So how’s that liberalism working out for you Charlotte?

A few months ago Kyle Wingfield of the AJC wrote a column about the unhealthy habit many Atlantans have developed of pointing to Charlotte, North Carolina as an example of what we need to do here. Below is a sample:

One thing I’ve noticed since moving back to Georgia is how many people here spend an inordinate amount of time fretting about North Carolina, and specifically Charlotte. They’re building high-speed rail in North Carolina. They’re building light rail in Charlotte. They’re spending more money on incentives to lure businesses. They just landed the Democratic National Convention in 2012.

(Notice how many of the supposed superiorities in our northern neighbor concern left-wing causes; you don’t hear much about North Carolina leading the way in cutting red tape or privatizing inefficient state-government functions.)


A little background: Even with things going so swimmingly in North Carolina — at least according to some people here in Georgia — the state’s voters just saw fit to turn out the majority party (the Democrats) in both chambers of the legislature. It’s the first time the state’s senate has been out of Democratic control since 1870.

And now a few facts that may help explain the political upheaval:

  • During the 2009 through 2012 fiscal years, North Carolina has had bigger budget shortfalls than Georgia all four years in absolute terms, and in three of the four years as a percentage of the state’s budget. This year, their budget shortfall is projected at $3.8 billion to our $1.7 billion.
  • North Carolina’s unemployment rate, at 9.8 percent, is just about the same as our 10.2 percent.
  • North Carolina was cited by the Tax Foundation as having one of the nation’s 10 worst business tax climates; Georgia is in the middle of the pack at No. 25.

The reason I bring this up again is that this weekend I saw an interesting post about Charlotte’s Mecklenberg county on Twitter:

House hunting in SC 2day. Our property taxes going up $2000 next year. $2000 tax increases might be fine in NJ & CA. Bye, bye MeckCo & #CLT

So a metro Charlotte resident is going to move across state lines because their taxes just went up $2000 a year in a horrible economy? Huge tax increases in Charlotte? That couldn’t be right… could it? Well it is according to a blogpost titled Our 6.3% Property Tax Increase:

By the time you read this our top elected local Socialist – I’m writing of course about Jennifer Roberts –  will have graciously presented you with a 6.3% property tax increase. We now have a property tax rate of $.8166 per $100 of accessed property. A revenue neutral rate would have been $.7678 per $100. This 6.3% increase will soak you for another $50 MILLION. For some reason the percentage increase was never mentioned by that bastion of journalistic integrity – The Charlotte Observer – in their breathless advocacy for the tax increase prior to Tuesday’s budget vote by the BOCC.

If you live in Charlotte (85% of Mecklenburg County residents) you have already been the highest taxed individual in North Carolina for the past ten years.In the FY 2009 budget year (last available statistics), Charlotteans were clipped on average $2,360. The median average in North Carolina was $1,304. That’s a mere 44% difference if you’re mathematically inclined. Thanks to Roberts, you are padding your lead.

One of the leading bastions of liberalism in the Southeast is now raising taxes during an economic depression because they have to pay for the expensive policies that many influential Atlantans want to duplicate. Makes me glad I live in Alpharetta, Georgia. My property taxes will actually decrease this year.

So how’s that liberalism working out for you Charlotte?

Is transportation the new housing?

Kyle Wingfield wrote a column discussing crony capitalism in the case of Fannie Mae that gave me an epiphany of where the next government created disaster will occur.

Kyle’s column explored the idea that political elite of both political parties in the United States have been guilty of spending taxpayer money to benefit themselves, their friends and their supporters. Wingfield used Fannie Mae to point out that the crony capitalism inherent in our current political system is the driving force behind our nations rush toward bankruptcy and that the backlash to this unsustainable trend has given birth to the Tea Party movement. I suggest you read the whole column here.

One particular section of Kyle’s column struck me because I see a clear parallel between what occurred with Fannie Mae and what is now going on with the sudden rush to subsidize transportation and transit projects with more taxpayer money. Below is the section I am referring to:

Fannie Mae co-opted relevant activist groups…. Fannie ginned up Astroturf lobbying campaigns….

Fannie lavished campaign contributions on members of Congress. Time and again experts would go before some Congressional committee to warn that Fannie was lowering borrowing standards and posing an enormous risk to taxpayers. Phalanxes of congressmen would be mobilized to bludgeon the experts and kill unfriendly legislation.

Fannie executives ginned up academic studies. They created a foundation that spent tens of millions in advertising. They spent enormous amounts of time and money capturing the regulators who were supposed to police them.

A government entity co-opting activist groups, ginning up academic studies and spending tens of millions of taxpayer dollars to finance astroturf lobbying campaigns? Well that might have happened when Fannie Mae spent hundreds of millions creating a housing bubble that drove this nation into a depression…. but something like that couldn’t happen again. Could it?

Surely government organizations like the Federal Department of Transportation, Federal Transit Authority and the Environmental Protection Agency would never spend hundreds of millions of dollars promoting ideas and policies that will lead this nation further down the path toward bankruptcy… would they? Well according to the Center for Transportation and Livable Systems:

The U.S. Department of Transportation supports a network of University Transportation Centers throughout the nation to advance technology and expertise in transportation through combined efforts of research, education, and technology transfer. Within the federal SAFETEA-LU legislation, the Center for Transportation and Livable Systems (CTLS), formerly the Center for Transportation and Urban Planning, was designated the University of Connecticut’s University Transportation Center in August 2005. CTLS began its first year of operation in 2007 and since then has supported dozens of researchers and students through its research activities and helped inform the public and the scientific community in its workshops, seminars and symposia.

The theme of the Center for Transportation and Livable Systems is Livable and Sustainable Transportation Systems for Smart Growth — a holistic theme that incorporates walking, bicycling, transit and automobiles in an integrated multi-modal system

But that must be an isolated example. It’s not like the federal government would spend $175 Million on some ridiculous initiative to expand transit into low density suburban and rural communiites. Would it? Apparently so according to this press release on the Federal Transit Authority website: 

U.S. Transportation Secretary Ray LaHood today announced the availability of up to $175 million in livability grants to help urban, suburban and rural communities develop transit options to better connect people to where they live, work and play.  Local transit agencies will be able to compete for livability dollars from the pool of up to $175 million. The competitive grant program will
begin accepting applications when announced in the Federal Register during the week of June 20.

It seems everywhere I look there are indications that the federal government along with many state and local officials have begun the process of screwing up America’s transportation infrastructure the same way they managed to destroy the nation’s real estate industry. But it isn’t just politicians. It is also their cronies in the infrastructure and real estate development industries that are helping to create this mess.

Remember the first scandal to break for Georgia’s new Speaker of the House, David Ralston, back in 2010? Maybe a clip from this AJC article will refresh your memory:

House Speaker David Ralston and his family spent part of Thanksgiving week in Europe on a $17,000 economic development mission paid for by lobbyists interested in building a high-speed train line between Atlanta and Chattanooga.

Commonwealth Research Associates, a D.C.-based consulting firm, paid for the trip, which also included Ralston’s chief of staff Spiro Amburn and his spouse, to Germany and the Netherlands the week of Nov. 21-27, according to records filed with the Georgia Government Transparency and Campaign Finance Commission, formerly known as the State Ethics Commission.

The trip was the most expensive single expenditure reported by a lobbyist since at least 2005.

Coincidentally another article explains that Speaker Ralston is now proposing that the state of Georgia use the train those lobbyists wanted as leverage in the water wars between state of Tennessee and Georgia:

Georgia’s House speaker says leaders from his state need to sit down with Tennessee officials and discuss trading transportation enhancements for access to the water in the Tennessee River.

During a recent radio interview with WABE-FM in Atlanta, Speaker David Ralston, R-Blue Ridge, said his state might be willing to offer improved rail, roads or other links between Chattanooga and Georgia air and sea ports in exchange for access to the river.

Isn’t that special? Sure is funny how the push for inefficient and unbelievably expensive trains shows up in the oddest places.

Between the early 1990’s and 2008 the federal government along with willing accomplices at the state and local level worked hand in hand with banks, governmental agencies, developers, builders, land speculators and a host of other cronies to create a real estate bubble that has staggered this country. In the process a lot of people made a lot of money at the taxpayers’ expense.

I see many of the same people doing almost the exact same thing now. The only difference is that now they are salivating over the billions of dollars to be made from creating a transportation bubble.

So the question I leave you with is this: Is transportation the new housing?

The public transportation money pit in perspective

*Editors note:Please read the update posted below the original article*

The AJC has started a series of articles designed to give a comprehensive assessment of Georgia’s transportation situation as the state decides whether to raise taxes in the hope of solving the state’s transportation problems. The first article in the series is titled Atlanta at heart of area’s transit issues and you can read the whole thing here.

As the AJC continues their series I will examine their coverage from my own perspective and today I want to focus on the paragraph below because it illustrates beautifully how the absurd inefficiency of public transportation and the resulting cost to taxpayers is overlooked by proponents as well as those responsible for covering transportation issues.

One thing Atlanta wants to do, if the project makes the final list, is pump $861 million into 
MARTA to bring the “system into a state of good repair.” Tom Weyandt, Atlanta’s senior policy adviser for transportation, said MARTA currently has a $1.6 billion backlog on repair projects.

The current MARTA sales tax costs Dekalb and Fulton County taxpayers more than 300 Million Dollars a year but the system still has 1.6 Billion Dollars  worth of maintenance projects that they can’t afford to pay for? In these days of trillion dollar federal deficits people have become completely desensitized to astronomical numbers but let us take a moment to put 1.6 Billion Dollars in perspective. This is what 1.6 Billion Dollars looks like: $1,600,000,000.00.

According to the 2010 census there are now 420,000 people living in the city of Atlanta so that 1.6 Billion Dollars would be $3,809,524 for every person that lives in Atlanta. So after decades of collecting tens of billions of dollars in sales taxes, MARTA needs almost 4 Million Dollars from each man, woman and child in the city of Atlanta just to stay running! Since the average person in Atlanta makes about $50,000 a year, each resident would have to work 76 years just to pay for the repairs that MARTA already needs but it wouldn’t even begin to expand capacity, improve service or reduce congestion in any way.

The numbers being tossed around by public transportation advocates aren’t just numbers, they are money that has to be collected from people that are suffering double digit unemployment along with plummeting property values and skyrocketing prices for food and gas. Politicians and bureaucrats may treat numbers with nine zeros in them like play money but taxpayers are the ones that have to pay the bill so we need to keep this money pit in perspective.


Update 5/23/2011 7:30 p.m.

As some of you may have noticed my math on the post above was off by almost a trillion dollars and the result was a post which exaggerated the projected per capita cost to Atlanta residents a thousand-fold. Oops! It was a silly mistake which occuured because my calculator wouldn’t function in the billions and in my haste I incorrectly adjusted the numbers twice. I’d like to thank Michael Hadden for pointing out my error.

I do find it ironic that while trying to show how difficult it is to put transportation spending in perspective I actually ended up proving the point by illustrating how easily an error of 1000 percent could go unnoticed. I apologize for my carelessness and will immediately refund each of my readers a prorated share of their subscription fee. 😉

Racial diversity in Alpharetta? Duh!

This article in the Atlanta Journal reports that census figures show black families are migrating from urban centers in the south to the suburbs in large numbers. To that shocking revelation my response is “Duh!”.

The example given in the article is that of the Taylor family which recently moved from Atlanta to the city of Alpharetta. The story describes the family’s decision to move like this:

Among the new black suburbanites are Ray Taylor, 34, and his wife, Marcia, 33. Four years ago, they moved from Atlanta to the northern suburb of Alpharetta, Ga., about 20 miles away, seeking better schools and a wider range of community activities. They now have two small children, ages 4 and 1.

Taylor, a political independent who voted for Democrat Barack Obama in 2008, said he also liked having more exposure to people of different racial and political backgrounds. Compared with Atlanta, Alpharetta has a broader mix of whites and Hispanics and tends to lean more Republican.

“We wanted to be close enough to access the city and have the best of both worlds,” he said.

The story about the Taylor family is pretty much the same as that of the Tramonte family I wrote about last week other than the race of the people involved. In fact the only thing truly surprising about the Taylor family’s story is that Associated Press considered their race to be newsworthy at all. Anyone that attends public schools in North Fulton or goes shopping at Northpoint Mall already knows that Alpharetta is as culturally diverse as most of Atlanta’s inner city neighborhoods but I guess that is still news to people that don’t live here.

Welcome to Alpharetta Mr. and Mrs. Taylor. Based on your criteria for selecting a home you have chosen wisely and rest assured that you are surrounded by people that share many of your values regardless of political affiliation or skin color. Alpharetta is a terrific place for your family and I hope your children spend many happy years calling this home.

GA 400: Atlanta’s Information Highway

Yesterday I wrote about the distribution of Atlanta’s high wage workers and low wage workers as reported by the Atlanta Regional Commission. Not surprisingly the maps showed that the overwhelming majority of high wage earners in the metropolitan area live in the wedge formed between I75 and I85 on the North side of Atlanta.

That was interesting but not surprising. What I found more interesting and definitely more surprising was that is a big difference in the types of high wage earners that reside inside the perimeter (ITP) and those that live outside the perimeter (OTP). And counterintuitively I found that the higher earning professionals were actually more concentrated OTP.

As you can see on the map below the vast majority of people described as professional, scientific and technical workers live ITP in Buckhead or Dunwoody. According to the report this would include lawyers, accountants, architects and presumably doctors since the area includes Pill Hill where many of Atlanta’s hospitals are concentrated. Just like the location of high earners in general I found that interesting but not surprising.

What I found surprising was that the overwhelming majority of so-called “information” workers actually live outside the perimeter in North Fulton and South Forsyth county. The information workers are described as internet, telecommunications and data processing professoinals and according to the chart they average almost 20% higher monthly salaries ($6900 mo./ $5800 mo.) than the more traditional professionals who choose to live inside the perimeter.

It’s widely known that Alpharetta has many computer, telecommunications and data companies located here but I was really surprised to see that so few of these professionals choose to live downtown. Maybe they got tired of paying the tolls?

Perhaps we should change GA 400’s nickname from the Hospitality Highway to the Information Highway. Who came up with that silly Hospitality Highway in the first place?

(click to enlarge)

When your adversary is making a fool of himself, get out of the way

Kyle Wingfield had another great column in the AJC this week about the unhealthy obsession many Georgians have with what is going on in North Carolina. It is a great article and it I have noticed the same phenomenom.

To put it simply there are a lot of liberals in Georgia that are constantly harping about the way Charlotte, NC is beating us to the punch in adopting liberal policies. Of course many of these policies are currently driving the states of California, Illinois and New York into bankruptcy but that doesn’t seem to worry them as much as the possibility of Atlanta without more trains.

You can read all of Kyle’s column here.

Lyndon Johnson once said “When your adversary is making a fool of himself, get out of the way”. I hope Georgia’s political leaders heed that thought.

Atlanta real estate is still struggling to find bottom

AJC reporter Michelle Shaw has a piece in today’s paper which relays the latest grim news about Atlanta’s real estate market. The headline sums it up well, “Metro home prices, sales plunge”.

The article says that single family home sales for October were down 10.6% from last year and that in the first six months of the year foreclosures were 23% of sales in the Atlanta metro area. Ms. Shaw does a good job of painting a realistic picture so you should read the whole thing:

Some of the people interviewed even hint that real estate is in a cycle of deflation. Deflation means that buyers are holding off on purchases because they expect prices to fall and then because the buyers are holding out, the sellers are forced to lower prices. Deflation sounds good for buyers but it can be a stubborn, self fulfilling prophecy with devastating long term consequences. At first the lower prices would be good for buyers. But eventually the constant decrease in prices would be devastating to homeowners, banks and businesses. Eventually the new home buyers would find themselves suffering from lower wages that were brought on by the same deflation they had earlier welcomed.

A fear of that deflationary cycle explains why the federal reserve has decided to pump money into the economy even though food, gas and other necessities are already going up in price. Printing more money is going to make inflation worse but the fed seems more concerned about real estate deflation than they are about overall inflation.

Real Estate will rebound. It’s just a matter of time. But the market still has to hit bottom before we can have a real recovery and unfortunately there just isn’t any evidence that we have hit bottom yet.