I would also suggest something similar for the financial industry.
Government should start/capitalize FRESH NEW banks after closing all those that did not deserve to be helped. These NEW BANKS will be run so that they would extend credit.
There are many towns that could be bulldozed; I'm all for it. This would also be integrated with a sort of building moratorium effort, to not overbuild. just to build. The act of demolition and re-zoning and re-thinking could be a stimulating thing across the nation. Th main issue we face is too much inventory, too many square feet, and this type of direction at least is more common sense in that it balances supply and demand!
On June 23, 2006 - on the one-year anniversary of the Kelo decision (see above), President George W. Bush issued an executive order stating in Section I that the federal government must limit its use of taking private property for "public use" with "just compensation", which is also stated in the constitution, for the "purpose of benefiting the general public." He limits this use by stating that it may not be used "for the purpose of advancing the economic interest of private parties to be given ownership or use of the property taken".[7] However, eminent domain is more often exercised by local and state governments, albeit often with funds obtained from the Federal government.
It's probably a great idea to do it in a controlled manner, instead of leaving it up to the angry masses to raze everything. They might even be able to offset costs by charging unemployed pitchfork-bearers to vent their anger by destroying a building.
I'm up for that program as long as they start with the McMansions in the burbs.
There is the minor problem that with modern machinery, not many workers are needed. A house is GONE in one day or less. One macho-machine operator, 5 truck drivers, one flagger, 2 supervisors, and one porta-potty delivery guy.
Brilliant idea. Not just urban though there are abandoned structures in rural areas across the country that create no economic value (i.e. taxes), they are merely eyesores and worse reduce the value of surrounding structures. I have always thought paying to remove these structures would help those communities. Now is the time!!
Listen, we've got lots o' problems here. Why don't we just throw 'em all together, and provide a remedy.
Have the military carpet bomb designated areas. Charge admission. Of course, we'd have to drop leaflets to ensure that no one is in the area..(I think they have practice here already), and simultaneously provide the tax breaks and sell refreshments....hey televise it!
So now the broadcast industry is involved, (private sector employment), oh yeah... make it a serial, weekly. Raffle it, 'your town, could be next'!
Yes. A plan I have been touting for quite some time. Almost always met with ridicule. It seems that I'm crazy until CR says it. Thanks for the confirmation.
If I were in charge, my stimulus would be to demolish every housing development built post 2003 and recycle the materials towards rebuilding and revitalizing the ghost-downtowns common all across america. Denser developments with more apartment complexes and walkable communities.
With Eminent Domain on the books, it's legally feasible.
do it in a controlled manner, instead of leaving it up to the angry masses to raze everything
If you can keep the angry masses from being low bidder.
But you could form a citizens' corps of demo parties - Habitat for Uninhabitability, if you will. Would give the masses something to focus on, an outlet for venting their anger, and leave them feeling good about making a difference.
This is good, you have appraisers come in to lowball projects, so that flippers, I mean investors can get tax breaks to re-new or re-build old structures. This would help create jobs and upgrade old areas and then in 4 years, they would be worth a lot more dough!
to make this more fun, i suggest a tv contest to pick the ugliest condo's in a city for the 'treatment'. then the controlled-explosive takedown - which everyone likes to watch.
first the condos, then the mcmansions.
oh, and the land returned to nature or made into public parks.
Bulldozing the oversupply is the only way to correct oversupply in a shortened time frame, since houses aren't perishable. (Please don't argue that the shoddy construction of late makes them perishable. They aren't.) Othwise, we just sit here and wait and wait for years until the greed of the 2000s slowly and ever-so-slowly gets absorbed.
Yes. A plan I have been touting for quite some time. Almost always met with ridicule. Elvis | 01.11.09 - 3:07 pm | #
That's because CR is talking about "un-usable" buildings or projects already scheduled for demo,... not your real estate agent turned hooker sub division bando fantasy.
I've demolished quite a few houses over the years, in order to build new construction. Here's how it goes: The hoe arrives by float the night before. At 7:30AM the the hoe operator arrives and puts his machine to work creating a pile of rubble where the house once stood - takes about 1 hr. About 9:00 AM the first dump truck arrives, and is loaded by the hoe. As he drives away, headed to the landfill site, another truck waiting is loaded. A few truck loads later, the site is completely clean. Takes about 3 hrs. Employment? One hoe operator, his machine, and about three trucks in rotation for 4 hrs. Next work, occurring by say noon the hoe starts to dig the hole, (the other 1/2 of his income for the day, in terms of hours). Digging the hole makes the job worthwhile, i.e. the cost of moving his machine on and off the property. It might take a good operator 4 hrs to dig the hole. End of story.
Landfill fees and trucking are a big part of the job cost. By the end of the day, I might have spent $3,000 to $4,000 all in. Depends on variables like how far is the landfill, and what are the fees. The human labour component is a small part of the total cost. I'm sure this scenario is much the same for any city, give or take 20% in costs for localisation scale
This will never fly unless you give it a catchy name. Perhaps "Subdivision Conservation Payments" would be properly Orwellian. As some wag suggested on CR months ago, homebuilders could turn the subdivisions into farmland, and then get paid for not growing crops on them.
With Eminent Domain on the books, it's legally feasible.
Most states reacted to Kelo by prohibiting condemnation for the purpose of "economic" development, instead requiring an actual public use (park, highway, etc).
The only way this proposal works is through tax credits, which makes arbitrary distinctions based on the "age" of the property unsustainable. Historical preservation needs to remain under the purview of local zoning boards.
I don't think it is a bad idea, but I think the scope is somewhat limited. This is not 1950's style 'urban renewal', I assume, but more selective removal.
Last year there was an article in the Minneapolis papers - the mayor and some people from the planning department were touring foreclosures on the North side (rough area) and they estimated that one of three houses they saw was a tear-down - simply not worth the effort to fix. I think that is a low estimate. However, those lots are still not desirable due to the character of the neighborhood.
The other problem is simple: it takes less than a day to pull out a house like that, given the equipment and methods we'd now use. Not much there for job creation or for total spending.
Hey here's a token idea.. how about we let some stuff fail? How about we let some assets depreciate? How about we actually let some people and businesses go bk..
financial gravity can't be stopped.. it can only be deferred for a bit.
I didn't see the post by Kondratieff while I was writing. His point is correct - not a lot of $$$ potential there.
There is some benefit, I think, to removing these things. Mabe you'd tear down half of Detroit... but then what?
"not your real estate agent turned hooker sub division bando fantasy.
sdtfs"
Then it doesn't affect the oversupply. It, therefore, does not address the overriding problem and is just a way to keep people busy. I prefer the gov't buying foreclosed properties at foreclosure auctions at foreclosure market rates and then bulldozing them after salvaging what they can. It gets rid of the paper and it gets rid of the oversupply. Problem address. Resolution of problem expedited. It is a radical solution for a mind blowing problem. If stdfs doesn't like it, it increases my confidence that it is the necessary slolution.
why not just load up the empty houses with a couple cartons of ciggies, and a case of shampipple... it'll keep the win/win going with firefighters and welfare fraud.
Tax credits for renovating historic property have traditionally only benefited the top 5%. Because the federal government can't designate homes as having "historic" qualities, they tend to leave the designation to the cities and states, at which point graft tends to be a huge issue.
Reform plan raises fears of Bank secrecy
The Bank of England will be able to print extra money without having legally to declare it under new plans which will heighten fears that the Government will secretly pump extra cash into the economy. link one -- Banking Bill
"Quite why the Bank has to keep its operations so shrouded in secrecy is a mystery to me," said Simon Ward, economist at New Star. "This [reform] will make it much more difficult to track what the Bank is doing."
Among the details which will no longer be published are those revealing the extent to which London's banks are using the Bank's deposit facilities a yardstick of pressure in the financial system.
Debating the issue in the House of Lords recently, Lord James of Blackheath, a Conservative peer, said: "Remove [this] control and there is nothing to stop an unreported and unmonitored flooding of the money market by the undisciplined use of the printing presses.
"Gubmint Cheese writes:
"in buildings designated for them to stay in.."
"Man.. reading that just gave me shivers down my spine.."
Simply not allowing homeless people to live in any abandoned home they seem fit, since like a logical and reasonable thing to me. Or, we can just say screw the laws, every man for himself.
You've just lost every bit of credibility you've built up over the years. This is the most ridiculous thing I've ever heard you say by a country mile. This is the most basic fallacy of economics, known as the Broken Window Fallacy. You really should look it up Bill, and you really should pick up a copy of Economics in One Lesson to disabuse yourself of this silliness.
You CANNOT create wealth and prosperity by destroying things. PERIOD.
The local and state govs already own a lot of this property through failure to pay taxes. If they had imagination they could have already cleared and
given the property to potential tax payers.
Elvis - I know the 'every man for him/her self' thing is not the way to go.. but the idea of having designated shelters for the homeless.. wow.. just scares me to see where we could be going (are going in my view)
We need more parking lots anyway, for all the new tents. Anonymous | 01.11.09 - 2:57 pm | #
An anecdotal story...
In the summer of 1978 I was working in Minneapolis. In an area off Hiawatha near Franklin & Cedar Ave there is a community called 'The Res'... it was a rough neighborhood where Native Americans 'wintered'... in the summer they headed up north returning to the real reservations to be with friends and family and to hunt & fish. This was before casinos so there was little or no opportunity to work (or even collect support payments) on the 'Red Road'... but in the summer the reservations were a lot more pleasant than the inner city so families returned. In the depths of a Minnesota winter the opposite was true so back to the city. The rundown homes & apartments in the 'Res' in Mpls were abandoned all summer then 'reclaimed' in the winter. It was a migratory pattern in every sense of the word.
Over the years there were a lot of abandoned homes that were burned out & leveled. The lots became overgrown.
Back in '78 a new group entered the scene - the 'Boat People' - local churches sponsored individual Hmong & Vietnamese refugees from the war... what they soon learned is if you sponsor one you sponsor a whole family... once you sponsor a family you sponsor a village... etc. They newcomers moved into those 'abandoned' homes [vacated by Indians for the summer] and immediately started 'planting' in the nearby vacant lots. By the end of the summer there were a number of gardens all throughout the neighborhood.
It didn't end completely happy however - the Natives returned in the fall and tried to 'reclaim' their winter quarters - didn't turn into a 'war' but let's just say the newcomers didn't immediately leave... I mean if you had been fighting the Viet Cong & Khmer Rouge - what can a few Lakota or Ojibwa do to scare you? In the end - years later - the Lakota & Ojibwa got their casinos and resultant tribal social services and the 'Res' off Hiawatha is much smaller and more prosperous today... and the SE Asians have dispersed though many still garden outside the city and are heavily represented at city farmer's markets ... but I will NEVER forget the transformation that occurred to that neighborhood that summer - it was a complete night and day difference when all those local gardens popped up. If 'demolition' leads to that kind of renaissance - sign me up.
I think it is telling that people are afraid to bulldoze houses. It is outside-the-box thinking and many are confined to thinking inside-their-box. "Oh, no, we cannot do that. People need homes." I guess it was the same kind of radical thinking that got women to be able to vote. And that turned out okay. Except I don't think Jas should be able to vote.
Gubbmint,
we have had them here in Phoenix for years, and they do take in the folks to whom loss of housing is essentially temporary. The lifestyle homeless, well they live in the ravines, alleys and go 'bando. Nothing ever changes with regard to this issue.
As a matter of fact, the destruction of adequate, or even inadequate boarding type housing has contributed to the homeless in any big city you care to contemplate. Without the ability for disabled and fixed income to find affordable housing (have you seen how long the Section 8 lists are!??) the street or uncomfortable illegal boarding becomes the norm. Adaptive reuse is often prohibited under building and zoning codes designed for perpetual economic growth.
Gubmint Cheese: "Hey here's a token idea.. how about we let some stuff fail?"
That was my hope, but I'm just a liberal (which simply means anyone who disagrees with Cons).
So shusssssh... wait just another few weeks and this can be the new Conservative talking point! Perfect, and say it with stuffy air of long-suffering superiority, too. That never gets old..
First we gotta wait until the current Con-politicos finish stuffing the Treasury up their crony-friends asses.
Then, when it's only working Americans left in trouble ... it will be Time to Let Things Fail and have the Free Market decide ... timmmmmmmmbeeeerrrr! Amirite?
Cons of America are willing and able, Gubmint Cheese, you are just a little too soon.
Cash for Clunkers is a generic name for a variety of programs under which the government buys up some of the oldest, most polluting vehicles and scraps them. If done successfully, it holds the promise of performing a remarkable public policy trifecta stimulating the economy, improving the environment and reducing income inequality all at the same time.
Stop paying for Social Security & Medicare/medicaid. This will save money and shorten the lives of unproductive folks. (like in China etc.,)
Take away child tax deduction. With fewer children, less expense for education, lower unemployment. (like in Japan). If workers are needed, auction off immigrant visas to highest bidders.
Cut down defense expense to half its size. The job of defense is to protect US. Not to wage wars abroad.
Legalize & tax drugs. Huge unaccounted economy will be brought overboard expanding GDP. Same with prostitution too. Make all 50 states like Nevada for gambling & prostitution.
Build good railroads. They save a lot on oil import so we don't have huge deficits and constant wars with middle east.
Much better than demo'ing property would be concrete bridge restoration. I have no idea what the numbers are, but there must be hundreds of thousands of bridges that are in serious decay in the US. Now whould be a great time to fix them. It could be done by fixed bid tender. A great way to do it would be to tender the job out thru a local engeering firm that has experience in the area and make sure to spread the contracts around to at least a handful of different firms in each county. Make the Eng firm responsible for the job at a realistically low-end fee for management, since this is a tax-payer reallocation of wealth by government. Make the banks WHO ALREADY HAVE the money, loan it out. Leverage the stimulus money, to cover the cost of the debt, amortized over 30 years. Make the municipality responsible for the principal portion of the debt repayment. Some grand plan like this is needed, and keep it simple and low cost. Roll it out nationwide. At least you are investing in the infrastructure of your country, as opposed to investing in exotic MIC war machinery to destroy infrastructure elsewhere.
Elvis and Citizen Allen - it's not that I don't agree or think that the idea would/will work - far from it. I just get the feeling that the composition of those staying in the 'designated shelters' is going to be changing. While the druggies and 'usual' characters will be there, there will be a growing number of people who have just fallen on recent hard times - people who used to rent, or own.. etc. Overall I think its a good idea - Just my sixth sense thing kicking in...
I think it is a good idea, although unfortunately the scale is not big enough to make a dent on on the economic downturn.
I am more interested to hear the government promote really big ideas like smart grid, renewable energy, universal health care (and by the way, middle aged white collar unemployed need new jobs too). Cleaning up the existing environmental mess would be quite nice too.
Here's a word of caution though - anyone here been to say downtown Buffalo NY lately? My father was an exec' in that town 40 years ago... the company failed the area razed in hope that would clear the way for 'future' development. I was back there last summer - the vacant area near where his plant was IS STILL vacant. They could've grown & harvested timber on that land in the years those sites have remained vacant.
Just cause you unbuild it doesn't mean they'll come.
There are many residential AND commercial buildings out there that need to be torn down.
The current owners most likely can't afford to to it.
The manpower that could be utilized would not have too many "earning curves".
I might suggest though that each building be a "controlled demolition" (materials are salvaged for further additional uses). I built two of my barns from recycled studs, beams, siding, bricks & block).
Second, how about a tax credit for demolishing residential housing units? In many areas there are old, vacant housing units. These are a public nuisance, but the owners have no motivation to demolish the property.
I fear that this program would be misused to remove good housing stock from the supply, in the name of culling bad housing but in reality to keep on a too high level. This would do no good to the economy, now that housing isn't seen as infallible anymore. If the owners need a motivation to demolish their houses: What about demanding punctual property tax payments on all non-homesteads that would be otherwise expropriated and either demolished or converted to affordable housing?
I agree, there are going to be a lot more desperate people, but we need to figure out how to deal with them reasonably. Meanwhile, as for letting things fail- how much more do you want?
The amount of failure in the pipeline will astound you. Right now I am aware of two state governments that are technically insolvent.
Now, how much can you stand before you start applauding anything that looks like cushioning the blow?
As I pointed out on the last thread, most Reaganesque solutions are moribund.
Republicans in Arizona are still talking about a small tax cut as stimulative in the face of a catastrophic drop in tax revenues and a constitutionally mandated balanced budget. And they are complaining about accepting any federal bailout!!??!!
I am at a loss, the lack of understanding of the current situation is what is distressing, and the fact that the Republicans are so f*cking clueless tells me we will be living under a democratic administration for a long time. Balanced government is best, but the sheer intellectual poverty of the Republicans is stunning.
With the two million overhang - or over supply - of single family homes, the Gov't should establish a Resolution Trust Corporation (name it what you want) with the sole purpose of purchasing and managing (yea, it will be a big job) at a minimum one million single family homes (Gov't investment of $200 billion, but keep in mind today's borrowing cost are near zero) while at the same time destroying a million very old homes (I agree 100% with CR).
The benefits:
- the $350 billion TARP is doing nothing so put it to work (foreclosure assistance is NOT the answer).
- removing one-million SFH's would play favorably in terms of reducing supply.
- relieve the people who should never have purchased a home by allowing them to rent the same home.
- force the banks who are hording the first $350 billion round of TARP money to absorb some of these losses.
- establish the RTC - the largest federally run property management company in the US.
- execute a long term exit strategy (i.e., sell the properties in 6-8 years).
- job creation
The negative:
a shift in demographics (owner neighborhoods now turned rental).
I like the idea, provided (of course) that it is unusable / eye-sore properties.
I remember an article a short while back wherein England tinkered with tax rates to discourage empty, unused properties. The business community promptly responded by demolishing a lot of older buildings and leaving empty lots throughout the cities, which made things appear worse than before.
I don't know if it has been mentioned by anybody yet, but it sure is a whole lot easier to take something apart or tear it down than it is to put it together or to build it in the first place. You wouldn't have to be a good carpenter, just a little training with a sledge hammer or a sawzall, which wouldn't take much time!
You CANNOT create wealth and prosperity by destroying things.
In some beach front communities with really restrictive zoning laws, many homeowners actually hope that their houses get destroyed come hurricane season. Most of the time, there was nothing wrong with the property; it's just that the homeowners wanted a bigger house.
Whether or not a $8M beach front house as any practical economic benefit is another issue.
Good er..., well an idea anyway.
Does anyone realize how long it takes to get NESHAP clearance for abating asbestos and lead??? Or how much that costs?? Talk about your rabbit holes.
CR, love ya baby, but construction is being set up to be gamed right now, and I ought to know. That gov. cheddar will just concentrate more wealth, and there will be nowhere near enough jobs created. Think, one 20 million dollar sewer revitalization requires about 10 workers and about 20 support personnel (from pipe salesmen to secretaries to truck drivers).
Every day seems to bring a new solution. Every solution makes me believe more and more there is no solution but time, loss and pain. All of these "solutions" may numb the pain but surely the time factor will be lengthened.
The monies spent from the Stimulus Plan might very well achieve one of its intended purposes (it puts $$ into the economy).
The unfortunate truth to it as well, though, is, most people whom get any "extra" money in their pockets NOW will spend it much more WISELY. IN OTHER WORDS THERE WILL BE NO LONG-TERM ECONOMIC BENEFIT. AND, I would venture to say that most of it will be "holed away" as was a lot of the first bunch. (Actually, probably a BIGGER percentage will be saved now since more realize we're in "deeper doo-doo" than before).
"You CANNOT create wealth and prosperity by destroying things."
That's what Capitalism does. So, destroying homes is nothing more than destroying something that was bult by destroying something else, i.e. a forest, or an ecosystem.
dryfly(Very Good) writes: \tHere's a word of caution though - anyone here been to say downtown Buffalo NY lately? dryfly | 01.11.09 - 3:59 pm | #
dryfly - I was in Buffalo/Niagara Falls in November doing some flight test work. The whole area is so depressed ... much more so than a few years earlier when we were there. I saw boarded up places that have been that way for over two years. They did demo some hotels in Niagara Falls to build parking lots for the gigantic Indian casino there. The Canadian side is much more alive. At least the Buffalo area still has excellent food.
Just in government property alone there are abandoned schools, hospitals, and various institutions like prisons and sanitariums, wharves, old barracks and military warehouses that will never be usable as housing, the list goes on and on before you even hit privately owned housing.
Quite seriously, I wouldn't spend SQUAT if I were the new President. I'd let the States know that we're saving the $775B to bail out your unemployment plans, underfunded pension plans, and other unseen financial "shotgun blasts to the head"!
"Mr. Loyd George, who after a bout of political raillery at the expense of Sir John Simon and Sir Herbert Samuel, pleaded earnestly with the Government to adopt his own familiar plans for State financing of public works--slum clearance, telephones, land settlement, reclamation and reconditioning of derelict lands. We have, pleaded Mr. Lloyd George, "millions of mend idle, millions of acres idle, hundreds of millions of money idle. Cannot we bring the three together." link
I been watching football and switching back and forth to CNN. They're running IOUSA with intermittent commentary. I left the room when Rivlin started spewing her Keynesian horse hockey.
Before the government spends money demolishing (and who decides on the demolition contractors? this could get political) why not FOR FREE give the public an opportunity to obtain the property, with the string that the new owner will "fix" the property if needed. What isn't claimed gets demolished.
There are SO many opportunities here for public good besides demolition. We keep warning on this blog about "worse than depression" times ahead, that reads a whole LOTTA homeless families. For some people, excess housing is hurting their bottom lines. For others, survival is iffy.
Demolition should not be the first road taken. First see if anyone wants/needs the property. Especially if the property is usable as is, put it up for grabs.
I prefer my Cat 953. It is waaaaay too much fun to crunch a house with a track loader. It is very satisfying work......
Bruce | 01.11.09 - 4:22 pm
Yeah, if you are in a hurry. The way things are now, what's the rush? The rednecks around here BID on tearing down an old house. They sell the recycled materials.
What about paying people to hunt and kill wall streeters? Now that is something which is employment intensive. You could also pay a bounty for each severed head trophy that can be identified.
I watched part of IOUSA yesterday but I was at work so didn't get to see much of it. I find it kind of ironic the MSM all of a sudden thinks doom and gloom is in vogue.
I guess one of the reasons I like this idea is that I've wanted to bulldoze good sections of LA for decades, good times or bad.
The idea that destroying RRE is going to somehow prevent prices from reaching their historical norms is ridiculous, of course. In fact, given that household size has probably bottomed and homeownership definitely peaked I'd say that the new "norm" could be a long ways further down.
Demolition should not be the first road taken. First see if anyone wants/needs the property. Especially if the property is usable as is, put it up for grabs. Outsider | 01.11.09 - 4:24 pm | #
The snarky 'buzz word' for 60s urban renewal was 'Urban Removal'... there are lots of inner cities where the stuff torn down way back then still haven't been built on and it isn't all due to 'environmental red tape'.
"You CANNOT create wealth and prosperity by destroying things."
that's also what Nature does.
think of new growth rising from a natural forest fire or fertilizing plant growth from compost.
the questions are what is being destroyed, how is it being destroyed, how are the materials that are left recycled, and what kind of new growth is it fertilizing?
I watched part of IOUSA yesterday but I was at work so didn't get to see much of it. I find it kind of ironic the MSM all of a sudden thinks doom and gloom is in vogue.
Comrade Kristina | Homepage | 01.11.09 - 4:27 pm | #
So, nobody's watching? And they're missing the emergence of yet another hot info babe.
I wonder what "Habitat for Humanity" would say about this. I mean, heck, they're still out there building little houses, aren't they? Comrade Bear (tj & the bear) | 01.11.09 - 4:30 pm | #
I know people working w/ H4H - they would LOVE to have lots prepped for them... especially if there is a clean up required... probably not a huge risk for RRE but for CRE it is [lord only knows what cems were poured where 50, 60, 100 years ago in a lot of these older cities]...
Along the same lines, the defense industry could build bombs and missles and fighter jets, then dimantle them when they're done. Could go on forever...
Mock, I can't imagine facing down this crisis with the knowledge in the back of my mind that at any moment Sarah could be in charge...Horrifying at all levels...
print $1 trillion or so in hard cash, then pay people to slowly burn it over the course of three years. temporary jobs, guaranteed inflation, then gradual deflation at a controllable rate.
If the gov't buys foreclosed homes and foreclosure auctions at foreclosure market prices, and then destroys them after first salavaging the good parts, there is value left:
Value of the salvaged materials.
Value of the lot (stubbed with utilities).
All is not lost in the short-term and, in the long-term, it gets us back closer to a functioning economy.
The snarky 'buzz word' for 60s urban renewal was 'Urban Removal'... there are lots of inner cities where the stuff torn down way back then still haven't been built on and it isn't all due to 'environmental red tape'.
dryfly
This was a pet project of governor Nelson Rockefeller in NY. We lived outside this little industrial city upstate. The kind of place that had been going downhill since the 1920's.
But there was still some industry, a nearby college and there were a couple main drags with neat old buildings.
By the early 1970s it looked like it had been nuked. And with the economy headed down, that was that. What a freaking waste. They took away the only reason anyone had for visiting downtown.
The idea then was just as CR's is now, tear down the old stuff and spur new building. Nope. Just further exodus.
I think on this, CR's California sensibilities led him astray.
Oho, Gazprom's insistence on a copy of the document is suddenly clearer...
Russia-Ukraine deal on gas for Europe in doubt
Sun Jan 11, 2009 3:29pm EST
By Christian Lowe and Dmitry Zhdannikov
MOSCOW/KIEV (Reuters) - A deal to restore Russian gas supplies via Ukraine to Europe appeared on the verge of collapse on Sunday after Moscow rejected handwritten additions by Kiev as a 'mockery of common sense'. Russia-Ukraine deal on gas for Europe hits trouble
| Reuters
"there are lots of inner cities where the stuff torn down way back then still haven't been built on and it isn't all due to 'environmental red tape'."
dryfly | 01.11.09 - 4:28 pm | #
It's pretty telling when my brother,the special ops guy for 13 years, says "I would not go there with less than a squad".
And he wasn't talking about someplace in Iraq or A-stan.
Yes,he has been in a lot of these hoods while on active duty...that should wind the tinfoilers up.
Short of a Jubilee, even wages from new created jobs will go to pay down debt and to savings, just the Stimulus I. Combined with the current velocity of money being zero, stimulus will be disappointing.
.......Some of us don't contribute to the "establishment media whores" associated with BIG BUSINESS cable TV.
(Jeeze - that almost made me feel 25 again!)
Black Star Ranch | 01.11.09 - 4:36 pm | #
And your response reflects the maturity of your position.
When the MSM embraces something that has gestated out of the blogosphere, we should be satisfied that we are making some progress. Solutions come from acceptance of reality. Bill Bonner at Agora did IOUSA. He has been a reliable voice at all his Agora sites, including Daily Reckoning, 5 Minute Forecast, Desidooru Saloon, et.al.
Short of a Jubilee, even wages from new created jobs will go to pay down debt and to savings, just the Stimulus I. Combined with the current velocity of money being zero, stimulus will be disappointing.
Looking for equities -20% from here.
sc | 01.11.09 - 4:46 pm | #
I was the first to surface the notion of jubilee. I am satisfied to know that others have snagged the ultimate inevitability of this.
"but then I just got 12-loads of cow manure this morning for the gardens. YESSSS!! Everything here is all better now."
Black Star Ranch | 01.11.09 - 4:43 pm
12 loads? For a garden? I grew up on a farm and 12 loads the size we used to move would bury a garden multiple feet deep in cow/pig shit.
I hope those were small loads or you have one hell of a garden...
Ahhhhh,the aroma is flooding back like it was yesterday!
"LOL. Actually, my response reflects my inability to justify a $70/month bill for cable o sat. Been there, done that.
Black Star Ranch"
Add the internet and the phone and its more like $150. $1800 is a lot for things that used to be about $200/year. Put $50 on top of that for a PDA and we are talking $2400 a year just to get information. Something has got to give there.
takes skilled workforce to tear down a building then it does to build one- even the big ones after the explosion.
Although it may seem like a crazy idea how about building more affordable housing. We needed it even during the boom times and we will certainly need more now. At lot of the exburb stuff that is in excess is really not suitable for conversion to affordable housing.
citizen energyecon - I commented in one of the previous threads how last week a Ukrainian court ruled a contract with Gazprom from 2006 invalid because the person who signed it for Ukraine turns out did not have the authority to do that (accoridng to the court)
If the gov't buys foreclosed homes and foreclosure auctions at foreclosure market prices, and then destroys them after first salavaging the good parts, there is value left:
Value of the salvaged materials.
Value of the lot (stubbed with utilities).
All is not lost in the short-term and, in the long-term, it gets us back closer to a functioning economy.
Elvis | 01.11.09 - 4:43 pm | #
why not give it to a homeless vet?
Interesting the children of suicide bombers get free education and all their college fees paid for by Hezbollah. The also get a gift on every fathers day. The seem to treat their people a lot better than we do.
"Old, vacant housing units" that are "a public nuisance" would not properly be included in an honest count of "housing stock", so you're double counting the benefit.
Either the structures are not fit and wouldn't feasibly be fit for occupancy OR they are viable housing, not both.
i still like nova's idea of a free house for every returning vet...
As for those mcmansions out in the exurbs, there are those group homes for the mentally disabled that were once promised, but never built. With plenty of bedrooms and bathrooms, and a single kitchen, they could fill that function nicely.
"Either the structures are not fit and wouldn't feasibly be fit for occupancy OR they are viable housing, not both.
tew"
Yes, this is an important point. The net benefit of reducing the oversupply is very low. It would serve other benefits, though, but not improve the most vital and smothering problem.
What about more public transportation infrastructure instead of demolition projects?
The NYC area needs another airport. There are also stalled projects like the "new" Penn station, the Lexington Ave. subway line, that would add value.
DC is building a metro line to Dulles. I think they should also extend existing lines further into the suburbs, and maybe a "circle line" where the Beltway is.
This is an excellent idea (with the modification that houses demolished should be limited to those that are too decrepit to be bought at auction).
Lots cleared by demolition should then be made into parks or community gardens, providing more employment.
But on the larger problem of finding enough ideas for shovel ready programs, I think this problem is really a clever political tactic by Obama. There is no shortage of such projects, but saying publicly that there is and starting the stimulus debate with a lowball dollar figure has succeeded in stimulating a chorus of demands for more projects and bigger spending, which is exactly what is needed.
Obama is maneuvering the program through the political field. There is now a two year history of his road to the Presidency that indicates he is very shrewd on this score.
Comrade Kristina writes:
Mock, I can't imagine facing down this crisis with the knowledge in the back of my mind that at any moment Sarah could be in charge...Horrifying at all levels...
yeah its sad really
the republicans have many excelent women in their ranks who would make for outstanding president or vp
"why not give it to a homeless vet?" - crazyvermonter........that is the most intelligent thing I've ever heard you say, cv! There's some promise in that idea. It would be good for all parties - but mostly the veteran.
"will soon be wheel barrow-ing it to the garden and orchard...expanding to one acre under till" ......outside of the wheelbarrowing part, THAT would get me pumped, mock.
Sandystructures AutoGroup writes: Can someone explain why ford's river rouge plant was chosen for this specific location?
If we send a few f117's in with 2klb bunker buster's , would we build a new walmart supercenter?
parks and community gardens are public goods, worth having in themselves. this would not be make-work, though make-work is not always bad. there is plenty of infrastructure to build that is necessary, and plenty beyond that which would be valuable.
Even if the housing is marginally viable to live in, it isn't going to make much difference to demolish it in areas where the population is already shrinking anyhow.
This has been a fertile area for research. NYC has tremendous experience, having restored over 110,000 housing units that were abandoned during 70s and 80s
I know people working w/ H4H - they would LOVE to have lots prepped for them... especially if there is a clean up required... probably not a huge risk for RRE but for CRE it is [lord only knows what cems were poured where 50, 60, 100 years ago in a lot of these older cities]...
The local Habitat for Humanity here usually starts with donated land, often prepped and ready (by developers who donate the land in return for H4H building their locally-mandated affordable housing quota for them.) So yes, H4H would be all over it. That said, if there fundamentally-sound apartment buildings that could be rehabbed into 3/4 flat buildings, they'd also be willing to take those as donations. Building individual SFHs isn't always the most efficient way to address homelessness, and HRH knows it.
"presenting houses to veterans is an excellent idea
joe shmoe"
What about fire fighters, teachers, policemen, etc...? This is a slippery slope. What about the veterans who already own a house? Do they get one, too, or do they get the shaft?
CR, you forgot to mention that it was all that digging that got us out of the depression, not the WW2 like some capitalists bastards would say. Just look at the stock market and unemployment in 1937-1938. It was booming, and everybody was digging. So let's start digging our way out!
Better to take the hopeless residential units into public ownership and use tax dollars to improve them and then rent them at whatever the market rent is, even if it zero.
Only houses that cannot be rented at zero should be demolished.
Elvis writes:
"presenting houses to veterans is an excellent idea
joe shmoe"
What about fire fighters, teachers, policemen, etc...? This is a slippery slope. What about the veterans who already own a house? Do they get one, too, or do they get the shaft?
Elvis | 01.11.09 - 5:23 pm | #
How about we take care of the families of those who died in the line of service- that includes fireman and police- would that be a slippery slope. The how about those were severely wounded. I would much rather see these folks get it than some vulture investor.
G Cox writes:
Better to take the hopeless residential units into public ownership and use tax dollars to improve them and then rent them at whatever the market rent is, even if it zero.
Only houses that cannot be rented at zero should be demolished.
G Cox | 01.11.09 - 5:25 pm | #
one of the big problems with affordable housing is that it just not possible to build cheap enough to make it viable without some subsidies. Now that we (tax payer) have an opportunity of getting properties substantially below their replacement cost we have a shot at having sufficient affordable housing. There never was bubble in affordable housing even at the best of times.
but you can thank rove for the illegitimate black baby push polls in the Carolinas for that
Not THE Carolinas - South Carolina.
The two states are more different than you might think. NC is much more progressive. Not that we don't have our share of rednecks - just a much smaller proportion.
I'm a bartender and I think for putting up with the drunken American public we should get houses as well. I already have a house but if you'd all pay it off for me that would be great!
I'm a bartender and I think for putting up with the drunken American public we should get houses as well. I already have a house but if you'd all pay it off for me that would be great!
Comrade Kristina | Homepage | 01.11.09 - 5:33 pm | #
You are a saint for whom there is a special place in Heaven.
What about fire fighters, teachers, policemen, etc...? This is a slippery slope. What about the veterans who already own a house? Do they get one, too, or do they get the shaft?
Elvis | 01.11.09 - 5:23 pm | #
yes, yes, ponies for everybody! including fire fighters and policemen in Vallejo, CA. destruction avoids problems of allocating limited resources, with the exception of who is chosen to do the higher-skilled aspects of demolition work - but I'm sure someone has a brother-in-law in the industry - or one willing to enter it for guaranteed federal money. this is gonna be 2002 all over again.
There is plenty of land in Vermont. Why don't we just give everyone free land in Vermont who somehow qualifies? Then they could use the salvaged home materials from the demolition (transported and paid by us, of course) and they could build new houses in Vermont for all these people. I'm sure the people of Vermont would welcome a bunch more people.
one of the big problems with affordable housing is that it just not possible to build cheap enough to make it viable without some subsidies.
crazyvermonter | 01.11.09 - 5:30 pm | #
Try, and I know it's a stretch, to get past the notion of money.
"Although it may seem like a crazy idea how about building more affordable housing."
This is what I've worked on - as an architect - pretty much full time for the last 4 years. You can't build it fast enough... and the typical stuff we have done, much of it suburban townhouse style - is generally of better build quality than adjacent for-sale projects by the big nationals.
However, you don't just pump up the pipeline in a hurry. Projects often go on 'brownfield' land, take years to get through local approvals and must always be done with a level of planning and care. Otherwise you are building junk. Also, you do not want to overload an area with affordable units and stigmatize for-profit housing in that area; it has to be blended.
The biggest blow to the non-profits and agencies that sponsor affordable housing has been the decline in the resale value of tax credits. When corporations look ahead and see no profits, tax credits lose value.
absolutely. homes to the widows/widowers and children.
@elvis:
easy to make the grant of a house into an option, part of a benefits package that offers, say, an increased pension or a house. Those with a house take the pension increase. Those with no house take the house. Does it need more detail? Sure. But it is not a big problem.
Consider the GI Bill of WWII vintage. Did its promise of college education hose those vetereans who already had a college degree?
We have to decide if we want to sink or swim as a country. If we want to swim, we need to stop drowning the very people we depend upon.
Funny, but the railroads in the 19th century were subsidized with huge land grants. The TARP and auto bailouts are not the first subsidies for big businesses. Subsidies and aid do not bring the end of capitalism.
"one of the big problems with affordable housing is that it just not possible to build cheap enough to make it viable without some subsidies."
"Affordable housing" generally means jsut that, at least around here. There is always a non-profit or a county or city agency that sponsors and manages it. Rents are set to a percent of income. Around Minneapolis, build cost for a 2 or three bedroom, 1-1/2 bath, single attached garage T'house with excellent energy efficiency and good materials is under $100,000, not including land and infrastructure costs.
The land and infrastructure can vary all over the place - $20,000 to $50,000.
I'm sure others have commented on this, but just to make sure... this is just the broken windows fallacy that Henry Hazlitt wrote about in his book Economics From One Lesson. break some windows.
My granddad used to have a load of horse poop in every spring for his tomato garden. Great tomatoes, but it really stank for about 2 weeks until it rotted and he worked it in to the soil. This was in Balto. Wonder how much heavy metal was in the soil due to the air pollution?
...properly chosen infrastructure projects provide the best bang for the buck.
And here we go again - instead of FIRST agreeing on a selection method that at least gives us a hope of achieving "properly chosen", we're jumping right to tossing busy-work suggestions at the wall hoping something sticks.
dryfly writes:
christie whitman... ex gov nj comes to mind
mock turtle | 01.11.09 - 5:15 pm | #
But only democrats would vote for her... would cause a bit of a problem in the primary.
dryfly | 01.11.09 - 5:46 pm |
The very same person who when she was with the EPA told everyone that the air quality in lower Manhattan was okay. Yeah - no distrust of that person whatsoever...
Terrible idea. For all the billions - perhaps trillions - that we wasted on residential real estate we still have homeless people. Destroying those eye sores that offend people on their way to and from their suburban McMansions isn't something we need.
I'm sure others have commented on this, but just to make sure... this is just the broken windows fallacy that Henry Hazlitt wrote about in his book Economics From One Lesson. http://freedomkeys.com/window.htm bubblemore | Homepage | 01.11.09 - 5:45 pm | #
Broken window fallacy was already brought up... this isn't it. Here the window is already broken & the question is do we fix it and if so who & how.
Oh - regarding the specific proposal - 15 minutes in downtown Cleveland should give anyone who thinks is a good idea ample evidence to (at a minimum) rethink the desirability of this.
My granddad used to have a load of horse poop in every spring for his tomato garden. Great tomatoes, but it really stank for about 2 weeks until it rotted and he worked it in to the soil. lawyerliz | 01.11.09 - 5:46 pm | #
Horse smells like roses compared to pig... my father had a pig farmer down the road who would 'give' him manure... haul his spreader over back it up to the garden and let it go... kinda like this. Wow - you don't want to stand close to that sucker.
The idea of downsizing cities by removing old buildings and helping citizens to relocate to oher areas, then coverting whole neighborhoods into wetlands, gardens, etc. is already being tried out. Google "shrinking cities" - already being tried in some places in Ohio, I believe.
Los of employment opportunities here - building wetlands, urban greenspace, etc. employs lots of students, workers, environmental engineers, planners, etc.
Yeah pig manure is the worst, my Mom's cousin had a pig farm, the stench is unbearable. I had horses and never found the smell to be all that bad. Cow manure is pretty awful as well but pigs take the cake for sure.
Oh and for fertilizer, the best gardens we ever had were when we had rabbits. We'd store the rabbit manure we cleaned from the hutches in five gallon buckets with some water. Let them stand for a week or so and combine with horse manure on your garden. The cucumbers wouldn't stop growing until the frost came...
I think we should legalize prostitution across the country. It would provide plenty of employment, and many unemployed people from the financial services industry will find they already have the aptitude. Unoccupied homes and commercial buildings could be turned into brothels, generating tax revenue and contributing to GDP. The social stigma will decrease even more when people are hungry enough. After all, getting laid and getting off are much better than getting laid off.
And here we go again - instead of FIRST agreeing on a selection method that at least gives us a hope of achieving "properly chosen", we're jumping right to tossing busy-work suggestions at the wall hoping something sticks.
Have we not learned anything?
Sick and Tired Dude | 01.11.09 - 5:49 pm | #
that's the joy of socialism. here we are not only tossing it at the wall to see what sticks, but making arbitrary value judgments for dispensing surplus as handouts.
the idea isn't to rebalance with a stimulus really, not at all. it's to perturb a system that is failing to equilibriate on its own, not unlike throwing arbitrary spikes in a dataset to dislodge from a suboptimal local maxima. the only honest way to pull it off is either to deliberately create and destroy money, or dispense it in such a way that it has no economic value to anyone than anyone else(a pure public good). failing that a public good that benefits many random people is much preferable to one that arbitrarily advantages some selected group. you want stuff with social value that would never otherwise be done for any investment reason, because we are already committed to throwing the money away, so we should do something with it that would otherwise never get done.
Yeah pig manure is the worst, my Mom's cousin had a pig farm, the stench is unbearable. I had horses and never found the smell to be all that bad. Cow manure is pretty awful as well but pigs take the cake for sure. Comrade Kristina | Homepage | 01.11.09 - 6:01 pm | #
If I may say so: This comment board has definitely gone to shit.
"If they used that criteria for farm land it wouldn't pass - not at least after the sprayers had been through."
Pesticides, IIRC, contain chlor-organics like dioxins and furans. So does electrical cable insulation, so do the products of urban waste incineration, lignite from rotting wood, IIRC. I used to know an organic chemist - God bless his soul - who worked at the Academy of Sciences in Moscow. One of his specialities was chlor-organic compounds. The compounds are extremely potent - in parts per trillion - and tend to concentrate in fish, dairy products, including human milk. They are teratogenic, meaning they adversely affect the fetus.
One problem is that I don't think that we will have the volume of oil exports required to power an economic recovery.
Our middle case is that 10 years hence, the top five net oil exporters--Saudi Arabia; Russia; Norway; Iran & the UAE--will have already shipped about 80% of their post-2005 cumulative net oil exports.
I just ran across what appears to be a new real estate scam in Florida. I thought lawyerliz would be interested and maybe have some thoughts on it.
There's a distressed property in short sale, where the owner sold or gave a one year exclusive option to an investor to buy the property. The investor, and the marketing real estate agent, are now engaged in the short sale negotiation with the bank.
Because of this option contract, the real estate agent is effectively blocking other interested parties from making their own offer. I suspect the bank has no idea what is going on and is getting ripped off because they aren't seeing the other (higher) bids.
Normally, a seller has an interest in getting the highest sale price, even in short sale. I guess because the short sale loan forgiveness isn't taxable any more, the seller has no interest in getting a higher price? It is a really unusual situation and something doesn't seem right.
This argument is not very palatable to me. How about Ford, GM, and Chrysler just destroy all the cars they aren't selling too? Does that make sense? Hey; our government can even pay Ford, GM and Chrysler to destroy the cars!
(Sorry, I skipped reading this thread... so my point might've been made?)
So a problem with urban demolition is what to do with all these toxic waste products. A striking example is what happened to the urban environment as a consequence of 9 - 11.
Bulldose Detroit. Well, a big part of it. Same for a lot of other eastern cities. Create commons.
Add baseball, basketball, soccer fields. Run an Dept. of Agriculture program.
"We're about to head into a season of scheduled bad news," said Art Hogan, managing director at Jefferies "There's nobody who believes this is going to be anything less than a disaster."
TAKE THE MARKET ON THAT!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
The issue is whether the property, whether it be cars or houses, has a negative economic cost such that replacement or destruction actually increases net wealth.
"that's the proper analogy OLD WORTHLESS RUSTY VEHICLES... dragged in & melted down... UNFIT DILAPIDATED BUILDINGS... torn down & land leveled."
Perhaps while they were still useful they created the wealth that will see their destruction result nevertheless in a net profit. An old 18-wheeler that carried many products to market. An old building in which socially productive families were raised, or socially productive business was carried on.
"Elvis, you're absolutely delusional. Confidence isn't created by destroying things. If that were the case we should immediately start bombing our own cities."
That is what got us into the problem. We bombarded our nation with unneeded construction. Now we need to get rid of it. Or we can just wait and wait and wait and wait...I take it, you'd just like to wait. Good things come to those who wait and wait and wait. Unless, they die first.
Instead of "Hey, no one is buying this house I have... so the government can pay my price and bulldoze it". YLSP | 01.11.09 - 6:50 pm | #
It would be tried I'm sure... but people who haven't been to say East St. Louis... have no idea how many unfit buildings there are and how many unemployed live in those areas... coincidence? Not.
The problem is what next? After the tear down... much of what was leveled in the 60s is still leveled.
Recall Londonbanker's emphasis on the concept of 'productive works'. Old non-use or non-conforming use buildings are essentially stored costs. They are a cost on someone's future development pro-forma. When development is considered a 'productive work', then its time to demo and start the interest on the cost clicking.
Repairing bridges is somewhere in between. Its still a make-work project. If there were a scale for such things, demoing vacant building would be a very low-yield productive work. Building 10,000 wind turbines would be at the extreme other end of the scale.
Kondratieff canuk, yes. The idea I was trying to get across is that as we condemned and then demolished buildings we maintained values in those that remained. The addition of greenspace or the deletion of scary space thereafter made downtown more appealing and so more in demand. As long as the courthouse, city hall, etc remain downtown all those who work for or with government (lawyers, politicans, etc) will have to travel downtown to conduct business and more than a few of them will want to live within walking distance.
"Instead of "Hey, no one is buying this house I have... so the government can pay my price and bulldoze it".
YLSP"
That is why only foreclosed homes that the gov't bought at foreclosure autions would be bulldozed by the gov't. In any large scale project (especially gov't), there are going to be fraud issues. Oversight would help, but not prevent all.
With out saying protecting Union jobs who paid a ton for his election? Economist Moe Howard 3SU | 01.11.09 - 6:47 pm | #
That's the game here in California. The public servant unions pay for the legislative campaigns, then the elected legislators raise taxes and use the revenue to raise public servant pay & benefits; the cycle restarts every election.
Forget about giving non-military public servants houses; we've already mortgaged the state for them.
I'm reminded of the arguments against euthanasia for some reason.
Who decides what is destroyed? How much recycling of materials can be done or do you just knock it down and fill up landfills?
Have you ever watched demolition being done? Very easy and very fast unless you mandate full recycling of all usable materials but then that will depress other manufacturing.
Couldn't the buildings provide more jobs by rehabilitating the building and then selling it cheaply? How do you get the private owners to agree? The tax break idea was a good one but then aren't you lowering the tax base at an inopportune time?
Worst case is you do nothing and the locals will salvage and burn for free.
If you have liquidity, then you will be able to purchase necessities, and also the hard assets you will eventually need. Deflation will force down the prices of almost everything, hence preserving your purchasing power now will give you options in the future that very few will have. All fiat currencies are eventually inflated away, and in this case that will happen once the credit bubble has finished deflating and the international debt financing model is well and truly broken. I would expect that to be quite some time, as deflation and depression are self-reinforcing, and during that downward spiral it will be impossible to inflate.
During the deflationary phase you will need liquidity, but once it is over you will need to switch to hard assets. I would suggest waiting for very substantial price falls in order to hang on to as much of your wealth as you can, but not to wait for the bottom. The risks of spending a lot of money when no one else has any will grow with time, and you will need time to climb the learning curve associated with any self-sufficiency assets you buy. My guess is that deflation could last for a number of years, and that the best time to shift to hard assets (from a purely financial point of view) should be at least a couple of years away. Others with more resources may make the shift sooner, knowing that they will lose money, but having the luxury of being able to do so in order to buy time to learn new skills.
"Is the next step getting rid of our unproductive elders ?"
I beg your pardon [indignant]. Pavel Chichikov | 01.11.09 - 6:58 pm | #
LOL. Sporkfed isn't thinking - if he was he'd realize elders are 'inflationary'... printing money to spend on them is a direct attack on 'deflation' [defined as a shrinking money supply]... we won't go there UNTIL deflation is defeated and inflation kicks in... then grandma better watch out.
A Demolition Plan of housing and commercial buildings sounds like more ideas & strategies to Destroy America plus there's the assumption in this that there won't be a Recovery and thus no need for all these buildings in a permant Deflation scenario.
To go back to the "shrinking cities" idea - which is doing what CR suggests in a planned, thoughtful way, one of their goals (and I think Youngstown is one of the cities) is to reduce future infrastructure costs.
Example - if most of a neighborhood is abandoned or past savaging, relocate the remaining residents (voluntarily, by offering them places in better neighborhoods) and demolish the entire block of buildings - thereby cuttin future sewer, water and electric costs to the city. Convert to greenspace, urban grden space, or wetlands that are zero maintenance and provide some societal (and possibly ecosystem service) benefits.
So, done carefully, not really the same as the "broken window fallacy"
the best time to shift to hard assets (from a purely financial point of view) should be at least a couple of years away Subcommander Doom | 01.11.09 - 7:01 pm | #
Assuming there's any hard assets worth having available by then.
Kondratieff canuk @ 6:57 pm - my view as well: smart grid, renewable energy, mass transit, universal health care, environmental clean-up. Not that smaller projects like CR's proposal should be excluded, but the government program needs a clear focus on improving the future productivity
A shopkeeper has a rotting door. It does a poor job of keeping out the weather, nor does it do well at keeping the heat within during the cold times. Worse, its odor is such that people are unwilling to pass it to enter the shop. The shopkeeper decides to replace it, but is stopped by many who call it a broken window.
"Keep the door and the money you would spend to replace it. Instead, you could be spending the money upon a new suit. Or saving it and letting it earn interest." And so the shopkeeper retained the door, and suffered under miserable conditions and no customers - and could not understand why the good advice of his neighbors did so poorly for him.
The problem is obvious when stated this way, of course. I do not know for certain what CR's objective in the recommendation might have been, but the abhorrence of tearing down anything because it's a broken window ignores the fact that there are a lot of broken doors out there.
fried writes:
i still like nova's idea of a free house for every returning vet...
Yeah, that's a great idea. Let's give the youth more of a reason to go slaughter brown skins around the globe so defense contractors and big oil can add more vehicles to their already burgeoning classic car collections.
More bang for your buck!
Let's demolish Detroit and Washington D.C. We'll do it in order to save them, like 'Nam.
Great Idea!
+1
No on NASCAR, yes to Demolition Derbies.
Are you nuts CR?
This wont help the economy in any way.
Making fun of this aint fun anymore.
Come up with something good instead
I think it's an excellent suggestion. It certainly would be a way to help the inner cities.
They will create deconstruction jobs...not a bad idea, it will solve housing oversupply problem as well. Very Keynesian.
All you need to do is make it so the owner has to pay more property taxes for vacant unused property versus vacant land.
Somehow demolition occurs mighty fast.
I have seen houses in the wilds of Nevada with no roofs- demoed to cut the taxes.
It does destroy a lot of restorable historic property, sadly.
Balance the costs.
Someday this war's gonna end...
Broken Window Fallacy.
I would also suggest something similar for the financial industry.
Government should start/capitalize FRESH NEW banks after closing all those that did not deserve to be helped. These NEW BANKS will be run so that they would extend credit.
Excellent idea Bill!
we had to destroy the village in order to save it
There are many towns that could be bulldozed; I'm all for it. This would also be integrated with a sort of building moratorium effort, to not overbuild. just to build. The act of demolition and re-zoning and re-thinking could be a stimulating thing across the nation. Th main issue we face is too much inventory, too many square feet, and this type of direction at least is more common sense in that it balances supply and demand!
Demolition is counterintuitive, much like electing legislators to repeal laws rather than make new ones.
Considering the recent failures of conventional wisdom, perhaps counterintuitive thinking is exactly what we need. Deconstructionism, indeed.
Tax breaks to re-develop crap property!!
On June 23, 2006 - on the one-year anniversary of the Kelo decision (see above), President George W. Bush issued an executive order stating in Section I that the federal government must limit its use of taking private property for "public use" with "just compensation", which is also stated in the constitution, for the "purpose of benefiting the general public." He limits this use by stating that it may not be used "for the purpose of advancing the economic interest of private parties to be given ownership or use of the property taken".[7] However, eminent domain is more often exercised by local and state governments, albeit often with funds obtained from the Federal government.
We need more parking lots anyway, for all the new tents.
o no no no, demolishing housing, when there are tent cities ?
et tu CR
...
It's probably a great idea to do it in a controlled manner, instead of leaving it up to the angry masses to raze everything. They might even be able to offset costs by charging unemployed pitchfork-bearers to vent their anger by destroying a building.
I'm up for that program as long as they start with the McMansions in the burbs.
There is the minor problem that with modern machinery, not many workers are needed. A house is GONE in one day or less. One macho-machine operator, 5 truck drivers, one flagger, 2 supervisors, and one porta-potty delivery guy.
Hey, these big old buildings may have big bad loans, no?
Brilliant idea. Not just urban though there are abandoned structures in rural areas across the country that create no economic value (i.e. taxes), they are merely eyesores and worse reduce the value of surrounding structures. I have always thought paying to remove these structures would help those communities. Now is the time!!
re-develop renew^ "building moratorium "
Hey, these big old buildings may have big bad loans, no?
Anonymous | 01.11.09
mortgage and lender get to be the base for the landfill.
I meant to mention above that anything 'old' (pre-WWII, when buildings were built 'right') are exempt. They get historic renovation.
We are all cement and rock men now.
Listen, we've got lots o' problems here. Why don't we just throw 'em all together, and provide a remedy.
Have the military carpet bomb designated areas. Charge admission. Of course, we'd have to drop leaflets to ensure that no one is in the area..(I think they have practice here already), and simultaneously provide the tax breaks and sell refreshments....hey televise it!
So now the broadcast industry is involved, (private sector employment), oh yeah... make it a serial, weekly. Raffle it, 'your town, could be next'!
..why the possibilities are endless...
This could be like a SuperFund Cleanup, but with a new name, like TARP???
I would suggest any block where they film The Real Housewives of ______
Yes. A plan I have been touting for quite some time. Almost always met with ridicule. It seems that I'm crazy until CR says it. Thanks for the confirmation.
If I were in charge, my stimulus would be to demolish every housing development built post 2003 and recycle the materials towards rebuilding and revitalizing the ghost-downtowns common all across america. Denser developments with more apartment complexes and walkable communities.
With Eminent Domain on the books, it's legally feasible.
do it in a controlled manner, instead of leaving it up to the angry masses to raze everything
If you can keep the angry masses from being low bidder.
But you could form a citizens' corps of demo parties - Habitat for Uninhabitability, if you will. Would give the masses something to focus on, an outlet for venting their anger, and leave them feeling good about making a difference.
I'm not sure if I'm kidding.
Rap; "I want my bailout money"
YouTube - I Want My Bailout Money by Michael Adams the Health Ranger
This is good, you have appraisers come in to lowball projects, so that flippers, I mean investors can get tax breaks to re-new or re-build old structures. This would help create jobs and upgrade old areas and then in 4 years, they would be worth a lot more dough!
to make this more fun, i suggest a tv contest to pick the ugliest condo's in a city for the 'treatment'. then the controlled-explosive takedown - which everyone likes to watch.
first the condos, then the mcmansions.
oh, and the land returned to nature or made into public parks.
Attach this to a lotto system, where the winner can bulldoze any building they want (on a list)?
Slow newsday on CR...
demolition would certainly address the housing glut
Bulldozing the oversupply is the only way to correct oversupply in a shortened time frame, since houses aren't perishable. (Please don't argue that the shoddy construction of late makes them perishable. They aren't.) Othwise, we just sit here and wait and wait for years until the greed of the 2000s slowly and ever-so-slowly gets absorbed.
Yes. A plan I have been touting for quite some time. Almost always met with ridicule.
Elvis | 01.11.09 - 3:07 pm | #
That's because CR is talking about "un-usable" buildings or projects already scheduled for demo,... not your real estate agent turned hooker sub division bando fantasy.
craig writes:
we had to destroy the village in order to save it
RGE - We had to burn the village to save it
I've demolished quite a few houses over the years, in order to build new construction. Here's how it goes: The hoe arrives by float the night before. At 7:30AM the the hoe operator arrives and puts his machine to work creating a pile of rubble where the house once stood - takes about 1 hr. About 9:00 AM the first dump truck arrives, and is loaded by the hoe. As he drives away, headed to the landfill site, another truck waiting is loaded. A few truck loads later, the site is completely clean. Takes about 3 hrs. Employment? One hoe operator, his machine, and about three trucks in rotation for 4 hrs. Next work, occurring by say noon the hoe starts to dig the hole, (the other 1/2 of his income for the day, in terms of hours). Digging the hole makes the job worthwhile, i.e. the cost of moving his machine on and off the property. It might take a good operator 4 hrs to dig the hole. End of story.
Landfill fees and trucking are a big part of the job cost. By the end of the day, I might have spent $3,000 to $4,000 all in. Depends on variables like how far is the landfill, and what are the fees. The human labour component is a small part of the total cost. I'm sure this scenario is much the same for any city, give or take 20% in costs for localisation scale
This will never fly unless you give it a catchy name. Perhaps "Subdivision Conservation Payments" would be properly Orwellian. As some wag suggested on CR months ago, homebuilders could turn the subdivisions into farmland, and then get paid for not growing crops on them.
can we start with the Citicorp, JPM and BOA buildings? please, oh please.
jill | 01.11.09 - 3:08 pm | #
Here's hoping that goes viral.
My pick for ugliest condo:
- real estate - REALTOR.com®
http://files.posterous.com/crokos/1LOuRVXGcrQ3drKWn9gqNYfvGnXlbPrl9uQX74j7cBqF2dN3y6ryOgKYvWyg/Clipboard01a.jpg?AWSAccessKeyId=1C9REJR1EMRZ83Q7QRG2&Expires=1231704739&Signature=RpoeKgXkEKUOX8i1gbeu4xF2gNw%3D
With Eminent Domain on the books, it's legally feasible.
Most states reacted to Kelo by prohibiting condemnation for the purpose of "economic" development, instead requiring an actual public use (park, highway, etc).
The only way this proposal works is through tax credits, which makes arbitrary distinctions based on the "age" of the property unsustainable. Historical preservation needs to remain under the purview of local zoning boards.
It might take a good operator 4 hrs to dig the hole. End of story.
Was the government paying for it? Didn't think so ;p
Landfill fees and trucking are a big part of the job cost.
Yea! More work for truckers! And it's On Topic!
It does destroy a lot of restorable historic property, sadly.
Citizen AllenM | 01.11.09 - 2:47 pm | #
Make that 'exempt' and provide 'stimulus' to rehab. That's a pretty easy work around.
ReflectionOf.Me - of you and of everything that surrounds us...
I don't think it is a bad idea, but I think the scope is somewhat limited. This is not 1950's style 'urban renewal', I assume, but more selective removal.
Last year there was an article in the Minneapolis papers - the mayor and some people from the planning department were touring foreclosures on the North side (rough area) and they estimated that one of three houses they saw was a tear-down - simply not worth the effort to fix. I think that is a low estimate. However, those lots are still not desirable due to the character of the neighborhood.
The other problem is simple: it takes less than a day to pull out a house like that, given the equipment and methods we'd now use. Not much there for job creation or for total spending.
Broken Window Fallacy.
F. Bastiat | 01.11.09 - 2:49 pm | #
Not so. The window is already 'broken'.
$450,000 and no patio?
Hey here's a token idea.. how about we let some stuff fail? How about we let some assets depreciate? How about we actually let some people and businesses go bk..
financial gravity can't be stopped.. it can only be deferred for a bit.
/rhetorical rant
yes, its time for a de-construction plan....
saddle up the horses.
In the context of the inner cities, CR's proposal has another benefit.
It would help reduce crime. The correlation between abandoned construction and crime is well-established.
It would also put a lot of otherwise unskilled labor to work.
I like it. Conjure likes it. What's not to like about it? It needs to be done.
I didn't see the post by Kondratieff while I was writing. His point is correct - not a lot of $$$ potential there.
There is some benefit, I think, to removing these things. Mabe you'd tear down half of Detroit... but then what?
"not your real estate agent turned hooker sub division bando fantasy.
sdtfs"
Then it doesn't affect the oversupply. It, therefore, does not address the overriding problem and is just a way to keep people busy. I prefer the gov't buying foreclosed properties at foreclosure auctions at foreclosure market rates and then bulldozing them after salvaging what they can. It gets rid of the paper and it gets rid of the oversupply. Problem address. Resolution of problem expedited. It is a radical solution for a mind blowing problem. If stdfs doesn't like it, it increases my confidence that it is the necessary slolution.
Could we replace empty houses and strip malls in the exurbs with farmland?
Mabe you'd tear down half of Detroit... but then what?
The Detroit National Forest...
If you demolish the vacant houses, where will all the homeless people stay?
"If you demolish the vacant houses, where will all the homeless people stay?
Bond Girl"
In buildings designated for them to stay in.
the owners of power could accomplish the same thing with a civil war.
"If you demolish the vacant houses, where will all the homeless people stay?"
Interesting, isn't it? It forces the communities in question to address other issues as well.
"in buildings designated for them to stay in.."
Man.. reading that just gave me shivers down my spine..
Not sure why exactly.. just sounds very scary... Orwellian..
Homeless advocates will scream bloody murder over this proposal.
MP - been gone a while.. where are all of the conjure clocks at now? Touble you for a recap?
why not just load up the empty houses with a couple cartons of ciggies, and a case of shampipple... it'll keep the win/win going with firefighters and welfare fraud.
Tax credits for renovating historic property have traditionally only benefited the top 5%. Because the federal government can't designate homes as having "historic" qualities, they tend to leave the designation to the cities and states, at which point graft tends to be a huge issue.
last I heard it was 6 seconds till the chariot turns back into a pumpkin.
Urgent message from the authorities:
Reform plan raises fears of Bank secrecy
The Bank of England will be able to print extra money without having legally to declare it under new plans which will heighten fears that the Government will secretly pump extra cash into the economy.
link one -- Banking Bill
"Quite why the Bank has to keep its operations so shrouded in secrecy is a mystery to me," said Simon Ward, economist at New Star. "This [reform] will make it much more difficult to track what the Bank is doing."
Among the details which will no longer be published are those revealing the extent to which London's banks are using the Bank's deposit facilities a yardstick of pressure in the financial system.
Debating the issue in the House of Lords recently, Lord James of Blackheath, a Conservative peer, said: "Remove [this] control and there is nothing to stop an unreported and unmonitored flooding of the money market by the undisciplined use of the printing presses.
If you demolish the vacant houses, where will all the homeless people stay?
Bond Girl | Homepage | 01.11.09 - 3:24 pm | #
Work Kamps.
Might as well have some demolition. We had some on 9/11.
YouTube - Comparison Vid - The Planned WTC Demolition
YouTube - It was a Military Plane!
Correct, Anon, and that's at least 1/3 off the 2007 price.
"Gubmint Cheese writes:
"in buildings designated for them to stay in.."
"Man.. reading that just gave me shivers down my spine.."
Simply not allowing homeless people to live in any abandoned home they seem fit, since like a logical and reasonable thing to me. Or, we can just say screw the laws, every man for himself.
@Gubbmint Cheese
Conjure's global depression clock is now:
11:59:54
ASBESTOS
Comrade Dazed, I love it!! Men & teen boys set to destroy stuff. An admission fee to be charged. Maybe a paintball war first. . . The mind boggles.
Girls too, if they wanna, but most wouldn't.
And a glod discussion that I wasn't in on with Pavel.
Sob.
Oh, yeah, and lead based paint.
Iron clad waiver forms?? Nah.
Masks and gloves?? Nah.
Only on newer bldgs???
It is now obvious that all sanity has fled. I'm speechless, CR, just speechless.
You've just lost every bit of credibility you've built up over the years. This is the most ridiculous thing I've ever heard you say by a country mile. This is the most basic fallacy of economics, known as the Broken Window Fallacy. You really should look it up Bill, and you really should pick up a copy of Economics in One Lesson to disabuse yourself of this silliness.
You CANNOT create wealth and prosperity by destroying things. PERIOD.
"I'm speechless, CR, just speechless.
Lisa"
Fortunately for you, you can still type, so speech isn't absolutely necessary to transmit your views.
"You CANNOT create wealth and prosperity by destroying things. PERIOD.
Vic"
You can create confidence in markets again, though.
Elvis has left the "building"
We could finish tearing down the Super Collider from a previous recession waste of time work project.
The local and state govs already own a lot of this property through failure to pay taxes. If they had imagination they could have already cleared and
given the property to potential tax payers.
Elvis - I know the 'every man for him/her self' thing is not the way to go.. but the idea of having designated shelters for the homeless.. wow.. just scares me to see where we could be going (are going in my view)
@MP - thx for the update (I think)
I'm just glad MP's clock has a second hand.
Looking at a preview of the leading indicators A Look at Leading Indicators - Most Times They're Late there are plenty of shovel ready projects in the non-residential construction segment.
i guess i am one of the few who does not want to reduce the housing inventory. prices, please keep going lower so i can afford one finally.
Demolish all abandoned buildings and use the materials to build an impenetrable wall around the US (to keep out the illegals).
""You CANNOT create wealth and prosperity by destroying things. PERIOD."
You absolutely can. It all depends on what you create in their place.
We need more parking lots anyway, for all the new tents.
Anonymous | 01.11.09 - 2:57 pm | #
An anecdotal story...
In the summer of 1978 I was working in Minneapolis. In an area off Hiawatha near Franklin & Cedar Ave there is a community called 'The Res'... it was a rough neighborhood where Native Americans 'wintered'... in the summer they headed up north returning to the real reservations to be with friends and family and to hunt & fish. This was before casinos so there was little or no opportunity to work (or even collect support payments) on the 'Red Road'... but in the summer the reservations were a lot more pleasant than the inner city so families returned. In the depths of a Minnesota winter the opposite was true so back to the city. The rundown homes & apartments in the 'Res' in Mpls were abandoned all summer then 'reclaimed' in the winter. It was a migratory pattern in every sense of the word.
Over the years there were a lot of abandoned homes that were burned out & leveled. The lots became overgrown.
Back in '78 a new group entered the scene - the 'Boat People' - local churches sponsored individual Hmong & Vietnamese refugees from the war... what they soon learned is if you sponsor one you sponsor a whole family... once you sponsor a family you sponsor a village... etc. They newcomers moved into those 'abandoned' homes [vacated by Indians for the summer] and immediately started 'planting' in the nearby vacant lots. By the end of the summer there were a number of gardens all throughout the neighborhood.
It didn't end completely happy however - the Natives returned in the fall and tried to 'reclaim' their winter quarters - didn't turn into a 'war' but let's just say the newcomers didn't immediately leave... I mean if you had been fighting the Viet Cong & Khmer Rouge - what can a few Lakota or Ojibwa do to scare you? In the end - years later - the Lakota & Ojibwa got their casinos and resultant tribal social services and the 'Res' off Hiawatha is much smaller and more prosperous today... and the SE Asians have dispersed though many still garden outside the city and are heavily represented at city farmer's markets ... but I will NEVER forget the transformation that occurred to that neighborhood that summer - it was a complete night and day difference when all those local gardens popped up. If 'demolition' leads to that kind of renaissance - sign me up.
I know of condos 'way uglier than that one!!!
And I actually think in some cases this would positively benefit the neighborhood.
Miami has a lot of "infill" lots. Taken for failure to pay taxes/liens.
They stupidly leave on the muni liens which sometimes add up to 10s of thousands of dollars, and expect the buyers to pay for them.
If you have a house infested with fornicating teens, bandos, drug dealers driving the rest of the neighborhood crazy, this would fix a lot.
Not kidding.
An appropriate neighborhood could be picked and the remedy applied.
I suggest the neighborhood in which the house with the granite countertops and nothing much else in the video on the left be selected.
Creative Destruction!
Where do I sign up?
I think it is telling that people are afraid to bulldoze houses. It is outside-the-box thinking and many are confined to thinking inside-their-box. "Oh, no, we cannot do that. People need homes." I guess it was the same kind of radical thinking that got women to be able to vote. And that turned out okay. Except I don't think Jas should be able to vote.
Good idea finally build the wall on the border! That makes to much sense to protect our country.
Gubbmint,
we have had them here in Phoenix for years, and they do take in the folks to whom loss of housing is essentially temporary. The lifestyle homeless, well they live in the ravines, alleys and go 'bando. Nothing ever changes with regard to this issue.
As a matter of fact, the destruction of adequate, or even inadequate boarding type housing has contributed to the homeless in any big city you care to contemplate. Without the ability for disabled and fixed income to find affordable housing (have you seen how long the Section 8 lists are!??) the street or uncomfortable illegal boarding becomes the norm. Adaptive reuse is often prohibited under building and zoning codes designed for perpetual economic growth.
This will end with a change in philosophy.
Someday this war's gonna end...
Oops, I mean right.
The other left.
Gubmint Cheese: "Hey here's a token idea.. how about we let some stuff fail?"
That was my hope, but I'm just a liberal (which simply means anyone who disagrees with Cons).
So shusssssh... wait just another few weeks and this can be the new Conservative talking point! Perfect, and say it with stuffy air of long-suffering superiority, too. That never gets old..
First we gotta wait until the current Con-politicos finish stuffing the Treasury up their crony-friends asses.
Then, when it's only working Americans left in trouble ... it will be Time to Let Things Fail and have the Free Market decide ... timmmmmmmmbeeeerrrr! Amirite?
Cons of America are willing and able, Gubmint Cheese, you are just a little too soon.
Cash for Clunkers
Cash for Clunkers is a generic name for a variety of programs under which the government buys up some of the oldest, most polluting vehicles and scraps them. If done successfully, it holds the promise of performing a remarkable public policy trifecta stimulating the economy, improving the environment and reducing income inequality all at the same time.
You CANNOT create wealth and prosperity by destroying things. PERIOD.
You also can't get out of debt by taking on more debt, but that doesn't stop government from trying it.
Some more advice:
Much better than demo'ing property would be concrete bridge restoration. I have no idea what the numbers are, but there must be hundreds of thousands of bridges that are in serious decay in the US. Now whould be a great time to fix them. It could be done by fixed bid tender. A great way to do it would be to tender the job out thru a local engeering firm that has experience in the area and make sure to spread the contracts around to at least a handful of different firms in each county. Make the Eng firm responsible for the job at a realistically low-end fee for management, since this is a tax-payer reallocation of wealth by government. Make the banks WHO ALREADY HAVE the money, loan it out. Leverage the stimulus money, to cover the cost of the debt, amortized over 30 years. Make the municipality responsible for the principal portion of the debt repayment. Some grand plan like this is needed, and keep it simple and low cost. Roll it out nationwide. At least you are investing in the infrastructure of your country, as opposed to investing in exotic MIC war machinery to destroy infrastructure elsewhere.
Elvis and Citizen Allen - it's not that I don't agree or think that the idea would/will work - far from it. I just get the feeling that the composition of those staying in the 'designated shelters' is going to be changing. While the druggies and 'usual' characters will be there, there will be a growing number of people who have just fallen on recent hard times - people who used to rent, or own.. etc. Overall I think its a good idea - Just my sixth sense thing kicking in...
'I see desperate people'
"You CANNOT create wealth and prosperity by destroying things."
There's a revelation in there somewhere.
I think it is a good idea, although unfortunately the scale is not big enough to make a dent on on the economic downturn.
I am more interested to hear the government promote really big ideas like smart grid, renewable energy, universal health care (and by the way, middle aged white collar unemployed need new jobs too). Cleaning up the existing environmental mess would be quite nice too.
Gaia, perfect.
"Daddy. Did you pay for this house?"
"Yes, I did."
"Did all the bandos living in the neighbor pay for those houses?"
"No, they didn't."
"OK. That seems fair. Now they have places to live. BTW, I'm going to quit school at 10 and get my own bando house."
"You are catching on, honey. I wish I had."
You CANNOT create wealth and prosperity by destroying things."
There's a "revelation" in there somewhere.
I think you me re-valuation, or de-valuation....but point taken.
Here's a word of caution though - anyone here been to say downtown Buffalo NY lately? My father was an exec' in that town 40 years ago... the company failed the area razed in hope that would clear the way for 'future' development. I was back there last summer - the vacant area near where his plant was IS STILL vacant. They could've grown & harvested timber on that land in the years those sites have remained vacant.
Just cause you unbuild it doesn't mean they'll come.
I might suggest:
The "demo" idea has some good points:
There are many residential AND commercial buildings out there that need to be torn down.
The current owners most likely can't afford to to it.
The manpower that could be utilized would not have too many "earning curves".
I might suggest though that each building be a "controlled demolition" (materials are salvaged for further additional uses). I built two of my barns from recycled studs, beams, siding, bricks & block).
CR:
I fear that this program would be misused to remove good housing stock from the supply, in the name of culling bad housing but in reality to keep on a too high level. This would do no good to the economy, now that housing isn't seen as infallible anymore. If the owners need a motivation to demolish their houses: What about demanding punctual property tax payments on all non-homesteads that would be otherwise expropriated and either demolished or converted to affordable housing?
I agree, there are going to be a lot more desperate people, but we need to figure out how to deal with them reasonably. Meanwhile, as for letting things fail- how much more do you want?
The amount of failure in the pipeline will astound you. Right now I am aware of two state governments that are technically insolvent.
Now, how much can you stand before you start applauding anything that looks like cushioning the blow?
As I pointed out on the last thread, most Reaganesque solutions are moribund.
Republicans in Arizona are still talking about a small tax cut as stimulative in the face of a catastrophic drop in tax revenues and a constitutionally mandated balanced budget. And they are complaining about accepting any federal bailout!!??!!
I am at a loss, the lack of understanding of the current situation is what is distressing, and the fact that the Republicans are so f*cking clueless tells me we will be living under a democratic administration for a long time. Balanced government is best, but the sheer intellectual poverty of the Republicans is stunning.
Someday this war's gonna end...
"Just cause you unbuild it doesn't mean they'll come."
No, it doesn't, but they definitely won't come to a used-up neighborhood.
Better to begin with a clean slate.
With the two million overhang - or over supply - of single family homes, the Gov't should establish a Resolution Trust Corporation (name it what you want) with the sole purpose of purchasing and managing (yea, it will be a big job) at a minimum one million single family homes (Gov't investment of $200 billion, but keep in mind today's borrowing cost are near zero) while at the same time destroying a million very old homes (I agree 100% with CR).
The benefits:
- the $350 billion TARP is doing nothing so put it to work (foreclosure assistance is NOT the answer).
- removing one-million SFH's would play favorably in terms of reducing supply.
- relieve the people who should never have purchased a home by allowing them to rent the same home.
- force the banks who are hording the first $350 billion round of TARP money to absorb some of these losses.
- establish the RTC - the largest federally run property management company in the US.
- execute a long term exit strategy (i.e., sell the properties in 6-8 years).
- job creation
The negative:
I like the idea, provided (of course) that it is unusable / eye-sore properties.
I remember an article a short while back wherein England tinkered with tax rates to discourage empty, unused properties. The business community promptly responded by demolishing a lot of older buildings and leaving empty lots throughout the cities, which made things appear worse than before.
I don't know if it has been mentioned by anybody yet, but it sure is a whole lot easier to take something apart or tear it down than it is to put it together or to build it in the first place. You wouldn't have to be a good carpenter, just a little training with a sledge hammer or a sawzall, which wouldn't take much time!
CR goes Kommando Keynesian!!!!!
Notify the Nobel Prize committee immediately Igor!
If there is a banker inside house before demo, does that qualify for increased credit?
No, it doesn't, but they definitely won't come to a used-up neighborhood.
Better to begin with a clean slate.
mp | 01.11.09 - 4:01 pm | #
Agree.
You CANNOT create wealth and prosperity by destroying things.
In some beach front communities with really restrictive zoning laws, many homeowners actually hope that their houses get destroyed come hurricane season. Most of the time, there was nothing wrong with the property; it's just that the homeowners wanted a bigger house.
Whether or not a $8M beach front house as any practical economic benefit is another issue.
Good er..., well an idea anyway.
Does anyone realize how long it takes to get NESHAP clearance for abating asbestos and lead??? Or how much that costs?? Talk about your rabbit holes.
CR, love ya baby, but construction is being set up to be gamed right now, and I ought to know. That gov. cheddar will just concentrate more wealth, and there will be nowhere near enough jobs created. Think, one 20 million dollar sewer revitalization requires about 10 workers and about 20 support personnel (from pipe salesmen to secretaries to truck drivers).
Peter Schiff: new videos
YouTube - Peter Schiff predictions
Trading Day
Every day seems to bring a new solution. Every solution makes me believe more and more there is no solution but time, loss and pain. All of these "solutions" may numb the pain but surely the time factor will be lengthened.
As my Army Ranger friend says, FUBAR.
What I don't understand is:
The monies spent from the Stimulus Plan might very well achieve one of its intended purposes (it puts $$ into the economy).
The unfortunate truth to it as well, though, is, most people whom get any "extra" money in their pockets NOW will spend it much more WISELY. IN OTHER WORDS THERE WILL BE NO LONG-TERM ECONOMIC BENEFIT. AND, I would venture to say that most of it will be "holed away" as was a lot of the first bunch. (Actually, probably a BIGGER percentage will be saved now since more realize we're in "deeper doo-doo" than before).
rich writes:
What do you expect?
Every President comes from some background or other.
Obama is the first U.S. President since Woodrow Wilson from an academic background. He has no real-world experience in anything....
Obama'a only claim to fame is earning degrees and writing popular books.
and uh reagan was a b movie actor
and bush two, before "becoming" gov was spoon fed wealth (harkin oil) (the rangers deal) before he was a drunk
now theres real world experience
IN OTHER WORDS THERE WILL BE NO LONG-TERM ECONOMIC BENEFIT
Black Star Ranch | 01.11.09 - 4:13 pm | #
In the long run... you know the rest.
"You CANNOT create wealth and prosperity by destroying things."
That's what Capitalism does. So, destroying homes is nothing more than destroying something that was bult by destroying something else, i.e. a forest, or an ecosystem.
The Universe awaits our extinction.
dryfly(Very Good) writes:
\tHere's a word of caution though - anyone here been to say downtown Buffalo NY lately?
dryfly | 01.11.09 - 3:59 pm | #
dryfly - I was in Buffalo/Niagara Falls in November doing some flight test work. The whole area is so depressed ... much more so than a few years earlier when we were there. I saw boarded up places that have been that way for over two years. They did demo some hotels in Niagara Falls to build parking lots for the gigantic Indian casino there. The Canadian side is much more alive. At least the Buffalo area still has excellent food.
So, destroying homes is nothing more than destroying something that was bult by destroying something else, i.e. a forest, or an ecosystem.
The Universe awaits our extinction.
That was a 2 line synopsis of Keanu Reeves in "The Day the Earth Stood Still." Talk about a pointless movie.
Obama being a constitutional law professor don't count for shit.
Now if he was a plumber or a ditch digger, that would be important real world experience towards being president.
What was Nixon again?
Oh yeah that's right like Carter he was a Naval officer, but as a plus Carter was a farmer, making for a much better president.
Let's use it as target practice for our military and all their new fangled gadgetry.
Maybe we could recreate the World Trade Center Towers coming down....that would be a blast.
Just in government property alone there are abandoned schools, hospitals, and various institutions like prisons and sanitariums, wharves, old barracks and military warehouses that will never be usable as housing, the list goes on and on before you even hit privately owned housing.
You wouldn't have to be a good carpenter, just a little training with a sledge hammer or a sawzall, which wouldn't take much time!
I prefer my Cat 953. It is waaaaay too much fun to crunch a house with a track loader. It is very satisfying work......
So you're saying that Obama is just another Reagan or Bush?
Aren't you scared?
Quite seriously, I wouldn't spend SQUAT if I were the new President. I'd let the States know that we're saving the $775B to bail out your unemployment plans, underfunded pension plans, and other unseen financial "shotgun blasts to the head"!
On the same line as Peter, is Pat Buchanan:
YouTube - US on the edge of the abyss
If there is a banker inside house before demo, does that qualify for increased credit?
Dumb as a banker | 01.11.09 - 4:12 pm | #
Double points if he is with his Realtor®...
October 29, 1932
"Mr. Loyd George, who after a bout of political raillery at the expense of Sir John Simon and Sir Herbert Samuel, pleaded earnestly with the Government to adopt his own familiar plans for State financing of public works--slum clearance, telephones, land settlement, reclamation and reconditioning of derelict lands. We have, pleaded Mr. Lloyd George, "millions of mend idle, millions of acres idle, hundreds of millions of money idle. Cannot we bring the three together." link
I been watching football and switching back and forth to CNN. They're running IOUSA with intermittent commentary. I left the room when Rivlin started spewing her Keynesian horse hockey.
But, I will vote twice for the info babe's legs!
I think this plan. I would like to propose the first major infrastructure project - transform Detroit into a new National Forest.
Kind of like Central Park, but about 100 times larger.
thread music: YouTube -
Before the government spends money demolishing (and who decides on the demolition contractors? this could get political) why not FOR FREE give the public an opportunity to obtain the property, with the string that the new owner will "fix" the property if needed. What isn't claimed gets demolished.
There are SO many opportunities here for public good besides demolition. We keep warning on this blog about "worse than depression" times ahead, that reads a whole LOTTA homeless families. For some people, excess housing is hurting their bottom lines. For others, survival is iffy.
Demolition should not be the first road taken. First see if anyone wants/needs the property. Especially if the property is usable as is, put it up for grabs.
I prefer my Cat 953. It is waaaaay too much fun to crunch a house with a track loader. It is very satisfying work......
Bruce | 01.11.09 - 4:22 pm
Yeah, if you are in a hurry. The way things are now, what's the rush? The rednecks around here BID on tearing down an old house. They sell the recycled materials.
What about paying people to hunt and kill wall streeters? Now that is something which is employment intensive. You could also pay a bounty for each severed head trophy that can be identified.
"They sell the recycled materials."
....Exactamente................
I watched part of IOUSA yesterday but I was at work so didn't get to see much of it. I find it kind of ironic the MSM all of a sudden thinks doom and gloom is in vogue.
I guess one of the reasons I like this idea is that I've wanted to bulldoze good sections of LA for decades, good times or bad.
The idea that destroying RRE is going to somehow prevent prices from reaching their historical norms is ridiculous, of course. In fact, given that household size has probably bottomed and homeownership definitely peaked I'd say that the new "norm" could be a long ways further down.
Demolition should not be the first road taken. First see if anyone wants/needs the property. Especially if the property is usable as is, put it up for grabs.
Outsider | 01.11.09 - 4:24 pm | #
The snarky 'buzz word' for 60s urban renewal was 'Urban Removal'... there are lots of inner cities where the stuff torn down way back then still haven't been built on and it isn't all due to 'environmental red tape'.
I wonder what "Habitat for Humanity" would say about this. I mean, heck, they're still out there building little houses, aren't they?
"You CANNOT create wealth and prosperity by destroying things."
that's also what Nature does.
think of new growth rising from a natural forest fire or fertilizing plant growth from compost.
the questions are what is being destroyed, how is it being destroyed, how are the materials that are left recycled, and what kind of new growth is it fertilizing?
sorry meant to also quote M.Bama above:
"That's what Capitalism does."
I watched part of IOUSA yesterday but I was at work so didn't get to see much of it. I find it kind of ironic the MSM all of a sudden thinks doom and gloom is in vogue.
Comrade Kristina | Homepage | 01.11.09 - 4:27 pm | #
So, nobody's watching? And they're missing the emergence of yet another hot info babe.
Not the right music, but the concept is there:
http://www.youtube.com/watch?v=21Dd0vpw7s4
I wonder what "Habitat for Humanity" would say about this. I mean, heck, they're still out there building little houses, aren't they?
Comrade Bear (tj & the bear) | 01.11.09 - 4:30 pm | #
I know people working w/ H4H - they would LOVE to have lots prepped for them... especially if there is a clean up required... probably not a huge risk for RRE but for CRE it is [lord only knows what cems were poured where 50, 60, 100 years ago in a lot of these older cities]...
Property in most cities is worth more if the condemned structures are torn down anyway.
"So, nobody's watching [CNN]?"
.......Some of us don't contribute to the "establishment media whores" associated with BIG BUSINESS cable TV.
(Jeeze - that almost made me feel 25 again!)
....why do I feel like a 10-year old child in a classroom listening to his 4th-grade teacher?"
That is how I felt about OB's campaign.
Economist Moe Howard 3SU | 01.11.09 - 11:43 am | #
yeah like sara palin
"heres a big shout out to the third grade"... or...ill get back to ya on that"
ps i like mccain and consider him an honorable man...would have made a much better prez than bush 8 years ago
but you can thank rove for the illegitimate black baby push polls in the Carolinas for that
Along the same lines, the defense industry could build bombs and missles and fighter jets, then dimantle them when they're done. Could go on forever...
Mock, I can't imagine facing down this crisis with the knowledge in the back of my mind that at any moment Sarah could be in charge...Horrifying at all levels...
want real "Keynesian" stimulus? why don't we stop kidding ourselves and try this: YouTube - Watch the K Foundation burn a million quid
print $1 trillion or so in hard cash, then pay people to slowly burn it over the course of three years. temporary jobs, guaranteed inflation, then gradual deflation at a controllable rate.
YouTube -
If the gov't buys foreclosed homes and foreclosure auctions at foreclosure market prices, and then destroys them after first salavaging the good parts, there is value left:
All is not lost in the short-term and, in the long-term, it gets us back closer to a functioning economy.
.......seriously, isn't it amazing the caliber of person we get to run for President?
Bush allowed $350B+ to be blown....
Obama hopefully won't do the same X2....
....but then I just got 12-loads of cow manure this morning for the gardens. YESSSS!! Everything here is all better now.
The snarky 'buzz word' for 60s urban renewal was 'Urban Removal'... there are lots of inner cities where the stuff torn down way back then still haven't been built on and it isn't all due to 'environmental red tape'.
dryfly
This was a pet project of governor Nelson Rockefeller in NY. We lived outside this little industrial city upstate. The kind of place that had been going downhill since the 1920's.
But there was still some industry, a nearby college and there were a couple main drags with neat old buildings.
By the early 1970s it looked like it had been nuked. And with the economy headed down, that was that. What a freaking waste. They took away the only reason anyone had for visiting downtown.
The idea then was just as CR's is now, tear down the old stuff and spur new building. Nope. Just further exodus.
I think on this, CR's California sensibilities led him astray.
Oho, Gazprom's insistence on a copy of the document is suddenly clearer...
Russia-Ukraine deal on gas for Europe in doubt
Sun Jan 11, 2009 3:29pm EST
By Christian Lowe and Dmitry Zhdannikov
MOSCOW/KIEV (Reuters) - A deal to restore Russian gas supplies via Ukraine to Europe appeared on the verge of collapse on Sunday after Moscow rejected handwritten additions by Kiev as a 'mockery of common sense'.
Russia-Ukraine deal on gas for Europe hits trouble
| Reuters
"there are lots of inner cities where the stuff torn down way back then still haven't been built on and it isn't all due to 'environmental red tape'."
dryfly | 01.11.09 - 4:28 pm | #
It's pretty telling when my brother,the special ops guy for 13 years, says "I would not go there with less than a squad".
And he wasn't talking about someplace in Iraq or A-stan.
Yes,he has been in a lot of these hoods while on active duty...that should wind the tinfoilers up.
Chris
Short of a Jubilee, even wages from new created jobs will go to pay down debt and to savings, just the Stimulus I. Combined with the current velocity of money being zero, stimulus will be disappointing.
Looking for equities -20% from here.
"The idea then was just as CR's is now, tear down the old stuff and spur new building. Nope. Just further exodus."
Does it hurt a tree or flower when you prune it? Depends on the flower or tree...
"......Moscow rejected handwritten additions by Kiev as a 'mockery of common sense'."
"I'm sorry, Mrs. Romer, you wrote, you wanted some jobs for people OTHER than "big, burly guys"? Did I read that note right?"
.......Some of us don't contribute to the "establishment media whores" associated with BIG BUSINESS cable TV.
(Jeeze - that almost made me feel 25 again!)
Black Star Ranch | 01.11.09 - 4:36 pm | #
And your response reflects the maturity of your position.
When the MSM embraces something that has gestated out of the blogosphere, we should be satisfied that we are making some progress. Solutions come from acceptance of reality. Bill Bonner at Agora did IOUSA. He has been a reliable voice at all his Agora sites, including Daily Reckoning, 5 Minute Forecast, Desidooru Saloon, et.al.
Think about this some more.
"...homebuilders could turn the subdivisions into farmland, and then get paid for not growing crops on them."
The soil must be tested first for heavy metals, toxic organic compounds like dioxins, etc.
Short of a Jubilee, even wages from new created jobs will go to pay down debt and to savings, just the Stimulus I. Combined with the current velocity of money being zero, stimulus will be disappointing.
Looking for equities -20% from here.
sc | 01.11.09 - 4:46 pm | #
I was the first to surface the notion of jubilee. I am satisfied to know that others have snagged the ultimate inevitability of this.
How about if we start with the White House and the Capitol?
"but then I just got 12-loads of cow manure this morning for the gardens. YESSSS!! Everything here is all better now."
Black Star Ranch | 01.11.09 - 4:43 pm
12 loads? For a garden? I grew up on a farm and 12 loads the size we used to move would bury a garden multiple feet deep in cow/pig shit.
I hope those were small loads or you have one hell of a garden...
Ahhhhh,the aroma is flooding back like it was yesterday!
Chris
"And your response reflects the maturity of your position."
LOL. Actually, my response reflects my inability to justify a $70/month bill for cable o sat. Been there, done that.
IOUSA doesn't matter, it's an historical documentary now, not a call to action.
12-side dump loads....yes, BIG garde
Just wait until people in California get tax refunds in IOUs...
Broward Horne, that's what I meant about the irony...
"LOL. Actually, my response reflects my inability to justify a $70/month bill for cable o sat. Been there, done that.
Black Star Ranch"
Add the internet and the phone and its more like $150. $1800 is a lot for things that used to be about $200/year. Put $50 on top of that for a PDA and we are talking $2400 a year just to get information. Something has got to give there.
takes skilled workforce to tear down a building then it does to build one- even the big ones after the explosion.
Although it may seem like a crazy idea how about building more affordable housing. We needed it even during the boom times and we will certainly need more now. At lot of the exburb stuff that is in excess is really not suitable for conversion to affordable housing.
Is there a Russian Cato saying: Ukraina delenda est?
IOUSA doesn't matter, it's an historical documentary now, not a call to action.
Broward Horne | Homepage | 01.11.09 - 4:54 pm | #
At least recognize that it is a start of a dialogue that may go somewhere, or not.
citizen energyecon - I commented in one of the previous threads how last week a Ukrainian court ruled a contract with Gazprom from 2006 invalid because the person who signed it for Ukraine turns out did not have the authority to do that (accoridng to the court)
The bridges and dams are how old, in all States through out The USA. Those could be started tomorrow in my county.
Pavel Chichikov writes:
Is there a Russian Cato saying: Ukraina delenda est?
No, but quite a few Russians want the Crimea and eastern Ukraine back
Can someone explain why ford's river rouge plant was chosen for this specific location?
If we send a few f117's in with 2klb bunker buster's , would we build a new walmart supercenter?
The soil must be tested first for heavy metals, toxic organic compounds like dioxins, etc.
Pavel Chichikov | 01.11.09 - 4:49 pm | #
Come on, Pavel, don't be such a wimp.
If the gov't buys foreclosed homes and foreclosure auctions at foreclosure market prices, and then destroys them after first salavaging the good parts, there is value left:
All is not lost in the short-term and, in the long-term, it gets us back closer to a functioning economy.
Elvis | 01.11.09 - 4:43 pm | #
why not give it to a homeless vet?
Interesting the children of suicide bombers get free education and all their college fees paid for by Hezbollah. The also get a gift on every fathers day. The seem to treat their people a lot better than we do.
Sandystructures AutoGroup writes:
Can someone explain why ford's river rouge plant was chosen for this specific location?
If we send a few f117's in with 2klb bunker buster's , would we build a new walmart supercenter?
Sandystructures AutoGroup | 01.11.09 - 5:02 pm | #
no jobs in that destruction.
""You CANNOT create wealth and prosperity by destroying things.
define wealth. Define prosperity.
The smallest example is the atom. We split(destroy) uranium, and it provides immense quantities of power that we utilize for w&p.
Demolition is stimulus.
War is peace.
Failure is success.
Slavery is freedom.
YES, WE CAN !
"Put $50 on top of that for a PDA and we are talking $2400 a year just to get information. Something has got to give there." - Elvis
You guys are bigger, badder dogs than I. DSL costs me $15p/m. The most intelligent news I get is from here. Thanks, Folks!
prophetic?
Burning Down the House / Talking Heads
YouTube -
Watch out
You might get what youre after
Cool babies
Strange but not a stranger
Im an ordinary guy
Burning down the house
Hold tight wait till the partys over
Hold tight were in for nasty weather
There has got to be a way
Burning down the house
...
"Old, vacant housing units" that are "a public nuisance" would not properly be included in an honest count of "housing stock", so you're double counting the benefit.
Either the structures are not fit and wouldn't feasibly be fit for occupancy OR they are viable housing, not both.
I would go with this for Thread music: YouTube -
Black Star Ranch writes:
12-side dump loads....yes, BIG garden
Black Star Ranch | 01.11.09 - 4:54 pm | #
whew, thank goodness finally something you and i can agree on
my wife and i had great western farm supply dump 10 yards of chicken manure- mushroom compost, next to the driveway in the front yard
will soon be wheel barrow-ing it to the garden and orchard...expanding to one acre under till
cVT, i challenge that.
An old friend is a weapons RS. Many hi end jobs are related to this field.
i still like nova's idea of a free house for every returning vet...
As for those mcmansions out in the exurbs, there are those group homes for the mentally disabled that were once promised, but never built. With plenty of bedrooms and bathrooms, and a single kitchen, they could fill that function nicely.
"Either the structures are not fit and wouldn't feasibly be fit for occupancy OR they are viable housing, not both.
tew"
Yes, this is an important point. The net benefit of reducing the oversupply is very low. It would serve other benefits, though, but not improve the most vital and smothering problem.
What about more public transportation infrastructure instead of demolition projects?
The NYC area needs another airport. There are also stalled projects like the "new" Penn station, the Lexington Ave. subway line, that would add value.
DC is building a metro line to Dulles. I think they should also extend existing lines further into the suburbs, and maybe a "circle line" where the Beltway is.
Bankruptcy is the modern eqivalent of "jubilee."
"What about more public transportation infrastructure instead of demolition projects?"
This adds jobs, but doesn't address the economic monkey-in-the-engine of the overbuilding glut.
CR
This is an excellent idea (with the modification that houses demolished should be limited to those that are too decrepit to be bought at auction).
Lots cleared by demolition should then be made into parks or community gardens, providing more employment.
But on the larger problem of finding enough ideas for shovel ready programs, I think this problem is really a clever political tactic by Obama. There is no shortage of such projects, but saying publicly that there is and starting the stimulus debate with a lowball dollar figure has succeeded in stimulating a chorus of demands for more projects and bigger spending, which is exactly what is needed.
Obama is maneuvering the program through the political field. There is now a two year history of his road to the Presidency that indicates he is very shrewd on this score.
Comrade Kristina writes:
Mock, I can't imagine facing down this crisis with the knowledge in the back of my mind that at any moment Sarah could be in charge...Horrifying at all levels...
yeah its sad really
the republicans have many excelent women in their ranks who would make for outstanding president or vp
christie whitman... ex gov nj comes to mind
Why do we need roads . How much longer will they be used ..Worlds first flying car prepares for take-off . World’s first flying car prepares for take-off - Times Online
"why not give it to a homeless vet?" - crazyvermonter........that is the most intelligent thing I've ever heard you say, cv! There's some promise in that idea. It would be good for all parties - but mostly the veteran.
"will soon be wheel barrow-ing it to the garden and orchard...expanding to one acre under till" ......outside of the wheelbarrowing part, THAT would get me pumped, mock.
Sandystructures AutoGroup writes:
Can someone explain why ford's river rouge plant was chosen for this specific location?
If we send a few f117's in with 2klb bunker buster's , would we build a new walmart supercenter?
not with one already within 5 miles:
3001 Miller Rd, Dearborn, MI 48120 to 5851 Mercury Dr, Dearborn, MI 48126 - Google Maps
forgot to add:
parks and community gardens are public goods, worth having in themselves. this would not be make-work, though make-work is not always bad. there is plenty of infrastructure to build that is necessary, and plenty beyond that which would be valuable.
Bankruptcy is the modern eqivalent of "jubilee."
Reptillian | 01.11.09 - 5:13 pm | #
Not even in the same solar system. Do your homework.
Even if the housing is marginally viable to live in, it isn't going to make much difference to demolish it in areas where the population is already shrinking anyhow.
presenting houses to veterans is an excellent idea
Detroit Rock City:
2009 Car of the Year: Hyundai Genesis - Jan. 11, 2009
Hyundai Genesis wins Car of the Year honors.
On the plus side, the F 150 won truck of the year.
No mention of the Volt or the Electric Ford Ranger...
Good idea
This has been a fertile area for research. NYC has tremendous experience, having restored over 110,000 housing units that were abandoned during 70s and 80s
Check out a summary here:
HousingPolicy.org | Policy - Facilitate Reuse of Abandoned, Vacant and Tax-Delinquent Properties
Needs to be tied to specific state and city reforms - as long as you do x,y,z => here's the $$$!!!
I know people working w/ H4H - they would LOVE to have lots prepped for them... especially if there is a clean up required... probably not a huge risk for RRE but for CRE it is [lord only knows what cems were poured where 50, 60, 100 years ago in a lot of these older cities]...
\t dryfly | \t \t \t \t01.11.09 - 4:34 pm | #
The local Habitat for Humanity here usually starts with donated land, often prepped and ready (by developers who donate the land in return for H4H building their locally-mandated affordable housing quota for them.) So yes, H4H would be all over it. That said, if there fundamentally-sound apartment buildings that could be rehabbed into 3/4 flat buildings, they'd also be willing to take those as donations. Building individual SFHs isn't always the most efficient way to address homelessness, and HRH knows it.
"presenting houses to veterans is an excellent idea
joe shmoe"
What about fire fighters, teachers, policemen, etc...? This is a slippery slope. What about the veterans who already own a house? Do they get one, too, or do they get the shaft?
CR, you forgot to mention that it was all that digging that got us out of the depression, not the WW2 like some capitalists bastards would say. Just look at the stock market and unemployment in 1937-1938. It was booming, and everybody was digging. So let's start digging our way out!
Better to take the hopeless residential units into public ownership and use tax dollars to improve them and then rent them at whatever the market rent is, even if it zero.
Only houses that cannot be rented at zero should be demolished.
Elvis
short answer: yes. give teachers houses.
Elvis writes:
"presenting houses to veterans is an excellent idea
joe shmoe"
What about fire fighters, teachers, policemen, etc...? This is a slippery slope. What about the veterans who already own a house? Do they get one, too, or do they get the shaft?
Elvis | 01.11.09 - 5:23 pm | #
How about we take care of the families of those who died in the line of service- that includes fireman and police- would that be a slippery slope. The how about those were severely wounded. I would much rather see these folks get it than some vulture investor.
CR has been reading Orlov?
All this talk...
What about a leap, a cognitive leap into a new reality?
"This could eliminate housing units from the housing stock, provide local jobs, and possibly remove a public nuisance."
If the houses are in such bad shape, demolishing them wouldn't really remove units from stock, would it? Sort of an obsolete inventory item I think.
G Cox writes:
Better to take the hopeless residential units into public ownership and use tax dollars to improve them and then rent them at whatever the market rent is, even if it zero.
Only houses that cannot be rented at zero should be demolished.
G Cox | 01.11.09 - 5:25 pm | #
one of the big problems with affordable housing is that it just not possible to build cheap enough to make it viable without some subsidies. Now that we (tax payer) have an opportunity of getting properties substantially below their replacement cost we have a shot at having sufficient affordable housing. There never was bubble in affordable housing even at the best of times.
good point lama, but it is all about digging.
but you can thank rove for the illegitimate black baby push polls in the Carolinas for that
Not THE Carolinas - South Carolina.
The two states are more different than you might think. NC is much more progressive. Not that we don't have our share of rednecks - just a much smaller proportion.
JIm (NC Jim)
I'm a bartender and I think for putting up with the drunken American public we should get houses as well. I already have a house but if you'd all pay it off for me that would be great!
demolish homes and create parks would add value.
I'm a bartender and I think for putting up with the drunken American public we should get houses as well. I already have a house but if you'd all pay it off for me that would be great!
Comrade Kristina | Homepage | 01.11.09 - 5:33 pm | #
You are a saint for whom there is a special place in Heaven.
What about fire fighters, teachers, policemen, etc...? This is a slippery slope. What about the veterans who already own a house? Do they get one, too, or do they get the shaft?
Elvis | 01.11.09 - 5:23 pm | #
yes, yes, ponies for everybody! including fire fighters and policemen in Vallejo, CA. destruction avoids problems of allocating limited resources, with the exception of who is chosen to do the higher-skilled aspects of demolition work - but I'm sure someone has a brother-in-law in the industry - or one willing to enter it for guaranteed federal money. this is gonna be 2002 all over again.
crazyvermonter,
There is plenty of land in Vermont. Why don't we just give everyone free land in Vermont who somehow qualifies? Then they could use the salvaged home materials from the demolition (transported and paid by us, of course) and they could build new houses in Vermont for all these people. I'm sure the people of Vermont would welcome a bunch more people.
one of the big problems with affordable housing is that it just not possible to build cheap enough to make it viable without some subsidies.
crazyvermonter | 01.11.09 - 5:30 pm | #
Try, and I know it's a stretch, to get past the notion of money.
"Although it may seem like a crazy idea how about building more affordable housing."
This is what I've worked on - as an architect - pretty much full time for the last 4 years. You can't build it fast enough... and the typical stuff we have done, much of it suburban townhouse style - is generally of better build quality than adjacent for-sale projects by the big nationals.
However, you don't just pump up the pipeline in a hurry. Projects often go on 'brownfield' land, take years to get through local approvals and must always be done with a level of planning and care. Otherwise you are building junk. Also, you do not want to overload an area with affordable units and stigmatize for-profit housing in that area; it has to be blended.
The biggest blow to the non-profits and agencies that sponsor affordable housing has been the decline in the resale value of tax credits. When corporations look ahead and see no profits, tax credits lose value.
Obama to Bernanke: "You do the printing I'll do the digging".
@crazy vermonter:
absolutely. homes to the widows/widowers and children.
@elvis:
easy to make the grant of a house into an option, part of a benefits package that offers, say, an increased pension or a house. Those with a house take the pension increase. Those with no house take the house. Does it need more detail? Sure. But it is not a big problem.
Consider the GI Bill of WWII vintage. Did its promise of college education hose those vetereans who already had a college degree?
We have to decide if we want to sink or swim as a country. If we want to swim, we need to stop drowning the very people we depend upon.
Funny, but the railroads in the 19th century were subsidized with huge land grants. The TARP and auto bailouts are not the first subsidies for big businesses. Subsidies and aid do not bring the end of capitalism.
The soil must be tested first for heavy metals, toxic organic compounds like dioxins, etc.
Pavel Chichikov | 01.11.09 - 4:49 pm | #
If they used that criteria for farm land it wouldn't pass - not at least after the sprayers had been through.
Obama to Bernanke: "You do the printing I'll do the digging".
Broker | 01.11.09 - 5:37 pm | #
Secret Serivice code names 'Wing Man' and 'Red Baron'...
"one of the big problems with affordable housing is that it just not possible to build cheap enough to make it viable without some subsidies."
"Affordable housing" generally means jsut that, at least around here. There is always a non-profit or a county or city agency that sponsors and manages it. Rents are set to a percent of income. Around Minneapolis, build cost for a 2 or three bedroom, 1-1/2 bath, single attached garage T'house with excellent energy efficiency and good materials is under $100,000, not including land and infrastructure costs.
The land and infrastructure can vary all over the place - $20,000 to $50,000.
I'm sure others have commented on this, but just to make sure... this is just the broken windows fallacy that Henry Hazlitt wrote about in his book Economics From One Lesson.
break some windows.
Can't believe someone hasn't posted some good old TNT as thread music yet.
christie whitman... ex gov nj comes to mind
mock turtle | 01.11.09 - 5:15 pm | #
But only democrats would vote for her... would cause a bit of a problem in the primary.
My granddad used to have a load of horse poop in every spring for his tomato garden. Great tomatoes, but it really stank for about 2 weeks until it rotted and he worked it in to the soil. This was in Balto. Wonder how much heavy metal was in the soil due to the air pollution?
...properly chosen infrastructure projects provide the best bang for the buck.
And here we go again - instead of FIRST agreeing on a selection method that at least gives us a hope of achieving "properly chosen", we're jumping right to tossing busy-work suggestions at the wall hoping something sticks.
Have we not learned anything?
dryfly writes:
christie whitman... ex gov nj comes to mind
mock turtle | 01.11.09 - 5:15 pm | #
But only democrats would vote for her... would cause a bit of a problem in the primary.
dryfly | 01.11.09 - 5:46 pm |
The very same person who when she was with the EPA told everyone that the air quality in lower Manhattan was okay. Yeah - no distrust of that person whatsoever...
Terrible idea. For all the billions - perhaps trillions - that we wasted on residential real estate we still have homeless people. Destroying those eye sores that offend people on their way to and from their suburban McMansions isn't something we need.
I'm sure others have commented on this, but just to make sure... this is just the broken windows fallacy that Henry Hazlitt wrote about in his book Economics From One Lesson.
http://freedomkeys.com/window.htm
bubblemore | Homepage | 01.11.09 - 5:45 pm | #
Broken window fallacy was already brought up... this isn't it. Here the window is already broken & the question is do we fix it and if so who & how.
Oh - regarding the specific proposal - 15 minutes in downtown Cleveland should give anyone who thinks is a good idea ample evidence to (at a minimum) rethink the desirability of this.
My granddad used to have a load of horse poop in every spring for his tomato garden. Great tomatoes, but it really stank for about 2 weeks until it rotted and he worked it in to the soil.
lawyerliz | 01.11.09 - 5:46 pm | #
Horse smells like roses compared to pig... my father had a pig farmer down the road who would 'give' him manure... haul his spreader over back it up to the garden and let it go... kinda like this. Wow - you don't want to stand close to that sucker.
The idea of downsizing cities by removing old buildings and helping citizens to relocate to oher areas, then coverting whole neighborhoods into wetlands, gardens, etc. is already being tried out. Google "shrinking cities" - already being tried in some places in Ohio, I believe.
Los of employment opportunities here - building wetlands, urban greenspace, etc. employs lots of students, workers, environmental engineers, planners, etc.
You've just lost every bit of credibility you've built up over the years.
If that's true, he's just tearing it down so he can build it up again. You see how that works? It creates jobs!
Google "shrinking cities" - already being tried in some places in Ohio, I believe.
blueridge | 01.11.09 - 5:57 pm | #
Youngstown? I heard they decided 'small was better' [not by choice].
Yeah pig manure is the worst, my Mom's cousin had a pig farm, the stench is unbearable. I had horses and never found the smell to be all that bad. Cow manure is pretty awful as well but pigs take the cake for sure.
Anybody know the number of Pinky Tuskadero? I believe she is an expert on Demolition Derbies. Maybe she could be the "Demolition Csar?" Anyone?
Oh and for fertilizer, the best gardens we ever had were when we had rabbits. We'd store the rabbit manure we cleaned from the hutches in five gallon buckets with some water. Let them stand for a week or so and combine with horse manure on your garden. The cucumbers wouldn't stop growing until the frost came...
I think we should legalize prostitution across the country. It would provide plenty of employment, and many unemployed people from the financial services industry will find they already have the aptitude. Unoccupied homes and commercial buildings could be turned into brothels, generating tax revenue and contributing to GDP. The social stigma will decrease even more when people are hungry enough. After all, getting laid and getting off are much better than getting laid off.
And here we go again - instead of FIRST agreeing on a selection method that at least gives us a hope of achieving "properly chosen", we're jumping right to tossing busy-work suggestions at the wall hoping something sticks.
Have we not learned anything?
Sick and Tired Dude | 01.11.09 - 5:49 pm | #
that's the joy of socialism. here we are not only tossing it at the wall to see what sticks, but making arbitrary value judgments for dispensing surplus as handouts.
the idea isn't to rebalance with a stimulus really, not at all. it's to perturb a system that is failing to equilibriate on its own, not unlike throwing arbitrary spikes in a dataset to dislodge from a suboptimal local maxima. the only honest way to pull it off is either to deliberately create and destroy money, or dispense it in such a way that it has no economic value to anyone than anyone else(a pure public good). failing that a public good that benefits many random people is much preferable to one that arbitrarily advantages some selected group. you want stuff with social value that would never otherwise be done for any investment reason, because we are already committed to throwing the money away, so we should do something with it that would otherwise never get done.
Since stimulus money is borrowed, any projects must generate sufficient profit to repay the debt and accrued interest on it.
Make-work doesn't qualify, and neither does upkeep on roads and bridges. Tearing down unneeded housing and malls doesn't cut it.
Improved transportation systems, especially a passenger railway system, offers true ROI. So does R&D in biotech, etc.
Improved efficiency in health care via single-payer system would be at the top of the list.
We have dolts making fiscal policy, no better than the dolts making monetary policy.
Revro writes:
no no no no, demolishing housing, when there are tent cities ?
you mean like a TARP
Yeah pig manure is the worst, my Mom's cousin had a pig farm, the stench is unbearable. I had horses and never found the smell to be all that bad. Cow manure is pretty awful as well but pigs take the cake for sure.
Comrade Kristina | Homepage | 01.11.09 - 6:01 pm | #
If I may say so: This comment board has definitely gone to shit.
I think some posters have made the assumption that the idea is to roll specifically homes.
I think the idea is ANY strucuture.
Like bethlehem's former steel plants, or ford's river rouge, or ford islands hangers, or moffet fields hanger,or the federal reserve building.
want real "Keynesian" stimulus? why don't we stop kidding ourselves and try this: YouTube
- Broadcast Yourself.? v=J...feature=related
That was a prank by the KLF. That was not actual quid they were burning.
"If they used that criteria for farm land it wouldn't pass - not at least after the sprayers had been through."
Pesticides, IIRC, contain chlor-organics like dioxins and furans. So does electrical cable insulation, so do the products of urban waste incineration, lignite from rotting wood, IIRC. I used to know an organic chemist - God bless his soul - who worked at the Academy of Sciences in Moscow. One of his specialities was chlor-organic compounds. The compounds are extremely potent - in parts per trillion - and tend to concentrate in fish, dairy products, including human milk. They are teratogenic, meaning they adversely affect the fetus.
One problem is that I don't think that we will have the volume of oil exports required to power an economic recovery.
Our middle case is that 10 years hence, the top five net oil exporters--Saudi Arabia; Russia; Norway; Iran & the UAE--will have already shipped about 80% of their post-2005 cumulative net oil exports.
I just ran across what appears to be a new real estate scam in Florida. I thought lawyerliz would be interested and maybe have some thoughts on it.
There's a distressed property in short sale, where the owner sold or gave a one year exclusive option to an investor to buy the property. The investor, and the marketing real estate agent, are now engaged in the short sale negotiation with the bank.
Because of this option contract, the real estate agent is effectively blocking other interested parties from making their own offer. I suspect the bank has no idea what is going on and is getting ripped off because they aren't seeing the other (higher) bids.
Normally, a seller has an interest in getting the highest sale price, even in short sale. I guess because the short sale loan forgiveness isn't taxable any more, the seller has no interest in getting a higher price? It is a really unusual situation and something doesn't seem right.
I think we should legalize prostitution across the country.
Even better. We have to figure out how to export it!
Found out today my insurance company pays for medical tourism, which I think is the equivalent of an import.
This argument is not very palatable to me. How about Ford, GM, and Chrysler just destroy all the cars they aren't selling too? Does that make sense? Hey; our government can even pay Ford, GM and Chrysler to destroy the cars!
(Sorry, I skipped reading this thread... so my point might've been made?)
So a problem with urban demolition is what to do with all these toxic waste products. A striking example is what happened to the urban environment as a consequence of 9 - 11.
"Even better. We have to figure out how to export it!"
It's beginning to look as if large parts of our economy are based on it - figuratively.
"I think we should legalize prostitution across the country"
....No thanks, I like it legal HERE only.....
Bulldose Detroit. Well, a big part of it. Same for a lot of other eastern cities. Create commons.
Add baseball, basketball, soccer fields. Run an Dept. of Agriculture program.
Earnings Kickoff: Nothing 'Less Than a Disaster' - CNBC
"We're about to head into a season of scheduled bad news," said Art Hogan, managing director at Jefferies "There's nobody who believes this is going to be anything less than a disaster."
TAKE THE MARKET ON THAT!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
YLSP:
Cash for Clunkers
The issue is whether the property, whether it be cars or houses, has a negative economic cost such that replacement or destruction actually increases net wealth.
Sort of like a leaky flush valve on a toilet.
"that's the proper analogy OLD WORTHLESS RUSTY VEHICLES... dragged in & melted down... UNFIT DILAPIDATED BUILDINGS... torn down & land leveled."
Perhaps while they were still useful they created the wealth that will see their destruction result nevertheless in a net profit. An old 18-wheeler that carried many products to market. An old building in which socially productive families were raised, or socially productive business was carried on.
But if not....
"Elvis, you're absolutely delusional. Confidence isn't created by destroying things. If that were the case we should immediately start bombing our own cities."
That is what got us into the problem. We bombarded our nation with unneeded construction. Now we need to get rid of it. Or we can just wait and wait and wait and wait...I take it, you'd just like to wait. Good things come to those who wait and wait and wait. Unless, they die first.
Instead of "Hey, no one is buying this house I have... so the government can pay my price and bulldoze it".
YLSP | 01.11.09 - 6:50 pm | #
It would be tried I'm sure... but people who haven't been to say East St. Louis... have no idea how many unfit buildings there are and how many unemployed live in those areas... coincidence? Not.
The problem is what next? After the tear down... much of what was leveled in the 60s is still leveled.
Is the next step getting rid of our unproductive
elders ?
"You all need to read Economics in One Lesson, because you've clearly not been inoculated from specious economic reasoning.
Vic"
Or, you just don't get it.
Recall Londonbanker's emphasis on the concept of 'productive works'. Old non-use or non-conforming use buildings are essentially stored costs. They are a cost on someone's future development pro-forma. When development is considered a 'productive work', then its time to demo and start the interest on the cost clicking.
Repairing bridges is somewhere in between. Its still a make-work project. If there were a scale for such things, demoing vacant building would be a very low-yield productive work. Building 10,000 wind turbines would be at the extreme other end of the scale.
Kondratieff canuk, yes. The idea I was trying to get across is that as we condemned and then demolished buildings we maintained values in those that remained. The addition of greenspace or the deletion of scary space thereafter made downtown more appealing and so more in demand. As long as the courthouse, city hall, etc remain downtown all those who work for or with government (lawyers, politicans, etc) will have to travel downtown to conduct business and more than a few of them will want to live within walking distance.
"Is the next step getting rid of our unproductive
elders ?"
I beg your pardon [indignant].
"Instead of "Hey, no one is buying this house I have... so the government can pay my price and bulldoze it".
YLSP"
That is why only foreclosed homes that the gov't bought at foreclosure autions would be bulldozed by the gov't. In any large scale project (especially gov't), there are going to be fraud issues. Oversight would help, but not prevent all.
With out saying protecting Union jobs who paid a ton for his election?
Economist Moe Howard 3SU | 01.11.09 - 6:47 pm | #
That's the game here in California. The public servant unions pay for the legislative campaigns, then the elected legislators raise taxes and use the revenue to raise public servant pay & benefits; the cycle restarts every election.
Forget about giving non-military public servants houses; we've already mortgaged the state for them.
I'm reminded of the arguments against euthanasia for some reason.
Who decides what is destroyed? How much recycling of materials can be done or do you just knock it down and fill up landfills?
Have you ever watched demolition being done? Very easy and very fast unless you mandate full recycling of all usable materials but then that will depress other manufacturing.
Couldn't the buildings provide more jobs by rehabilitating the building and then selling it cheaply? How do you get the private owners to agree? The tax break idea was a good one but then aren't you lowering the tax base at an inopportune time?
Worst case is you do nothing and the locals will salvage and burn for free.
CRE came bank after the 80's.
Pavel Chichikov writes:
"Is the next step getting rid of our unproductive
elders ?"
I beg your pardon [indignant].
Pavel Chichikov | 01.11.09 - 6:58 pm | #
Keep churning out the poetry.
If you have liquidity, then you will be able to purchase necessities, and also the hard assets you will eventually need. Deflation will force down the prices of almost everything, hence preserving your purchasing power now will give you options in the future that very few will have. All fiat currencies are eventually inflated away, and in this case that will happen once the credit bubble has finished deflating and the international debt financing model is well and truly broken. I would expect that to be quite some time, as deflation and depression are self-reinforcing, and during that downward spiral it will be impossible to inflate.
During the deflationary phase you will need liquidity, but once it is over you will need to switch to hard assets. I would suggest waiting for very substantial price falls in order to hang on to as much of your wealth as you can, but not to wait for the bottom. The risks of spending a lot of money when no one else has any will grow with time, and you will need time to climb the learning curve associated with any self-sufficiency assets you buy. My guess is that deflation could last for a number of years, and that the best time to shift to hard assets (from a purely financial point of view) should be at least a couple of years away. Others with more resources may make the shift sooner, knowing that they will lose money, but having the luxury of being able to do so in order to buy time to learn new skills.
--SL
"Is the next step getting rid of our unproductive
elders ?"
I beg your pardon [indignant].
Pavel Chichikov | 01.11.09 - 6:58 pm | #
LOL. Sporkfed isn't thinking - if he was he'd realize elders are 'inflationary'... printing money to spend on them is a direct attack on 'deflation' [defined as a shrinking money supply]... we won't go there UNTIL deflation is defeated and inflation kicks in... then grandma better watch out.
"I'm reminded of the arguments against euthanasia for some reason."
Euthanising a building is the same as euthanising Grandpa?
How things seem to be shaping up...
YouTube - Star Wars - I have a bad feeling about this
A Demolition Plan of housing and commercial buildings sounds like more ideas & strategies to Destroy America plus there's the assumption in this that there won't be a Recovery and thus no need for all these buildings in a permant Deflation scenario.
"Keep churning out the poetry."
I'd better, although 'churning' is a term better used at the dairy than in the study.
To go back to the "shrinking cities" idea - which is doing what CR suggests in a planned, thoughtful way, one of their goals (and I think Youngstown is one of the cities) is to reduce future infrastructure costs.
Example - if most of a neighborhood is abandoned or past savaging, relocate the remaining residents (voluntarily, by offering them places in better neighborhoods) and demolish the entire block of buildings - thereby cuttin future sewer, water and electric costs to the city. Convert to greenspace, urban grden space, or wetlands that are zero maintenance and provide some societal (and possibly ecosystem service) benefits.
So, done carefully, not really the same as the "broken window fallacy"
guest,
you're in the twilight zone.
the best time to shift to hard assets (from a purely financial point of view) should be at least a couple of years away
Subcommander Doom | 01.11.09 - 7:01 pm | #
Assuming there's any hard assets worth having available by then.
Kondratieff canuk @ 6:57 pm - my view as well: smart grid, renewable energy, mass transit, universal health care, environmental clean-up. Not that smaller projects like CR's proposal should be excluded, but the government program needs a clear focus on improving the future productivity
The fallacy of the rotting door.
A shopkeeper has a rotting door. It does a poor job of keeping out the weather, nor does it do well at keeping the heat within during the cold times. Worse, its odor is such that people are unwilling to pass it to enter the shop. The shopkeeper decides to replace it, but is stopped by many who call it a broken window.
"Keep the door and the money you would spend to replace it. Instead, you could be spending the money upon a new suit. Or saving it and letting it earn interest." And so the shopkeeper retained the door, and suffered under miserable conditions and no customers - and could not understand why the good advice of his neighbors did so poorly for him.
The problem is obvious when stated this way, of course. I do not know for certain what CR's objective in the recommendation might have been, but the abhorrence of tearing down anything because it's a broken window ignores the fact that there are a lot of broken doors out there.
fried writes:
i still like nova's idea of a free house for every returning vet...
Yeah, that's a great idea. Let's give the youth more of a reason to go slaughter brown skins around the globe so defense contractors and big oil can add more vehicles to their already burgeoning classic car collections.
"... (voluntarily, by offering them places in better neighborhoods)..."
How many Detroit bangers would you want in your neighborhood? It ought to be limitless.
"Is the next step getting rid of our unproductive
elders ?"
We could come back and take your job away? Better to pays to stay home!