ThinkProgress Logo

Yglesias

The Undersupply of Noisy Mexican Restaurants

A coalition of NIMBYs living in an expensive apartment building near Logan Circle are upset about a proposed plan to increase business activity in their neighborhood:

It’s worth looking at the costs and benefits here. If Tortilla Coast opens, it will presumably be employing people. That’s a good thing for those people, and at the margin in general it’s good for the earnings prospects of working class people in Washington, DC. What’s more, both the income earned by the workers at Tortilla Coast and the sales generated by Tortilla Coast will be taxed by the DC government. That will allow more generous social services or lower tax rates throughout the District of Columbia. And note that the magnitude of these impacts is directly related to the question of how late Tortilla Coast is allowed to stay open, and to whether or not it’s allowed to operate an outdoor cafe. Both longer hours and more seats will increase the number of customers Tortilla Coast is able to serve, and thereby will increase the overall volume of employment and sales generated by Tortilla Coast. These are citywide impacts, with citywide implications and it’s perverse that the conventional policymaking dynamic treats the question of Tortilla Coast’s operating hours as a purely local concern.

Of course it’s true that the people living on the block will be more directly impacted by the rest of us. But there’s a problem of citywide aggregation here. After all, any proposed new business has to be located somewhere in particular. And even though we might all want less business activity directly outside our doors, we also might all want more business activity citywide. Certainly I think we all claim to want lower unemployment, higher incomes, more generous social services, and lower tax rates and it’s difficult to achieve those things without more business activity.

Another thing to consider from a citywide policy framework is that if a noisy Mexican restaurant opens on the corner of 15th and P and people find it unpleasant, it’s hardly as if the block is going to become a desolate wasteland. A 1,300 square foot condo on the block in question is currently selling for $780,000. Under the circumstances, introducing a noisy Mexican restaurant to the neighborhood might be considered affordable housing policy. Certainly it’s not obvious to me why, as a matter of citywide policy, we would want to put a high weight on protecting the investments of wealthy real estate owners. Progressives have become very interested over the past decade in the ways in which the political system exacerbates inequality but are often a bit negligent when it comes to identifying precise mechanisms. But what we have here on a small scale is an effort to reduce the demand for working class labor in order to maintain elevated asset price values.

Climate Progress

Kyl Defends Taxpayer Subsidies For Richest Oil Companies

Appearing on Fox News Sunday with Chris Wallace, Sen. Jon Kyl (R-AZ) argued that budget talks should not include the reduction of oil and gas subsidies. Kyl, who abandoned budget negotiations with the White House this week, claimed that eliminating $2 billion in annual subsidies for the richest oil companies — instead of slashing programs that feed the poor and protect the middle class — would “hurt the American consumer”:

First of all, if you want gas prices to rise and pay more than $4 at the pump, go ahead and do this. That is not what we should be about right now. That kind of tax increase is going to flow right to the consumer. Everybody knows that. Secondly, you are picking out one industry in the United States, an industry that employs almost 10 million people, represents 7.5% of the Gross Domestic Product. You’re saying to them you are not going to get the same tax treatment that all other manufacturing corporations get in the United States. So we’re going to punish you, because you make a lot of money. It’s also true with those big profits, they have enormous costs of investment. Of course, you covered the issue of how much it costs to put one of those platforms out in the middle of Gulf of Mexico. Billions of dollars. Big money all the way around. You’ll hurt the American consumer if you impose more taxes on them.

Watch it:

Kyl is not telling the truth about oil and gas subsidies:

Eliminating Oil Subsidies Won’t Raise Gas Prices. Eliminating Big Oil’s subsidies would have very little effect on gas prices. The subsidies have little to no influence on the investment decisions oil companies make, especially with the price of oil around $100 a barrel. Instead, the tax breaks simply pad oil profits, and are funneled into “obscene” executive pay schemes and shareholder payoffs. Even the American Petroleum Institute, which opposes cutting the subsidies, has admitted that eliminating subsidies wouldn’t affect gas prices.

The Oil And Gas Industry Employs About 700,000 Americans, Not “Almost 10 Million”. A report prepared for the American Petroleum Institute in 2009 estimated the the oil and gas industry involves only 2.1 million direct jobs with 7.1 million indirect and induced jobs. But even the 2.1 million jobs figure is grossly inflated. According to the U.S. Bureau of Labor, oil and gas drilling — the industries directly affected by most of these subsidies — only employed 63,012 jobs in September 2009, the most recent reporting period. U.S. Department of Labor 2007 statistics indicate the drilling and production of oil and natural gas, plus support activities directly account for 425,025 jobs. If sectors such as oil refineries and natural gas distribution are included, even though they are unaffected by drilling subsidies, the total increases to 743,825 jobs. According to U.S. Bureau of Economic Analysis data from 2009, the drilling and production of oil and natural gas directly generates 799,100 jobs.

Taxes aren’t dollars that disappear, and the payment of taxes isn’t a punishment for successful businesses, like the oil industry that gets over $7 billion in subsidies a year, far more than the Obama administration has proposed cutting. Taxes paid go back into the American economy, supporting the long-term investments that make the United States the richest nation on earth.

For example, taxes support public universities like Arizona State, where Kyl earned his bachelor’s and law degree. Taxes pay for the electoral system that Kyl joined as a member of Congress in 1986, where he has been taxpayer-funded ever since. Then again, Kyl has also directly received $333,332 from the oil and gas industry in political contributions over his career. Maybe he is just concerned about protecting his own personal oil and gas subsidies, which he receives on top of his taxpayer salary.

Yglesias

Twenty-Two Percent Of Americans Say They Wouldn’t Vote For A Well-Qualified Mormon Presidential Candidate

Gallup poll has some bad news for Mitt Romney:

Though the vast majority of Americans say they would vote for their party’s nominee for president in 2012 if that person happens to be a Mormon, 22% say they would not, a figure largely unchanged since 1967.

There’s some reason to think that these numbers would move if Romney became the GOP nominee. Gallup adduces evidence from the 1960 campaign to show that anti-Catholic bias declined rapidly over the course of JFK running for president. And as you can see, back when it looked like Romney might win in 2008 people seemed to suddenly become more Mormon friendly. But this is hardly the only research indicating that a substantial swathe of voters doesn’t like Mormons. They’re better off than atheists (poor us) but it’s not ideal from an electability standpoint.

Of course one issue here is identity-motivated voting is a two-way street. JFK not only lost votes to Nixon from anti-Catholic voters, he presumably benefitted from enthusiasm for his candidacy from Catholics. Barack Obama probably lost votes in 2008 to anti-black prejudice, but also secured 95% of the African-American vote and boosted black turnout. Romney could, similarly, plausibly benefit from larger-than-normal performance among Mormon voters. That’s not a large demographic nationally speaking, but could be important in Nevada.

Media

While Trying To Disprove Fox News’ Bias, Chris Wallace Invokes ‘Obamacare’ And Doubts Climate Science

Fox News has been under increasing scrutiny this week after Daily Show host Jon Stewart appeared on Fox News Sunday last weekend where he came prepared with research to tear into the network as an “ideological organization” that “gets marching orders” to promote conservative ideology.

Today, Wallace devoted the end of his show to wagging his finger back at Stewart, laying out a lengthy defense of his employer. But within moments, Wallace demonstrated the very bias he was trying to disprove when he used the term “Obamacare” — a derisive term for the Affordable Care Act used reliably by conservative media, politicians, and activists. The rest of his argument was not much better. Wallace took particular issue with a poll Stewart cited that found that Fox has the most misinformed viewers. Wallace said the poll was junk because it labeled respondents as “misinformed” if they didn’t believe scientists and acknowledge that climate change is real, or didn’t trust the Congressional Budget Office that the Affordable Care Act lowers the deficit.

In other words, Wallace thinks someone who doesn’t believe facts shouldn’t be considered “misinformed”:

The fact checking website PolitiFact called into question some of Stewart’s statements, but as ThinkProgress and others have pointed out, their conclusions are wrong. Every poll that has tested factual knowledge on politically controversial issues has found Fox News viewers to be the most misinformed.

Yglesias

Tomorrow’s Radiation Heaters Today

Via James Fallows, a great exhibit from the French National Library of prints from 1910 depicting the utopian lifestyle of 2000. A lot of them involve weird air travel, but my favorite is this idea of using dangerous nuclear isotopes to replace your fireplace (“chauffage au radium”):

It’s particularly interesting when you consider that France is, in fact, the world leader in the use of nuclear energy.

NEWS FLASH

U.S. Wars Cost $20 Billion A Year For Air Conditioning Alone | What does the U.S. military spend annually to stay cool on bases in the war zones like Iraq and Afghanistan? $20.2 billion, former Iraq war logistics chief Brigadier Gen. (Ret.) Steven Anderson told NPR. A gallon of gas to power an air conditioner in Afghanistan must be shipped to Karachi, Pakistan, then spend 18 days travelling for 800 miles over land in fuel convoys, dangerous transportation operations in which Anderson calculates over 1,000 U.S. troops have lost their lives. Anderson added that a policy stating, “We will no longer build anything other than energy efficient structures in Iraq and Afghanistan,” would have a “profound effect.”

Yglesias

Section 8 Housing Vouchers Spreading To Suburbia

Stephanie McCrummen’s report on people in unlikely places taking on Section 8 tenants mostly puts it in the context of the nationwide housing slump, but I’d say a relative shift in preferences about neighborhood locations is also a big part of the story:

It was clear that Liza Jackson’s luck had changed when she drove her pearl-white Dodge sedan, the one with the huge pink plastic eyelashes over the headlights, into Pinebrook, an eight-year-old subdivision where residents tend to notice cars with huge pink eyelashes.

“There goes the neighborhood,” one homeowner said when she heard that her potential new neighbor had a federal housing voucher known as a Section 8. [...] From Jackson’s point of view, the dismal housing market appeared as a glorious reversal of fortune: Fresh swaths of suburbia were opening up to the very people it has so often excluded.

I think this is an undersold point. There are two things that are bad about declining home sale prices. One is that the decline is associated with a decline in construction activity and construction employment. But over the long term, if the population rises the construction industry will exist. The other is that the decline has left many households unsustainably indebted. If you borrow $200,000 to buy what turns out to be only $100,000 worth of house, you have a real problem on your hands. But I think the right way to think of this problem is as a problem of debt—the price was too high in the past—rather than as a problem of current home values. In principle, an equilibrium where homes are cheap is preferable to ones where they’re expensive. Cheap homes mean that women like Liza Jackson can acquire higher living standards. And cheap homes mean that you wouldn’t need to take out giant loans to buy them in the first place, so the issue of debt-overhang would be moot.

NEWS FLASH

CBS’ ‘Face The Nation’ Forgets Herman Cain | Former Godfather Pizza CEO Herman Cain did surprisingly well in a new Des Moines Register poll of Iowa Caucus goers, coming in third in the widely-watched poll. But when CBS’ “Face the Nation” discussed the poll today, their graphic completely ignored Cain, yet made room for candidates who did much worse, including Tim Pawlenty. Why did they leave out Cain?

NEWS FLASH

Christie Says He Was ‘Damn Right’ To Treat Constituent Rudely | Earlier this month, a constituent asked New Jersey Gov. Chris Christie (R) why, if he sends his kids to private school, he thinks it’s fair to cut funding for public schools. Christie made headlines when he rudely told her it was “none of your business.” While on Meet the Press today, Christie was asked if this was an appropriate way to respond to a constituent. Christie said that it “damn right” was. Watch it:

Climate Progress

Insiders Warn “Shale Plays are Just Giant Ponzi Schemes” in Bombshell-Laden NY Times Piece on Natural Gas, Fracking

The lead story in the New York Times today is a detailed bubble bursting of the much vaunted boom in unconventional natural gas.

Natural gas companies have been placing enormous bets on the wells they are drilling, saying they will deliver big profits and provide a vast new source of energy for the United States.

But the gas may not be as easy and cheap to extract from shale formations deep underground as the companies are saying, according to hundreds of industry e-mails and internal documents and an analysis of data from thousands of wells.

The NYT has gained access to some amazing, must-read e-mails that “suggest a view that is in stark contrast to more bullish public comments made by the industry, in much the same way that insiders have raised doubts about previous financial bubbles.”

“The word in the world of independents is that the shale plays are just giant Ponzi schemes and the economics just do not work,” an analyst from IHS Drilling Data, an energy research company, wrote in an e-mail on Aug. 28, 2009.

If this were just one or two e-mails  from people outside of the industry, they might be easier to dismiss.  But  as the headline states, “Insiders Sound an Alarm Amid a Natural Gas Rush”:

“Money is pouring in” from investors even though shale gas is “inherently unprofitable,” an analyst from PNC Wealth Management, an investment company, wrote to a contractor in a February e-mail. “Reminds you of dot-coms.”

… “And now these corporate giants are having an Enron moment,” a retired geologist from a major oil and gas company wrote in a February e-mail about other companies invested in shale gas. “They want to bend light to hide the truth.”

The article raises three serious concerns about the new gas boom:

  1. Are most wells going to deplete much faster than people expect?
  2. Will the price of natural gas have to be much higher than people thought to make the economics work?
  3. Will this all mean more fracking — with all of the potentially dangerous side effects, including leakage of methane, which boosts the lifecycle greenhouse gas emissions of  shale gas?

Let’s start with the first.

Read more

Older

Switch to Mobile
ThinkProgress Signup Overlay Skip and Continue to ThinkProgress Skip and Continue to ThinkProgress

Sign Up