Archive for December 2008
At this time of year there are two types of story you can do. A review of the year gone by or a look at what lies in store.
I am resisting the review of 2008, simply because I rarely bother with reading things like that by others.
But two forecasts that popped up on Twitter this morning are worth looking at. James Howard Kunstler has a longish piece in the Straight, which takes his usual dyspeptic view of America’s future and underlines his earlier forecasts that have been fulfilled – such as the growing volatility of oil prices.
I am especially concerned about an “infrastructure stimulus” project aimed at highway improvement at the expense of public transit. This would be the epitome of a campaign to sustain the unsustainable. We need to begin planning right away for a transition away from automobiles, not in order to be good socialists but because Happy Motoring is at the core of our unsustainability trap. The car system is going to fail in manifold ways whether we like it or not, and it will fail due to circumstances already underway.
He is of course talking about the new US administration – but it applies equally here. Despite his profession of being green with his “carbon emissions levy” (First in Canada!) Gordon Campbell is still pressing ahead with the Gateway. As long as he can get it funded.
The introduction of the carbon tax has also allowed his minion Kevin Falcon to back down from the “no new taxes” mantra – and even the vehicle levy looks like making a comeback as way of digging Translink out of the financial pit it has dug for itself. Jeff Nagel in his blog post today speculates about how that will play out with the Mayors – and what that could mean. One possibility is that Falcon has to come clean and actually take responsibility for his decisions. And the “new” idea is that the levy if it is introduced will be a “value proposition” – it will give some kind of break on transit fares to those who have to pay it. Which only goes to show that these people never ever learn from their own mistakes. This thing could have the worst elements of UPass added to its appeal – yeah, that’ll work!
For those of you who have stayed with me through the ups and downs of 2008, thankl you for your loyalty and continued interest. 2009 is not going to be an easy year either but at least we have the chance of seeing some change in Victoria as well as in DC – and quite possibly in Ottawa too. We can but hope for a more progressive approach here in BC and in Canada.
Please be safe tonight and let someone else drive – transit is free after 5pm
A strike is imminent in BC’s ports – and this piece does some breast beating about how bad that would be. But buried in the middle of the story is this gem
Local 514 workers have been without a contract since March 2007
I am not going to take sides in a dispute I know nothing about, but we have to recognize brinkmanship when we see it. Nearly two years have been allowed to go by. And no doubt negotiations have been tough – but somebody at that table was certainly pushing things beyond reasonable limits. And pointing to the current state of the economy is just pure politics
In a letter recent letter to federal labour minister Rona Ambrose, [Vancouver Port CEO Gordon] Houston said a strike would “significantly impact most of Canada’s west coast supply chains at a critical time in our economic history.”
In other words he is preparing the way to push for legislation to get the strikers back to work – once we get parliament back in session.
Of course there is always the other way. Actually bargain in good faith and come up with a compromise with disatisfies each side equally – you can’t always get what you want, but if you try you can get what you need.
The last two weeks have been a winter weather nightmare for Vancouver, with huge dumps of snow followed by rain, heavy slush and flooding. All over the city, people are griping about the toll storm after storm has taken on their holiday season.
But they’re asking another question, too: what if it happens during the 2010 Winter Olympics?
Really? Was that top of mind when you were stuck for an hour waiting for a SkyTrain at metrotown? Or when you were unable to get around on the North Shore because of bus reroutes?
I suppose at least it is welcome that there is some acknolweldgement that some organisations are admitting they were not that well prepared.The airport for example – “We have already ordered a couple of extra pieces of snow-clearing equipment for 2010″ – tho0ugh I am not sure that a couple of pieces is quite enough. I think some variable sign messages at the east end of Sea Island would be useful too, to divert people to lots where there are parking spots instead of wasting time in line ups trying to get out of lots that have no space available.
The city’s transit system will be different in 2010, with more buses and a new subway line that won’t be affected by weather because most of it runs underground, said Ken Hardie,
But that new subway emerges from its tunnel at Marine Drive and then is in the open all the way to both Richmond Centre and the airport. And the short platform lengths mean the SkyTrain method of operating longer trains with a driver are not an option for the Canada Line.And while they may be more new buses, will there actually be funding in place to ensure that they will be operating
But my real point is that Olympic readiness is frankly a minor headache. We can expect the weather to get steadily worse. Yes we came near to breaking records this year – but the idea that this is exceptional is wrong headed. When climate changes, precedents are no longer a guide as to how to proceed. Steering the ship by staring at its wake is pretty stupid. Because the planet is warmer now, there is more energy driving the weather systems. Because the ocean is warmer, currents are changing. This means that more severe weather events are inevitable – and they will of progressively greater severity. We have done nothing very much to reduce our contribution to this process, and failed this year to agree to do anything different. And the scientists are now admitting that their earlier forecasts were far too conservative as they left out a number of feedback mechanisms.
It is now too late to stop this process. But it does mean we have to revisit our contingency plans and get ready for a different weather pattern than the ones we have been using for event planning. And I for one have very little confidence in organsiations which admit that their plans are dependent on divine intervention. But mostly planning should not be what to do for the Olympics but what to do to make sure the place does not come to a grinding standstill for days on end when confronted by entriely predictable worsening weather conditions.
This is an important story and has quite a significant impact on what I have been writing about recently. If there is a “credit crunch” it means that qualified borrowers could not get credit. The banks – and other lenders – would not be lending to anyone, and this would have a very significant drag on the economy. Now no-one is arguing that the economy has tanked – it is more about why, because that then determines what should be done about it.
Economist Dean Baker … explains the situation in simple terms: The media, he argues, “are blaming the economic collapse on a ‘credit crunch’ instead of the more obvious problem that consumers just lost $6 trillion of housing wealth and another $8 trillion of stock wealth.” It’s a commonsense argument: much of the economic growth of the Bush era existed on paper only, built on the rise of a massive bubble in real estate values rather than growth in productive industries. When all that ephemeral wealth vaporized — and with the economy shedding jobs like a dog with dermatitis — consumers stopped buying, and businesses, anticipating a long slowdown, stopped seeking the loans that they might have otherwise tapped to expand their operations.
This is the first time I have seen this argument. There has been quite a bit of controversy over the bailout. Most of it is anger that the banks seem to have been rewarded for their irresponsibility, that the public sector now has to bear the brunt of the bad mortgage loans and bankers continue to enjoy their private jets and huge bonuses. Mneanhwile the automakers – who actually build things – were treated to very much closer scrutiny and are expected to report back on how they use the money. This was not the case for Wall Street.
If good projects cannot get regular financing then P3s become unfinanceable even if they are backed with taxpayer’s money. But it now seems the banks not only have money – they are also willing to lend it but no one has been asking to borrow. Furthermore banks need to lend – since that is how they make most of their money – gouging customers with transaction fees being only a small share of their highly profitable business. The amounts they are now paying depositors are negligible but the interest rates they levy on loans are fabulous. Especially credit cards.
But I have been so far taken in by the “credit crunch” story – and believed that this would make getting P3 financing both difficult and expensive. Well it now seems that it will be easier than I thought. Though still expensive compared to what governments can borrow at – since the credit ratings of those who can dip at will into the taxpayers’ pocktes are much better than any private sector consortium. P3s have proved to be much less rewarding for taxpayers than their promoters like to pretend, and many of the supposed benefits – particularly greater efficiencies and risk transfer – failed to appear.
There is now a marked shift in governments’ willingness to incur indebtedness. Even Stephen Harper concedes that deficit spending will be necessary to fight the current recession. And most economists now agree that the reason FDR did not cure the Great Depression with his New Deal was that he did not spend enough, and his deficits prior to the war were at about the same level as his ineffective predecessor, Herbert Hoover.
But increasing public spending only boosts the economy in the construction phase. The project itself has to be worthwhile for there to be continuing benefits. If the project does not meet a real need, and provide genuine benefits to the community as whole then paying of the loans (whoever took them out) just becomes a drag – as the benefits have to exceed the costs for the project to be considered worthwhile. This is why cost benefit analysis remains central to project appraisal, and why it must be done properly and objectively.
Whatever else anyone says about the Gateway project, the CBA was certainly not objective – and it is very difficult to take any of the claims made for it seriously. It is based on a series of assertions and projections which seemed dubious at the time they were made but now seem wildly improbable. So the fact that the government will probably be able to build these projects may seem a good idea now, but won’t for very long. Not only will we be paying for this mistake for a very long time – but we will also have lost, once again, the opportunity to invest in a sensible measures to improve transit in this region. Which always should have been the first priority but has always fallen behind the mega-project ribbon cutting opportunities which so obsess our politicians.
So I will concede that I was probably wrong to state that the P3s will not get funded by the banks. But that does not mean I was wrong about anything else about this daft idea. Pointless public works – like digging holes and the filling them up again in earlier government make work projects – are bad enough. Willfully wrong headed projects which encourage the use of private cars and the further sprawl of the suburbs are much, much worse. And frankly, the current projections of increasingly rapid climate change and the coming crunch of peak oil mean that the Gateway is going to be seen around here as a disaster. Unless some cataclysmic nature event overtakes it.
If you travel through YVR you can get real time departure and arrival information. You can also get an update on current conditions – there is a box labelled “latest information”. At the time of writing – 14:00 on Saturday December 27 that information reads “Winter Weather Disrupts Flights [Last updated on 12/24/2008 at 9:44:12 AM] “
Nothing at all about the mess on the ground. Airports are of course intermodal – but all the web site cares to keep updated is the flight times – nothing else. It might be useful to know, for instance, that there is no hourly parking – or even any space left in the economy lot – before setting off to the airport. That was certainly the case at 12:30 today – and could well still be the case for all I know.
Of course everything is going to be so much better once the Canada line opens – but that is small comfort for those trying to get family members onto flights today. Currently they seem to working normally – just the usual level of delays and cancellations, and most of those outside the purview of YVR.
Of course it is too much to expect that surface parking lots – such as the economy lot in the central loop – actually have some snow cleared. Or some of the illegally parked cars in the driveways towed to some remote corner of the long term lot. Indeed many cars seem to have been left in the economy lot for a long time as many have significant snow loads on their roofs.
At least the parking attendant did not attempt to charge me for the time I spent fruitlessly looking for a parking spot. Why the lot had not been marked as full only some higher authority at YVR knows. I suspect the answer is simple neglect. Once there is snow on the ground there is too much running around to do. And of course there is no system in place to signal this information to those thinking they will be able to use these lots.
WASHINGTON — The U.S. Surface Transportation Board on Wednesday approved a merger of rail companies, in a move designed to relieve rail and auto traffic congestion in the Chicago area.
The board unanimously approved the Canadian National Railway Co.’s purchase of the Elgin, Joliet & Eastern Railway Co. from U.S. Steel Corp. Canadian National offered to pay $300 million for the line and spend another $140 million to upgrade the line and help communities mitigate the traffic impacts.
There was a lot of politicking around this one – but it came down to some communities against others. And despite the “threat” that the election of Barack Obama was supposed to pose to the deal, common sense prevailed.
This will also be good news for Prince Rupert – as the route from there to the midwest will now see significant time savings.
Frances Bula in the Globe and Mail reports that developers in BC are thinking about building new rental apartments instead of condos. Given a vacancy rate of 0.5% and steadily rising rents, that may not be a bad idea. This type of development practically ceased in Canada in the 1970s when federal tax incentives for apartment buildings were ended.
A couple of things occurred to me. The first is that even in the boom times, many condos were not being bought by occupiers – many were speculative “flippers” – and others were bought for the purpose of letting. In fact some strata councils introduced rules forbidding rentals (like mine) as way of “keeping out the riff raff”. There is a lot of the rental market which is distinctly grey – suites that do meet the building code and may well not be reported for tax purposes. Many municipalities have decided to abandon the idea of enforcement against illegal suites, recognising that they serve an essential social function, but still worry about the health and safety aspects of spaces being used for human occupation that fail to meet even the most basic standards.
Secondly the operation of rental units actually requires a lot of professional skill and attention – but usually does not get it. Big developers like Cressey still have significant rental holdings. But the way the legislation has been changed by the present government has removed much of the protection tenants once had. And this has done very little so far to bring new units onto the market. The most recent major news in this sector has been the forced eviction of tenants by owners claiming the need for vacant possession to renovate, but actually being cover for stiff rent increases. The law currently allows landlords to raise rents every year up to a specific limit. There is, of course, no provision for tenants to keep rents down or get them reduced.
Under the old law as a tenant of a Cressey property I became an unwilling expert in the workings of the provincial agency that was supposed to regulate tenancies. I spent quite a bit of time and effort in quasi-litigation just to get the place where I lived looked after properly. The work that had been done just before we moved in was simply cosmetic and was designed to c0ver up problems that has been left unrepaired for years. The worst was the simple failure to ensure that tiles in the bathroom were properly grouted. After long rounds of visits to the Landlord and Tenant offices – and paying rent into escrow – the landlord finally brought in contractors who had to replace the bathroom floor and the kitchen ceiling – but not before trying to blame me for leaks which had been going on for years before I arrived. It was an abrasive and unpleasant experience. But all I wanted them to do was look after their property properly. Cressey, of course, was much more interested in its new developments for sale. It is a lot easier to blame the tenants for everything – and harass them – than actually try to ensure that you have adequately maintained units.
There is a great deal of prejudice against tenants. One of the people I used to commute with in Victoria was appalled that, as a tenant, I had the right to vote in municipal elections. Very few landlords are as good as the last one I had, who went out of his way to ensure I was comfortable. He is one of the very few I have known who recognised that his interests and mine interlocked. I am fairly certain that this Vancouver Craig’s List ad is a spoof but who knows.
It is probably too much to expect that many municipalities will get into this business. Though the developers are suggesting they need incentives “temporarily forgoing property taxes or development charges” – and even expecting the province to get involved. The market may well actually work for a while without these kinds of support. But what is equally clear is that the market has grotesquely failed – and that is evident by the homelessness problem. And the market is generally not at all interested in getting into “social housing”. Although, of course, there have been and are those only too willing to try and exploit the homeless too. And it seems the current political atmosphere here is still stuck in 19th century attitudes to the poor that prevent us from doing what we could do to help in terms of a wider variety of tenures and support mechanisms.
What is really sad is so many of the people who could be moving us to become a more inclusive and caring society will be in churches this week, singing carols and talking about a homeless family forced to occupy a stable and give birth to a child among the animals. Their political philosophy seems to get hung up on the idea that only private acts of charity have any moral value. Yes it is very good to work in a food bank or give out blankets and warm jackets at this time of year. But we do that every year and it never changes – the need is, if anything, growing. Our politicians need to get their heads around the idea that a decent home and an adequate social safety net are indeed Canadian values that we cherish and expect our governments – at all levels – to rebuild. And soon.
I think that is probably a good point to stop blogging and go enjoy the holiday myself. I trust that all of you who read this blog will have a safe and happy holiday – and not have to spend too much time stuck at airports.
Quite a good piece from the Province that got copied to the Financial Post on Rail for the Valley. Mostly positive, but oddly neglectful “the Golden Ears Bridge and other improvements” is hardly a adequate way to deal with the Gateway and the present government’s determination to make sure we get lots more freeways but no trains – and that is supposed to contribute to reducing greenhouse gas emissions! But then that may be the only way to a story like this into the Asper’s papers.
He is right about one thing. This will be big issue in the upcoming election just as it was in recent municipal elections