Tag Archives: housing

IHOP Has Cut Back Its Menu By 30 Items

by Adolph7467 Posted on September 18, 2014

Mother Jones

Here’s an interesting factoid: in 2008 we apparently reached Peak Menu. That year, the average menu contained 99.7 items. Then the housing bubble burst, we entered the Great Recession, and menus began to shrink. Today’s menus feature a paltry 92.6 items.

Why is this? Cost is one reason: it’s cheaper to support a smaller menu. But Roberto Ferdman writes that there’s more to it:

The biggest impetus for all the menu shrinking going on is likely tied to a change in the country’s food culture: Americans are becoming a bit more refined in their tastes.

“Historically, the size of menus grew significantly because there wasn’t the food culture there is today,” said Maeve Webster, a senior director at Datassential. “People weren’t nearly as focused on the food, or willing to go out of their way to eat specific foods.”

For that reason, as well as the fact that there were fewer restaurants then, there used to be a greater incentive for restaurants to serve as many food options as possible. That way, a customer could would choose a particular restaurant because it was near or convenient, rather than for a specific food craving (which probably wasn’t all that outlandish anyway). But now, given the increasing demand for quality over quantity, a growing appetite for exotic foods and a willingness to seek out specialized cuisines, Americans are more likely to judge a restaurant if its offerings aren’t specific enough.

“The rise of food culture, where consumers are both interested and willing to go to a restaurant that has the best Banh Mi sandwich, or the best burger, or the best trendy item of the moment, means that operators can now create much more focused menus,” said Webster. “It also means that the larger the menu, the more consumers might worry all those things aren’t going to be all that good.”

Hmmm. Let me say, based on precisely no evidence, that I find this unlikely. Have American tastes really gotten more refined since 2008? Color me skeptical. And even if American palates are more discriminating, are we seriously suggesting that this has affected the menu length at IHOP, Tony Roma’s, and Olive Garden—the three examples cited in the article? I hope this isn’t just my inner elitist showing, but I don’t normally associate those fine establishments with a “growing appetite for exotic foods and a willingness to seek out specialized cuisines.”

So, anyway, put me down firmly in the cost-cutting camp. Long menus got too expensive to support, and when the Great Recession hit, casual dining chains needed to cut costs. They did this by lopping off dishes that were either expensive to prep or not very popular or both. Occam’s Razor, my friends, Occam’s Razor.

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IHOP Has Cut Back Its Menu By 30 Items

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What Marc Andreessen Gets Wrong About Our Future Robot Overlords

by KareemLalonde Posted on June 25, 2014

Mother Jones

Marc Andreessen recently wrote a widely shared post about how robots will change the economy. The Netscape founder turned mega-venture-capitalist predicts that we’re headed toward a future when robots do our grunt work, launching a “Golden Age” where humans are freed from wage-grubbing to do “nothing but arts and sciences, culture and exploring and learning”:

Housing, energy, health care, food, and transportation — they’re all delivered to everyone for free by machines. Zero jobs in those fields remain…It’s a consumer utopia. Everyone enjoys a standard of living that kings and popes could have only dreamed of…Since our basic needs are taken care of, all human time, labor, energy, ambition, and goals reorient to the intangibles: the big questions, the deep needs. Human nature expresses itself fully, for the first time in history. Without physical need constraints, we will be whoever we want to be.

Andreessen is not the first to daydream about this scenario. My colleague Kevin Drum has written about it extensively, and he shares some of Andreessen’s optimism about what this world might look like:

Global warming is a problem of the past because computers have figured out how to generate limitless amounts of green energy and intelligent robots have tirelessly built the infrastructure to deliver it to our homes. No one needs to work anymore. Robots can do everything humans can do, and they do it uncomplainingly, 24 hours a day. Some things remain scarce—beachfront property in Malibu, original Rembrandts—but thanks to super-efficient use of natural resources and massive recycling, scarcity of ordinary consumer goods is a thing of the past. Our days are spent however we please, perhaps in study, perhaps playing video games. It’s up to us.

Also, read our brief history of awesome robots.

Basically, it’ll be pretty sweet. But both Andreessen and Drum caution that this consumer utopia is at least several decades away, and getting there will be a bumpy ride until we come up with new ways for people to get the things they want and need. Because unlike the original Luddites, the British artisan weavers who protested the Industrial Revolution by ransacking garment mills, only to find new work running the machines, huge swaths of today’s workforce aren’t wrong to suspect a dead end ahead. “The Digital Revolution is different,” Drum says, “because computers can perform cognitive tasks too, and that means machines will eventually be able to run themselves. When that happens, they won’t just put individuals out of work temporarily. Entire classes of workers will be out of work permanently.” Which means many of us are headed for Hooverville 2.0, a possibility that Andreessen doesn’t disagree with, at least in the short term.

So how best to brace ourselves for that hiccup on the road to utopia? Here’s where Drum and Andreessen part ways. In Andreessen’s vision, we “create and sustain a vigorous social safety net” for the economically stranded. Sounds great, but how do we pay for it? He veers into late-night infomercial territory here: “The loop closes as rapid technological productivity improvement and resulting economic growth make it easy to pay for the safety net.” The machine will pay for itself!

In other words, robots make everything faster, easier, and better, so humans will make more money selling goods and services, and we’ll all end up with more dimes to spare for those still finding their feet in the robot-powered economy. So we shouldn’t listen to the “robot fear-mongering” about machines coming to eat our jobs—the robot revolution is also a personal-tech revolution, and iPhones and tablets are new reins on the global economy:

What never gets discussed in all of this robot fear-mongering is that the current technology revolution has put the means of production within everyone’s grasp. It comes in the form of the smartphone (and tablet and PC) with a mobile broadband connection to the Internet. Practically everyone on the planet will be equipped with that minimum spec by 2020. What that means is that everyone gets access to unlimited information, communication, and education. At the same time, everyone has access to markets, and everyone has the tools to participate in the global market economy.

Yet plenty of people are less worried about job-stealing robots than the people who will own the robots. As technologist Alex Payne points out, using a smartphone doesn’t mean you’ve got your hands on the “means of production.” Using a robot will never be fractionally or profitable as owning a robot, or a robot factory, or the data center that stores the information collected by the robot. “The debate, as ever, is really about power,” argues Payne. And it’s no secret that a narrow segment of white and Asian males currently occupies nearly all the ergonomic chairs at that table.

Drum has no doubt that robots are in fact coming to eat our jobs, and it’s the folks with the social and financial capital to buy robots that will call the shots: “As this happens, those without money—most of us—will live on whatever crumbs the owners of capital allow us.” If the robot-owning 1 percent of tomorrow is anything like today’s, then there is little indication that they’re willing to share their spoils. Take a look at this chart of productivity versus worker wages over the last 60 years. Productivity has been shooting up, helped in no small part by greater efficiencies thanks to technology. But worker pay hasn’t been rising alongside these productivity gains:

So where’s all the extra money, the “resulting economic growth” from all this “rapid technological productivity improvement” that Andreessen promises? It’s parked in the pockets of the 1 percenters. Here’s how the share of income is divided between capital owners—the people who own the technology—and labor:

Drum says these metrics are a few of the economic indicators that make up the “horsemen of the robotic apocalypse” in which “capital will become ever more powerful and labor will become ever more worthless.” The other indicators are fewer job openings, stagnating middle-class incomes, and corporations stockpiling cash instead of investing it in new goods and factories. These don’t look so hot, either:

Drum points to a couple of options economists have floated to fend off the robotic apocalypse. The first is redistribution through taxing capital: The wealthy robot owners will employ a few laborers to churn out massive amounts of goods and services, and government turns over a cut of their profits to displaced workers, who spend their days buying the products made by the wealthy’s robots. But corporate execs are likely to fight higher taxes, despite the obvious downsides of an impoverished consumer base. In any case, many of us would probably prefer real jobs to “enforced idleness.” Still, says Drum, “the ancient Romans managed to get used to it—with slave labor playing the role of robots—and we might have to, as well.”

Redistribution could play out in a couple other ways. If people can no longer expect to get by on their brawn or their wits, Drum suggests that government steps in and gives each child a handful of stocks, or maybe a robot of their own—something to give everyone a stake in the sweat-free economy. Other options have been suggested, like Jaron Lanier’s idea of Big Data paying users in “micro-payments” for letting them collect and use our data. But here, too, the linchpin is corporations and their owners’ willingness to share.

The rest of Andreessen’s solutions are straightforward. First, make sure everyone has access to technology and education on how to use it. I’ve argued extensively for the latter, and Drum sees it as a no-brainer. Second, “let markets work” so that “capital and labor can rapidly reallocate to create new fields and jobs.” Yet unless reallocation is the new corporate-speak for fairly redistributing profit, there’s simply no way the rest of us humans won’t get creamed by our robot overlords.

Additional research and production by Katie Rose Quandt and Prashanth Kamalakanthan.

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What Marc Andreessen Gets Wrong About Our Future Robot Overlords

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An Update From Our 1 Percent World: Southern California Housing Edition

by genestrong2484 Posted on April 16, 2014

Mother Jones

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The LA Times reports that the Southern California housing market is once again getting frothy:

But a deeper look at the market reveals a recovery divided between the rich and everyone else.

The market for high-dollar homes is hopping, with sales on the rise and buyers launching bidding wars. But sales of low- to medium-priced homes have plummeted during the same period — with many potential buyers priced out….Those declines came even as sales of high-end homes increased. Sales of homes costing $800,000 or more grew 12%, while sales of homes costing less than $500,000 fell at twice that rate.

….”We’re getting multiple offers on just about everything,” said Barry Sulpor, an agent with Shorewood Realtors in Manhattan Beach, where he said there is a new wave of tear-downs and new construction in prime beachfront locations. “The market is really on fire.”

I think partly this is a bit of a statistical artifact: a lot of investors were buying cheap houses a year ago, figuring they could rent them out and make a killing. That didn’t work out so well, and now a lot of those houses are back on the market. Long story short, some of the increase in low-end housing prices over the past year or two has been a bit of an investor-fueled mirage, and now reality is catching up to that.

Still, the overall picture is clear: At the lower end of the market, ordinary people have been increasingly locked out for a while, and that’s still the case. Nor is it any surprise. After all, median wages have stagnated during the entire period that we so laughingly refer to as a “recovery.” As always in our brave new 1 percent era, things are going pretty well for the rich. For the not-so-rich, not so well.

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An Update From Our 1 Percent World: Southern California Housing Edition

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10 Things Elizabeth Warren’s Consumer Protection Agency Has Done For You

by BraydenUqe Posted on March 14, 2014

Mother Jones

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The Consumer Financial Protection Bureau (CFPB), the watchdog agency conceived of and established by Sen. Elizabeth Warren (D-Mass.) in the wake of the financial crisis, had a hard time getting on its feet. The GOP tried everything it could to hobble the bureau, but to no avail. Over the past couple of years, the CFPB has issued dozens of protections shielding consumers from shady practices by mortgage lenders, student loan servicers, and credit card companies. Here are ten things the CFPB, which was created in 2011, has done to protect the little guy:

1. Mortgage lenders can no longer push you into a high-priced loan: Until recently, lenders were allowed to direct borrowers toward high-interest loans, which are more profitable for lenders, even if they qualified for a lower-cost mortgage—a practice that helped lead to the financial crisis. In early 2013, the CFPB issued a rule that effectively ends this conflict of interest.

2. New homeowners are less likely to be hit by foreclosure: In the lead-up to the financial crisis, lenders also sold Americans “no doc” mortgages that didn’t require borrowers to provide proof of income, assets, or employment. Last May, the bureau clamped down on this type of irresponsible lending, forcing mortgage lenders to verify borrowers’ ability to repay.

3. If you are are delinquent on your mortgage payments, loan servicers have to try harder to help you avoid foreclosure: During the housing crisis, loan servicers—companies that collect payments from borrowers—were permitted to simultaneously offer a delinquent borrower options to avoid foreclosure while moving to complete that foreclosure. New CFPB rules force servicers to make a good faith effort to keep you out of foreclosure. That’s not all: Loan servicers will now face civil penalties if they don’t provide live customer service, maintain accurate mortgage records, and promptly inform borrowers whose loan modification applications are incomplete.

4. Millions of Americans get a low-cost home loan counselor: In Jan 2013, the CFPB required the vast majority of mortgage lenders to provide applicants with a list of free or low-cost housing counselors who can inform borrowers if they’re being ripped off.

5. Borrowers with high-cost mortgages get an outside eye: Lenders who sell mortgages with high interest rates are now required to have an outside appraiser determine the worth of the house for the borrower. If a borrower is going to be paying sky-high prices for a fixer-upper, at least she’ll know it beforehand.

6. Fly-by-night financial players will be held accountable: Part of the CFPB’s mandate is to oversee debt collectors, payday lenders, and other under–regulated financial institutions that profit off low-income Americans. The bureau is preparing new restrictions on debt collectors, and considering new regs on payday loan industry. In the meantime, the bureau is cracking down on bad actors individually.

7. Folks scammed by credit card companies get refunds: In October 2012, the CFPB ordered three American Express subsidiaries to pay 250,000 customers $85 billion for illegal practices including misleading credit card offerings, age discrimination, and excessive late fees. This past September, the CFPB ordered JPMorgan Chase to refund $309 million to more than 2.1 million Americans for charging them for identity theft and fraud monitoring services they didn’t ask for.

8. Student lenders face scrutiny: The CFPB oversees private student loan servicing at big banks to ensure compliance with fair lending laws. In December, the agency announced that it will also start supervising non-bank student loan servicers, which are companies that manage borrowers’ accounts. Many of these servicers have been accused of levying unfair penalty fees and making it hard for borrowers to negotiate an affordable repayment plan.

9. Service members get extra protection: In June, the CFPB ordered US Bank and its non-bank partner Dealers’ Financial Services to refund $6.5 million to service members for failing to disclose fees associated with a military auto loan program. In November, the CFPB ordered the payday lender Cash America to pay up to $14 million for illegally overcharging members of the military.

10. Consumers get a help center: If your bank or lender does anything you think is unfair, the bureau has a division dedicated to fielding consumer complaints. The agency promises to work with companies to try to fix consumers’ problems.

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10 Things Elizabeth Warren’s Consumer Protection Agency Has Done For You

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Why Is Paul Ryan Attacking Poverty Programs? He Needs to Tell Us Loud and Clear.

by ValentinBunbury Posted on March 5, 2014

Mother Jones

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Paul Ryan released a thick report on federal poverty programs earlier this week, and liberals were none too pleased with it. Over at CBPP, Sharon Parrott explains why: “It’s replete with misleading and selective presentations of data and research, which it uses to portray the safety net in a negative light. It also omits key research and data that point in more positive directions.” In fact, it’s so bad that quite a few of the researchers who are name checked in Ryan’s report have spoken out publicly to complain about how badly their work was misrepresented.

But we should rein in the criticism a bit, says the Economist’s John Prideaux. He believes that Ryan’s report really is useful and really could represent a change of direction for conservatives:

In fact there is not a single proposal to cut spending on federal anti-poverty programmes in there. What the report does do is document how fragmented the federal government’s poverty programmes are….Take the federal schemes to expand the supply of housing for people with low incomes. There is Public Housing, Moving to Work, Hope VI, Choice Neighborhoods, Rental Assistance Demonstration, Rental Housing Assistance, Rental Assistance Payment, the Housing Trust Fund, the Low Income Housing Tax Credit, the Private Activity Bond Interest Exclusion, the HOME Investment Partnerships Program and the Self-Help Homeownership Opportunity Program. The programmes on the demand side, in other words that help people pay their rent, are almost as numerous.

….Most of the commentary on the budget committee’s report suggests that it is filled with the same stuff that Republicans have been peddling for ages. And to be sure it includes plenty of studies that are critical of food stamps, Head Start and Pell grants. But read the whole thing and you get the impression that there are House Republicans who understand that there is more to poverty reduction than getting the government out of the way. They should be braver about saying this.

I think this gets to the heart of the matter. Even conservatives—the more honest variety, anyway—will concede that liberals have plenty of reasons to be skeptical of Ryan’s goals. His annual budget roadmaps have consistently relied on slashing spending for the poor, and Republicans in general have been consumed with cutting safety net spending for decades. It’s perfectly natural to view a report that lambastes federal poverty programs as merely the first step in an effort to build support for cutting spending on those programs.

So how about if we see some of Prideaux’s bravery before we bite on Ryan’s proposals? Liberals should certainly be open to making safety net programs more efficient, and if that’s Ryan’s goal he’ll find plenty of Democrats willing to work with him. But that all depends on knowing that this isn’t just a Trojan Horse for deep cuts to spending on the poor.

So how about if we hear this from Ryan? How about if he says, plainly and clearly, that he wants to improve the efficiency of safety net programs, but wants to use the savings to help more people—or to help people in smarter ways—not as an excuse to slash spending or to fund more tax cuts for the wealthy? Really, that’s the bare minimum necessary for liberals to suspend their skepticism, given Ryan’s long history of trying to balance the budget on the backs of the poor.

This would require a genuine turnabout from Ryan, and it would require him to genuinely confront his tea party base with things they don’t want to hear. And it would demonstrate that helping the poor really is his goal. But if he’s not willing to do that, why should anyone on the left believe this report is anything other than the same old attack on the poor as moochers and idlers that’s become practically a Republican mantra over the past few years?

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Why Is Paul Ryan Attacking Poverty Programs? He Needs to Tell Us Loud and Clear.

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Is This the Beginning of the End for Solitary Confinement?

by abram Posted on February 27, 2014

Mother Jones

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Minors, pregnant women, and the developmentally disabled can no longer be placed in solitary confinement in New York State prisons (barring exceptional circumstances) thanks to an agreement between the New York Civil Liberties Union (NYCLU) and the New York State Department of Community Corrections (DOCCS) on February 19. The agreement will require the state to develop sentencing guidelines and maximum isolation sentences for the first time, and will make it the largest US prison system to ban the use of disciplinary solitary confinement for minors.


Solitary in Iran Nearly Broke Me. Then I Went Inside America’s Prisons.


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VIDEO: Shane Bauer Goes Back Behind Bars at Pelican Bay

See more MoJo coverage of solitary confinement.

The agreement came just days before Sen. Dick Durbin (D-Ill.) called for the end of the use of solitary for certain vulnerable individuals at a high-profile congressional hearing on Tuesday. The hearing featured testimony from activists, corrections officials, and former inmates, including Orange is the New Black author Piper Kerman, who stated: “Solitary confinement impedes access to important pre-natal and women’s health care services. In fact, pregnant women in solitary confinement often receive no medical care. And yet, pregnant prisoners in America are still sent to the SHU Special Housing Unit.”

New York is not the only state taking steps toward solitary confinement reform. Last week, Colorado Department of Corrections executive director Rick Raemisch, who has committed to lowering Colorado’s solitary confinement rate to less than 3 percent of the state’s prison population, penned a New York Times Op-Ed about his own experience in willing isolation for a night. At an early February meeting of corrections professionals, Mike Dempsey, who runs the Indiana Department of Corrections’ Division of Youth Services, discussed his state’s reduction of juveniles in solitary confinement from 48 beds—with some minors serving 24-month sentences—to 5-10 with a maximum sentence of 24 hours. Earlier this month, California, home to last year’s massive prisoner hunger strike, held a hearing on the use of solitary confinement—though ultimately prison advocates were unsatisfied with the Department of Corrections and Rehabilitation’s proposed regulations.

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Is This the Beginning of the End for Solitary Confinement?

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Miami and Los Angeles Sue Banking Giants Over the Sub-Prime Mortgage Debacle

by Traci B. Jackson Posted on December 23, 2013

Mother Jones

Some of the cities hardest hit by the sub-prime mortgage crisis are fighting back with lawsuits against the banks whose lending fueled the collapse of the housing market. Most recently, the city of Miami filed three separate suits against Wells Fargo, Bank of America, and Citigroup, claiming their lending practices violated the federal Fair Housing Act and cost the city millions in tax revenue.

The cases, all of which were filed in the Southern District of Florida, focus on the banks’ treatment of minority borrowers. According to the city, minority residents were routinely charged higher interest rates and fees than white loan applicants, regardless of their credit history. They were also stuck with other onerous terms—such as prepayment penalties, adjustable interest rates, and balloon payments—that increased their odds of falling into foreclosure.

It’s no secret that some big banks discriminated against minority borrowers during the housing bubble. Racial bias ran so deep inside Wells Fargo’s mortgage division that employees regularly referred to subprime mortgages as “ghetto loans” and African American borrowers as “mud people,” according to testimony from former bank officials. In 2011, Bank of America paid $355 million to settle a Justice Department lawsuit, charging that its Countrywide Financial unit steered hundreds of thousands of minority borrowers into predatory mortgages.

Lawyers for the city of Miami, which is roughly 60 percent Latino and 20 percent African American, argue that these discriminatory practices are one key reason that the fallout from the sub-prime lending frenzy hit the city so hard. “The State of Florida in general, and the City of Miami in particular have been devastated by the foreclosure crisis,” reads the city’s complaint. “As of October 2013, the State of Florida has the country’s highest foreclosure rate, and Miami has the highest foreclosure rate among the 20 largest metropolitan statistical areas in the country.” The city is seeking compensation for the drop in real estate tax revenue due to foreclosures, which have further depressed property values, and for the cost of providing municipal services to abandoned homes.

In a written statement to the Miami Herald, Wells Fargo called the discrimination claims “unfounded allegations that don’t reflect our corporate values,” while Citigroup insisted that it “considers each applicant by the same objective criteria.” Bank of America also defended its lending practices as fair and said it had “responded urgently” to assist customers during the financial crisis.

Miami isn’t the first city to take on the banking giants. Earlier this month, Los Angeles—which claims to have lost more than $78 billion in home value due to foreclosures—sued Citigroup, Bank of America, and Wells Fargo on the same grounds. Richmond, California, a working-class Bay Area suburb, plans to rescue borrowers whose mortgages are underwater by seizing their properties using eminent domain. Homeowners will remain in their homes and be given new loans for amounts that reflect current values. And the city will have a fighting chance of shoring up its dwindling tax revenue. It’s a good deal for everyone—except the bankers behind the housing implosion.

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Miami and Los Angeles Sue Banking Giants Over the Sub-Prime Mortgage Debacle

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Larry Summers, Secular Stagnation, and the Great Investment Drought

by Lubomyr21t Posted on November 18, 2013

Mother Jones

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This weekend Paul Krugman lavished immense praise on a presentation that Larry Summers gave to the IMF a few days ago, and I’ll confess that I’m a little puzzled by this. Not because it wasn’t a good presentation. It was. But it’s quite short and basically just tosses out an idea without really elaborating on it much. Here’s the idea: we might be in a permanent condition of slow economic growth—i.e., secular stagnation.

The evidence Summers presents is pretty straightforward: during the aughts, we had a huge housing bubble, and yet the economy still performed only listlessly:

Too easy money, too much borrowing, too much perceived wealth. Was there a great boom? Capacity utilization wasn’t under any great pressure. Unemployment wasn’t under any remarkably low level. Inflation was entirely quiescent. So somehow even a great bubble wasn’t enough to produce any excess in aggregate demand.

That’s true enough, and you can argue that this is a new thing. As recently as the late 90s, the dotcom bubble did produce a boom and did push employment to very high levels. That in turn put pressure on employers to offer higher wages, and sure enough, wages went up.

But the housing bubble, despite being even bigger than the dotcom bubble, did no such thing. As Summers says, it didn’t produce high employment; it didn’t push wages up; and it didn’t get the economy running at full capacity. And today, six years after the bubble burst and four years into recovery, with the world’s financial plumbing once again functioning just fine, the economy still isn’t running at high capacity. What’s up?

When I’ve talked about this before, I haven’t framed it as a problem of the natural interest rate going below zero, as Summers does. Instead, I’ve usually framed it as a problem of an investment drought. There simply aren’t enough promising real-world investments available, which means that lots of money is either sitting on the sidelines or else getting diverted into financial rocket science.

Now, in one sense, this is just two ways of saying the same thing: there aren’t enough promising real-world investments at current interest rates. It doesn’t matter that real interest rates are already negative. Reduce them even further, and more investments will look like winners. And yet, if Summers is right and this is a permanent condition,1 we’re still left with a question: what happened to produce a world in which, for an extended period of time, even negative interest rates aren’t low enough to make real-world investments attractive in sufficient quantities to get the economy humming?

The answer matters, because it determines our response. Krugman mentions demographics as one possible answer: slowing population growth means slower economic growth. Another possibility is increased automation: as machines take over more and more work, there are fewer jobs available and less income to spend. There’s also Tyler Cowen’s great stagnation thesis. Or the possibility that increasing income inequality means that the future will have fewer and fewer middle-class buyers to power a consumer economy, and investors know it. Or perhaps, as Jared Bernstein suggests, the culprit is the financialization of America (and the world):

I wonder if the key is “secular,” as in sector, as in sectoral misallocation. Many observers of the US economy have worried about the impact of financialization—the relative growth of the finance sector—on growth. Part of the concern is the bubble machine, and part is the devotion of considerable resources to non-productive activities.

And the misallocation is profound. Who out there thinks financial markets are playing their necessary role of allocating excess savings to their most productive uses? Anyone?

Not me. And yet, I wonder if this is really something that can be blamed on Wall Street? I’m all for reining in the size of the financial sector, but I confess to thinking that there must be something deeper than this that underlies our problem. Wall Street would happily allocate more money to real-world investment opportunities if the demand were there. But it’s not, even with essentially free money. For some reason, the investment community doesn’t believe that expanding production of real-world goods and services to maximum levels will pay off. If Summers is right, this is not a temporary condition that can be solved with monetary policy, it’s a permanent change in the economy. But why? One way or another, the answer has to get back to the real world. That’s where everything starts.

1Something that’s still up in the air. Usually, when bad economic times last long enough, people start to thing they’ll last forever. Ditto for good economic times. It may be that we’re just in an usually bad recession and need more time to pull out. However, the evidence of the aughts really does suggest that something happened to the economy starting around 2000, which means it’s been going on for an awfully long time.

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Larry Summers, Secular Stagnation, and the Great Investment Drought

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In This One California Town, New Houses Must Come With Solar Power

by Christinef76 Posted on April 22, 2013

A house in Lancaster, California gets a solar power retrofit. Photo: KN6KS

A desert terrain, a southerly latitude and a “colorful mayor” have joined forces to turn Lancaster, California, a city of around 150,000 that lies northeast of Los Angeles, into the solar capital “of the universe” says the New York Times. The city, says Geek.com, “now officially earned the distinction of being the first US city to mandate the inclusion of solar panels on all new homes built within the city limits.”

Technically the solar powered mandate isn’t so hard and fast, and builders have a bit of wiggle room. Starting January 1st, either they can build solar panels into their designs, producing one kilowatt of electricity for each city lot, or the builders can buy a “solar energy credit” to offset their non-energy-producing ways—money which would go to fund larger solar developments.

The city’s push into solar, says the Times, is being spearheaded by its Republican mayor Robert Rex Parris.

His solar push began about three years ago; City Hall, the performing arts center and the stadium together now generate 1.5 megawatts. Solar arrays on churches, a big medical office, a developer’s office and a Toyota dealership provide 4 more.

The biggest power payoff came with the school system. After the Lancaster school board rejected an offer from SolarCity, saying it was unaffordable, the city created a municipal utility. It bought 32,094 panels, had them installed on 25 schools, generated 7.5 megawatts of power and sold the enterprise to the school district for 35 percent less than it was paying for electricity at the time. Another 8 megawatts now come from systems operating at the local high school and Antelope Valley College.

Parris’ goal for Lancaster, says a 2010 story from the Los Angeles Times, is to see the city “produce more energy than we consume before 2020.”

More from Smithsonian.com:

Island Nation Now Runs Entirely On Solar Power

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In This One California Town, New Houses Must Come With Solar Power

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During the coldest week in decades, some Sandy-damaged homes still don’t have heat

by Pauline80x Posted on January 25, 2013

During the coldest week in decades, some Sandy-damaged homes still don’t have heat

By Philip Bump

It has been 87 days since Hurricane Sandy hit the Northeast. The past three of those days have fallen during the coldest week in New York City in 17 years.

From The New York Times:

As the region suffers through a brutal cold snap this week, with temperatures so punishing that uncovered slivers of flesh feel like paper cuts and the slightest wind can send a chill through the teeth like a Popsicle, the best solution seems not to leave home. But for many people whose boilers were flooded by seawater during Hurricane Sandy and still languish, awaiting repair, home is as frigid as the outdoors.

Residents who have made do with cold homes under extra blankets and triple socks since the storm hit in October face new challenges as the thermometer continues to dip. Temperatures this week have been about 10 to 15 degrees lower than midwinter averages, according to the National Weather Service, and are expected to slide into the teens over the next few nights, and could even fall into the single digits in parts of the region.

As of Tuesday, New York City’s Rapid Repairs construction teams had restored heat, hot water or power to 12,247 residences in 7,112 buildings, according to Peter Spencer, the spokesman for the Mayor’s Office of Housing Recovery. But work is continuing in an additional 1,893 buildings, a substantial portion of which, Mr. Spencer estimated, remain without heat.

Daniel Choi’s house doesn’t have heat, the Times reports. Neither does Devon Lawrence’s. Retired nurse Hazel Beckett is warming bricks on her stove to stay warm.

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Breezy Point, Long Island.

Most of the still-powerless homes are in the areas of New York along the coast, the neighborhoods deluged by storm surge: the Rockaways, Staten Island, Breezy Point. For years before the storm hit, these were the neighborhoods understood to be most at risk, but little was done to prepare them. Now New York Gov. Andrew Cuomo (D) is reluctant to rebuild in them. Again, the Times:

“There are some parcels that Mother Nature owns,“ he said earlier this month in his official State of the State speech. “She may only visit once every few years, but she owns the parcel and when she comes to visit, she visits.”

To deal with such intrusions, the governor wants to give homeowners in these areas a choice. New York will help them rebuild a better house — on stilts, for example, higher than future floodwaters. Or they can sell what’s left of their homes to the state and move to higher ground.

Details of his proposal — called the Recreate NY-Smart Home program — are still being worked out, and it is hard to say how many New Yorkers will take him up on his offer to relocate. It is also hard to know how much money Mr. Cuomo will be able to spend per house, since this program will be part of a larger Sandy package that includes protecting subways and utilities and creating a fuel reserve to manage future gas lines.

Should Cuomo need ready-made stories in his push for smarter rebuilding, he could turn to elderly Hazel Beckett and her warmed-up bricks. This is a scene that should never have happened — much less three months after the fact.

Philip Bump writes about the news for Gristmill. He also uses Twitter a whole lot.

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During the coldest week in decades, some Sandy-damaged homes still don’t have heat

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