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		<title>kfarr &#187; economics</title>
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		<title>When should public transportation systems be private?</title>
		<link>http://kfarr.com/2008/07/10/when-should-public-transportation-systems-be-private/</link>
		<comments>http://kfarr.com/2008/07/10/when-should-public-transportation-systems-be-private/#comments</comments>
		<pubDate>Thu, 10 Jul 2008 22:28:54 +0000</pubDate>
		<dc:creator>kfarr</dc:creator>
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		<description><![CDATA[A recent episode of Russ Roberts&#8217; EconTalk podcast featured a wonderful intersection of interests: economics, public policy and public transit. One of Russ&#8217; academia friends, economist Michael Munger, speaks at length on the program about the public transportation system quality in Santiago, Chile before and after nationalization of their bus network. Prior to 2007 Santiago&#8217;s [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=kfarr.com&blog=1892208&post=360&subd=kfarr&ref=&feed=1" />]]></description>
			<content:encoded><![CDATA[<p>A <a href="http://www.econtalk.org/archives/2008/07/munger_on_the_p.html">recent episode</a> of Russ Roberts&#8217; EconTalk podcast featured a wonderful intersection of interests: economics, public policy and public transit.</p>
<p>One of Russ&#8217; academia friends, economist Michael Munger, speaks at length on the program about the public transportation system quality in Santiago, Chile before and after nationalization of their bus network.</p>
<p>Prior to 2007 Santiago&#8217;s surface transit was made up of a patchwork of thousands of independent, private bus operators. Operators specialized in niches ranging from neighborhood local busses which stopped at every block in a town to luxury express busses providing direct to city center service.</p>
<p>Since nationalization circa February 2007 the masses have expressed widespread complaints about the poor quality of the system. Wikipedia&#8217;s <a href="http://en.wikipedia.org/wiki/Transantiago">article on Transantiago</a> sums up these complaints well:</p>
<blockquote><p>The major complaints are the lack of buses and their inconsistent frequencies, missing or poor infrastructure (such as segregated corridors, prepaid areas and bus stops), the network&#8217;s coverage, and the number of transfers needed for longer trips.</p></blockquote>
<p>I agreed in spirit that market based solutions can offer better outcomes than public, centralized planning in some situations. But, we shouldn&#8217;t get rid of public transit and city planning.</p>
<ul>
<li>I do agree that in controlled situations, a market solution is better. San Francisco&#8217;s publicly owned and operated transit system is largely a failure, spurring reactions identical to those of Santiago&#8217;s newly nationalized bus system. Here, Munger and Roberts are spot on in their complaints of the stupidity of nationalizing a once private resource. (Remember, SF had a patchwork of completely privately owned transit lines until around the 1910&#8242;s. Everything I&#8217;ve read says these competing systems provided <em>excellent</em> service, especially given available technologies.)</li>
<li>But, I do not share Munger and Roberts&#8217; idyllic view that free markets are the holy grail of public transport policy. Two reasons:
<ul>
<li>Just look at our suburban car-based communities. These communities are real life experiments in market based, unplanned transport and city zoning policies. These communities are a dismal failure.</li>
<li>While bus systems can arguably run with no government intervention, most other high-capacity transit systems need exclusive, government granted corridor rights-of-way, whether that be below ground subways, above ground rail corridors, or even fantastical elevated monorails. Like utilities, physical constraints necessitate government involvement to some degree.</li>
</ul>
</li>
</ul>
<p>Like many EconTalk podcasts, even if you don&#8217;t agree with everything, the discussion points a great alternative spotlight on conventional public policy views.</p>
<p>My favorite viewpoint: the entire concept of central transportation planning is communist at its core &#8212; an odd anomaly in a nation proud of its free-market ideology. Why should transportation &#8220;planners&#8221; dictate the best transportation routes? Our publicly owned and operated Muni is blind to the most powerful natural &#8220;planner&#8221; in the world: market feedback.</p>
<p>This viewpoint strikes me especially hard in the context of the impending Transit Effectiveness and the Geary BRT projects in the planning faces. With the TEP, the City is spending millions of dollars and years of research to accomplish what free market forces could do everyday, instantly, for free.</p>
<p><a href="http://www.econtalk.org/archives/2008/07/munger_on_the_p.html">Link to podcast page</a> (<a href="http://www.econlib.org/library/Downloads/y2008/Mungertransportation.mp3">direct mp3 link</a>)</p>
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		<title>More Bay to Breakers</title>
		<link>http://kfarr.com/2008/05/22/more-bay-to-breakers/</link>
		<comments>http://kfarr.com/2008/05/22/more-bay-to-breakers/#comments</comments>
		<pubDate>Fri, 23 May 2008 01:29:10 +0000</pubDate>
		<dc:creator>kfarr</dc:creator>
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		<guid isPermaLink="false">http://kfarr.wordpress.com/?p=337</guid>
		<description><![CDATA[This is a continuation of a previous post. Toward the end of my shift, around 3pm, I picked up an elderly Chinese couple hailing on the street downtown. They were heading all the way out to the deep Richmond on the far west side of the City. We took Turk as far west as we [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=kfarr.com&blog=1892208&post=337&subd=kfarr&ref=&feed=1" />]]></description>
			<content:encoded><![CDATA[<ul>
<li>This is a continuation of a <a href="http://kfarr.com/2008/05/21/driving-bay-to-breakers/">previous post</a>.</li>
<li>Toward the end of my shift, around 3pm, I picked up an elderly Chinese couple hailing on the street downtown. They were heading all the way out to the deep Richmond on the far west side of the City. We took Turk as far west as we could go until it turns into Balboa. They lived on Balboa so we continued on as both Fulton and Geary were clogged from the post-race exodus.
<p>Being the transportation geek I am, I put a lot of thought toward transportation logistics, especially after the event. Wikipedia says Bay to Breakers brings in close to 100,000 participants each year.</p>
<p>As I drove westward with the elderly Chinese couple it became quickly apparent that there were insufficient transportation options available for people leaving the event. Starting from about Divisadero westward there were hails at every block. From Park Presidio westward there were constant hails on both sides of the street from a thick crowd of tired, drunk and shivering partiers who hadn&#8217;t dressed for the chilly afternoon fog.</p>
<p>The problem is two fold:<br />
1) There was insufficient transportation infrastructure to bring these folks back downtown, and<br />
2) Race participants from out of town were clearly unaware of the meager transportation infrastructure that DID exist, namely the frequent but slow 38-Geary just 2 blocks north of Balboa.</p>
<p>I noticed a number of special Muni &#8220;Bay to Breakers&#8221; busses which, according to SFMTA&#8217;s <a href="http://www.sfmta.com/cms/malerts/SFMuniBaytoBreakers.htm">website</a>, provided express service from GG park direct downtown. This is well intentioned, but a bit silly. Both the N-Judah and 38-Geary provide regular, high-capacity service downtown. Providing parallel express busses is inefficient use of resources. As evidenced by street hails and my brief glimpses of the few busses they used for the &#8220;special&#8221; service, the special busses did not offer nearly enough capacity.</p>
<p>Here&#8217;s a better solution: provide FREE shuttle busses from the event to the 38-Geary and N-Judah lines, and beef up the frequency of these lines. Use the special event fare to pay for additional 38-Geary and N-Judah runs. Again, it was silly to reinvent what already exists &#8212; adequate eastbound transit lines are in abundance in the Sunset and Richmond. The only missing piece of the puzzle were north/south bound shuttles from the park to the 38/N lines with clear signage directing pedestrians toward these shuttles.</li>
<li>During both the pre-race rush and the post-race exodus I received a number of calls from friends looking for cab rides.
<p>This is a tough request to balance: On the one hand I seek to earn as much as possible during my shift while I have access to the limited resource of a cab operating medallion and the vehicle, but on the other hand I want to help out friends who are having a hard time catching a cab, especially given the unusually high demand for cabs in the City. Balancing those desires is difficult.</p>
<p>The best balance I have come up with is to offer a ride if I&#8217;m in the neighborhood. Here is the best reasoning I can muster:</p>
<ul>
<li>The only time that these requests are made is when the City is extremely alive: demand for cabs is high which is usually correlated with traffic congestion. Thus, traveling to another &#8216;zone&#8217; will cost at least 1, perhaps 2 fares since travel time is compounded by congestion.</li>
<li>By the time I finally move to the new zone, especially one far across the city, most likely that person would have been able to find a cab had they not been waiting for me. Or, in the worst case, they did find a cab and my effort is wasted.</li>
<li>Because the person is either a close friend or a friend of a good friend, I will charge them nothing, less than the meter, or, at the least, I won&#8217;t accept a tip. It&#8217;s a bit counterintuitive to recognize that the cost is not just the actual ride I gave them for free, but also the time required to change zones. Therefore the total cost could be as many as 2 or 3 fares, not just the 1 fare that I gave them for free. (2-3 fares is $15 &#8211; $45.)</li>
<li>The best compromise I can offer is to pick a friend up if I&#8217;m in the same zone, which is just a 1 fare cost assuming they aren&#8217;t charged.</li>
</ul>
</li>
<li>After dropping the elderly Chinese couple in the deep Richmond, I knew I could easily find a fare on Balboa. But, as sometimes happens in times of extreme cab demand, I was a bit apprehensive about re-approaching the masses of humans hailing their hearts out.
<p>It&#8217;s a scene out of a classic zombie film: You&#8217;re the last human alive on Earth. As you drive through the urban wasteland, masses of brain-dead zombies try to attack your car, tearing at the loose rubber seams of your cab&#8217;s door jams with an unending murderous zeal to taste even a sliver of your as yet untainted human blood. This is what Balboa Street at 39th Avenue looked like Sunday afternoon after Bay to Breakers, at least in the eyes of this cab driver.</p>
<p>I went a few blocks on hail-free Anza, making the plunge to Balboa-land around 37th Avenue. Every corner of 37th and Balboa bulged with ravenous taxi-hungry yuppies. One of the groups had a camera &#8212; a very expensive commercial grade TV camera. I aimed for them &#8212; chances are they wouldn&#8217;t be too drunk or ravenous. It turned out to be a crew shooting for an HD Net travel program. As they climbed in the 7 passenger van, a smaller group approached our cab to squeeze in and share the journey back downtown. &#8220;Can we come along too?&#8221; I deferred to the first group, &#8220;I have no problem with it, but I&#8217;ll defer to the first party and we&#8217;ll drop them off first.&#8221; We had a deal.</p>
<p>The HD Net crew was heading back to their Fisherman&#8217;s Wharf hotel. To avoid as much traffic as possible I headed north on Park Presidio and swung around the Marina to the Fish Wharf. It was a great route. We chatted a bit about HD video equipment&#8217;s astronomical pricing. Their camera, without a lens, cost upwards of $40,000 &#8212; add $30,000 for a lens and you&#8217;re now carrying around a piece of equipment worth the value of a factory built house and lot in the super-suburbs of Indianapolis. We talked a bit about HD formats; there are still a number of tape-based formats battling for victory, but it appears that fight will be short-lived as the battles moves toward tapeless. I was intrigued; our additional passengers were not.</p>
<p>The HD Net guys tipped me very, very well, handing me two twenties for a $18 fare. I did a good job aiming for potential passengers. I took the 3 remaining friends downtown to Union Square and charged them only the meter of the remaining distance. All parties were happy with the transaction. Including the elderly couple, I netted $80 from a quick out/in Richmond run. I look forward to future City event days. Pride weekend is coming up soon.</li>
<li>Just as I thought about the breakdown of the City&#8217;s overall transportation infrastructure to bring race goers home from the event, I thought specifically toward the breakdown of the cab infrastructure.
<p>Obviously, there is not sufficient supply given the outlandishly abnormal increase in demand. I am a big fan of the concept of peak medallions, or supplying a peak increase in supply at times of obvious demand increases. Another approach is to fiddle with pricing.</p>
<p>I imagined one such approach: let&#8217;s say that people could call my cab company during times when it&#8217;s impossible to find cabs. On Sunday, during the B2B event, it was tough to get through at all, and even if the call was answered there just weren&#8217;t enough cabs to answer the flood of incoming requests. Most of the radio calls that were answered were airport runs (I answered a few on Sunday). Why are those responded to when others aren&#8217;t? The obvious answer is that airport runs net the driver a lot of cash for the amount of time invested.</p>
<p>So, airport runs attract drivers even on a busy shift because it offers a higher than average (guaranteed) payoff. Why couldn&#8217;t this work for extremely urgent intra-City runs?</p>
<p>Driving down a street with hails at every corner doesn&#8217;t give me any information, aside from instant surface judgments, about the degree to which each person really <em>needs</em> a cab. Instead of trying to guess which waiting customer really <em>needs</em> a cab, a simple method would be to increase the price of cabs, or offer the chance for customers to make clear if they are willing to pay more. Customers could call dispatch and be clear that they are comfortable paying double meter. Drivers would be more willing to pass up street hails to answer double meter dispatch calls.</li>
<li>I took a New York family from a restaurant to their son&#8217;s USF graduation at the top of Nob Hill at the Masonic Center.
<p>The dad and I talked on the ride about why it was so tough to find a cab, why the City&#8217;s cab fleet has a hard time expanding to peak demand, how NYC has a power of ten more cabs (15,000 vs. 1,500), how a peak medallion system would be difficult to implement but would be labor friendly, and how indecision to act on a solution hurts residents and visitors of the City.</p>
<p>As I dropped them off he said, &#8220;You&#8217;ll do well.&#8221;</p>
<p>&#8220;Today?&#8221; I asked. &#8220;It&#8217;s been a good day given all the City events.&#8221;</p>
<p>&#8220;No, you&#8217;ll do well in the rest of your life.&#8221;</p>
<p>Thanks for the compliment, NYC dad.</li>
</ul>
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		<title>You&#8217;re richer than you think.</title>
		<link>http://kfarr.com/2008/04/30/youre-richer-than-you-think/</link>
		<comments>http://kfarr.com/2008/04/30/youre-richer-than-you-think/#comments</comments>
		<pubDate>Wed, 30 Apr 2008 23:57:29 +0000</pubDate>
		<dc:creator>kfarr</dc:creator>
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		<description><![CDATA[While sitting in the queue to pay the toll for the Bay Bridge Monday, I heard two great counterintuitive pieces on KQED. The first was a thoughtful comparison between our quality of life now compared to the distant past. It is a true and important comparison and a nice reminder of how great our lives [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=kfarr.com&blog=1892208&post=317&subd=kfarr&ref=&feed=1" />]]></description>
			<content:encoded><![CDATA[<p><img src="http://kfarr.files.wordpress.com/2008/04/moneybagsandpiggybank.jpg?w=200&#038;h=213" alt="Money bag and piggy bank" width="200" height="213" class="alignnone size-full wp-image-318" /></p>
<p>While sitting in the queue to pay the toll for the <a href="http://en.wikipedia.org/wiki/San_Francisco-Oakland_Bay_Bridge">Bay Bridge</a> Monday, I heard two great counterintuitive pieces on KQED.</p>
<p>The first was a thoughtful comparison between our quality of life now compared to the distant past. It is a true and important comparison and a nice reminder of how great our lives really are in modern times.</p>
<p>&#8220;A Very Rich Man&#8221; KQED Perspective:</p>
<ul>
<li><a href="http://www.kqed.org/.stream/anon/radio//perspectives/2008/04/2008-04-28-perspectives.mp3">&gt;MP3 Direct Link&lt;</a></li>
<li><a href="http://www.kqed.org/epArchive/R804280737">Program Page</a></li>
</ul>
<p>The second was a nice piece by NPR&#8217;s Morning Edition which sought to answer the question of why Americans have built up so much personal debt in the past 20 years. I liked this part: for some, debt it good. Debt is not always an evil thing.</p>
<p>In my case, I know that my income will be considerably higher in a few years than it is now. As exemplified by the example in the story, it would make little sense for me to save money now given my limited income.</p>
<p>&#8220;Why Do We Borrow So Much?&#8221; Morning Edition Story:</p>
<ul>
<li><a href="http://www.npr.org/templates/story/story.php?storyId=89957723">Segment Page</a></li>
</ul>
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<enclosure url="http://www.kqed.org/.stream/anon/radio//perspectives/2008/04/2008-04-28-perspectives.mp3" length="1178061" type="audio/mpeg" />
	
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			<media:title type="html">Money bag and piggy bank</media:title>
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		<title>Website highlights financial stress of driving a taxi in the City</title>
		<link>http://kfarr.com/2008/03/26/website-highlights-financial-stress-of-driving-a-taxi-in-the-city/</link>
		<comments>http://kfarr.com/2008/03/26/website-highlights-financial-stress-of-driving-a-taxi-in-the-city/#comments</comments>
		<pubDate>Wed, 26 Mar 2008 21:56:15 +0000</pubDate>
		<dc:creator>kfarr</dc:creator>
				<category><![CDATA[econ]]></category>
		<category><![CDATA[politics]]></category>
		<category><![CDATA[taxi]]></category>
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		<guid isPermaLink="false">http://kfarr.wordpress.com/?p=283</guid>
		<description><![CDATA[I point your temporary attention to a Flash website produced by UC Berkeley j-school grad students Eric Zassenhaus and Amy Jeffries. The video clips thumbnailed along the bottom are accurate and colorful paintings of a typical taxi shift. Well worth a view. But wait, there&#8217;s more. The site also features insightful interviews with Heidi Machen, [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=kfarr.com&blog=1892208&post=283&subd=kfarr&ref=&feed=1" />]]></description>
			<content:encoded><![CDATA[<p><img src='http://kfarr.files.wordpress.com/2008/03/yellowcabdriver.jpg?w=500' alt='San Francisco Yellow Cab 2803' /></p>
<p>I point your temporary attention to a Flash <a href="http://journalism.berkeley.edu/projects/primary08/sfcabs/">website</a> produced by UC Berkeley j-school grad students <a href="http://journalism.berkeley.edu/students/resume.php?ID=313">Eric Zassenhaus</a> and <a href="http://journalism.berkeley.edu/students/resume.php?ID=278">Amy Jeffries</a>.</p>
<p>The video clips thumbnailed along the bottom are accurate and colorful paintings of a typical taxi shift. Well worth a view.</p>
<p>But wait, there&#8217;s more. The site also features insightful interviews with Heidi Machen, the SF Taxi Commission Executive Director; Jim Gillespie, Yellow Cab President; and Thomas George-Williams, <a href="http://www.utw.us/">United Taxicab Workers</a> member.</p>
<p>Since I drive a cab in the City and can&#8217;t shut up about local politics, I have some pointed reactions:</p>
<p>I don&#8217;t know who Heidi Machen is or how she got to be Executive Director of the SF Taxi Commission, but she doesn&#8217;t seem to have an accurate grasp of the industry over which she regulates. This is a bit scary.</p>
<p>When asked about the recent gate-fee increase, Ms. Machen responds with a bubbly response. &#8220;In many ways it&#8217;s very positive,&#8221; she starts, repeating again for emphasis, &#8220;in many ways it&#8217;s very positive, because, if indeed the taxi companies needed money to purchase the alternative fuel and hybrid vehicles San Francisco is looking at a clean taxi fleet in 3-4 years. Wow! That&#8217;s phenomenal!&#8221;</p>
<p>&#8220;If indeed?&#8221; If indeed? Ms. Machen, your job, for which you are paid a bulbous salary of some sort, is to be Executive Director of the Taxi Commission. There should be no &#8220;if&#8221; in your response. You should know whether or not taxi companies need money to purchase alternative fuel and hybrid vehicles BEFORE implementing fee increases.</p>
<p>Continuing, &#8220;On the other hand you look at the controller&#8217;s report and the controller said this would have an immediate detrimental effect on taxi drivers&#8217; incomes. So, that can be a negative, obviously, because taxi drivers, a lot of them, may be hanging on marginally. On the other hand, maybe it encourages taxi drivers to become more efficient. Some would fear it would make taxi drivers more reckless.&#8221; Ponderously she summarizes, &#8220;I think there are some positives and some possible negatives that we&#8217;re looking at.&#8221;</p>
<p>My fear is she doesn&#8217;t seem to &#8220;get it.&#8221; A key sticking point: taxi companies need CPI gate increases but drivers also need correlated revenue increases. The discussion of green cabs is a sideshow distracting from this core issue.</p>
<p>On the other hand, Mr. Gillespie in his role as General Manager of Yellow Cab understands the situation perfectly. Unfortunately, his role is not an advocate for drivers but instead for revenue maximization for Yellow Cab. (This is not a judgment of his motivation, just a recognition thereof.) But, at least he &#8220;gets it.&#8221;</p>
<p>Thomas George-Williams, an active member of the local United Taxi Worker union &#8220;gets it&#8221; too. But, as most drivers are not members of the Union, its influence, regardless of Mr. George-Williams &#8220;getting it,&#8221; is unfortunately questionable.</p>
<p><a href="http://journalism.berkeley.edu/projects/primary08/sfcabs/">Link</a></p>
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			<media:title type="html">San Francisco Yellow Cab 2803</media:title>
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		<title>&#8220;Energy independence&#8221; is silly. We must use less energy regardless of its source.</title>
		<link>http://kfarr.com/2008/03/21/energy-independence-is-silly-we-must-use-energy-less-not-produce-it-at-home/</link>
		<comments>http://kfarr.com/2008/03/21/energy-independence-is-silly-we-must-use-energy-less-not-produce-it-at-home/#comments</comments>
		<pubDate>Fri, 21 Mar 2008 20:48:20 +0000</pubDate>
		<dc:creator>kfarr</dc:creator>
				<category><![CDATA[econ]]></category>
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		<category><![CDATA[energy independence]]></category>
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		<guid isPermaLink="false">http://kfarr.wordpress.com/?p=279</guid>
		<description><![CDATA[My unwavering allegiance to the American Public Media radio program Marketplace was made ever tighter by a clear and compelling opinion piece by Jerry Taylor of the Cato Institute. The piece is written so concisely I can do no better than to quote Mr. Taylor&#8217;s introduction: President Bush and many others are fond of saying [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=kfarr.com&blog=1892208&post=279&subd=kfarr&ref=&feed=1" />]]></description>
			<content:encoded><![CDATA[<p><img src='http://kfarr.files.wordpress.com/2008/03/20080320_jerry_taylor_18.jpg?w=500' alt='Jerry Taylor, Cato Institute' /></p>
<p>My unwavering allegiance to the American Public Media radio program <a href="http://marketplace.publicradio.org">Marketplace</a> was made ever tighter by a clear and compelling <a href="http://marketplace.publicradio.org/display/web/2008/03/20/energy_independence/">opinion piece</a> by Jerry Taylor of the <a href="http://en.wikipedia.org/wiki/Cato_Institute">Cato Institute</a>.</p>
<p>The piece is written so concisely I can do no better than to quote Mr. Taylor&#8217;s introduction:</p>
<blockquote><p>
President Bush and many others are fond of saying that oil prices are high because we import too much oil. In reality, they&#8217;ve got it exactly backwards. We import energy for a reason: it&#8217;s cheaper than producing it here at home. A governmental war on energy imports will, by definition, raise energy prices.
</p></blockquote>
<p>Bingo.</p>
<p>Our search for the holy grail of &#8216;energy independence&#8217; has distracted us from the real issue at hand: we have built our country, our cities, our communities around a transportation infrastructure that relies almost solely on fossil fuels. When the cost of these fuels increase faster than expected, the repercussions are multiplied: not only does it cost more for you to drive to a market to purchase goods, the goods cost more to produce and deliver since they rely on that same transportation infrastructure.</p>
<p>Oops!</p>
<p>Our national focus should be on changing the policies that have led us to rely so heavily on fossil fuels instead of debating from which source we should purchase these fossil fuels.</p>
<p>Links</p>
<ul>
<li><a href="http://download.publicradio.org/podcast/marketplace/pm/2008/03/20/marketplace_cast1_20080320_64.mp3">Direct MP3 Link</a></li>
<li><a href="http://marketplace.publicradio.org/display/web/2008/03/20/energy_independence/">Segment Page (including transcript)</a></li>
</ul>
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<enclosure url="http://download.publicradio.org/podcast/marketplace/pm/2008/03/20/marketplace_cast1_20080320_64.mp3" length="14052797" type="audio/mpeg" />
	
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			<media:title type="html">Jerry Taylor, Cato Institute</media:title>
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		<title>Fire destroys low-income resident&#8217;s apartment. Archaic rent control forces her to leave City.</title>
		<link>http://kfarr.com/2008/03/19/fire-destroys-low-income-city-residents-housing-rent-control-forces-them-to-leave-city/</link>
		<comments>http://kfarr.com/2008/03/19/fire-destroys-low-income-city-residents-housing-rent-control-forces-them-to-leave-city/#comments</comments>
		<pubDate>Wed, 19 Mar 2008 21:04:17 +0000</pubDate>
		<dc:creator>kfarr</dc:creator>
				<category><![CDATA[econ]]></category>
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		<category><![CDATA[price]]></category>
		<category><![CDATA[price ceiling]]></category>
		<category><![CDATA[price control]]></category>
		<category><![CDATA[regulation]]></category>
		<category><![CDATA[rent]]></category>
		<category><![CDATA[rent control]]></category>
		<category><![CDATA[rental]]></category>
		<category><![CDATA[san francisco]]></category>
		<category><![CDATA[sf]]></category>
		<category><![CDATA[subsidies]]></category>
		<category><![CDATA[supply]]></category>
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		<description><![CDATA[The Chronicle has a touching and well-written article about the aftermath of the Mission District fire that completely destroyed a 30-unit apartment building Monday evening. Central to the article is the story of Griselda Paleo. Ms. Paleo is 59 and lived alone in a studio apartment in the building. Her apartment was tied to an [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=kfarr.com&blog=1892208&post=277&subd=kfarr&ref=&feed=1" />]]></description>
			<content:encoded><![CDATA[<p><img src='http://kfarr.files.wordpress.com/2008/03/ba_sffire_042_rad.jpg?w=500' alt='mission district fire' /></p>
<p>The Chronicle has a <a href="http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/03/18/BA4LVM715.DTL">touching and well-written article</a> about the aftermath of the Mission District fire that completely destroyed a 30-unit apartment building Monday evening.</p>
<p>Central to the article is the story of Griselda Paleo. Ms. Paleo is 59 and lived alone in a studio apartment in the building. Her apartment was tied to an 18-year old rent controlled price of $698. Her income is $850 from a federal disability program. How can Ms. Paleo relocate in the City? Short answer: she can&#8217;t.</p>
<p>Studios in the City start at $1,000 per month, it&#8217;s hard to find a decent quality one at $1,200. Even sharing an apartment will likely use her entire income stream.</p>
<p>Since rent control regulations tie the stabilized apartment price to that particular apartment, if that apartment is destroyed, transferred to a live-in owner, etc, the tenant loses that price control. That is what happened with Ms. Paleo.</p>
<p>Ms. Paleo&#8217;s case shows that <strong>tying price controls to a particular property is a critical failure of rent control policies as implemented in San Francisco and some other big cities, notably New York City.</strong></p>
<p>Rent control is a form of welfare paid to tenants regardless of income and paid solely by rental property owners. Welfare for low-income residents to live in our City is good. But, offering housing welfare to all residents <em>regardless of income</em>, supported <em>only by property owners</em> is silly.</p>
<p>Instead, the City should offer a rent SUBSIDY program, financed by <em>all</em> City residents that stabilizes rental unit prices for <em>low-income</em> tenants. Among other benefits, this would not tie a tenant to a particular property as in Ms. Paleo&#8217;s case.</p>
<p>A rent <strong>subsidy</strong> program in place of rent control offers a number of benefits:</p>
<ul>
<li>Ms. Paleo would be free to move to any apartment in the City, whether displaced by natural disaster as in this case, or by her own choosing if she wants to move to a new neighborhood.</li>
<li>Tenants who do not need assistance will not be eligible. Ms. Paleo obviously needs rental assistance, but an investment banker with an income of &gt;$100K should not be eligible for rent assistance. With the current system there is no way to differentiate the investment banker from Ms. Paleo. This is silly.</li>
<li>The cost of the program would be borne by all City residents, not just rental property owners. This is important. Since rent control is a significant tax on property owners that choose to rent their property, this significantly limits the number of properties put on the rental market. By removing the rent control tax and instead spreading the cost of rent subsidies to the entire population, we allow the rental property market to operate much more smoothly.</li>
</ul>
<p>Our Supervisors and Mayor wouldn&#8217;t touch the idea of changing the rent control structure with a ten foot pole.</p>
<p>City leaders, your inaction has forced Ms. Paleo to leave our City.</p>
<p>Links</p>
<ul>
<li><a href="http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/03/18/BA0KVLMKT.DTL&amp;hw=mission+fire&amp;sn=002&amp;sc=805">Original Chronicle article about fire with pictures</a></li>
<li><a href="http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/03/18/BA4LVM715.DTL">Aftermath article</a></li>
</ul>
<p>PS. Rent control is better than nothing. It&#8217;s a good start, but it&#8217;s just not the most effective solution we can come up with.</p>
<p><img src='http://kfarr.files.wordpress.com/2008/03/ba_sffire19_0048kr.jpg?w=500' alt='Hugo Gonzalez and Griselda Pal' /><br />
Hugo Gonzalez and Griselda Paleo walk through the patio at a Red Cross shelter set up at the recreation center on Harrison Street. <a href="http://www.sfgate.com/cgi-bin/object/article?o=0&amp;f=/c/a/2008/03/19/BA4LVM715.DTL">Chronicle photo by Kurt Rogers.</a></p>
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			<media:title type="html">mission district fire</media:title>
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			<media:title type="html">Hugo Gonzalez and Griselda Pal</media:title>
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		<title>Hey, SFMTA, please double residential parking fees and introduce traffic congestion fees.</title>
		<link>http://kfarr.com/2008/03/19/hey-sfmta-increase-residential-parking-fees-and-vehicle-congestion-fees/</link>
		<comments>http://kfarr.com/2008/03/19/hey-sfmta-increase-residential-parking-fees-and-vehicle-congestion-fees/#comments</comments>
		<pubDate>Wed, 19 Mar 2008 20:31:40 +0000</pubDate>
		<dc:creator>kfarr</dc:creator>
				<category><![CDATA[econ]]></category>
		<category><![CDATA[politics]]></category>
		<category><![CDATA[transit]]></category>
		<category><![CDATA[bus]]></category>
		<category><![CDATA[busses]]></category>
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		<category><![CDATA[dpt]]></category>
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		<category><![CDATA[empty]]></category>
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		<category><![CDATA[parking]]></category>
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		<description><![CDATA[The San Francisco Municipal Transportation Agency (SFMTA) is a bureaucratic whale, containing, in separate stomachs, the Department of Parking and Traffic (DPT) and the San Francisco Municipal Railway (Muni) public transit system. Recently, the SFMTA crunched some numbers and said, &#8220;Uh oh, we won&#8217;t have enough money to cover our costs over the next two [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=kfarr.com&blog=1892208&post=274&subd=kfarr&ref=&feed=1" />]]></description>
			<content:encoded><![CDATA[<p><img src='http://kfarr.files.wordpress.com/2008/03/sfmta-nomoney.jpg?w=500' alt='sfmta muni and dpt have empty pockets' /></p>
<p>The San Francisco Municipal Transportation Agency (SFMTA) is a bureaucratic whale, containing, in separate stomachs, the Department of Parking and Traffic (DPT) and the San Francisco Municipal Railway (Muni) public transit system.</p>
<p>Recently, the SFMTA crunched some numbers and said, &#8220;Uh oh, we won&#8217;t have enough money to cover our costs over the next two years.&#8221; Fair enough. Next step, &#8220;We need more money.&#8221;</p>
<p>Ideas? The <a href="http://www.examiner.com/a-1287518~Muni_looks_at_ways_to_offset_looming_shortfall.html">Examiner</a> and the <a href="http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2008/03/17/state/n053618D76.DTL&amp;hw=parking&amp;sn=008&amp;sc=520">Chronicle</a> report the SFMTA has publicly discussed two classes of options: increasing transit fees and increasing parking fees.</p>
<p>Are these ideas justified? Most definitely yes &#8212; these fee increases are justified and necessary.</p>
<p>But, I believe the SFMTA needs to increase some fees significantly MORE than has been suggested. If we&#8217;re smart and look at the dirty details (below) we can find some fees that we can significantly increase. This has a multiple benefits &#8212; controlling traffic congestion, reducing total personal vehicle miles driven and rationing limited road real estate while ALSO generating significant revenue for the cash-strapped SFMTA. Win, win, win?</p>
<ul>
<li>Increasing transit fees: Monthly Fast Pass (unlimited bus pass) cards cost $45 per month and are priced below market. $1.50 each way to work plus 2 weekend trips per day makes a frequent Muni rider pay $90 per month if they pay per trip. The SFMTA&#8217;s analysis of neighboring communities&#8217; monthly pass prices is wise and on par. An increase to $60 per month is more than reasonable given the value offered by the pass. At $60, the Fast Pass is still a bargain for regular transit users.</li>
<li>Increasing parking fees:
<ul>
<li>Parking meters are priced at $.25/10 minutes = $1.25/hour = $12.50/day. This is below market value compared to garages. This could be increased.</p>
<p>Idea: Why is Sunday meter collection or extended metered hours not discussed? Meters are not collected on Sundays. Meters are not collected after 6pm. Not only is this lost revenue but it causes inconvenience for City residents struggling to find spaces in highly trafficked commercial corridors at peak times. (This is the reason we have meters in the first place &#8212; to ration limited spaces. These spaces are still in high demand after 6pm and on Sundays in many metered commercial corridors. Just look at the Mission on Sunday afternoons; it&#8217;s a zoo.)</p>
<p>Idea: Why aren&#8217;t meters priced based on demand? If meters had variable pricing, the City could collect significantly more revenue on Friday and Saturday nights, in addition to busy Saturday and Sunday shopping times on commercial corridors. This is a significant revenue opportunity lost that also serves City residents and visitors who are more than willing to pay market price for convenient parking.</li>
<li>Yearly residential permits are priced at $60/year = $5/month. <a href="http://kfarr.com/2007/10/20/theres-no-free-parking/">Residential City parking permits are SEVERELY undervalued</a> and could easily be doubled without approaching the true market cost of parking. Yearly residential permits should be priced $120/year immediately, with a yearly increase after that.
<p>At $120/year this is still an amazing bargain: I can park in my neighborhood ALL YEAR LONG for only $120? Remember, monthly private spaces cost as much as $250 per MONTH.</p>
<p>People may complain, but even at $120/year this would result in no fewer permits purchased. Not until we pass $200/year will quantity demanded of yearly permits even begin to see a dent. Assuming about half of SF has a residential parking permit, just doubling this permit results in about $30 million incremental revenue per year.</li>
</ul>
</li>
<li>Congestion fees: Why is this not discussed as a revenue source? (Answer: The City can&#8217;t implement fast enough to be included as a revenue source for this 2-year projected shortfall.)
<p>Let&#8217;s change this. The City should implement congestion pricing within the next year.</p>
<p>Variable City congestion pricing serves double duty as a significant revenue generator for the SFMTA AND as a traffic and transit speed increaser. It increases the speed of its public surface street-shared transit system and increases the convenience and utility of currently congested streets for frequent City street &#8216;power-users&#8217; like delivery vehicles, taxis and persons with an absolute need for personal vehicle use.</li>
</ul>
<p>So, SFMTA, go along with your plan, but let&#8217;s instead <strong>double</strong> yearly residential parking permits and let&#8217;s introduce congestion pricing immediately.</p>
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			<media:title type="html">sfmta muni and dpt have empty pockets</media:title>
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		<title>Ignore the Hillary/Obama charades: NAFTA is good.</title>
		<link>http://kfarr.com/2008/03/01/ignore-the-hillaryobama-charades-nafta-is-good/</link>
		<comments>http://kfarr.com/2008/03/01/ignore-the-hillaryobama-charades-nafta-is-good/#comments</comments>
		<pubDate>Sat, 01 Mar 2008 18:58:02 +0000</pubDate>
		<dc:creator>kfarr</dc:creator>
				<category><![CDATA[econ]]></category>
		<category><![CDATA[happiness]]></category>
		<category><![CDATA[politics]]></category>
		<category><![CDATA[barack]]></category>
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		<category><![CDATA[nafta]]></category>
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		<guid isPermaLink="false">http://kfarr.wordpress.com/?p=259</guid>
		<description><![CDATA[Marketplace painted a nice picture of Obama and Hillary&#8217;s voracious battle for the crown of ultimate NAFTA hater. This is frustrating. Yes, they&#8217;re in Ohio. Yes, they have to cater to the lowest common denominator. Instead, they should rise up above the normal crap and say, &#8220;Look America, NAFTA is here. I (didn&#8217;t support it/didn&#8217;t [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=kfarr.com&blog=1892208&post=259&subd=kfarr&ref=&feed=1" />]]></description>
			<content:encoded><![CDATA[<p><img src='http://kfarr.files.wordpress.com/2008/03/20080228_barack_hillary_18.jpg?w=500' alt='hillary and obaaaaaaaaama' /></p>
<p>Marketplace <a href="http://marketplace.publicradio.org/display/web/2008/02/28/nafta/">painted a nice picture</a> of Obama and Hillary&#8217;s voracious battle for the crown of ultimate NAFTA hater.</p>
<p>This is frustrating. Yes, they&#8217;re in Ohio. Yes, they have to cater to the lowest common denominator.</p>
<p>Instead, they should rise up above the normal crap and say, &#8220;Look America, NAFTA is here. I (didn&#8217;t support it/didn&#8217;t agree with my husband), but it&#8217;s not going anywhere soon. But, I *DO* support free, government supported retraining programs to help displaced persons find jobs. This is a *REAL* way that, if elected, my administration would work toward a solution for Ohio and American citizens that were hardest hit by NAFTA.&#8221;</p>
<p>Please remember: NAFTA is not bad. Free trade is not bad. But, free trade often displaces labor that is most easily displaced &#8212; which is most often low/unskilled labor.</p>
<p>Our government must recognize that the effects of free trade often hits hardest our lowest income members of society. As such, our government has a strong social duty to provide free retraining and placement programs for those displaced by trade.</p>
<p><a href="http://marketplace.publicradio.org/display/web/2008/02/28/nafta/">Link</a></p>
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			<media:title type="html">hillary and obaaaaaaaaama</media:title>
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		<title>Politicians forget (ignore?) basic economics.</title>
		<link>http://kfarr.com/2008/02/22/politicians-forget-ignore-basic-economics/</link>
		<comments>http://kfarr.com/2008/02/22/politicians-forget-ignore-basic-economics/#comments</comments>
		<pubDate>Fri, 22 Feb 2008 18:35:52 +0000</pubDate>
		<dc:creator>kfarr</dc:creator>
				<category><![CDATA[econ]]></category>
		<category><![CDATA[politics]]></category>
		<category><![CDATA[alcohol]]></category>
		<category><![CDATA[california]]></category>
		<category><![CDATA[control]]></category>
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		<category><![CDATA[permit]]></category>
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		<category><![CDATA[price controls]]></category>
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		<category><![CDATA[rent control]]></category>
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		<category><![CDATA[san francisco]]></category>
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		<guid isPermaLink="false">http://kfarr.wordpress.com/?p=249</guid>
		<description><![CDATA[Let&#8217;s rewrite a few headlines to illustrate the point. Case 1 The original headline reads, &#8220;<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=kfarr.com&blog=1892208&post=249&subd=kfarr&ref=&feed=1" />]]></description>
			<content:encoded><![CDATA[<p><img src='http://kfarr.files.wordpress.com/2008/02/oopsmigdensandoval.jpg?w=500' alt='Oops Migden Sandoval' /></p>
<p>Let&#8217;s rewrite a few headlines to illustrate the point.</p>
<p>Case 1</p>
<p>The original headline reads, &#8220;<a href="http://www.examiner.com/a-1235510~Supervisor_looks_to_limit_liquor_licenses.html\">Supervisor looks to limit liquor licenses.</a>&#8221; Supervisor <a href="http://en.wikipedia.org/wiki/Gerardo_Sandoval">Gerardo Sandoval</a> seeks to add a ballot measure banning any future City liquor licenses.</p>
<p>This headline should read, &#8220;San Francisco Supervisor seeks to inconvenience (but not prohibit) citizens&#8217; access to a specific range of legal products (alcohol), while also restricting trade from further competition (further liquor licenses), entitling existing holders of permits to become unjustly enriched by these misguided attempts at reducing violence. Oops!&#8221;</p>
<p>This legislation will not reduce violence. It will increase the value of liquor licenses for private individuals or corporations that own existing licenses. It will also inconvenience taxpaying citizens that desire liquor products, especially those in growing areas such as Mission Bay that have yet to develop retail outlets. Why are these people to be inconvenienced with no liquor stores in their new community just because we have a stupid Supervisor?</p>
<p>Correlation does not indicate causation. At best, a high prevalence of liquor stores may be correlated with lower income or high violence, but in no way does the presence or lack of liquor stores serve as a cause or solution to violence.</p>
<p>Case 2</p>
<p>The original headline reads, &#8220;<a href="http://www.examiner.com/a-1235509~Bill_aims_to_maintain_rent_controlled_units.html">Bill aims to maintain rent-controlled units.</a>&#8221; State Senator <a href="http://en.wikipedia.org/wiki/Carole_Migden">Carole Migden</a> (D-San Francisco) introduced a bill Wednesday that would allow local governments to order property owners to replace every demolished rent-control unit with an equivalent rent-control unit somewhere else in the City.</p>
<p>The headline should read, &#8220;State Senator Carole Migden wishes to doom San Francisco to rental market failure hell ad infinitum in the mistaken belief that price ceilings are an effective tool to reduce rental unit prices instead of promoting incentives for builders and owners to increase supply. Oops!&#8221;</p>
<p><a href="http://kfarr.com/2007/10/20/i-want-to-pay-a-bit-more-rent-so-do-you/">Rent control is a price ceiling. Price ceilings don&#8217;t work.</a></p>
<p>Politicians, if this is the best you can do, please just stop making any new legislation. Go back to <a href="http://kfarr.com/2008/02/14/why-is-congress-wasting-its-time-aka-our-money-with-baseball-players/">scolding sports celebrities</a>.</p>
<p>By the way, this is a prime example of <a href="http://kfarr.com/2008/01/25/does-san-francisco-suffer-from-hippie-conservatism/">hippie conservatism</a>.</p>
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		<title>Why is Congress wasting its time (aka our money) with baseball players?</title>
		<link>http://kfarr.com/2008/02/14/why-is-congress-wasting-its-time-aka-our-money-with-baseball-players/</link>
		<comments>http://kfarr.com/2008/02/14/why-is-congress-wasting-its-time-aka-our-money-with-baseball-players/#comments</comments>
		<pubDate>Thu, 14 Feb 2008 22:33:17 +0000</pubDate>
		<dc:creator>kfarr</dc:creator>
				<category><![CDATA[econ]]></category>
		<category><![CDATA[media]]></category>
		<category><![CDATA[politics]]></category>
		<category><![CDATA[baseball]]></category>
		<category><![CDATA[congress]]></category>
		<category><![CDATA[corporation]]></category>
		<category><![CDATA[economics]]></category>
		<category><![CDATA[elected]]></category>
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		<category><![CDATA[public policy]]></category>
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		<guid isPermaLink="false">http://kfarr.wordpress.com/?p=236</guid>
		<description><![CDATA[I&#8217;ll admit right up front: I&#8217;m not sure what Congress actually does at their meetings in Washington. But, what I glean from an ear half-tuned to NPR is that it&#8217;s usually a discussion on legislation germane to American citizen&#8217;s lives and within the general jurisdiction of the legislative branch of our government. So then why [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=kfarr.com&blog=1892208&post=236&subd=kfarr&ref=&feed=1" />]]></description>
			<content:encoded><![CDATA[<p><img src='http://kfarr.files.wordpress.com/2008/02/clemens.jpg?w=500' alt='Roger Clemens wastes our time' /></p>
<p>I&#8217;ll admit right up front: I&#8217;m not sure what <a href="http://en.wikipedia.org/wiki/United_States_Congress">Congress</a> actually does at their meetings in Washington. But, what I glean from an ear half-tuned to NPR is that it&#8217;s usually a discussion on legislation germane to American citizen&#8217;s lives and within the general jurisdiction of the legislative branch of our government.</p>
<p>So then why are our elected officials spending so much time on the allegations of steroid use of baseball players?</p>
<p>Last I checked, the <a href="http://en.wikipedia.org/wiki/Major_League_Baseball">Major League Baseball</a> monopoly is a privately held corporation. Despite local decisions to support the construction of stadiums through significant public tax breaks and subsidies, MLB remains a large, arguably well-run, private corporation which often handles tough internal human resources issues such as substance abuse, as would any other large corporation with stringent performance contracts and important PR considerations.</p>
<p>So, I&#8217;ll return to my original question. Why are our elected officials spending so much time and effort on this issue?</p>
<p>As a lowly taxpayer and voter, I would rather our elected officials spend time and effort providing universal healthcare so that I can see the dentist without saving up for weeks on end or ending up in bankruptcy if, God forbid, I had cancer. Or, maybe they can work to reduce government spending so that the value of the dollars I earn doesn&#8217;t continue to endlessly nosedive. Or, maybe they can cut our losses in Iraq or tighten an unaccountable defense department that has a difficult time tracking its own purchases.</p>
<p>I guess all those public needs must wait until our elected public officials have fully dissected the internal HR substance abuse crisis of a privately held company. Gosh, how silly of me to even think this wasn&#8217;t mucho importante issue #1 for the American people.</p>
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