Friday News Digest

This week we kicked off our new membership platform. This is a very important step for us, a continuation of the transition from the early days of me working evenings and weekends (still do that, but now Strong Towns is my day job too) through our early foundation support (thank you Blandin) to a place now where our movement can be viable over the long term through the support of our members.

The directions this organization has taken since 2009 were always a byproduct of my immediate ambitions and limited capacities, lots of little experiments, while my own path of tortured discovery was shared with you through my blogging and podcasting. We’re now growing up (“maturing” to use Strong Towns speak) and, thanks to our Executive Director Jim Kumon, becoming a more effective organization in the process. That is important, and I’ve embraced it, because what we are doing is so critical to the future of this county.

I’m excited for what is coming. Please consider joining us as a member and being part of that next step.

Enjoy this week’s news.

• Every now and then it is nice to step back and look at the ground we've covered. John Shepherd first heard our message over three years ago while working in Minnesota. He came and heard us in Laramie, Wyoming, last week and provided an update on his blog. A very good recap of the Strong Towns message by someone who has thought it about it long time and is out there doing the hard work day after day. Thanks so much, John. It was great to see you again.

• The economy is back -- at least it all feels good -- and with the whole budget/debt thing resolved in Washington, we can just get back to the business of American prosperity. Hang on....did I say the "economy" is back? I just meant debt, our substitute for real private sector wealth creation. Ask yourself next time you are waiting in line in the drive through how many wealthy countries throughout history are overwhelming comprised of debtors.

Consumer credit, for instance, surged past the $3 trillion mark in the second quarter of 2013 and continues on an upward trajectory, according to the most recent numbers from the Federal Reserve.

At $3.04 trillion, the total is up 22 percent over the past three years. Student loans are up a whopping 61 percent.

Total household debt, according to the Fed's flow of funds report, is at $13 trillion, nearly back to its pre-crisis level in 2007 and a shade below government debt of $15 trillion.

"We have not solved (anything) when it comes to the deleveraging myth," said Michael Pento, president of Pento Portfolio Strategies. "We have learned nothing."

While the specter of another debt crisis might seem scary, some economists tout it as a healthy sign of a recovery. "In a moment of crisis, that's going to come back to haunt you," said Peter Cardillo, chief market economist at Rockwell Global Capital. "As long as you can support that debt through growth, it's really not a major concern."

• In other signs that we mistake for real growth, speculative industrial construction is also making a comeback, and in the city of big subsidy (Shakopee) no less. Chuck, they're really making things happen there. Yeah, they are, and with all the money sloshing through the system, it is one of those indicators that insanity/fear are taking over for logic, exactly what happens in an inflationary bubble, as people run to make investments in anything they hope will keep them ahead of the game. Build it and they will come is part of the Desperation Phase of this Suburban Experiment. No other civilization has become wealthy this way. Our wealth is an illusion, just like the prospects for industrial spec buildings.

The Minnetonka-based Opus Group is kicking off construction this week of a new industrial warehouse and distribution facility in Shakopee. The first phase of the Valley Park Business Center, slated for completion in the spring of 2014, calls for approximately 200,000 square feet of space.

Opus is charging ahead on a speculative, or “spec,” basis—meaning it has no signed leases for the space. During the economic downturn, no one was willing to roll the dice on spec projects.

• In my local paper, the State Highway Patrol announced that they will be stepping up enforcement of seat belt laws because of the tragic rise in automobile collissions, this in the same week that the Minneapolis Star Tribune reports that Minnesota is nearing 100% compliance with seat belt laws. The State Patrol is the hammer looking for the nail, but the article accidentially reveals what the real problem is: STROADs, the most dangerous, costly and ineffective way to design an auto transportation system. Padding, body armor and restraints become less helpful as speeds increase and increasing speeds where there is complexity (intersections) is beyond reckless.

As an example of the statewide effort, the seven-county Brainerd District supervisors realize that in their district, about 85 percent of the year-to-date fatal and serious injury crashes have occurred on rural highways, many at or near intersections.

• STROADs are the lowest returning transportation investment we routinely build. They are very expensive and the development pattern they induce is incredibly low yielding. This article deals with the physical unattractiveness of one STROAD, but the aesthetics are just a byproduct. What was maddening to me is that they quoted an economist who seemed to suggest that this is somehow how a natural pattern, that the act of taxing businesses and property owners decades ago in order to build this infrastructure -- an act that undermined the prosperity of those being taxed -- was somehow the work of Adam Smith's invisible hand and not a society binging on illusory wealth for short term gain, that the lack of alternatives today (we destroyed them with our policies) somehow represents a preference. The traditional development pattern created a complex economic environment with lots of interdependencies. This STROAD is the monoculture replacement. It is the equivalent of replacing a rain forest with a corn field. The former exists in a naturally resilient state achieved over time while the other is an unstable, unnatural creation that will die without constant care and support.

“Some people love McGalliard and some people hate it,” Mayor Dennis Tyler said. “Most of those who hate it hate its appearance. It’s not a very attractive street.”

But we go anyway.

“Despite its physical unattractiveness, we all vote with our feet to shop there,” said Michael Hicks, an economist and director of the Center for Business and Economic Research at Ball State University.

• And while I'm not a huge fan of Complete Streets (I'm not against it, but I'm not advocating for it either), if Houston can reach a consensus that there is something to be gained by designing public spaces for more than automobiles, your community can reach that consensus as well.

Houston is a city that embraces its diversity and the complete streets policy takes that same view and applies it to our mobility system, meeting the diverse needs of all Houstonians while creating more accessible and attractive connections to residential areas, parks, businesses, restaurants, parks, and employment centers. Its also important to keep in mind that Complete Streets help build healthy communities in many ways.”

 Frankly, it’s always been possible to do a Complete Street in Houston, but the default has been let’s get those cars moving. Now we want the default to be a Complete Street and anything different than that to be something that has to be the exception.

• Absolutely stunning TED talk. I know many people feel NYC is an anomaly and very little of what happens there applies to the rest of the country. I agree to an extent, but the philosophy of the approach -- small experiments that provide information and allow you to make better investments -- is universal. If you want to see how this thinking applies in a small town or neighborhood context, check out out Neighborhoods First report.

• Build it and they will come is a manifestation of the Desperation Phase of the Suburban Experiment. Even a generation ago, the notion that local governments had a role as the dumb money at the table, committing their last remaining wealth in a desperate bid to avoid the bottom, would have been unthinkable. Now it is standard economic development. This article does a good job of revealing the current psychology, but it also left me very frustrated because it left unrefuted the notion that the only alternative is to do nothing. Again, read our Neighborhoods First report. There is an absolute TON to do.

Westfield is funding a $45 million youth sports complex as well as $15 million in public amenities near its downtown. Fishers is spending $10.75 million on a parking garage and other amenities downtown. Greenwood is building a $10 million water park. Brownsburg is launching plans for a recreational center or water park at a cost of between $8 million and $12 million.

As suburbs struggle on limited budgets to maintain or bolster public services, such as police and fire protection, street maintenance and snow removal, the challenge they face is how to grow their tax bases.

Their approach isn’t novel but is becoming more common in the wake of the recession and in era of state-mandated caps on property taxes: Spend public money to lure privateinvestment.

In a shift in thinking, they believe they can spur economic growth by spending taxpayer dollars to build high-end parks, entertainment venues and other attractions that people will seek out. The hope is that the private sector will respond by spending millions of dollars more to build offices, restaurants, hotels and shops on nearby land, drawing tourists who shop and dine and professionals with high salaries who want to move there.

• This week I was in Hillsborough County, Florida, which is the Tampa Bay area. The more I travel Florida the more I am dismayed by the absolutely bizarre transportation system they have built. To get to our meeting, we drove 40 minutes on one of the worst STROADs I've even been on. And they are everywhere. The area I was helping out in had three parallel highways running next to each other, all in like a ten mile stretch. The oldest was total STROAD, with all the run down and neglected uses that were shiny and new back in the 1950's. The middle was the STROAD with the newer fast food joints and gas stations (wonder what the trajectory is there?) and the newest was the interstate. Of course, in the area we were looking at, developers and politicians were interested in a new interchange on the highway, the process of STROADing our highways now more sophisticated and expensive. And while FDOT acknowledges they don't have the money, everyone seems addicted to the quick economic development pop and unable to consider a fundamentally new approach, one that maximizes the money they do have.

Hillsborough County has already taken steps toward collaboration in planning the county’s transportation future. The policy group Steinman addressed Wednesday includes all seven Hillsborough County commissioners, the mayors of the county’s three cities and the chair of the board that runs the county’s HART bus system.

County commissioners formed the group in April to look for solutions to the county’s clogged transportation systems, with an emphasis on projects that promote economic development. The group is expected to finish its hearings in December and will hand over its work in February.

• Jim Kunstler writing for the Chris Martenson's Peak Prosperity blog about why growth is obsolete. Good writing, thick with thought provoking reality.

Despite the wishful thinking and happy-talk propaganda lighting up the media-space, we have arrived at the problematic point of the story: the end of cheap oil. This is poorly understood by the public and, apparently, by leaders in business, politics, and the media, too. They misunderstand because they insist on thinking that peak oil was simply about running out of oil. It’s not. It’s about running out of the ability to extract it from the earth in a way that makes economic sense — that is, at a price we can afford in terms of available capital and energy invested (and also ecological destruction). That dynamic is now exerting a powerful influence on modern civilizations.

• And yes, a huge asteroid will someday impact Earth and kill us all. Another reason to eat, drink and be merry.

• And finally, while I've had a great stretch here of meeting people and sharing our message -- North Carolina, Pennsylvania, DC, Wyoming, Kansas, Florida and heading to New Jersey, Washington and Vancouver next week -- these days home with my family are so important. The ages have changed, but the soundtrack for Fridays remains the same. Glad they are off school today so we can have some fun.

Enjoy your weekend. I'll be in New Jersey Monday for a Complete Streets gathering and then I'm headed across the country to Washington State and a stop north of the border. Can't wait.