Xtracycle+Big Dummy taking off in USA

Interesting little TV news clip here about the BIG DUMMY+Xtracycle taking off in the USA. Big Dummy is a bike developed by Surely specifically for the Xtracycle. Interesting also that the Surely guys did not mention anything about Xtracycle, who were the ones who actually designed the concept in the first place. Maybe that is because they don't want you to know that the big dummy is actually not really necessary. You can put the Xtracycle on just about any old bike you like. That's what I do and it works a treat, and a damn sight cheaper, and you can import/export more easily by buying the bike locally and attaching the Xtracycle to it. Anyhow, nice to see that it's becoming more popular. Xtracycle are out of stock again, so it must be selling like crazy.

The War on Traffic

Many people forget these days that in the 1960' and 70's, Japan had something of a civil war - the "War on Traffic" or 「交通戦争」. This was a topic taken seriously in the media to a backdrop of skyrocketing gasoline prices, the oil shocks and deep social unrest and anger at the government riding (driving?) roughshod over the people. Many efforts were made in traffic calming, including speed limits, restricting automobile access around schools and on back streets, major improvements to bus, rail, subway and other public transport. This is also the time when bicycle use exploded in Japan with efforts by local governments to promote bicycle use. People might have even believed the war on traffic could have been won.

But as we all know, the Japanese lost their War on Traffic, utterly and completely. There were many reasons for the failure of common sense. The Korean and Vietnam wars had contributed to the huge growth in Japan's automobile industry, which then brought huge political power to bear on the automobile side. Memory of the oil shock faded, and gasoline prices gradually subsided. Efforts by the IMF and World Bank to promote automobile use with massive loans for highway building (a.k.a. "infrastructure") were beginning to have traction among the public - automobile sales grew rapidly, and with it more political power. The massive highway building in the leadup to the 1964 Tokyo Olympics was a major coup for the roads lobby in this sense. And the American way of life (i.e. automobile + sprawl) still held an irresistible allure.

Traffic planning and traffic calming efforts on the other hand were piece meal, tended to play around the edges of the real issue, and by the 1980's were completely hijacked by the very people that they were intending to control - people who loved cars. Eventually all road works and traffic had one primary goal - the fast and efficient flow of automobile traffic.

Low gasoline prices in the 1990's, combined with growing power of the auto-makers as their share of the economy grew really consolidated the position of the 道路族 roads lobby. Most of all, the tsunami of Keynsian fiscal stimulus directed at road building through the 1990's completely cemented the automobile's position in Japanese Society - particularly in the countryside. Much of the road building in the 1990's was in country towns which had until then largely escaped from the disease of sprawl that was afflicting the major cities. Bypasses, high speed national roads combined with sprawling suburban construction were rampant. Pressure from China and elsewhere in agriculture, and low worldwide prices for primary produce pushed down the price of agricultural land, which was already depressed from the bursting of the real estate bubble in '89 - '90. These factors combined to push Japan headlong into rampant urban sprawl that continues today with the creation of local and foreign big box retailers on the suburban outskirts of town, still chasing an American dream that even the Americans have already begun to wake from. 15 years ago in Japan it would have been entirely feasible to get by with a bicycle and the train because everything you wanted was concentrated around the station in the centre of town. These days, things are not so simple, even in small country cities. The town centre may have everything you NEED, but if you want the cheapest or hippest items, you need to go to various big box shops scattered all over the city. Japan's consumption of oil, coal and other items continued to rise.

So Japan lost it's "War on Traffic", and the "rebels" are today few and far between and not well organized. I cannot help but hope that the increasing awareness of global warming, the fact that building roads as a fiscal stimulus is now regarded as having been a big mistake, the growing 車離れ and the amazing success of initiatives such as the Velib model will stimulate people to start a new fundamental debate again in Japan about the kind of lifestyle people want and whether the automobile is going to play a big part in that or not.

In China, by contrast - the War on Traffic is in full pitched battle right now. Stories like THIS ONE from NPR in the US highlight the real fight that is going on. I see a similar story to Japan's - auto money is starting to talk. An Olympics in Beijing has become a lever to push through the construction of massive highway systems. Trains that are built, go to the airport. Local governments in some cities have even banned electric bicycles for whatever reason they can get away with - knowing that more money will flow (for the time being) if they promote automobiles (and culture and lifestyle be damned). It is clear that the Chinese populace has not given up the fight. In another report, students at a University appear to have vented their collective anger at a driver, destroying the car completely and even flipping it over. Here is the story from the other camp. You would have to be blind not to see that this event shows the utter frustration and anger towards automobiles and the friction between the two camps. I hope the Chinese authorities take it as a sign, because if the Chinese continue to attack the issue by playing around the edges the way the Japanese did in their own War on Traffic, the Chinese will slowly move to the auto camp, and the Chinese will cease to be citizens and become another docile bunch of homogenous consumers just like the rest of us in the "developed" world.

Post-Car Society

Who would have thought Newsweek would run an article about "kuruma-banare", the growing trend among Japanese of forsaking their automobiles for good? I didn't think Newsweek capable of it myself. But HERE IT IS. It seems the trend has finally reached a stage it can no longer be ignored. If the decline in new car sales continues, "kuruma-banare" could well become 2008 buzzword of the year.

"Catchment Area"

Once again, I am convinced that the Japanese have nailed what is perhaps the best possible solution to a complex social issue. I found this brief article in the UK paper the Guardian:

http://education.guardian.co.uk/print/0,,329742428-115019,00.html

The author describes how in the old days, school students had to go to the nearest school. It reduced choices, but dramatically strengthened communities and ensured healthy commuting lifestyles for children. However these days, the vast majority of parents in the English speaking world drive their kids to school for a variety of reasons - the sprawl means bigger distances and less friendly eyes to keep an eye on the kids, the lack of community means there are less friendly eyes at all, the lack of safe routes to school, the desire to go to a "better" school across town, the fact that everyone else also drives which makes it dangerous for the kids to walk... in a vicious cycle until we reach where we are today with crisis levels of childhood stress, obesity, lack of independence and dearth of social skills.

Nothing however, could be further from the situation in Japan. As far as I can tell of the Japanese system, at least where I live right now, there is what seems to be an extremely good solution. Ostensibly, and as a general rule, children are required to go to their nearest school. However, there are options for parents who desire other choices. First there is of course the private school system. But parents can also apply to send their children to other public schools - if they are prepared to jump through the right hoops. The whole process is intentionally onerous and involves making your case to the ward office and then the application is subject to further review by the public school board, who are required to give priority to local children. Occassionally parents will try to game the system by renting an apartment nearby and registering this address on the application. The ward office is aware of this and do in fact perform spot checks to discourage this behaviour, and of course word gets around in tight knit communities.

This system sounds like a fantastic compromise between the public good of stronger communities, and the desire to allow a degree of choice to parents and students. It also appears to work quite smoothly.

Flowing from, and based upon this foundation system are a number of other excellent rules that can be and are applied at schools in Japan with excellent results, making commuting a generally wonderful experience all round. Firstly, children are required to walk to school, and to do so alone without their parents. Being without parents, elementary school children are not allowed to ride bicycles to school, and are required to walk. This encourages children to travel to school together in groups. Most children are within a kilometre or so of their school, and even this distance isn't all that far to walk once you get used to it, so not being able to ride a bike isn't such a big drag. It also encourages kids to hang together, and avoids the dangers that might come of having younger kids riding bikes to school when they are going by themselves, as parents to not generally walk their kids to school. Not riding bikes also reduces the potential range of the children, so they are less likely to go further afield where friendly community eyes may not be watching, or dangerous unfamiliar roads. In any case, disallowing bicycles is nothing compared to what happens if you decide to drive your kids to school, God forbid...

In the land of the Toyota, children are almost universally spared from being driven to school by car. Parents are not allowed to drive their children to school. Yes, you heard me - NOT ALLOWED. Fancy that. In fact, roads near school entrances are routinely blocked completely during the school commute hours, and drivers who are caught in such areas are fined and booked by the police. In other words, it is ILLEGAL to drop off your kid at the gate to many schools. And as a result - there is no rush hour at the school gate, there is none of the noise, the danger, the stress or ANY of that - just peace and quiet and the sound of kids laughing and talking as they walk to school together.

I had not really thought about it so much before, but in Japan you really do see children out walking about, playing and enjoying their route to school, feeling the changing seasons, seeing and smelling the flowers. In fact, I see a few on my way to work, and say good morning to them every day. It is wonderful seeing them grow, and there are a few precious serendipitous moments when the weather is special or something happens. I used to take my two children to kindergarten behind my bicycle on a small "Chariot" trailer. When the regular school kids I would see on my way to work first saw me do this up the hill, they of course swamped me immediately. They all wanted a look, and peppered me with questions for a few seconds, then goodbyes and off to school. A few mornings later, they all help push me up the hill, just for fun. Then Winter came, and they helped me up the hill in the snow when I was struggling. This all by a group of 8 to 12yr old boys. There is also a disabled gentleman who likes to sit on his front porch and chat with the kids as they go to school, and there are many others like him who do the same, just for the fun of seeing the kids grow, and for the real tangible sense of community it fosters. I imagine they are a good pair of eyes to discourage any funny business that Westerners are so afraid of when asked if they would let their children walk to school on their own. It is also nice when you know who's kids belong with which adults, and for example you might see a kid on your regular commute with a broken arm, and strike up a conversation in the supermarket with their parent the next time you see them. The parent tells you they have some medical condition that causes such and such, and armed with this knowledge you can watch out for them, or mention to the headmaster when you see them, so they can watch out for them etc etc. In a real example, some school kids knocked out a street lamp here after school one day. After the incident, a flyer was put up asking for witnesses. A few locals had seen them and were pretty sure they knew who it was and mentioned to the parents. Sure enough the kids fessed up and mystery solved. From the kids perspective, you have this vast boundless freedom when you are let loose on your own, but at the same time the kids are in fact wrapped the whole time in this loving, protecting, real (not virtual) community who will keep them on the right path just by way of being there, a community which the kids don't even really notice much until they grow old enough to appreciate it.

You miss all of that when kids are driven to school. You don't see anyone but your family and your teacher. No-one will see your broken arm. Nobody knows you in the neighborhood. Nobody helps you push your bike up the hill, or share a smile and the joy of a beautiful Spring morning. It is such a shame that several generations of kids in the English speaking world missed that whole formative experience, but one can only hope that they will find away for their own children to experience it. It will be a hard task, but undoubtedly will begin with the establishment and enforcement of (1) safe routes to school, and (2) the sense of community that such a system is so dependent on.

Yours in hope...

Rail Privatization

I found this article in the FT: Deutsche Bahn IPO to proceed

The Germans may perhaps look to Japan's experience with rail privatization. What seems to have happened here is vast improvements in efficiency in running existing lines but something of a stagnation in capital investment in new lines or services, and what gains have been made have had hidden costs.

One thing that Japan Rail (JR) has become heavily involved in since privatization is residential real estate construction and sales - i.e. promoting, advertising, supporting and profiting from suburban sprawl. They have a program of subdividing massive areas around outlying stations, and advertising these lots on their trains, sometimes in tandem with a new express line etc. The powerful synergies are undoubtable - a fantastic sales and advertising networks, insider knowledge on any new lines or service, the ability to add carparks to stations to facilitate these sprawling suburban lifestyles, and once they sell a house in these outlying suburbs, they have a lifetime of outer suburban commuting revenue from that owner, who would probably otherwise be an inner city renter. The profit potential is certainly fat. However, clearly the national rail network provider's focus has shifted away from providing a public good towards a stronger profit motive. On the whole, is it REALLY a good thing if rail services can be improved using profits garnered by raping society on another front? By creating vast new bed towns and feeding suburban sprawl, with all the well-known and documented social and environmental ills that this involves, the overall outcome is debatable.

Note to the Germans: Beware of unwitting externalizations such as this when considering, or when measuring the success of your new experiment. Many of these things rear their ugly heads many years on, although with proper oversight some may be avoided.

The Issue of Housing Affordability

Housing affordability has long been a major political issue. This is increasingly the case in Australia and New Zealand, where speculative local and international investment has driven prices extremely high. The latest Demographia International Housing Affordability Survey (PDF here) has just been released and includes UK, Ireland, Canada, USA, NZ, and Australia. Based on 2007 Q3 data the report unsurprisingly shows extremely low levels of affordability for NZ and Australia.

This is undeniable, but what should be questioned more is a fairly insideous argument - dangerous even, propounded by many, including none other than former Governor of the NZ Reserve Bank Dr. Donald Brash who, in his introduction to the study, states (Brashly, of course) that "Once again, the Demographia survey leads inevitably to one clear conclusion: the affordability of housing is overwhelmingly a function of just one thing, the extent to which governments place artificial restrictions on the supply of residential land.."

This is not surprising coming from an economist but it is a load of codswallop. Not because it isn't true, but because in life the easiest solution is not always the best. In fact it is often the worst. Let's think about this for a moment. What is the easiest way for the governments of a country like Australia and NZ to improve housing affordability? Well, the answer has to be by releasing more "vacant" land for development. Mr. Brash and many others are clamouring for this in Australia and NZ today. Why? Because it works - yea, it works all right. It works like getting a loan from a loan shark will help you pay of your gambling debt so that you can keep gaming without worrying about bothersome things like rehabilitation. No - banish the thought. I apologise for suggesting such a dreary boring do-goody thing. Much more fun to borrow from the loan shark and have a bit more fun. Much more fun to release a bit more land, keep the economy buzzing along with all the new residential housing and road building and beautifully mind-numbingly endless suburban sprawl it generates.

Hell, yea. Who wants to talk about cost? Who wants to think about those irksome things that responsible economists call "externalities".

Ok. Enough cynicism. What really happens when the government releases land? In a word, "sprawl". What happens when you have sprawl? Well, lots of things, and most of them are not good, except for the fact that the economy probably grows because prices come down, more people buy into the suburban dream, builders get busy and everyone is hunky dory... for a while... But the stark, inconvenient reality that everyone is trying so hard to pretend not to notice is that we are building growth at the expense of future generations. This is most strikingly shown by the US experience. The United States government is finding that it is having to spend an every greater proportion of the budget on the maintenance and upkeep of all the roads and sprawling infrastructure that it has build. Personal debt is at record levels because essentially that is what is funding the growth from individual consumption. In other words, once the benefits to growth from the stimulus have long withered away and been spent on flat screen TV's, all you have is the government liabilities of roads maintenance and upkeep, increased costs of maintaining the police forces to patrol these expanded urban areas, the electricity production to keep all those air conditioners pumping, the cost of all the extra sewage, drainage, road cleaning, ambulance services, not to mention the collateral damage from increased health burden from more injuries and environmental issues from low density cities. This whole argument reminds me very much of Dr. Robert Lustig's obesity interview I wrote of recently, in which he described the negative feedback loop effect that sugar and fructose has on the body. We have a similar negative feedback loop going on here.

Never let a financial economist convince you that growth is a good thing for its own sake. Look at what that the growth is comprised of and what that is going to cost you - now and into the future. A financial economist is more like a banker - they don't really give a damn who takes the money and what they do with it - only whether or not they can pay, and how much. And if the economy is growing, there is more chance that people will repay - so hell, ANY growth must be good, right...? (wrong!)

And don't think that China is doing it right either. They are going down exactly the same path - only it isn't a path any more -it is a 12 lane highway, and they are going down it at breakneck speed.

So let's think of a few advantages of keeping house prices UP. There are a few. You may be surprised. One is that it discourages Australians from buying McMansions. I find it fascinating that the same Australians who winge about the price of housing, are the ones who have made the average Australian new home THE LARGEST IN THE WORLD. No sympathy from me.

Another advantage is that foreign buyers are less likely to buy into Australian residential housing markets. This is an interesting one here. Australians tend to spend a little too much on consumption. In return they need to sell something to the foreigners. But Australians don't make much that foreigners want, so they sell shares in mining businesses and yes, residential real estate. Australia has one of the most liquid real estate markets in the world. Surely international speculation in these markets is something that keeps prices very high. I suspect, however, that more important is international investment in DEBT (RMBS). Investors buy the loans that banks make to homebuyers. Australians, addicted to their McMansions, buy ever bigger homes at inflated prices, promising to pay this borrowed money back. In other words, the real speculator here is the HOMEBUYER. For now, with China and the price of commodities booming, we have managed to pull this illusion off. But it cannot last - unless of course we force the government to release some more land so that we can party on a bit more!

But really. C'mon. We can do better than that. Are we citizens or consumers? What are you?