Sunday, October 31, 2010

Border Guard Bob takes a hull shot

Ha.  Paz takes a stake to Border Guard Bob. See:  Stop worrying about losing young Pittsburghers.  Though I might have titled the oped 'How I learned to stop worrying and love the diasporan'.  Also note an interesting and related editorial from Livingston County, Michigan: Students Rightly Looking to Depart.

Border Guard Bob needs to call Damage Control Bob

Speaking of young ex-Pittsburghers, funny reading elsewhere in the PG an article about one of the new post-bubble companies, the Chicago-based Groupon, yet there is nary a mention that the Groupon founder Andrew Mason is himself from Pittsburgh.


Saturday, October 30, 2010

Daily Marcellus

Each important to us in and of themselves:

But for some real perspective on it all.  An amazing read for anyone who thought the boom or day trading was something new.  This comes from here if you want to read the full article:


Friday, October 29, 2010

link of the moment

Just trust me, this is from today:  Revitalization authority leads to council spat

I think we could teach them a thing or two about what a spat really is.


EnergyBurgh 2.X

An insightful look at local energy doings from a site called fuelfix: Iron City Wants to be New Energy Capital

This is just me, but I still am a bit shocked reading stuff like that because when I wrote EnergyBurgh just a few years ago (or my use of the term a bit earlier here) the folks Downtown just wrote it off.  'quaint' or "that's old Pittsburgh" were about the most positive comments I got.  The only energy stuff people really cared about for years was some focus on "clean coal" or coal related issues.  No matter.

The article has some things of note.  See were the ACCD went out of its way to say it was not trying to entice drillers to move to Pittsburgh from Houston.  Not trying to attract firms must be some kinds of first in the history economic development/site selection marketing.  It is a reflection of, or realization that Pennsylvania can't really handle more drilling and is barely able to sustain what is going on now.

Find the comment in that article about the Terrible Towel and the documentary Gasland.   I would have paid to watch that exchange.  Also a quote worth cogitating on from Katie Klaber:
“We’re answering the question ‘What will it take to be a modern shale state? ‘” Klaber said.
"Shale state"?  A play on the iconic "oil-state" I guess? No hubris there. Funny how it does not feel like Saudi here although I am thinking there is some analogy to all the third country nationals that make up the workforce in a lot of oil nations.  Interesting question as to whether we want to be a place like Saudi in the end and not the least bit ironic as Saudi itself looks to diversify away from oil. I did once go out of my way to visit the first oil well in the Persian Gulf which was in Bahrain, just a hop skip and a jump from Saudi.  Had a museum with it that was only open a day a week, or a day a month.. something like that.

For my historian friends I should correct this post's title... is it EnergyBurgh 2.0,  or 3.0...  or even 4.0 at this point?


Pregame Politics

Election day 4 days away?  Might as well go with the flow until then.

I suspect everyone would agree interest in the election this year is ahead of last year, which was mostly a municipal election year in Pennsylvania. Statewide races for governor and senator are big factors of course, but how much more interest?  To look into that I parsed some voter registration stats the state makes available.  Here is the change in new voter registrations by county in Pennsylvania comparing the 4 weeks before the registration deadline in 2010 (which was earlier this month) with a similar 4 week period before the registration deadline in the fall of 2009. The average increase statewide was 115% more new registrations in 2010 vs. 2009.  The biggest increases by county looked like this:

Largest % Increases in Voter Registration by PA County - 2010 (month before registration deadline) vs 2009

I've put a full list of counties broken out like this onto google docs here. Not on this chart, but at the other extreme there are 5 counties that actually saw a decrease in registration in 2010 compared to 2009.  Most were small places.  Cameron County had only 7 new registrations over the month before the registration deadline, down from 9 a year earlier.  Union County had the biggest percentage decline with only 108 new registrations, down from 152 the year earlier.  Forest County had the fewest new registrations at 4, but that was the same as a year earlier. 

Centre County = State College and one presumes a lot of college students.  Some other college impacts in there I am sure, but Philly and Allegheny both showing increased voter registration far ahead the statewide average.

Begs the obvious question of who is registering by party.  Dems? Reps? Libertarians?  Maybe the Constitution Party is making a comeback? So here is the breakout of these new registrants in Allegheny County in 2010 in the 4 weeks leading up to the registration deadline.

New Voter Registration by Party - Allegheny County - Last 4 weeks before registration deadline 2010
Which I thought was a bit odd with more "Other" than Republican registrants.  Is that normal?  There are always a lot more 'other' registrations than people think which I suspect are folks being registered via motor-votor or other sources and are just not politically active people.  It's not normally reflective of some big group of neo-independent voters.  But to compare I looked at 2009 to see the breakout in registration by party.  You get this:

New Voter Registration by Party - Allegheny County - All of 2009
So who are all these new "Other" registrants?  The Republican registration % is nearly identical in both years..  But it looks like the new "other" registrants are pulling from Democrats more than Republicans.  Might be the bigger story of the political season?  Reliable 1% Libertarian registration though.


Thursday, October 28, 2010

Most interesting news item of the day

Most interesting news item of the day: link.


Are we getting smarter or younger?

So the Daily Beast gave us us a boost the other day in moving us up from 27th to 21st in their 2nd annual ranking of ‘smartest cities’.  They seem to aggregate several metrics including “libraries per capita”, but also de rigueur is a measure of educational attainment.  Specifically they measure those with a bachelors degree or higher in the population.  They do what everyone else does and measures the educational attainment of the population 25 and over.  That’s fine for a lot of regions, but as I point out for Pittsburgh it is not so insightful.  An older region, with lots more folks who grew up in an age when grad school, college, even high school was just not as common as today.  So for us what you get is a measure as much reflecting our age demographic.  Take it out, and what do you get?  From what I have compiled we rank a lot closer to the top in terms of educational attainment .. especially when you look at the younger parts of the labor force, we may in fact be the single most educated place in the nation. 
So the question is... are we getting smarter or younger?  and anyway, do thinks like this really change that much year over year? Educational attainment can't change over night and (as Jim R. likes to talk about) is really one of those mesofacts.   There is your new word of the day. JimR is coming to town next week btw. 


Wednesday, October 27, 2010

Pennsylvania Political Bullseye

I guess it is a week to the election... who knew?  Earlier I had thought people were not paying attention, but about 30 seconds in front of any TV in the state would make that near impossible.  Granted there are always a lot of ads this time of year, but it seems to be quite a deluge this year. 

Maybe the sheer number of ads is what is impacting their quality.  I say this for every last one of them, but if they are not boring they are inane.  Then there is the negativity.  Again, not something new, but you really have to wait for the few non-negative ads to run. It is not always this bad is it?  They could have ads with one candidate standing there with a Voodoo doll of their opponent and poking him (and it is all men locally and state-wide isn't it?) with pins for 15 or 30 seconds for all the content I see.  Are there no more creative ad-men(or women) around?

Anyway,  here is what the political bullseye looks like in Pennsylvania at the moment.  I have updated this illustration of voter registration stats by county (as of Oct 2010) colored by majority party.  You can play with the interactive version here.

Pennsylvania Total Voter Registration by County and Majority Party, October 2010


Tuesday, October 26, 2010

spotlight gets brighter

and now the FT aims its spotlight here: Pittsburgh’s pensions crisis nears deadline

Yet however much louder the parking miasma gets, the better we are as a place to live. Go figure.


Diaspora Report - Mr. McFeely edition

Have not seen a diaspora report over on the PG in some time...  So I have to do this myself. There has to be some stamp joke in this.  All I can say for this is I better get my mail in the future.  The new Postmaster General is a yunzer (and a Pitt grad).  USPS’s Donahoe: Who is the new postmaster general?

Just think, if Border Guard Bob had been successful, the guy would probably be stuck being the postmaster in Smock, PA or something like that. 


Monday, October 25, 2010

Pension Parking Parsing

I had a big long rambling post on general parking/pension issues, but it just isn't in me to post.  Reading about the latest round of rumblings on the fifth floor had be wondering how we wound up in this state.  Council-mayor relations have occassionally been bad in the past. Intra-council relations have sometimes gone off the deep end with members swearing at each other in session.  So maybe things today were sedate in comparison. 

Some things really need commenting on though.  Bram tweets that the administration presented some idea that if a bond was issued against future parking revenues, that there was a potential for the parking authority to default with a result of the bond holders taking posession of city parking assets.  If Bram passed that on accurately, then folks should know that that is basically false.  Default on a revenue bond really can't result in foreclosure against public assets like that.  Skipping legal wonkery, it just isn't the way things work. Purchasers of a revenue bond have claims against future revenue streams, not the underlying assets. It would be extraordinary, and certainly not required for the bonds to have a mortgage pledge in their prospectus. The concept of wall street types winding up as owners of the garages is just not an option.

Beyond that.. like I said I don't have it in me.  We are again down the rabbit hole Downtown and who knows where we will emerge when all is said and done. 

OK, I can't resist one really fundamental comment.  Seems to me that the whole presentation today by the mayor was that this bond issue plan wouldn't work and it was based on some math saying a bond would be issued at 5.5% if tax-exempt and 7.5% if not tax-exempt.  Are those rates for real?  I don't think any muni bond rates are that high these days are they?  Would make for some very different math if those rates are incorrect.    I really need my Bloomberg box back. 

Speaking of bond rates... us 3 public finance wonks may have noticed that bond  insurer Assured Guaranty had its bond rating dropped today... Methinks a few big public bonds locally have bond insurance issued by Assured Guaranty.  Oh, nevermind. 

Yeah... my original post was still longer than all of that.


It's not a bug, it's a feature

I joked in a comment here some time ago that we were lucky nobody had discovered a way to mine uranium via hydraulic fracturing...  but sometimes my subconscious is quite prescient.  From the Univ. of Buffalo today:  'Fracking' Mobilizes Uranium in Marcellus Shale, UB Research Finds.

I can see the PR now on it all..  "New energy source to be mined in Pennsylvania".


a decline by any other name

Note the story today about continuing enrollment declines in the Pittsburgh School District.   The headline factoid is that enrollment dropped 3% year over year with data for the current school year.  I don't quite get the headline and quotes about slowing or flattening decline. 3% is roughly the average rate of decline over the last decade.

I have not had time to update this,but this table tells a deeper story all by itself. This is the enrollment trend in the system for pre-K through grade 12.  So it is a slightly different number than is being reported in the news which is K-12.  But you see the trend, I'll add a picture of it when I get a chance.

YearTotal enroll.% change

Source: 1987-2009: NCES CCD

Note that news accounts say the school district self-reports total enrollment for the 2009-2010 year as being down to 26,123 and the latest numbers being 25,326 for 2010-2011.  Again, those two numbers reflect a slightly different universe than the time series above.  Above is total enrollment including pre-K, whole the reported numbers in the news seems to be K-12.  Must be 1000-1400 or so in pre-K somewhere.

I also am unclear about the demographic projections/trends indirectly cited as the reasons for all of this.  City-level population projections are very different from regional or even county level demographic projections.  Municipal level population projections are not as much impacted by natural population change (births and deaths) as they are migration.  The city in of Pittsburgh is much more impacted by migration trends impacting it's future population levels than say the county.  Lots of movement within the region that impacts all municipalities, but in particular the city of Pittsburgh.  The variation of intra-regional migration trends is much more than the sheer demographics impacting the region as a whole. Those intra-regional migration numbers average out to a much less volatile inter-regional migration rate. and of course, school enrollment has to address movement in and out of private/parochial/charter schools as well. 

Enrollment numbers are hard numbers... or at least a better number than a lot of other numbers we have on the city year over year.  Note that the census bureau actually recently revised upward its City of Pittsburgh enrollment numbers back through the last several years.   That is not saying the trend turned up, but that the downward trend has not been as fast as we thought over the last several years.  But that has been in population, not school enrollment. 

What to do?   Too bad nobody wants to pay as much for old school buildings as old parking lots.


Sunday, October 24, 2010

Infinitives are overrated

The Trib has an iteration of the recurrent story on the Pittsburgh dialect.

Am I wrong about something?  I swear that for most of my life the term was Yunzer, with a "U".  Yet it is always Yinzer these days.  I really think it all comes from the "New Yinzer" magazine and their misspelling (or mis-hearing) of the colloquial.  But I am not a linguist, so what do I know? 


This is a Drill! This is a Drill!.........

Who needs polls when you have a secret time machine? No hot tub required.

 On the Pennsylvania Secretary of State's web page over the weekend was this:

Breathe Sestak and Onorato supporters... breathe.   The site also had some notes that it was just testing...


Saturday, October 23, 2010

Daily Marcellus

Must read from the National Geographic of all places. Covering all sides it has: Forcing Gas out of Rock with Water. Also in same issue: A Drive for New Jobs Through Energy and A Dream Dashed by the Rush on Gas and Parks, Forests Eyed for the Fuel Beneath
For those waiting for royalty checks it is important to note that natural gas prices continue to plummet.  What is the great mystery is that given lower prices, along with the fact that T Boone Pickens is virtually pleading with natural gas producers to cut back production, nothing seems to be slowing the development of shale gas in Pennsylvania.  I wonder a bit.. if the summer had not been excessively hot, which boosted natural gas generated electricity, what would prices be now and would there be a storage problem in the industry?

Speaking of mysteries... some recent jobs number document the vast increase in mining jobs statewide.


Friday, October 22, 2010

Speaking of Steeler Nation

From the Orlando Sentinel: Steelers fans home in South Florida, too


Latest recession stats and the real birth of Steeler Nation

You may have saw the headline news items with the latest stats on Pennsylvania's unemployment rate... down 2/10ths of a percent in September vs. August.  From 9.2% to 9.0%. So good trend, but still a bad number. 

Parsing that a bit, some interesting things pop up.  Within the numbers being reported today the total number of unemployed in the state dropped by over 15K people between the two months.  By my scanning, that is the biggest month over month drop in 27 years.  In fact, with the exception of an extraordinary month in July of 1983 it is the single biggest month over month decline in the number of unemployed across the state in the last 40 years at least. 

July 1983 could be seen (superficially) as a banner month.  Total unemployment in the state dropped by over 100 thousand people. That is pretty historic as that kind of number goes, for us or most anywhere else.  Is that even conceivable, and is it a good thing? I bet a combination of unemployment benefits running out for the major waves of layoffs produced some historic flows into the ranks of discouraged workers, coupled with the peak outmigration from the region produced that number more than anything else.  It was also the month that produced the all time historic drop in the state's labor force.  The stats say the Pennsylvania labor force declined by over 67 thousand people between June and July 1983. That is a mind-numbing statistic much more than the jumps in unemployment that precipitated it. 

Comparing that this months numbers for the state, it is almost the opposite situation with regards to the labor force.  That fairly historic drop in the unemployment count (-15K) last month is matched almost exactly by a 16K increase in employment.. So the force actually blipped up just a bit by a thousand folks.  So there is no comparison to that miasmic month in 1983. 

I've been seaching for anecdotes on when the point came when folks really believed steel was not going to come back.  You can make the case that through typical recession cycles, even in the early 1980's, people believed any dip would be followed by growth in the future.... that the manufacturing workers getting unemployment would be called back at some point.  July 1983 may be the point where many folks realized something had really changed for good.


Feast or Famine for the Future of the ICA

Who has been most impacted by the changing fortunes of the parking lease?  I say it's the ICA, aka the Intergovernmental Cooperation Authority.  When the parking lease looked to be a go, I was thinking that a city flush with all this money would likely emerge from both Act 47 and ICA oversight in relatively short order.  Yet the circumstances changed and now by all accounts the balancing of the city's budget will be harder than ever. Consequently the ICA may again become relevant if it so chooses. So at least for today it seems the ICA and Act 47 may die another day.

Nobody has ever really asked what impact the ICA has had since it's inception.*  A few points they quibbled with some minor points on city budgets submitted to them over the last few years, but it never amounted to much policy impact in my opinion.  I don't think there is any point where the ICA actually exercised its authority to withhold certain state funds from the city.

Begs the question of course of what the ICA could do if it wanted to?  Maybe they could have a public opinion of any kind on some of the big issues we debate?  OK, maybe that is too much to ask.  What else?  I see that the ICA's progenitor and Philadelphia cousin, the PICA, has just put out something quite useful...  their Citizen's Budget Guide presentation...  for Philadelphia of course.  So for us, as the city rushes to submitted yet another revised budget in the next week, the public will generally know little of the issues because there isn't much to help them sort through the numbers.  

Quick.. without cheating, name one person currently on the board of the ICA. 

* Granted Bram had this look at the ICA executive director, but even that was not really about the ICA itself.


Thursday, October 21, 2010

Perpetually Parsing Pensions

You know this whole debate over whether to get the pension fund to 50% funding may not matter as much as it may seem.  Or at least the problem may be so much worse than we think and that the numbers we assume are good turn out to be wildly optimistic.

The government accounting folks, GASB, are considering a change in pension accounting rules that would bring public pension accounting more in line with private sector accounting.   The result, if it happens, is that the calculations of almost all public pension liability will be much much higher than they are now.  So Pittsburgh's billion dollar liability would be something a lot more. What if the number was $2 billion? Any % increase on a billion dollars is real money.  If you want to see more on the accounting issue, see this from the WSJ:  Board at Center of Pension Dispute   Note the Pittsburgh connection in the story that has nothing to do with the city btw.

I was reminded of that because I was reading a paper that just came out.  Remember when I compared Pittsburgh's debt and pension obligations per capita to that in Vallejo, California (which is still plodding through a bankruptcy proceeding) to Pittsburgh. Someone has taken the time to parse those numbers more systematically across a number of cities.

The Crisis in Local Government Pensions in the United States (link)
October 13, 2010

or if you want crib notes, read the Economist's coverage of their research.

It does not look like they included Pittsburgh in their research, most likely becasue the city is so small.  No time to parse all that, but in scanning it I think they cacluated some liability valuations that use some more normal assumptions on things like the future discount rate. Public pension plans tend to use a very high discount rate of 8%.  Actuarial valuations of private sector pension plans almost always use a much smaller value for their discount rate.   I suspect that if they did do such a caclulation for Pittsburgh would be quite a shock and show a lot higher than the billion dollar liability we are talking about these days.  Just imagine where we would be in that case?


Wednesday, October 20, 2010

The Economics of Cliff Stoudt

ESPN has this piece on a new book I guess I have to go read:  "The Ones Who Hit the Hardest: The Steelers, The Cowboys, The '70s and the Fight For America's Soul".  For a book link click on the picture on the left.

Why I really noticed is this quote from the author in there talking about Pittsburgh of course:
"The sheer volume of people who were out of work at the time was astounding. Steel mills, which for so long had been the engine that drove the American economy, were shutting down at such rapid rates, which meant hundreds of thousands of men who assumed that would be all they did their entire lives had to rethink their life's plan"
OK..  I've been through this and there are things we can debate some of the contemporary psychology at the time... but there is a disconnect between our Steeler memories of the 1970's and what came afterwards.  Remember, the 4 Pittsburgh superbowls were coming out of seasons played mostly in 1974, 1975, 1978 and 1979.

Now consider that manufacturing employment in the Pittsburgh region did not go down between 1971 and 1979.  I'm serious.  In 1971 Pittsburgh MSA manufacuturing employment = 290K.  1979 manufacturing employment = 288K. OK, some loss.  Maybe those 2,000 net job losses begat 2,000 really fanatical fans?  But the monstrous permanent job losses in manufacturing? The belief that steel was about to implode?  Not the issue for Pittsburgh in the 1970's.  Yet the great mythos of all those permanently unemployed steelworkers feeding the fan frenzy of the 1970's from the long cold unemployment lines is indelible history.  Now we have a whole book based on the myth. 

There were things going on within the decade.  Not one, but two oil/energy crises.  Not one, but two national recessions; both of which had big cyclical impacts on the regions manufacturing base. Inflation/stagflation and all sorts of other things.  It was also a time of some pretty serious wage increases in the steel industry..  so inflation or not, most local folks saw their purchasing power sustained if not increased. I think people conflate some of the other big national economic stories of the 70's with the Pittsburgh miasma that followed. 

Nonetheless, the whole story of the steel industry collapsing and the permanent structural employment the quote above seems to refer to are stories that would really only begin as Superbowl XIV finished.  Then right as XIV ended, all hell breaks loose for sure.  Bradshaw would be gone though.  As the jobs disappeared for good the region's fans would not be rooting for Bradshaw, but for Cliff Stoudt.

Maybe the book will explain it all to me?


Opportunity Cost

If I had any doubt the parking outcome is a good one... I didn’t catch this letter to the editor the other day.  There are few people I trust more than my friend Jack. 
Jack has taught me about lots of things, probably including this little thing in economics called opportunity cost.  I shudder to ask what the whole parking endeavor has cost the city.  Beyond fees and sheer time and effort there is the investment made by the Parking Authority and I really wonder whether there are contingency fees Morgan Stanley (and others?) is going to claim in the event the city does not go through with a lease.  Those $$ amounts may all pale in comparison to what I really worry about.
That headline was from August 27th  specifically.  In a remarkable and frightening conincidence August 27th just happened to be the day the Dow closed at it’s lowest levels since July.  The Dow closed that day at 9,982 and would climb by approx 10% over the 6 weeks since then. Even with a big market loss today, the Dow's close was 10,978 Even bond prices have generally gone up since then.  Get where I am going?
Opportunity cost?


Tuesday, October 19, 2010

The end of the Parking Lease Meter

No, nothing at all to do with today's news, but for all the new parking wonks in town Slate has a neat piece:   Time Expired: The end of the Parking Meter. I'll add... 'as we know it' for both the lease deal and meters for the record.

HuffPo has a local perspective: In The Public Interest: Parking Privatization: A (Cautionary) Tale of Two Cities

and just fyi.  Front page of the WashPo today has a big top of the fold map on foreclosures by county across the nation. I can't find a specific link quickly, but you may want to find the paper and ink on a stand somewhere. Another story they have is about the a big drop in the income of 'part time' workers in DC.  No time to look it up right now, but I will have to generate the comparable stats for us. 


Gerry who?

(Greetings Poltico readers)

Opening across the country is a new documentary: Gerrymandering.   Unless I am missing something I do not see any venues or showtimes around here??  What is up with that?  If there is anywhere that movie needs to be seen it is in Pennsylvania.   Not to pick on any one district, but below is the current shape for Pennsylvania's 18th Congressional District.  I would argue that PA18 is the most scientifically Gerrymandered district in the entire history of Gerrymandering. The result is the picture below. If this can't be used for a Rorschach test, then nothing can:

Anyone want to sponsor a showing?  If nothing else, could be fodder for a fundraiser.  I'll offer up a free presentation with lots of local maps on the topic to go along with any local showing for any appropriately nonpartisan fundraiser if that helps.


Monday, October 18, 2010

Allision in the parking lot

Just my musings on the state of the parking lot(s).......
True it is that democracy is messy.  Still, it is nearly impossible trying to keep score with what is going on Downtown as the plan to lease the city’s parking assets faces possible rejection tomorrow.  These are my thoughts of what is lost in the cracks and the things that I find really curious about how it is all playing out.
First I wonder how many people in the city really have a grip on the current machinations going on Downtown?  I bet the number of people who have any chance at deconstructing the politics at any given moment don’t number much more than a dozen.. and that probably would have to include Bram to get the number that high.  The question is whether those 12 really get it, or whether there is anything to actually figure out..  Maybe everyone is in pure reactive mode at this point.
Many things surprise me.  The first is just how quiet senior leadership with the city or Parking Authority has been.  Granted the Mayor is a few time zones away, but there has been only minimal and mostly reactive public comment from virtually every other major player in mayor’s office as the ground shifted. I don’t quite know what to make of it and I don’t quite believe it’s all because the Mayor is away.  Possibly there was already some realization that this all would not work politically and are already regrouping?  Just a theory, but it is kind of weird.  Maybe everyone is off working on plan B, or make that B1, B2… or B13 at this point??
If indeed it all fails, and that is still only conjecture at this point.. the ultimate mystery may be why support on council fell apart so completely.  Not to say there ever was support, but either the mayor’s office went this far without locking down some core council support, or really just presumed the current presumptive was utterly inconceivable.  Even if a marginal vote or two was needed on council, with the bid so high, there was more than enough for a few pet projects to be fully funded along the way to. Should have been more than enough to get to 5 votes.  Cynical I suppose, but the way politics works most everywhere.  If it does fail, is this the biggest mayoral proposal to be stopped by sheer public opposition since...  Fifth and Forbes?
If I really had to pick myself.. not that I have any say in even how the choice gets framed….  I am partial to the idea of going ahead with the deal.  i.e. taking the money to re-capitalize the pension fund, but still let the state takeover.  I still would really like to see the Downtown garages sold and not leased, but that is not on the table.  Of course, this idea may be pre-empted by the timing and may not even get a vote...  for now. There is no reason that can’t still be the path.  Once you accept state oversight, you take the debate away from the deadline of Act 44, then the timing issues all evaporate.  There is no rush then to do something immediately.  This could all be something we debate for the next year even and go ahead then.  Nothing is over.
The reason the state takeover piece is actually a good thing is because the goal is the long term..  right?  Even if we get to 50% pension funding, realize that is where the pension funds were at just a few years ago.  So there is no reason to think the long run trend has been impacted, just deferred.  The reason we are in this whole predicament is that in good stock market years or bad, the pension fund has almost always continued to fall behind, or certainly not gain as much as it should, if indeed it was on a path to becoming fully funded.  Something has been wrong with the city's contribution calculations for a long time. We could be 100% funded and the problem would still be there in the future.
The thing that really gets me though is the $$ amount that the bid came in at.  Why so few firms actually bid, and how you had one bidder put up more than $150 million more than other firms.  How one investment bank could think the same, theoretically fully disclosed, asset is worth so much more than what others would pay for it just strikes me as really odd.  Some smart people at the firms that bid less, or never even bothered to bid.  Just one of those "hmm...." things.
Bottom line?   One way or another I am pretty sure this story isn’t over whatever path gets taken. If there is a silver lining I would say that unlike the many many years decades where the pension problem was very much a stealth issue, I am pretty sure nobody can ignore it into the future.  That does constitute progress.

update:  Well, boom goes the dynamite and all of that.  Or so it seems.   Also just a coincidence, but check out this book review just out from Rolling Stone of all places:  Exclusive Excerpt: America on Sale, From Matt Taibbi's 'Griftopia'


Daily Marcellus

Some may know that one of the biggest things going on in the whole Marcellus Shale play has been the foreign investment it has been garnering.  In particular there has been a big investment from India of late.  The Indian firm Reliance Industries made some big equity investments in some local Marcellus developers of late. 

News going around the inter-tubes and beyond today over the new home the owner of Reliance Industries just had built in Mumbai.   Trump couldn't afford that even if he wanted it. 

and fwiw...  Platts tells us there is still a rapid decline for natural gas prices... somewhat unprecedented for this time of year. 


Sunday, October 17, 2010

Daily Ranking: Libertarian-Burgh?

So here is something I believe from the parent of the PBT in some way. 

But Pittsburgh ranks 99/100 in terms of the proportion of local jobs that are government jobs.  Parsing that would take me a week so just take it as a curious factoid for the moment.  If you are unclear the metric, 99/100 means we are ranked among the regions with the lowest proportion of government jobs... it is not that we rank low because we have a lot of government jobs.  It means we are really a Libertarian haven.  Who knew?

It really is a curious list I have never thought of before in quite this way.  The only region with a lower proportion of government jobs is Grand Rapids, MI while the region just higher than us (so 97/100) is San Jose, CA.  Not exactly 3 regions that have a lot of commonalities between them these days.

I'll add that if I were to guess, I bet the results of ordinal metric for this is driven by state level differences in how government and nonprofit sectors are organized.  By that I mean in some states it is much more common to have community hospitals that are run by government in some form. Thus their workers get classified as government workers.  In others such as with us, hospitals and health systems are more nonprofit organizations and nonprofits are technically private sector enterprises.  There is a similar issue in some higher education jobs as well.  Pitt, for example, as a "state-related" instittuion has private sector employees.  Other states may capture more higher education workers as government workers per se.  


SteelerNation... the wonk edition

Paz and Jim do the social entrepreneurship thing.  Check out the nascent Pittsburgh Expatriate Network.

Personally I'd name it the anti-Border-Guard-Bob network...  Nope, I didn't say that.  Down, ubu, down!


Saturday, October 16, 2010

Daily Marcellus

.. actually more your random Marcellus posting of the day.  Note this ebay auction for 10 acres of a Marcellus Shale lease that is posted on ebay right now

Non-marcellus related.. but I have never been able to find any local buyer who actually consumated a real estate purchase via an ebay listing for a property.  Here is a local posting from New Kensington running currently... with 32 bids no less.  Don't take thas as a recommendation to bid.  See some of the problems I talked about in looking at other local ebay listings for real estate.   and read the posting!!  Here is a post for a property in Natrona which is fascinating if you see what is actually being bid on.  It's not the price of the property, but the 'fee' to be allowed to lease the property for 11 years with a purchase option. The REALLY interesting thing is ebay comments would imply the poster has been doing this a lot locally??? Really? Someone really needs to look into that.  Especially because the current listing honestly states that the poster 'has never been' to the property.  You can google yourself the name of who is listed as the current owner "Milgrom Roger Trust".


Browns Induced Diaspora

I was going to just mail this over to Jim R., but I couldn't resist passing it on here.  From the Cleveland Plain Dealer is this article:  Eric Barr moves to Cleveland to follow the Browns.  Includes video.

Speaking of Cleveland...   via the tweetosphere and @NFLFanHouse is this tweet:

"Colt McCoy's listed as Questionable ("I Don't Wanna") against Pittsburgh. Never seen that one before. "


Friday, October 15, 2010

"plan benefit interpretation"

So I have generally refrained from commenting on core issues in the rapidly evolving Parking/Pension/Privatization debates because a) I've had my say b) the ever fluid nature of 5th floor politics makes it a moving target and c) maybe a bit of sheer ennui over it all... important as it is.  I can't quite imagine how some of the folks Downtown feel at this point.

But if you want my take on where the real center of gravity is in this whole fight, read the PG version of today's update on the mess and scan until you get to the paragraph that includes "plan benefit interpretation".

Some say the whole privatizaion plan is DOA as of right now.  I wouldn't dispute that any more than I would dispute whether Shane dies in the end.


Thursday, October 14, 2010

Daily ranking: Milken Top Cities

A note for being among the most improved since the previous ranking.  See the Milken Institute's Best Performing Cities 2010


Liquidity and transparency

I caught last month when PG ER2.0 had the snippet about the city claiming some of its pension assets were illiquid.  Bram tweets that the topic came up again today.  The topic being the investment-worthiness of something that somebody knows is counted in the assets of the City of Pittsburgh's collective pension fund.

Can someone please go find out what specific assets the city's pension fund is holding that are considered illiquid?... and what is a much more interesting question.. i.e.   What basis is being used to price them at in terms of calculating their current value?  Purchase price?  There is a knot forming in my gut. For the state PMRS fellow to mention it, and for the city to have the actuary send a letter out on the subject, both imply to me that the scale is not minimal in terms of what $$ are tied up in whatever it is.

Don't get me wrong, there are all sorts of funds investing in things not quite liquid.  Some investors prefer that type of risk. Whether that risk is appropriate to the fund that is now driving the entire policy discourse in the city of Pittsburgh is something we can debate.  Even pension funds are investing in liquid assets more and more, but normally a pension fund diving into such types of investment are doing pretty well and they are doing this with money they may not need anytime soon.  Remember the Alabama pension fund manager who was briefly the owner of US Airways.


Blight Beyond Braddock

Article and video worth a moment from the BBC: Gary, Indiana: Unbroken spirit amid the ruins of the 20th Century


Wednesday, October 13, 2010

The 1950s Browns

So maybe we are going a bit overboard on the tributes to what happened in 1960, but it legitimately was a sigular point in baseball history in many ways....   However, up in the NW part of Cleveburgh, this strikes me as a bit desperate.

What my good friends in Cleveland just never have a retort for is the simple fact that THOSE Browns left town some time ago.  It is a bit unclear who it is they are rooting for these days. 


Daily ranking and you know who

I am a little unclear if this came out today, or last month.  But, which is somehow related to the parent of the PBT I think has a new ranking out that has us among the very top for regions with the highest income growth rates.  Worth poking at some more when I get time.

and I owe Pittsblog a post.. I do.. but Mike can't keep me honest to my own promise to abstain from commenting on you know who.  It's all a bit like Dr. Strangelove's hand I suppose.


Morning in Pennsylvania

I first noticed these running during the Steelers game a couple weeks ago.   I see the PG also thought they were noteworthy and Elwin has a whole story on the ad campaign.

Don't you think that the first ad that runs on: makes you feel like It's morning again in Pennsylvania?

Don't get me wrong, those ads are awfully well done. Points for those who get the allusion whether it's theirs or mine.  I suppose someone will fund the Twilight on the Susquehanna version now. 


Tuesday, October 12, 2010

daily gaz de schiste

Nominally a story about opposition to shale gas development, but what I take from it is that Quebec may also be a big future producer of shale gas...  and they are located not so far away.  From Toronto see: Not everyone agrees shale's a plus

The development of ever more gas is curious because as the FT points out, the price keeps dropping: Warm weather keeps natural gas prices low

WSJ hints at the end of the speculation: Reliance To Digest US Shale Gas Assets Before Buying More -Source

although both China and Norway have made big shale gas investments of late. Not necessarily here, but in Texas. From Marketwatch: Cnooc, Statoil wade into Eagle Ford shale

The Inky has what is the most interesting story of the day for your inner social scientist: On Pa. natural gas tax, different polls yield different results



Energy-Burgh down deep

An entirely new meaning for Energy-Burgh:  Researchers use drilling data to find a geothermal hot spot in West Virginia.  I wonder.. any other 'missing' hot spots out there?

A broad definition of the Burgh I know... but maybe something for our P32 folks? It is going to muddy the water a bit in the whole fracking debate.  Some of the news stories on this talk of using enhanced geothermal systems to exploit the find.  The enhanced part as best I can tell is the fracturing of shale at depth.

Update:  I used to read FastCompany... and if I had I would have seen they caught this last week. How Google Cash Helped Find Geothermal Energy in West Virginia


Monday, October 11, 2010

the Doylestown chinchillas?

I spoke too soon.  Maybe I should have read the Monday op/eds before posting that. 

Folks have been debating tax policies and rates for millenia at this point.  Yet today someone came up with an argument against taxes unique in the whole history of tax debates. The following snippet comes from Slow down on a shale tax:
After the Marcellus tax, they will not be able to help themselves and will be emboldened to impose a new levy on all oil and gas production, then high-sulfur coal destined for China, then Lake Erie perch, then Doylestown chinchillas, and who knows where it will stop?
The slippy slopes of Doylestown chinchillas?  I thought for a moment there was something special about Doylestown chinchillas, sort of like the Memphis ducks or something... but no. or at least Mr. Google seems as confused as I am.  Whatever your position is, there has to be a higher level to debate this? I realize it may be too much to expect the public discourse to focus on the arc elasticity of cumulative gas production with respect to a change in a severance tax (which actually is the most important thing impacting whether we should tax and at what rate), but have we strayed so far from what the audiences at the Lincoln Douglas debates heard?



I have nothing...  but this has a whole bunch of labor economics, international trade and finance all rolled up in it. 


Sunday, October 10, 2010

Anonymous Burghers?

Now I could be wrong, but these unidentified folks sure look like a few Burghers to me?


Harrisburg Tales

It seems Harrisburg picked up the phone when Harrisburg called:

Patriot-News: Welcome to Harrisburg, city of distress -- and then some

Via WSAU, Reuters: Harrisburg, Pa., seeks bankruptcy attorneys

Here is a question?  How many state capitals have ever gone into bankruptcy?

and a curious title caught my attention as much as the latest TM sighting: Wernicke: 'We built parking lots; you store sand"


Friday, October 08, 2010

I think we've moved on past "Plastics"

Remember when Lehman Brothers was hording uranium...  OK, that's pretty out there, but that is what came to mind when I read about the great mystery buyer of natural gas-related leases. 

huh, you say.

I really am surprised no local news coverage of this: Mystery buyer, mystery price for 500,000 acres of Appalachian leases

Let's count.. 500K acres times what $/acre the market is at these days?  I think that is a couple orders of magnitude more $$ than is involved in say the former Hilton Hotel bankruptcy that gets lots of coverage all around.

Read the last line of that link to get to the interesting point.  Whomever was buy side on that must be one of two things.  Platts suggests only the first option, that the buyer was a publicly reporting company, but one that is so big that a multi-billion dollar deal did not warrant public disclosure of a material event.  The other possibility is that the buyer was a private entity.  I'm thinking a sovereign player.  Who is left though?  The Sultan of Brunei? 


Parking Costs Compared

Via the SF Chron is a story on some new benchmarking of parking costs in major cities... no Pittsburgh datapoints, but you can add those in yourself if you want.


Thursday, October 07, 2010

gas not rising

Another big drop in natural gas prices today. WSJ: Natural Gas Falls on Storage Glut.  or see the graph yourself.  A 6% drop in a day is a lot I suspect in any market anywhere at at any time.  Story says it is the lowest price since last year, and the lowest price for this time of year since 2001.  If inflation adjusted I would think you have to push those dates even farther into the past to find comparable prices. 

Realize that the PA supreme court recently ruled that minimum royalty payments to landowners are measured as net of expenses in developing the production.  Since I can only presume production costs have not dropped as well, it means that a 6% drop in the top line commodity price will result in a greater than 6% drop in net profit.. and thus a greater % drop in royalty payments.  Anyone receiving royalty payments know what the effective price point for costs is being used for calculating their payments? 

PA may have so much gas that the FT energysource blog says exporting may be the game for shale gas producers. See: Exporting shale gas could keep US producers in business. Note how they reference PA production results that were made public recently.

and if that is not enough, more natural gas is becoming available on the international market and coming to North America.  Commodities are commodities and that can only put downward pressure on prices here.


Gapers Back

Some may recall that a neo-media web publication out of Chicago called Gappers Block had a profile on Pittsburgh last month titled Pittsburgh and the Magic of Failure.

They came back and have an update:  A Steel Tree - Return to Pittsburgh


Straphangers unite

We need some comparable group like the Straphangers in NYC.  They have these neat reports on the state of transit in the Big Apple.


Best Places to Restart Your Career

Multiple 'Burgh mentions in this from the Daily Beast talking with an author of "What's Next": Best Places to Restart Your Career.  Isn't that a story about workforce migration?


I wish I had time to comment on the parking/pension (new acronym: P2?) story of the day. That story deserves twice the column inches,but what can you do?  Nonetheless, if you want to go obsess  on pension data you can start with my iPension page.


Wednesday, October 06, 2010

story of the day

So the news of the day is out of the school district.  Just pure speculation, but the news today now makes this news from last week make more sense.  A more interesting question is who Mark Roosevelt might take with him as he goes off to his new job.  Random question that I wonder about:  How many colleges have reopened after having been shut down?

How goes the school district though?  Lots of good news of late of course, including the Gates' award most especially.  Still, at the end of the day the question is what the numbers show for enrollment. As I have looked at before, city school enrollment has been faring badly compared to enrollment in nearby suburban school districts.   Here is the reported enrollment at the Pittsburgh School District over the last couple decades.   It has this appearance of stability up to the beginning of this decade, but I have reason to doubt some of those earlier numbers.  I suspect the trend downward started sooner than these numbers show.

YearTotal enroll.% change

Source: 1987-2009: NCES CCD

Note that news accounts say the school district self-reports total enrollment for the 2009-2010 year as being down to 26,123.  That number is inconsistent with the trend above.  Numbers above show total enrollment including preschool.  The 26K number is K-12 only. Looks like preschool totals for the school district are 1,300-1,400, so add that in to get a comparable number for 2009-2010.  I have not seen the 2010-2011 intitial enrollment stats yet.