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Uber and DUIs

In LA Weekly Dennis Romero writes IS UBER REDUCING DUIS IN L.A?

In a vast, 4,000-square-mile county, it’s hard for many folks to get around without a car. And that has meant that DUIs have become a much-feared epidemic.

But ride-sharing apps like Uber, Lyft and Sidecar have become a go-to Godsend for party people in L.A. And it’s conceivable that they’re starting have their impact on DUI statistics, possibly making streets safer for everyone.

How many friends do you know who now “Uber it” rather than get behind the wheel for a night out?

Brewer told us that she’s not sure why there’s such a serious drop in DUIs for Labor Day weekend….

HKO

This data is still being greeted with some skepticism, but I believe it will prove significant. This same report is being repeated in several cities.  There are just too many anecdotes and stories from passengers and drivers and the incredible growth in the use of Uber make the conclusion one that would be logically expected.

Further the elimination of cash payments reduces theft, and there may be some social (crime reducing) benefits from the increase of the sense of community these service engender.  That last benefit may be a stretch, but the DUI reduction should be expected.

In New York there are stories of people getting rid of their cars in light of the ease and availability of Uber type services.  This may be unique to New York given the high costs of car ownership there.

Government efforts to limit Uber in an effort to protect the taxi franchise may be coming at a high cost.

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Public Workers vs the Public

Amity Shlaes reviews “Government Against Itself: Public Union Power and Its Consequences” by Daniel DiSalvo in the Wall Street Journal:

Excerpts:

The facts: Public-sector unions are not underdogs. Since 2009, membership in unions such as the American Federation of State, County and Municipal Employees and the National Education Association has totaled more than the membership in traditional private-sector unions. The United Mine Workers, the union that resulted from the Harlan County conflict, counts under 50,000 active members, while the NEA boasts 2.5 million.

As Mr. DiSalvo shows, public-sector unions are also rich. Taken together, they spend hundreds of millions of dollars annually lobbying governments on behalf of their members. Our courts have ensured that funding for political activity will flow in the future by upholding rules that require payments from workers. Opponents of public-sector unions must content themselves with minor victories such as the recent Supreme Court opinion in Harris v. Quinn, which grants home-care workers, a narrow group, the right not to pay union dues.

This modern imbalance exists because of some long-ago shifts in federal law. In 1962 President John F. Kennedy signed Executive Order 10988, permitting collective bargaining for federal employees. State and city workers, teachers and firemen were also unionizing.

The trend is a shame and a drag on the economy. For the costs of public-sector unions are great. “The byproduct of political management of the economy is waste,” the author notes. Second, pension and benefit obligations weigh down our cities. Trash disposal in Chicago costs $231 per ton, versus $74 in non-union Dallas. Increasingly, such a burden is fatal. When Detroit declared bankruptcy in 2013, a full half of the city’s$18.2 billion long-term debt was owed for employee pensions and health benefits. Even before the next downturn, other cities and some states will find themselves faltering because of similarly massive obligations.

There is something grotesque about public workers fighting for benefits whose provision will hurt the public. Citizens who vote Democratic may choose not to acknowledge the perversity out of party loyalty. But over the years a few well-known Democrats have sided against the public-sector unions. “The process of collective bargaining as usually understood cannot be transplanted into the public service,” a Democratic politician once declared. His name? Franklin Roosevelt.

 

 

 

 

 

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Politically Disruptive Technology

Uber A

from Bloomberg, Is Uber Democratic or Republican? by Emily Greenhouse notes that Marco Rubio noted the impact that Uber has on the youth’s perception of regulation.

The students in my class were genuinely intrigued by this innovative service and wondered why they didn’t have it in Miami. I explained to them that it was because of regulations created by government. Politicians, I said, had passed rules to stifle competition that might threaten their constituents and supporters in the existing taxi and sedan service industry. In Miami, for example, there was a government-created cap on the number of sedan medallions allowed in the city. That regulation effectively shut out any competition to the existing car service companies—competition like Uber.

As my progressive young students listened to me explain why government was preventing them from using their cell phones to get home from the bars on Saturday night, I could see their minds change. They went from fervently believing that big government is necessary to protect the little guy to realizing that big government is often used to stick it to the little guy. Before I knew it, I was talking to a bunch of 20- and 21-year-old anti-regulatory activists.

HKO

Great minds think alike. This is the same politically disruptive trend I noted in Uber Libertarians in American Thinker.

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Liberal Inequality

NewYork

The most profound level of inequality and bifurcated class structure is found in the densest and most influential urban environment in North America— Manhattan. In 1980, Manhattan ranked seventeenth among the nation’s more than 3,000 counties in income inequality; by 2007 it ranked first, with the top fifth of all households earning 52 times that of the lowest fifth, a disparity roughly comparable to that of Namibia. 23 Manhattan’s GINI index now stands higher than that of South Africa before the apartheid- ending 1994 election. If Manhattan were a country, it would rank sixth highest in income inequality in the world out of more than 130 for which the World Bank reports data.

Indeed, in some of the most heralded “creative class” cities, both struggling ethnic newcomers and African Americans not only are economically marginalized but are becoming a smaller percentage of the population as costs have risen and good job opportunities have shrunk. Cities such as New York, Chicago, Philadelphia, and Boston , notes a 2013 Urban Institute study, are generally also the places where African American and Latino incomes most lag those of whites. Notwithstanding the rhetoric, much of the “hip and cool” world increasingly consists of monotonic “white cities” with relatively low, and falling, minority populations.  San Francisco, Portland, and Seattle, for instance, achingly political correct in theory, are actually becoming whiter and less ethnically diverse as the rest of the country diversifies.

from The New Class Conflict by Joel Kotkin

HKO

Ex NYC mayor Bloomberg wants more billionaires in NYC.  He explained “They are the ones that pay a lot of the taxes. They’re the ones that spend a lot of money in the stores and restaurants and create a big chunk of our economy,” he said. “And we take tax revenues from those people to help people throughout the entire rest of the spectrum.”

Isn’t this the essence of trickle down economics that the left criticizes so harshly?  The Laffer Curve is not about trickle down economics. It is about applying basic economic reason to the tax rate.  Higher taxes are a disincentive to earn more, especially if the marginal tax rate- the rate on the next dollar of income- is too high.  I would include other friction costs as well. Lower taxes CAN (but do not always) result in increased revenue.  It is ironic that this administration’s policies are more “trickle down” oriented and inequality has grown at a greater rate.

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Thoughts on Lower Oil Prices

therewillbe blood

At first glance the dramatically lower oil prices is great news because just about everyone we know will have more money in their pocket at the end of the week.   The middle class and the lower income will feel the greatest relief.  Every business that buys fuel for its fleet just got a boost in their bottom line.

Theoretically, though, every dollar gained by fuel consumers is a dollar not gained by the owners of the commodity.  To the extent that the owners of this commodity   are domestic the net effect on the economy is a wash.  But to the extent that the loser in this price shift is a foreign source then this will have a greater impact of the balance of trade and likely strengthening of the dollar.  A strong dollar makes our export more expensive, especially relative to a currency like the Russian ruble which is in a state of collapse.  Imports on the other hand are cheaper.  This is good for domestic consumers, bad for domestic producers who must now compete with cheaper imports.

The oil price drop highlights the foolishness of many of our Congressional leaders who have blamed greedy speculators for the higher price of oil in the past.  Did these greedy bastards just get the Christmas spirit?  It also highlights the completely ineffective  and misguided energy policy of this administration; making reckless loans for risky unproven green energy project that often ended in bankruptcy and failure while the cronies lined their pockets getting a great return for their campaign contributions.

The oil and gas energy industry, demonized by this progressive administration, have not only aided the lower income with lower fuel prices, but they also were the largest source of job creation.  The president and his party promised huge job growth from their investment in green energy and it proved to be just another lie.  They were bailed out by the antithesis of their policy.

Because such a large portion of the new jobs came from the oil and gas industry, lower oil prices will likely shelve new exploration and extraction projects and hurt job growth in the one industry that has created the most new jobs.  Will this be offset by the stimulus of an extra thirty bucks a week in everyone’s pocket? Somehow, I do not think so, but we will see.  It is possible that lower fuel prices will hurt job growth because, while lower prices may decrease job creation in the oil business,  many of the friction costs from the regulatory state still burden most other businesses.  The job growth from entrepreneurial activity outside the oil industry remains stagnant.

The true value of the oil price decline is noted by economist Mark Perry in his blog, Carpe Diem.  He notes  here:

 Incorporating the combined effects of: a) the increase in average fuel economy over time, b) the increase in the average hourly wage, and c) falling gas prices, the chart above shows the number of minutes of work required to buy enough gasoline to drive 100 miles. At 27.2 minutes, the current cost of gas in minutes worked to drive 100 miles is the lowest since 1999 (26.3 minutes). If gas prices fall another 26 cents per gallon from $2.36 currently to $2.10 per gallon, gas prices adjusted for fuel economy and wages would be the cheapest in US history. In some states like Oklahoma ($2.03), Missouri ($2.04), Kansas ($2.11), Texas ($2.13) and Indiana ($2.14), gas prices are already below or near that level.