 million in the next year.  

Conservative economist Mark Zandi was blunt: "the economy is shutting down."

In the next two weeks, the Congress will be considering the American Recovery and Reinvestment Bill of 2009. This package is the first crucial step in a concerted effort to create and save 3 to 4 million jobs, jumpstart our economy, and begin the process of transforming it for the 21st century with $275 billion in economic recovery tax cuts and $550 billion in thoughtful and carefully targeted priority investments with unprecedented accountability measures built in. 

The package contains targeted efforts in:

· Clean, Efficient, American Energy

· Transforming our Economy with Science and Technology

· Modernizing Roads, Bridges, Transit and Waterways

· Education for the 21st Century

· Tax Cuts to Make Work Pay and Create Jobs

· Lowering Healthcare Costs

· Helping Workers Hurt by the Economy

· Saving Public Sector Jobs and Protect Vital Services

> Note how infrastructure is downplayed.
Our first clue that infrastructure is playing a back-seat role in this.

The economy is in such trouble that, even with passage of this package, unemployment rates are expected to rise to between eight and nine percent this year. Without this package, we are warned that unemployment could explode to near twelve percent. With passage of this package, we will face a large deficit for years to come. Without it, those deficits will be devastating and we face the risk of economic chaos. Tough choices have been made in this legislation and fiscal discipline will demand more tough choices in years to come. 

Since 2001, as worker productivity went up, 96% of the income growth in this country went to the wealthiest 10% of society. While they were benefitting from record high worker productivity, the remaining 90% of Americans were struggling to sustain their standard of living. They sustained it by borrowing… and borrowing… and borrowing, and when they couldn’t borrow anymore, the bottom fell out. This plan will strengthen the middle class, not just Wall Street CEOs and special interests in Washington.  

Our short term task is to try to prevent the loss of millions of jobs and get our economy moving. The long term task is to make the needed investments that restore the ability of average middle income families to increase their income and build a decent future for their children.

EXECUTIVE SUMMARY

 Unprecedented Accountability: A historic level of transparency, oversight and accountability will help guarantee taxpayer dollars are spent wisely and Americans can see results for their investment.

· In many instances funds are distributed through existing formulas to programs with proven track records and accountability measures already in place.

· How funds are spent, all announcements of contract and grant competitions and awards, and formula grant allocations must be posted on a special website created by the President. Program managers will also be listed so the public knows who to hold accountable.

· Public notification of funding must include a description of the investment funded, the purpose, the total cost and why the activity should be funded with recovery dollars. Governors, mayors or others making funding decisions must personally certify that the investment has been fully vetted and is an appropriate use of taxpayer dollars. This will also be placed on the recovery website.

· A Recovery Act Accountability and Transparency Board will be created to review management of recovery dollars and provide early warning of problems. The seven member board includes Inspectors General and Deputy Cabinet secretaries.

· The Government Accountability Office and the Inspectors General are provided additional funding and access for special review of recovery funding.

· Federal and state whistleblowers who report fraud and abuse are protected.

· There are no earmarks in this package.

 This plan targets investments to key areas that will create and preserve good jobs at the same time as it is strengthening the ability of this economy to become more efficient and produce more opportunities for employment.

 Clean, Efficient, American Energy: To put people back to work today and reduce our dependence on foreign oil tomorrow, we will strengthen efforts directed at doubling renewable energy production and renovate public buildings to make them more energy efficient.

· $32 billion to transform the nation’s energy transmission, distribution, and production systems by allowing for a smarter and better grid and focusing investment in renewable technology.

· $16 billion to repair public housing and make key energy efficiency retrofits.

· $6 billion to weatherize modest-income homes.

> This seems reasonable although bailing out homeowners is questionable in my mind. Older private housing is not sexy, the way, say, public housing, condos, or homes are, but is critical for lower and middle income urban (and even suburban) residents. "All utilities included" or at least "heat included" are magic words for renters, allowing them to have a reasonable idea that they will only pay rent during the year. Unfortunately as gas prices have skyrocketed, profit margins for this sort of housing have evaporated. A focus on private apartment buildings would have been helpful here, especially as the myth of the ownership economy is, in part, at root of our problems. 

Note that this "includes $350 million for research into using renewable energy to power weapons systems and military bases."

Transform our Economy with Science and Technology: We need to put scientists to work looking for the next great discovery, creating jobs in cutting-edge-technologies, and making smart investments that will help businesses in every community succeed in a global economy. For every dollar invested in broadband the economy sees a ten-fold return on that investment.

· $10 billion for science facilities, research, and instrumentation.

· $6 billion to expand broadband internet access so businesses in rural and other underserved areas can link up to the global economy.

> So much for a major push to expand broadband. Fiber-to-the-home/office is having as many problems in cities as in rural regions due to the difficulties in clearing easements. But beyond those questions, how will this money be used fairly. Is this a bailout for telecommunications carriers? 

Something got left out of the executive summary. What could that be? How about a mini-bailout for businesses? The DTV conversion coupons do seem important. The FCC has apparently run out of money and the off switch on analog TV is coming next month. 

Creating Small Business Opportunity

· Small Business Credit: $430 million for new direct lending and loan guarantee authorities to make loans more attractive to lenders and free up capital. The number of loans guaranteed under the SBA’s 7(a) business loan program was down 57% in the first quarter of this year compared to last.

· Rural Business-Cooperative Service: $100 million for rural business grants and loans to guarantee $2 billion in loans for rural businesses at a time of unprecedented demand due to the credit crunch. Private sector lenders are increasingly turning to this program to help businesses get access to capital.

· Industrial Technology Services: $100 million, including $70 million for the Technology Innovation Program to accelerate research in potentially revolutionary technologies with high job growth potential, and $30 million for the Manufacturing Extension Partnerships to help small and mid-size manufacturers compete globally by providing them with access to technology.

· Economic Development Assistance: $250 million to address long-term economic distress in urban industrial cores and rural areas distributed based on need and ability to create jobs and attract private investment. EDA leverages $10 in private investments for $1 in federal funds.

DTV Conversion Coupons: $650 million to continue the coupon program to enable American households to convert from analog television transmission to digital transmission. 

 Modernize Roads, Bridges, Transit and Waterways: To build a 21st century economy, we must engage contractors across the nation to create jobs rebuilding our crumbling roads, and bridges, modernize public buildings, and put people to work cleaning our air, water and land.

· $30 billion for highway construction;

· $31 billion to modernize federal and other public infrastructure with investments that lead to long term energy cost savings;

· $19 billion for clean water, flood control, and environmental restoration investments;

· $10 billion for transit and rail to reduce traffic congestion and gas consumption.

> Here is the meat of the proposals for infrastructure…and it’s pretty lean. $30 billion is less than one year’s expenditure on highways. $10 billion for transit and rail isn’t that much when just one crucial project, the Trans-Hudson Tunnel, is slated to cost $9 billion.

Reading the expanded version of the memo, things start to look positively grim.  

· Upgrades and Repair: $2 billion to modernize existing transit systems, including renovations to stations, security systems, computers, equipment, structures, signals, and communications. Funds will be distributed through the existing formula. The repair backlog is nearly $50 billion. 

 · Amtrak and Intercity Passenger Rail Construction Grants: $1.1 billion to improve the speed and capacity of intercity passenger rail service. The Department of Transportation’s Inspector General estimates the North East Corridor alone has a backlog of over $10 billion.

 · Airport Improvement Grants: $3 billion for airport improvement projects that will improve safety and reduce congestion. An estimated $41 billion in eligible airport infrastructure projects are needed between 2007-2011.

There’s also a bit of money under this heading in the expanded version for Defense although since it’s largely for medical construction which is horribly underfunded, I won’t complain. The last President did what he could NOT to support the troops, or at least the ones who were injured…

Also, I won’t complain about $50 million for the NEA or needed work at the National Park Service. Other numbers again point to the difference between this bill and what is really needed: 

 · Clean Water State Revolving Fund: $6 billion for loans to help communities upgrade wastewater treatment systems. EPA estimates a $388 billion funding gap. The Association of State and Interstate Water Pollution Control Administrators found that 26 states have $10 billion in approved water projects.

· Drinking Water State Revolving Fund: $2 billion for loans for drinking water infrastructure. EPA estimates there is a $274 billion funding gap. The National Governors Association reported that there are $6 billion in ready-to-go projects, which could quickly be obligated.

Education for the 21st Century: To enable more children to learn in 21st century classrooms, labs, and libraries to help our kids compete with any worker in the world, this package provides:

· $41 billion to local school districts through Title I ($13 billion), IDEA ($13 billion), a new School Modernization and Repair Program ($14 billion), and the Education Technology program ($1 billion).

· $79 billion in state fiscal relief to prevent cutbacks to key services, including $39 billion to local school districts and public colleges and universities distributed through existing state and federal formulas, $15 billion to states as bonus grants as a reward for meeting key performance measures, and $25 billion to states for other high priority needs such as public safety and other critical services, which may include education.

· $15.6 billion to increase the Pell grant by $500.

· $6 billion for higher education modernization.

> I can’t argue here. Education is in dire straits. My only question is how we could rethink education today. It’s not teacher’s salaries that have gone sky high, it’s administrative expenditures. How can we cut those?

 Tax Cuts to Make Work Pay and Create Jobs: We will provide direct tax relief to 95 percent of American workers, and spur investment and job growth for American Businesses. [marked up by the Ways and Means Committee]

> Throwing bread to Republicans. Didn’t I say something about knowing that Obama was in trouble if he gave kickbacks to taxpayers? That didn’t take long.  

Lower Healthcare Costs: To save not only jobs, but money and lives, we will update and computerize our healthcare system to cut red tape, prevent medical mistakes, and help reduce healthcare costs by billions of dollars each year.

· $20 billion for health information technology to prevent medical mistakes, provide better care to patients and introduce cost-saving efficiencies.

· $4.1 billion to provide for preventative care and to evaluate the most effective healthcare treatments.

> I suppose this is necessary, but the numbers seem outrageous. Didn’t Google propose to do this for free? This sounds more like a busy work project than anything else.

Help Workers Hurt by the Economy: High unemployment and rising costs have outpaced Americans’ paychecks. We will help workers train and find jobs, and help struggling families make ends meet.

· $43 billion for increased unemployment benefits and job training.

· $39 billion to support those who lose their jobs by helping them to pay the cost of keeping their employer provided healthcare under COBRA and providing short-term options to be covered by Medicaid.

· $20 billion to increase the food stamp benefit by over 13% in order to help defray rising food costs.

> Ok, this is reasonable. But maybe we should think about the definition of unemployment? Under Reagan the government re-jigged the unemployment rate to make it look better. We really have something like 16% unemployment, or more. To be fair, under Clinton the government re-jigged the inflation rate. We really have a 6-9% rate of inflation, not 2.79%. See here.   

Save Public Sector Jobs and Protect Vital Services: We will provide relief to states, so they can continue to employ teachers, firefighters and police officers and provide vital services without having to unnecessarily raise middle class taxes.

· $87 billion for a temporary increase in the Medicaid matching rate.

· $4 billion for state and local law enforcement funding.

 

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Take a Break, Babu

Updated: See below.

Hot on the heels of the last post… I couldn’t help but let out a squeal of delight that one of the two greatest symbols of the decadence of architecture and the bubble economy, the Burj Dubai, is on hold for a year. Poor Babu can finally come down. 

Will it ever restart? How long can a building of that height be left idle before it goes Ryungyong? 

Quick: which is which?  

burj dubairyungyong

Photo of Ryungyong by Pricey. Photo of Burj Dubai by Orbit 77

 

Update. Alas, I am wrong again. It turns out the Burj Dubai is not shuttered. Andrew Blum points out that it’s the Nakheel project. Hard to keep tabs on all these efforts to make the world’s tallest building! I still hope Babu gets to take a break.  

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Wrong About Architecture

I was wrong.

Previously, I’ve suggested that the architecture of the last decade (the decade of the Bilbao-effect) did little to embody network culture and I thought it peculiar that the best examples of architecture that fits network culture are from the 1990s.

Over at Strangeharvest, Sam Jacob suggests otherwise and he is right.

I was wrong. The emptiness of the last decade perfectly embodies the period.

The punch-line (but do read the article):

Tomorrows visitors to todays (or yesterdays) iconic buildings will feel the swoosh of volumes, the cranked out impossibility of structure, the lightheadedness of refection and translucencies. They will marvel at buildings that hardly touch the ground, which swoop into the air as though drawn up by the jet stream. They will feel stretched by elongated angles that seem sucked into vanishing points that confound perspective, and will be seduced by curves of such overblown sensuality. And in this litany of affects they will find the most permanent record of the heady liquid state of mind of millennial abstract-boom economics. We might rechristen these freakish sites as museums of late capitalist experience, monuments to a never to be repeated faith in the global market.

Well said.

This is going to take a lot of unpleasant work to unpack from a historical perspective, but it’s part of this year’s book project.

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obama and cities

Yule Heibel passed a link to Obama talking about cities after being given a copy of Death and Life of American Cities by Jane Jacobs over Twitter the other day. 

 

I retweeted it, prompting the following thoughtful e-mail from Derek Lindner. 

To Obama’s credit, the video shows that he has familiarity with Jacobs, and by referencing ‘all the studies’ (or some such thing) he shows that he is up on more recent theories of urban planning, though what those are we don’t know (Biden, OTOH, is flipping through the book in the background looking as though it’s in Urdu.)  Of course Obama’s does nothing to let the man giving him the book realize that he’s just insulted Obama’s intelligence, as if he’d just been handed, say, Milton Friedman’s Capitalism and Freedom (1962) as a presidential primer on economics. 

The depressing thing is that no one else realizes Obama’s just been insulted, because the level of maturity of the discourse in general on the topic is so low. No one expects the president to know any better than Jacobs (or, apparently, to even know Jacobs, for that matter).

I’m hopeful that with Obama in office the level of public discourse will rise significantly, but I’m a bit nervous as to what might happen with the federal govt taking a larger role in urban planning policy at a national scale. Some high-level vision might be welcome–after seeing New Orleans’ planning process first hand, I’m not a strong advocate of bottom-up planning methodologies–but look at what central banking has done for our economy lately. Perhaps its better to let some decisions be made locally? 

Hm, I’d like to see your top five list of things Obama should do regarding urban planning policy. 

d

That’s my hope too, Derek. 

First of all, Jane Jacobs is a neoliberal (and Banham isn’t that far off too). Her faith in the spontaneous social order of the city led us right to the current mess, in which doe-eyed real estate developers took up the life that she found so appealing and sold it as spectacle, only to wind up choking the life out of it. Have you been to the Village lately? There’s no there, there, although they have Anthropologie.

Second, Obama is clearly above it all. He’s appealing to a crowd in Toledo, a city which is too peripheral to be in the global order of things and for which the promised Bilbao-effect of the Sejima glass pavilion isn’t going to pan out (I went there last year, it was ho-hum…in contrast, the old museum building captivated, especially a great show of work by David Macauley). Still, he points out that you can’t separate cities from the metropolitan regions they are in. Jacobs is still very much part of the crowd that favors a division between the city and the suburb. It’s funny that as I was taking Amtrak back from Philadelphia to Jersey today, I thought of a more lasting, if lesser known, to the field of urban studies, Jean Gottmann’s Megalopolis, published in the same year as Jacobs’s book. In the video Obama is on Gottmann’s side, not Jacobs’s:

We must abandon the idea of the city as a tightly settled and organized unit in which people, activities, and riches are crowded into a very small area clearly separated from its nonurban surroundings. Every city in this region spreads out far and wide around its original nucleus; it grows amidst an irregularly colloidal mixture of rural and suburban landscapes; it melts on broad fronts with other mixtures, of somewhat similar though different texture, belonging to the suburban neighborhoods of other cities. (Gottmann, 5)

Moreover, I suspect Obama, or at least his advisors, have read and absorbed much more cutting edge material. Certainly Bill Bishop’s The Big Sort seems like a blueprint for how Obama won the election. I’m hoping he’s reading stuff by the Metropolitan Institute at Virginian Tech, which to my mind consistently does the most interesting work on cities out there. It would also be great to hear that Obama had read some Stephen Graham and certainly, as a cautionary measure, Rebecca Solnit’s Hollow City. I’m a little bit scared, however, by the comment about Chicago. Certainly its doing well, but are the Richard Florida/Bilbao-Effect model that drove that metropolis is finished. We’ll see, I guess.

As for my recommendations for what Obama should do with cities, they’re on their way, really they are. 

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What I Talk About

It’s late (other people are all over it, I’m sure), but here’s what I talk about, courtesy of Wordle. So maybe I was wrong when I thought that the people at International Listings just didn’t get that this was an architecture blog… Oh wait a second, they’re real estate agents! No wonder. Explains everything (except where is the word bust below?). Do you think that they are doe-eyed? 

wordle image

 

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A Modest Proposal for Social Networks or, How This Could be the Next Facebook

I’m still trying to catch up with my big blog post (maybe a white paper?) on the research we did on Networked Publics and the Infrastructural City, so bear with me. In the meantime, how about some pie-in-the-sky ideas about Web 3.0 (so sorry)?  

A couple of weeks ago, Traction Software’s Jordan Frank wrote an intelligently-written post titled "Wither Web 2.0 Social Networking? My 2 Cents." Jordan begins with a series of gloomy links on the failure of social networking technology to monetize. It’s pretty obvious to those of you on Twitter or on Facebook…we use these sites all the time. Some 150 million people subscribe to Facebook and half of them use it every day. It costs a lot of money to run Facebook’s servers (the photo below is of some of the over 10,000 servers Facebook uses) and back in 2007, Fishtrain calculated that the server cost alone was around $1.05 a user and of course there are employees, office space, and so on.

In other words, that’s crazy money and for social networks to stay afloat, they are going to have to make some real cash fast. Facebook could well be racing the New York Times for which one will shut its doors first.

facebook's server room

Advertising is the hitch here. Social networks, search engines, and of course newspapers and magazines have long relied on advertising to fund their businesses, but as advertisers are able to see results more directly than ever before, they find that perhaps ads—especially the sort of relatively unobtrusive ads that appear on social networks…but that users still hate—aren’t really generating the kind of results they want.

Remember "it’s all about eyeballs?" I remember doe-eyed business school graduates telling me that a decade ago and look how far that went…

User fees are certainly possible but extremely unlikely, in my opinion, to succeed.

Instead, here’s a thought experiment. With millions of blogs and content-management-driven Web sites out there (like this one, but also online user communities), what if social networks left the corporate-owned ghetto? What if a set of tools were developed—OpenId being only the first one—to allow all the goodies of social networking sites—meeting friends, posting profiles, tracking online actions, sending dumb gifts, unfriending people, posting kid photos, poking—to spread across the Web? How different would this be than losing America Online, Compuserve, and the various online services of the 1980s and early 1990s? What if all this social networking stuff just went into the cloud—not a cloud owned by Amazon or Google—but a cloud owned by everyone? A few new tools and Drupal 9.0 could certainly do this, I think. 

Surely some important technological breakthroughs would have to be made to make this a reality, but really, why not? 

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champagne in the bathub

I fail to understand opinions such as those expressed in this article with regard to the real estate bubble. Did this come as a surprise to anyone? Maybe it’s because I’ve had an education in economics as well as architecture but how could anyone have failed to see the bubble coming? I remember doe-eyed realtors telling me that house prices could never go down. Really? I’d lived in California so I’d seen the after-effects of the 80s bust. Who were they kidding? Me or themselves? I’m sure they had back-up jobs or at least a lot of savings, right? 

House prices more than double in most global markets while populations effectively stay steady (and even decline in cases). The price of houses in areas in which families make, say, $150,000 rises to $650,000. There’s no way to get a 20% deposit on a house in that sort of climate. Clearly something was wrong (and continues to be wrong with the market—it is far from corrected yet, I expect another 40% fall in places like the New York and Los Angeles metro areas). Seriously, what is there not to understand? I’d rather believe the Fed, the Bush administration, and my doe-eyed realtor friends were all cynical fiends than bone stupid. Did anybody really think the bubble wasn’t going to burst? 

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more trouble in paradise

Time to paint this morning’s picture of just how dark it is out there. Let’s start with the Irish situation. I haven’t remarked much on it lately, because, I suppose, it seemed so obvious. Mistaking a peripheral position in the economy for a core position is always bad, especially if it’s your government and finance industries doing it. That’s just what happened in Ireland. The Celtic Tiger is not so much in free fall as in fast reverse now. It’s important to look back in history and remember that the Great Depression, bad as it was in the United States, was worse elsewhere. Hitchcock and Johnson originally intended the International Style exhibit as an intervention in Germany and only turned to MoMA when it became clear to them that the conditions in Germany would prevent future building.

Speaking of that show, think about the fact that in 1932 it was still possible to be somewhat optimistic about the economy, to think about building. We may not have fallen much yet. Obama’s latest plan, to digitize health care records, suggests that he may not have much idea what to do. This may help save money in health care, but it’s hardly much of a boost to the GDP. It makes nothing, it allows us to export nothing, and the investment is for a one time project that serves only one industry, albeit a big one. In other words, it’s rearranging desk chairs on the Titanic.

Meanwhile, at the Atlantic Michael Hirschorn plays out a scenario in which the New York Times shuts down its presses, perhaps as early as this May. The other day I was telling someone how the AT&T building is the last great corporate skyscraper and how the annihilation of AT&T after its completion meant that there would never be such iconic architecture again. Then I was sobered by the thought of the New York Times building as a new icon, but immediately realized that the exception confirmed the rule.  

Finally, if you think we aren’t producing anything, we are! Lots of nice carbon dioxide emissions are being created by all those Google searches. Two searches produce as much CO2 as boiling a tea kettle does. See Slashdot for more. At least we’ll stay warm in the winter when fossil fuels run out. 

 

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