Krugman on Mobility and Inequality.


The chart is bigger here, (still hard to read), but it shows that the greater the degree of inequality the lower the potential of class mobility for an individual.

BY Paul Krugman, March 4th, 2014. Category: WORTHY,

The Real Poverty Trap

Earlier I noted that the new Ryan poverty report makes some big claims about the poverty trap, and cites a lot of research — but the research doesn’t actually support the claims. It occurs to me, however, that the whole Ryan approach is false in a deeper sense as well.

How so? Well, Ryan et al — conservatives in general — claim to care deeply about opportunity, about giving those not born into affluence the ability to rise. And they claim that their hostility to welfare-state programs reflects their assessment that these programs actually reduce opportunity, creating a poverty trap. As Ryan once put it,

we don’t want to turn the safety net into a hammock that lulls able-bodied people to lives of dependency and complacency, that drains them of their will and their incentive to make the most of their lives.

OK, do you notice the assumption here? It is that reduced incentives to work mean reduced social mobility. Is there any reason to believe this as a general proposition?

Now, as it happens the best available research suggests that the programs Ryan most wants to slash — Medicaid and food stamps — don’t even have large negative effects on work effort. There is, however, some international evidence that generous welfare states have an incentive effect: America has by far the weakest safety net in the advanced world, and sure enough, the American poor work much more than their counterparts abroad:

Great! So poor Americans aren’t condemned to lives of complacency that drain their wills — or at least not nearly as much as the poor in other countries. So we must have much more upward social mobility than they do, as our poor make the most of their lives, right?

Um, no.:

In fact, the evidence suggests that welfare-state programs enhance social mobility, thanks to little things like children of the poor having adequate nutrition and medical care. And conversely,of course, when such programs are absent or inadequate, the poor find themselves in a trap they often can’t escape, not because they lack the incentive, but because they lack the resources.

I mean, think about it: Do you really believe that making conditions harsh enough that poor women must work while pregnant or while they still have young children actually makes it more likely that those children will succeed in life?

So the whole poverty trap line is a falsehood wrapped in a fallacy; the alleged facts about incentive effects are mostly wrong, and in any case the entire premise that work effort = social mobility is wrong.


Breaking up Large Cities: Husock

Let’s Break Up the Big Cities, by Howard Husock

Civic Bulletin
No. 14 May 1998

Let’s Break Up the Big Cities

Howard Husock

Howard Husock is Director of Case Studies in Public Policy & Management at Harvard University’s John F. Kennedy School of Government. He is author ofRepairing the Ladder: Toward a New Housing Policy Paradigm, and has written forThe Wall Street Journal and The Public Interest.

* This Bulletin is adapted from a longer article in the Winter, 1998 City Journal.

The idea of metropolitan government—a single, benevolent, expert central administration for urban areas—has tempted efficiency-minded urban theorists for generations. Here, they’ve argued, is a way of bringing order to the chaos of central cities surrounded by a crazy quilt of independent suburbs. Yet across the country local activists have been rejecting the push to create bigger jurisdictions. They want to retain—or create—smaller governments, by seceding from existing city governments; by incorporating new, smaller jurisdictions carved out of larger ones; or by resisting annexation by larger governments. Most notably, in Los Angeles, the ValleyVote movement, with Governor Pete Wilson’s support, proposes to detach the entire San Fernando Valley (population: 1.2 million) from the rest of the city. Proponents say such a secession could come to a referendum vote in the year 2000.

The conflict between localism and metropolitan government is a clash not over form but philosophy of government. To liberals, localism reflects a greedy retreat from the commonweal, sacrificing the city for the short-term improvement of the suburbs. If the suburbs shared their often considerable riches, older, poorer neighborhoods wouldn’t decline into dilapidated urban ghettos. This view, the elite wisdom about secession and incorporation movements, is simply wrong. Localism is popular not because it promises a sweetheart deal for a few privileged suburbanites at the expense of the greater good, or because the unsophisticated fail to understand a demonstrably superior metropolitan approach. Instead, it rests on common sense—which economics and political science amply confirm. Voters’ common sense tells them that the closer they are to government, the more it will respond to their demands. They will see their hard-earned tax dollars spent on the kind of projects they prefer and will have a greater assurance that interest groups—such as public employee unions—will not usurp local government for the benefit of their own members, who may not even live in the city in which they work.

In fact, there are good reasons to go one step further. To improve older neighborhoods in older cities requires not a single, bigger government but increased numbers of smaller ones. Rather than expanding cities, we should break them up into an array of independent, neighborhood-based governments that would set their own property tax rates, elect their own officials, and give city residents the same control and sense of community that their suburban counterparts take for granted.

In Los Angeles, the secessionist movement makes just such arguments. The head of the ValleyVote movement is a commercial real estate broker named Jeff Brain. In his professional life, Brain rents out storefronts in this and other small strip malls along the length of Ventura Boulevard, one of the San Fernando Valley’s main streets.

Brain’s complaints are very specific. Most nights, only two police cars patrol his own community of Sherman Oaks, which, like other residential areas in the Valley, has its own name but not its own government. Sidewalk cleaning in the commercial areas along Ventura Boulevard is dismal, even though merchants pay extra fees to the city for a private contractor to do the work. Brain also resents the private school tuition he pays for his four children to keep them out of the giant LA Unified School District, with its unmanageable 800,000 students. Moreover, the city pays little for Valley road repair (only $4 million out of a $28 million budget), even though the Valley contains a third of the city’s total area. Look at the number of residents per City Council member, Brain complains: some 250,000 people per Council district. With fewer than 100,000 residents, nearby independent cities like Burbank and San Fernando have their own mayors and city councils, along with lower business taxes and an easier permit process. Brain looks enviously at older commercial main streets in these neighboring communities, where small beautification steps have paid big dividends by helping to attract and retain shoppers and businesses, while Van Nuys Boulevard, another of the Valley’s main drags, grows shabbier by the day.

For Brain, being too distant from local government to get anything accomplished is more than a metaphor. “In order to get something for our area,” he observes, “we have to go downtown. That’s an hour’s drive to start. Then we have to convince council members from all over the city. They say, ‘Why should you get something if my neighborhood doesn’t?’ Then you reach an impasse.”

Such frustration drove Brain to mount a successful campaign this past fall to persuade Governor Wilson to sign legislation allowing city neighborhoods to detach, without first getting the permission of their existing city councils. Next he’ll try to get the more than 100,000 petition signatures necessary to get a regional advisory board to examine the issue, as required by law. Brain expects the petition drive—and then the secession vote—to succeed. And he believes that large parts of Los Angeles will follow suit, seeking to detach and incorporate on their own.

The reason to believe that Brain and other incorporation and secession leaders are right begins with history—even though the metropolitanists assert that history is on their side. Americans historically have supported the creation of more local governments, not fewer. The formation of independent cities and towns fueled the explosive economic takeoff of the late 1800s; it defused tensions between immigrant and native born; and it allowed the upwardly mobile to build communities that reflected their hard-won new social status. Distinct ethnic and cultural groups established their own niches, as in the once “dry” towns of Pasadena and Compton, California, where Methodists for many years used local control to keep out alcohol. The lesson is crystal clear: independent jurisdictions are a crucial means through which a nation as diverse as the U.S. can develop a modus vivendi among peoples of wildly various backgrounds. Even as advocates (including the Department of Housing and Urban Development) beat the drums for metropolitan government, the number of local governments in the U.S. has kept rising. From 1952 to 1992, the number of municipalities grew from 16,807 to 19,279.

There’s no shortage of theory to explain why this long-standing American preference for localism makes sense. The key fact: we don’t all want the same things from our local jurisdictions. Those with small children may care most about education, unmarried joggers may want to spend public money on parks, and the tidy-minded may want the streets cleaned three times a week. Forty years ago, in a brief but classic essay, economist Charles Tiebout argued that local governments do more than coexist side by side. Instead, they compete with one another for residents by offering different packages of services. Of course, wealthier communities can provide more amenities than poorer ones; that’s part of the free-market incentive structure. But at equivalent income levels, governments can differentiate themselves, in terms of the kinds of services they offer and also the cost-efficiency with which they provide them. If they fail to provide what people want at reasonable cost, residents can “vote with their feet,” wrote Tiebout. When municipalities lose residents, property values fall, leaving remaining residents with a powerful incentive to figure out what’s gone wrong.

Daniel Elazar, Director of Temple University’s Center for the Study of Federalism, observes that some of the nation’s most smoothly functioning cities may owe part of their success to competition of this sort. Elazar notes that in the Bay Area, three flourishing midsized cities—San Francisco, Oakland and San Jose—compete (and also cooperate) with one another and with Silicon Valley towns like Palo Alto and Sunnyvale. Prosperous and efficient Minneapolis and St. Paul, along with a gaggle of nearby cities with populations between 100,000 and 150,000, do the same.

In other words, because of this anti-monopolistic mechanism, smaller—not bigger, as the metropolitanists contend—is more efficient. New research from the Institute of Government at Florida International University, located right in the middle of Dade County’s wave of incorporations, soundly debunks the big-is-efficient argument that is the linchpin of the metropolitanists’ case. Public administration professor Milan Dluhy examined the costs per resident for a wide range of core municipal services in metropolitan Dade County and in 24 “fragmented municipalities” within and around the county. Dluhy found that economies of scale existed in only two areas: fire protection and library services. Localities can provide all the other services—police, recreation, public works, waste management—at equal or         less cost.

In addition, as government jurisdictions get larger, control gradually melts away from voters; realizing the difficulty of influencing officials, and increasingly impotent against the organized electoral power of public employees, individuals give up: as Jeff Brain likes to point out, voter participation is much lower in the San Fernando Valley areas that are part of Los Angeles than in those that are independent municipalities. Growing voter apathy gives organized public employees and other special interests a clear field to advance their own agendas, while the higher campaign spending that comes with big government allows unions and government contractors to sway officials by providing campaign funds and volunteers.

Not only are metropolitanists mistaken when they assert that bigger jurisdictions are more efficient than smaller; they are equally in error when they claim that such jurisdictions promote growth better. The reverse is closer to the truth: metro government is more likely to discourage than to foster growth. Why? Consider what I’ll call the golden goose effect. Communities are willing to accept new development, the golden goose, so long as they can be sure of getting the golden eggs—strengthening their tax base and adding or improving such neighborhood amenities as schools, parks, or police protection. Metro government changes this whole calculation. Suddenly there is no guarantee that city hall will use new tax revenues the neighborhood generates to improve the neighborhood. A community’s incentives change dramatically. Suddenly new developments bring a guarantee of costs but not of benefits. Areas asked to accept the new industrial park may get no improved services or new school buildings; the additional tax revenue, if not simply swallowed up in the day-to-day administration of the consolidated government, may well be spent in other parts of the city—probably those with the most political clout, which will probably not be the poorer areas.

Helping poor neighborhoods is the real agenda for metro government, which at heart, its supporters believe, will help less by facilitating economic growth than by facilitating redistribution. Stripped of its pretenses about efficiency and economic growth, the metro movement turns out to be a campaign to support the growing package of social services that our big cities provide—what might be called the municipal welfare state. Those who have fled the crime and disorder of inner cities must be joined with those who have been “left behind,” metropolitan advocates argue.

Instead of promising more of the redistributionist machinery that has failed so roundly over the last generation, however, breaking up the cities holds out a more valuable promise to poor neighborhoods: it offers them the incentive and the means to encourage economic growth. Knowing for sure, as suburbs now do, that they will benefit directly from new investment, poor municipalities would try to make their business climate accommodating. Independent municipalities will have the option of limiting regulation and accepting employment-generating businesses, even waste-recycling centers or power plants, that middle-class areas may not want, but whose financial benefits a poor community might find well worth the costs. (State and federal health and safety standards would still  apply, of course.) Neighborhoods would have the incentive to find the highest and best use of their land and buildings.

Whatever the complications very poor neighborhoods pose to creating a system of independent city neighborhoods, though, they should not obscure the tremendous benefits that such a system would bring the vast majority of neighborhoods. Not the least of these would be the new political cultures that will have a chance to take root, more communal and truly democratic than today’s. Here’s how it would work.

Neighborhoods that already have their own, informal identity, and often their own zip codes, would become formal municipalities, empowered to set property tax rates, operate police and fire departments, make zoning and land-use decisions, pick up garbage, and clean and repair their own streets. This does not, mean, however, that each municipality will in fact do all these things. Like suburbs, they will provide some services themselves and contract out others to either a private firm or another public entity, typically a county. Over time, individual municipalities will doubtless figure out which services should remain local, which are better provided through joint effort, and what is the best way to pressure outside contractors to keep prices down. The costs and revenues of those services for which metropolitan economies of scale exist could be shared through special-purpose districts that would oversee airports, say, or libraries or arterial roads.

Some new municipalities wouldn’t have to raise all their tax revenue internally. New municipal boundaries might divvy up poor communities among more prosperous neighboring areas. Any municipal breakup campaign will have to recognize that some sort of regional revenue sharing will have to guarantee that all areas have  decent schools and adequate police and fire protection. But assuring, say, a floor below which school spending must not fall is a far cry from aiming at overall tax equalization. What percentage of tax revenues should be shared? And who should pay it? All communities above a certain income level? Only the winnowing of the political process can provide final answers to such questions.

This is a radical proposal, true. The neighborhoods of our big cities have long been bound together; residents think of themselves as New Yorkers or Chicagoans. But they also think of themselves as residents of Flatbush and Canarsie—and in that capacity they lack the means of exerting political control over the places they call home, in contrast to people short distances away who have, in effect, greater rights to influence where they live. Perhaps the strongest argument in favor of the unthinkable possibility of breaking up the cities is that the movement to do so has already, spontaneously, begun. Metropolitan advocate David Rusk has written that we should not consider the “political geography of mature metropolitan areas” to be “immutable.” Just so—but not in the way he believes.

What hit Calgary?

“The frequency with which Canada experiences events such as heavy rainfall of a given intensity (known as the return period), is projected to increase such that an event that occurred on average once every 50 years will be likely to occur about once every 35 years by 2050.”Telling the Weather Story, Insurance Bureau of Canada, 2012

My city, a vibrant place that often transcends the province’s narcissistic oil culture, has had a Manhattan moment.

We thought we were big and powerful and beyond humbling just like New York. But as every true cowboy knows, Mother Nature invariably has the last word.

And so Calgarians are now living a chronicle foretold by climate scientists.

Many once worked at federal agencies that the nation’s federal government ruthlessly axed in an ideological assault on science and reason.

My friends and neighbours have also experienced another extreme weather event that Insurance Bureau of Canada reported a year ago, “will likely result in continued flood risk throughout Alberta.”

Alberta, always a geography of maximum weather, is now climate change central in Canada due to exponential growth in human communities and all in the path of increasing floods, droughts, fires and hail storms.

Bad weather once racked up $100 million worth of damages every year about a decade ago. Today unpredictable events now create half a billion dollars in disasters almost every year.

Yet most Albertans still can’t believe the scale of the multi-billion disaster that has dampened Calgary and environs because affluence tends to dull the senses.

Tragedy, too, breeds its own strange brew of incongruities.

In Calgary a citizen can still down a cappuccino on 17th Ave. while watching fire trucks laden with yellow Zodiacs race to flooded homes just blocks away.


So here’s what happened in the semi-arid Bow River basin (four per cent of Alberta) and it was largely predicted by climate scientists and water experts: An “extreme” weather event fell upon us like some Texas belly washer, and left tens of thousands homeless. Damage will total in the billions.

The speed and scale of the event “stunned” Prime Minister Stephen Harper, a climate change skeptic, and it mortified Premier Alison Redford, whose deficit plagued government hasn’t budgeted for disasters, let alone the future. (One 2011 report catalogued Alberta’s reticence on the issue this way: “Leadership on climate change adaptation from senior levels in all departments is weak.”)

The Great Flood, which punched a giant hole in the TransCanada Highway in Canmore, swelled rivers and undermined infrastructure built for, well, a more stable and reliable climate. The flood also exposed some market-driven deceptions about geography and basic hydrology.

It seems that flood plains will fill with water in oil-rich Alberta, a truth most might find evident but one the province’s one-party government has tried to conceal from the public for years.

A 2006 Provincial Flood Mitigation Report even recommended that the province forbid the selling of flood plains to developers. But the one-party state deep sixed the report for five years and not make it public until 2012.

The freak storm, partly the product of the energy of spend carbon emissions, washed away landmarks, towns, homes, memories, roads, pipelines, wells and bridges. It broke precipitation and stream flow records.

First came scattered rainfall, which saturated the ground in the foothills. Then the skies greyed like a sick man with cancer. The air, redolent of water, hung with a heavy menace.

When the skies opened they delivered buckets of rain that seemed oddly tropical in their intensity.

Along the foothills 80 to 340 mL of water fell in a 24-hour period. Calgary alone broke a record and received 45 mL in a day.

Alberta’s sprawling cities suddenly rediscovered that mountain water moves downhill as fast as torrents ripped through Canmore and Bragg Creek first.

And then the Bow and Elbow rivers swelled, spilling their banks with three times more water than the so-called landmark flood of 2005. (Climate change seems to be all about scoring Olympic records in global weather.)

In it together

Many citizens including myself gathered at off-leash dog park above the Elbow River to gawk and stare at rising waters on Friday morning in Calgary.

It was a remarkable day because the force and volume of water in the city’s rivers brought much of Calgary’s oil economy to a standstill.

Due to road closures and flooding, curious cyclists took to the streets in record numbers too.

Save for the odd reconnaissance helicopter and emergency vehicle sirens, the city seemingly lost its vehicular bustle and grew quiet. The sound of flowing water became, for a day at least, Calgary’s loudest radio station.

The suspension bridge by Sandy Beach crumpled and collapsed in a muddy torrent.

The onlookers photographed the chocolate water of the Elbow with their phones like Japanese tourists as it whooshed its way into city neighborhoods inundating thousands of homes and the Stampede grounds.

Meanwhile the Bow River took on the shape of the Mississippi and shut down the downtown core of the city. Canada’s oil capital could be without power for days if not weeks.

Warnings unheeded 

As I watched with a mixture of sadness and horror (the energy of Mother Nature is unlike any mechanical energy) I recalled a long list of dry climate change reports and emotionless forecasts for Alberta.

In 2005 the Prairie Adaptation Research Collaborative promised warming temperatures, melting glaciers, variable rainfall, changes in stream flows, accelerated evaporation and more extreme events.

In 2006 climate scientist Dave Sauchyn told a Banff audience that “droughts of longer duration and greater frequency, as well as unusual wet periods and flooding” would be the new forecast. Meanwhile researchers documented a 26-day shift in the onset of spring in Alberta over the past century.

Five years later the Bow River Council concluded that “Our rapidly growing population demands much of the land and water. Our climate is changing and the future of our water supplies is uncertain.”

In 2010 the National Roundtable on the Environment and the Economy, an agency that the Harper government killed last year because it didn’t like its messages on climate change, reported that changing precipitation patterns were “the most common gradual, long-term risk from a changing climate identified by Canadian companies.”

In particular oil and gas firms “with operations in Alberta expressed the highest level of concern. A number of them described potential water shortages due to decreased precipitation and runoff as the most significant risk from physical impacts of climate change that they are likely to face.”

In 2011 the NREE published more inconvenient truths in a document called Paying the Price. It concluded that annual cost of flooding in Canada due to climate change could total $17 billion a year by 2050.

It added that “economic and population growth, coupled with anticipated effects of climate change, will impact Canada’s freshwater systems and create new pressures on the long-term sustainability of our water resources.”

Moreover rising temperatures will “affect precipitation patterns and evaporation rates, as well as the frequency, intensity, and duration of extreme weather and climate events like droughts, heat waves and storms.”

A building current

The redundancy of the reports is startling. A 2011 document on climate change’s impact on the Bow River warned that events could be far more severe than modern water management has previously experienced.”

And then came the kicker. In 2012 Insurance Bureau of Canada produced a report by Gordon McBean, an expert on catastrophes. It bluntly warned that Alberta “will be greatly affected by drought and water scarcity under changing climate conditions, and can expect potential increases in hail, storm and wildfire events.” Spring rainfall could increase by 10 to 15 per cent in southern Alberta too.

In addition to changing rainfall patterns, “Retreating glaciers and stream flows may create difficulty in providing potable water to Alberta’s rapidly increasing population, and water scarcity may constrain Alberta’s economic development.”

And the list of warnings and chronicles foretold goes on and on like the Bow River itself.

After Hurricane Sandy pulverized Manhattan last year,  New Yorkers realized that they lived at sea level and were extremely vulnerable to climate change. They also learned that placing electrical stations and emergency equipment in basements of buildings or at street level wasn’t smart thinking.

The city’s state of emergency convinced the governor of New York, Andrew Cuomo, that “anyone who says there hasn’t been a dramatic change in weather patterns is in denial.”


According to a recent Nature commentary by energy analyst Chris Nedler, a Google search now turns up more than one million hits “that mention both ‘Hurricane Sandy’ and ‘renewable energy.’ ”

Calgarians, who are as hardy and distinct as New Yorkers, might react in a similar way after the Great Flood of 2013. They may even reassess their government’s carbon-laden pipeline fantasies as well as the pace and scale of the tar sands.

If nothing else the city’s often arrogant elites have been reminded that province’s Chinese-style economic growth is vulnerable to extreme events. A crowded and overdeveloped province of four million is nowhere near as resilient as a province of one million. (By some estimates the province’s untamed growth could make Alberta a net water and food importer by 2050.)

A Great Summary by Andrew Nikiforuk.

happy-aboriginal-dayCalgary-FloodAlbertans have also learned that climate change delivers two extremes: more water when you don’t need it, and not enough water when you do. The geographically challenged have also become learned, once again, that water travels down hill and even inundates flood plains.

So climate change is not a mirage. Nor is it weird science or tomorrow’s news. It is now part of the flow of daily life.

Moreover there is a steep price to pay for inaction on the destabilizing pollution emitted by our proliferating energy slaves.

Calgary’s moment

Water scientist David Schindler, who has warned repeatedly about the extreme droughts and water scarcity that climate change is bringing to the prairies, summed up the whole messy situation in an email to The Tyee and BBC.

“Costs (from the flooding) will be in the billions, and human error is a good reason why, but for the most part it is due to underestimating and ignoring natural flow patterns, rather than the usual watershed modifications,” wrote Schindler.

“Could the wacky weather be part of what is predicted due to climate warming? Very possibly, but of course it is impossible to say so with any certainty.”

In any case Calgary has had its Manhattan moment.

Quinoa & False Repetition

Are we wrong to buy and eat quinoa? Are we hurting Bolivians and Peruvians?

There is a good piece on “The Quinoa Story” in Bear Witness:

Is the fact that foodies are buying quinoa up making things bad for the growers? Should we stop eating it? Bearwitness has its doubts.  They doubt the facts as presented and they suspect the motives of the piece from NPR. Their whole post (above) is worth reading.


And here is a good comment on that piece by Bart Hall (one of many) which paints a different picture than the NPR summary.

Bart Hall (Kansas, USA)20 January 2013 16:09

I’m an agronomist who speaks Spanish with near-native fluency and enough Quechua to be polite. Over the years I’ve worked extensively with quinoa growers in Bolivia, Peru, and Ecuador. If anything you understate your case against NPR. For most small farmers it is a wonderful opportunity to find cash markets for a product which grows well on your land, especially since quinoa isn’t a source of starch so much as a protein supplement.

The major Andean starches are potatoes, and in more remote areas a couple of unrelated tubers called oca and ulluco. At lower altitudes they eat more yuca, which is manioc, and (upland) rice. For protein they commonly eat mutton and guinea pig (which is delicious), along with faba beans, eggs, quinoa, some cheese and red beans. Pork, too, at lower elevations.

Many’s the time I have greatly enjoyed a simple meal of mot”e’e (potatoes and faba beans with firey lachwa sauce) and caldo de cuy (guinea pig stew) thickened with potatoes and quinoa.

The real food starch problem is in Mexico and Central America where the diet is largely corn-based. The American political ethanol boondoggle has driven corm prices so high the locals can’t afford it, so the do without. Not so in the Andes.


What is going on? Why are newspapers around the world building strong support for this erroneous story? The Guardian. The Globe. The New York Times.

The Globe story asks us whether or not we’d give up buying this? Why would it do that? Why are none of the major papers who have repeated this very dubious story done any back ground checking? Who put out the first press release? Why?