Can America afford it’s rural communities

We hear a lot about the “takers” in America, a classification for, usually inner-city people who survive on benefits, unemployment, housing, medical, food stamps and more. Mostly the venom about takers also contains a racial element, it’s directed at black and minority groups who many assume benefit from Government programs without paying in.

It’s not often directed at the President himself, but as the New York times pointed out last year, Trump himself could be the ultimate taker.

Picture of small town America decaying
Decaying Texas – Mark Cathcart

What we don’t hear much about is the affordability of rural towns, and even many of the suburbs. One of America’s greatest strengths, it’s size, is also one of it’s biggest problems, small town sustainability. I’m no expert on the economy and sustainability, but if you drive long distance in America away from the Interstates, you can see the problem everywhere. Decaying towns, decaying infrastructure, slowing or declining population growth. I own and subsidize a rental home in one such town in Texas.

Back in 2014, I made my only drive from Austin TX to Boulder CO with my Mum, on what was to be her last grand tour. What struck me at the time were the endless poor quality roads, and the nearly, seemingly deserted small towns.

We covered 2,500 miles, mostly north west Texas, also New Mexico, and Colorado. On the way back we went via Taos, Santa Fe, and Roswell and then back through west Texas.

They had almost no choice in terms of food, restaurants and shops. I wrote this blog post “Decaying Texas”. It has a couple of slideshows of pictures taken along the way home.

The question of affordability will be right in the headlights in the coming years of the Trump administration. Almost every major program that the administration seems to want to change or cut will have a major impact on these rural societies. Downsizing the Federal government, a project of the Cato Institute, says:

Even if rural subsidy programs were administered efficiently, they represent an unfair redistribution of wealth. In many ways, rural Americans are better off than urban and suburban Americans. They enjoy cheaper housing, cleaner air, less congestion, and other advantages. So people who live in rural areas should not be a privileged class receiving special subsidies.

The Cato Institute couches the benefits in the usual political-speak weasel words as “Scholars at Cato believe that cutting the federal budget would enhance personal freedom, increase prosperity, and leave a positive fiscal legacy to the next generation.”

Rural communities for the most part exist to allow the exploitation of the land and resources. Hence the reason why America’s size is a strength, there is plenty to exploit. From farming for cattle, corn, wheat, to mineral extraction, to oil and gas fracking, America has it in abundance.

However, most of the infrastructure to support the communities is decades or more old and needs investment to sustain. Building roads, laying pipelines for water, sewage, telephone and internet service are expensive per capita. Roads particularly require a massive subsidy given the distances involved and the low number of people they service.

Trump Pence sign
Image: thehill.com / Getty Images

What is clear is that the new administration wants to cut regulations, budgets, and “Make America Great Again” #MAGA. I fear though for these communities, as they are likely to become unintended consequences of poorly thought through, and rushed changes in policy.

Education
School choice has been a great boon for suburban America. It has also been a positive benefit for the re-segregation of schools. Rich, often white people move from urban centers to suburban centers where they not only have choice, but can have their choice subsidized through vouchers, funded at the expense of public schools whose budgets are impacted by funding vouchers. Forget the furor about DeVos and if she is even qualified as U.S. secretary of Education. What is clear is that if she chooses to drive her professed support for school choice through vouchers as a policy, rural education will be screwed. Rural areas, without huge subsidy, will not have choice. Private businesses are not going to rush into towns and build new alternative charter schools, they can never make money from them.
If the alternative is distance learning, it has a double impact. 1. Distance or e-learning has typically less than optimal results, 2, by opting for choice through voucher, the local public schools are further devalued by lower attendance and either great subsidy, or lower budgets. This is a major issue, as schools in rural areas don’t just teach children, they are major social hubs for community interaction. Destroying public schools in rural areas, will further destroy their communities.  The Atlantic has a great article covering DeVos and the potential impact on rural schools and communities.
Health care (ACA and replacement)
This blog post was kicked off while driving to swimming this morning. I heard this Colorado Public Radio (CPR) piece on the rural hospitals fears for post “Obamacare”. Like schools, access to medical facilities in rural America is crucial to their survival(literally). Asides from concerns of access to healthcare and the affordability of it, the thing that struck me about the CPR interview was that  San Luis Valley Health in Alamosa provides 670 jobs and is the region’s largest employer. This is consistent with what I’ve observed elsewhere in Colorado and Texas, both large and small towns with massive health care employment.
In the UK, where the National Health Service (NHS) employees around 1.6-million people, making it the world’s 5th largest employer. The NHS is notionally is single organization, the NHS employs just under 2.5% of the UK population. Using the US Bureuau of Labor Statistics data for 2009, health care employment in private-sector health care industry employees just shy of 11-million people, add to that 100,000 of the 350,000 at the Veterans Administration, and then all the small town public health care clinics that deal with vaccinations etc. and it’s safe to say some 12-million work in health care in the USA. So, nearly 3.75% of the American population work in healthcare.
Health care in the US is much more expensive than the UK and most other developed countries in the world. This is in part due to the massive over provision and duplication of healthcare facilities. The simplest way to reduce the cost of Government programs, would be to drastically cut the provisions that support poor, rural communities. Make them travel further, pay hospitals less for the procedures, make fewer people qualify for the programs. That is exactly what these rural and small regional hospitals are concerned about, as discussed in the earlier referenced CPR piece.
Environmental Protection (EPA)
As I type this blog entry, Trump Administration EPA head, Scott Pruit is making his first address to the EPA (I’m not listening). This blog isn’t about his and the administrations dislike of the EPA and it’s regulatory overreach and climate actions. However, through executive orders that have frozen grants and programmes that impact some renewal and rejuvenation projects in rural areas and poor communities. What most won’t understand are the number of programmes the EPA supports and provides for small, rural communities and also for Native Americans. It’s unclear what the side effect of the major changes to the EPA will have on these programmes, or if they will just become Pruitts shrapnel.
Infrastructure (DOT)
While the President talks up his infrastructure goals, and decries the state of the roads, bridges and airports, outside of the wall, it’s not clear the Administration understands how much we currently spend and how poorly we budget and account for infrastructure. It’s already clear that Drivers are not paying their fair share, and that we are swimming in debt for road expansion and funding. It is hard to imagine that fiscal conservatives, the GOP and the TEA party are going to swallow more debt on a massive scale to fund this. In many rural areas, pot holed roads are being downgraded already to gravel roads also known as “unpaving“. States, cities and municipalities account for infrastructure in entirely the wrong way. They assume infrastructure itself has no value in their financial statements. They depreciate the assets over the course of its useful life until it has a no value. The problem is at that point, you can’t simply walk away.
As Strong Towns pointed out “Current accounting practices do not bear any relation to the future cash flow or the actual financial health of the city. When cities take on obligations, they should be properly accounted for as liabilities, not assets.” Given Rural towns tax base, population and business are declining, they are hit even more substantially by the errors in accounting from the past.
Agriculture (USDA)
There is significant investment by way of investment and development grants in rural areas, as well through crop subsidies. The top subsidized commodities are Feed grains, mostly corn, cotton, wheat, rice, soybeans, and dairy. Many of these would be uneconomical if the mega-corporations and farming cooperatives went unsubsidized.  America currently pays around $20 billion per year to farmers in direct subsidies as “farm income stabilization” via farm bills. These bills pre-date the economic turmoil of the Great Depression with the 1922 Grain Futures Act, the 1929 Agricultural Marketing Act, and the 1933 Agricultural Adjustment Act creating a tradition of government support.(Source: Wikipedia).
USDA goes way beyond that, it runs three other major programs through these agencies: Rural Housing Service, the Rural Utilities Service, and the Rural Business-Cooperative Service. They spent $6.5 billion in 2016 alone. USDA has about 100,000 employees, and is represented in most counties, in every state in America. It’s responsibilities include USDA oversees school lunches, meat inspection, food stamps, the Forest Service, rural electrification and much more. It’s total budget is some $140 billion in programs. The late pick of Georgia Governor Sunny Perdue concerned many in the rural community, some of his actions as Governor raise more questions, especially on his brand of rural endorsement. As governor, Perdue was caught in a more than a few scandals involving his businesses and personal property deals. He is also the first from a southern state, where rural and agriculture challenges are very different from the mid-west.
Housing (HUD)
For many people HUD stands for the “U” in Housing and Urban Development, they mostly focus on urbans areas, nothing could be further from the truth.  HUD operates many rural programs, in many cases funds pass through state agencies or other entities to rural communities. As well as development and assistance grants, HUD invests around $6.2 billion per year to provide affordable housing to low-income residents. Much of this through guaranteed low interest mortgages. How these programs will fare under Ben Carson is unknown. But without clear differentiation between urban and rural communities, many in the GOP and Administration will be going after cutting back HUD in general. HUD is also a major contributor to disaster assistance and provides many grants, relocation programmes and more.

Image: The Daily Herald – Mark Black | Staff Photographer
In an era when the GOP have spent forever convincing everyone that TAX=BAD, and portraying city folk as moochers and takers, can we really afford rural communities anymore? It’s very likely that these rural communities will experience the bulk of the pain from the Administration policy changes. Not through a single policy change, or executive order, but but through death by a thousand cuts.
If that happens, there will be no one but the current Administration and the Republican party to blame.

How False Stories Spread And Why People Believe Them

One of the most valuable lessons the administration will learn, is that they cannot control the media, or social media. Constantly making false or inaccurate claims, using false data, or more importantly watching something on cable news and then twisting it to fit your own agenda is a dangerous game.

The more accurate and transparent the administration is, the less conspiracy theory talk there will be, the less time it will take to manage the media, the more the administration can focus on what they really want to do. This is a hard lesson to learn, but essential.

Otherwise everything gets stuck in the mire. Too much time denying, too much time correcting, too much time covering up, too much time on internal meetings trying to decide what to do and how to handle it. All that causes stress, wastes time, and drives distrust between staff members as they don’t know who to believe.

Back in December 2016, Dave Davies on NPR Fresh Air, spoke at length to Craig Silverman, Media Editor of BuzzFeed News about fake news. If you didn’t hear it, it’s well worth a listen. It’s especially relevant based on my slow but inexorable move to delete my facebook account.

Time for a new deal?

Involuntary under-employment, the bitter price of austerity; Involuntary migration, the bitter fruit of concetrating decent jobs in small areas.

Neither globalization nor electricfied fences can fix this. It is delusional to believe that Britain or America can prosper sustainably when neighbouring nations are in a crisis.

Subtlety and leadership we cant expect from Trump and May. This is a great series of short video op-eds from BBC Newsnight.

Political Correctness and being liberal

if you mean I’m someone who can have a civil conversation without reverting to juvenile name calling, swear words and who thinks a man can do better than trying to be offensive by using slang names for women’s anatomy, then I take your attempt at intimidation and wear it with pride.

It’s always amusing when people try to dismiss you by accusing you of being “politically correct or PC” or worse still, a “liberal”.

I guess because it’s inauguration day, feelings are running high. I’ve tried to stay away from political discourse on facebook, until a friend posted a clip from Elizabeth Warren grilling the CEO of Wells Fargo bank, the point of the post was to ask for accountability.

One of the few responses was from “Jim”. I’ll call him that here, because, well, that was his name. In his response he didn’t much address the accountability point of the post, but fairly quickly turned to attacking Elizabeth Warren, calling her “a douche bag“.

And so I posted, and the response I got back was to call me one of the “PC crowd”. I’m always amused when people try to use that as an insult. Called one of these “names” don’t be intimidated.

pc

 

Doctors and Money

The NHS is funded(or should be) to take care of everyone to a level of minimum care. No one(in practice) should have to pay for any medical care.

One question that comes up regularly when discussing how to fix the healthcare system in the USA, is Doctors and Money. While Doctors are far from the only important people in a healthcare service, they are possibly the most visibly important.

It is often asked, or asserted, that if you had a single-payer healthcare system where Doctors were possibly salaried this would act as a disincentive, and over time you’d lose the best doctors to purely private practice. This belies the fact that experienced doctors in the British NHS can make additional money in private practise.

It also completely ignores the fact that while the NHS is a meets minimum, free at the source of treatment health service, there is a thriving private, and private insurance marketplace.

The NHS is funded(or should be) to take care of everyone to a level of minimum care. No one(in practice) should have to pay for any medical care.

However, these days the cost of drugs, the number of highly complex surgical procedures that are “standard” has grown beyond the normal funding of the NHS from say 20-years ago. Cancer care and the drugs for it now consume huge amounts of money, as does the treatment for obesity and the treatment of it, including heart disease.

If you are in a car crash, some form of violent attack, or other urgent care need, the NHS will supply an ambulance, emergency care, surgery, drugs, Dr’s, everything and you’ll never see anything related to billing or cost. Same for almost any minor health care problems, even many elective surgeries, and pregnancy, cancer care, pretty much any medical need.

Elective surgery does tend to get backed up, there are often long waits to see a specialist, as well as to get surgery. This depends though on the problem, the area of the country, and the time of year.

This time of the year the NHS is always stretched to and beyond its limit. It’s damp in the UK, older people tend to have been life long smokers and are very susceptible to respiratory illness. Both my parents died this way after a few weeks of gradually declining health as they were unable to recover from pneumonia. My Dads complicated by heart disease; my Mum a 7-year lung cancer survivor.

Both received 100% free NHS service, they were not rushed or hurried to move out of their hospital beds. The nursing and medical attention was top class. In fact, I’d go as far as to say  much better than here in the USA because there was never a discussion, question or insinuation that insurance might not cover something.

For those that a “meets minimum”, free healthcare service won’t do, you can always pay. Many companies offer private “top-up” insurance, which provides priority appointments, private hospital beds etc. And you can always elect to pay for the treatment you need need.

luton-news-sept-21st-1978I had two major hospital admissions, one on the NHS for a tib/fib fracture in 1978; the 2nd some 16-years later for corrective surgery. The 2nd I was working for IBM with top-up insurance. I saw the same specialist who’d saved my leg 16-years earlier. If I’d wanted to see him on the NHS, there was an 4-week wait; I saw him the next week at a local private hospital.

He recommended corrective surgery. On the NHS he would have done it in 4-6 weeks, depending on lots of things. I was able to schedule a specific day for 10-weeks out that better suited IBM’s schedule, private hospital, private staff, same consultant.

Fast forward to 2013. I’ve done over 100 triathlons and running races, including 6-Ironman races. Despite an initial prognosis in 1979 that I’d never run again. My knees are not so good. I wanted to see the same consultant, he is no longer practicing, wished me luck. I was recommended to the British Olympic Association’s Orthopedic Consultant. Chances of seeing him on the NHS, zero to very little.

I scheduled an appointment with him at Private hospital, flew to the UK, and he came in to see me especially. We spent the whole hour together, what I’d paid 450 UKP for. We discussed options, did measurements, x-rays, looked at different types of replacement knees etc.

He said that when I was ready for surgery to let him know, he would schedule me on his NHS roster and I could fly back. When discussing the same surgery here in the USA, he told me not to bother.

His experience had been that in the USA even dedicated specialist consultants didn’t have nearly the experience as NHS Specialist. In the USA they spend too much time consulting with patients and negotiating over billing. Patients in general take 3x as long to consult with in America because the options, cost and insurance options, and choices are so daunting and often when a preference is stated it has to be negotiated with insurance, co-pays, deductibles etc. all have to be understood by the Doctor and patient. The alternative is you get the Doctor, but little or no choice in replacement technology.

He has 2x 6-hour surgery days per week, they do 6-8 knee replacements per day; he spends 1-day NHS consulting, and 1-day private consulting and has 1-day open for Private surgery or additional consulting.. If he wants he can do private surgeries on Saturdays, vacation days or early mornings before NHS work. Average cost for NHS Surgery $0.

A US Specialist, according to him, does 6-10 operations per month, and my US research was cost around $30,000. In terms of knee replacements, the UK has much better insight, and much less medical device and insurance company influence on the type of replacement, they base their choices on OUTCOMES.

I’ll return to the discussion on healthcare systems shortly, but suffice to say, I’ll be going back to the UK when my time finally comes.

Giant fleet of small scheduling nightmares

In tenuous link between my recent posts on automation, here and especially here, where back in November I discussed autonomous vehicles and their impact on employment. I also said:

While many cities are salivating over the ability of self-driving, autonomous vehicles to fix their broken road and transport infrastructure, that’s missing the point.

Sometime between then and last weekend I became a weekend subscriber to the (Boulder) Daily Camera, a great local paper for the Boulder/Denver metro area. Right on queue, my first Sunday paper was laying in the snow on the drive this weekend and I opened it up and parsed it during the day. One item that particularly caught my eye was Dave Kriegers main editorial entitled “Imagine a giant fleet of tiny buses“.

serveimageI grabbed a pen, marked the editorial up, scribbled in the margins and sat down on Monday morning and wrote an open forum letter. It didn’t get published, I have no idea if it’s policy not to publish corrections on staff written op-ed pieces, or they just didn’t think it interesting enough to include?

Since a big fuss has blown up about an Uber self driving car today, running a red light yesterday(in full transparency, Uber self driving development has a big office here in Louisville that is a build-up from the Uber acquisition of Microsofts Bing mapping service.) I thought I’d turn Mondays open forum letter into a blog post.

This also lets me correct one misstatement. Self-driving cars will help with congestion theoretically. In heavy traffic, they will drive at a regulation speed, a safe distance from the vehicle in front, thus avoid the hard braking and the impact that can have on several miles of traffic.

It is hard to respond to Dave Kriegers editorial imaging “a giant fleet of tiny buses” in 300-words, but I’d like to have a try.

First, I completely agree with his sentiment that if you keep trying the same old thing, you’ll keep failing. However, when it comes to his “giant fleet of small buses” he falls into the same trap most transport ‘imagineers’ do when the come to self-driving vehicles. For the sake of brevity, let’s assume they’ll be electric; let’s assume they can dock themselves; let’s assume they have a slightly better range than current electric cars.

Dave jumps to the conclusion that less space will be needed for parking. Sort of, except the cars have to be charged somewhere. But yes, they could be charged in either fields or reclaimed parking garages outfitted with self-docking chargers. Dave then makes the confusing jump to the conclusion that “[they] could reduce congestion because fewer cars would serve more people”.

Anyone that’s given any serious thought to scheduling and transportation would understand implicitly that that isn’t true. It’s implied because it fits the paradigm of autonomous vehicles. If 20,000 people want to get into Boulder today between 7:15am and 9:00am in their own unshared transportation, and the demand is the same in the era of self-driving cars, then, you’ll have the same number of journeys. Add in the recharging trips, the fact that using Daves logic, there will be less self-driving cars, then some of those cars will have to drive in and out and back into Boulder, actually increasing the number of journeys and therefore contributing to the congestion.

If we take Daves “less parking space” claim at face value, then what will the space formerly used by parking garages be used for? Green space… err no, more offices/accommodation, with the potential to further increase the number of journeys and congestion.

Don’t get me wrong, self-driving cars are great, but until we have flying cars they will only help indirectly with congestion won’t help with congestion. The only way is shared transport. Bus Rapid Transport isn’t it either. Trams, street cars, metro-rail are the only real fix.

Creeping automation

Automation is everywhere, but most of us don’t notice it. Every product we buy, every service we use has been touched by automation, some more than others. Think about the products you buy about the grocery store? Come in a package? Packed by machine!

I’ve had some interesting emails from regular followers/readers about automation. I don’t think people quite understand how invasive and creeping automation is.

Here is a perfectly simple example. I live on a new development in Colorado. Some 70 single family homes, and now they are moving into the multi-family condo and town homes. They’ve built two condo buildings, and a 3rd 12-plex is going up now, literally right across the street.

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Pressed Siding, Floor and Ceiling Boards from Canada
OLYMPUS DIGITAL CAMERA
Crane lifts pre-constructed parts into place

First, let’s be clear, this isn’t a pre-fabricated building. It’s a unique design to this location, that most would consider “traditional construction”. Only it isn’t, it’s massively labor free, and largely “skilled-labor” free.

The construction is typical timber frame, in the old days, there would have been an army of craftsmen working on site, the continuous sound of saws and hammers. While there are some professional craftsmen on site, the bulk of the construction is being done by “nail gun jockeys” using pre-cut, assembled panels and components. They just nailed them into place.

Of course, walking pass this, you’d never normally take a second look. Since it’s directly opposite my home office, everytime I look out the window I see it. What do I see?

Creeping factory assembly and automation. All the major parts arrive pre-cut to size; the joists and all the boards for the side that need holes for windows and door arrive pre-cut. The original boards come from Canada and Mexico. Anyone who has seen the home improvement shows knows that the boards are not cut by craftsmen and craftswomen, but simply cut by operator assisted laser cutting machines. What do all these things have in common? Automation.

It would be easy to simple, let’s at least bring back the board creation, prep and the component assembly to the USA. Indeed easy to say. That assumes we have the raw material, and that the factories exist that can manage the increased workload. If they can’t then let’s assume they can be built.

What happens then? Well, the businesses that do the manufacturing either produce the same goods at the same price as they are available overseas, which will be hard. The US no longer has the same wealth of natural resources. Those that we do have are harder to extract, or come with environmental, planning or development restrictions. Even if these were lifted, they would still come with a price tag.

Those costs, plus any for plant construction, or increased raw material cost would be passed onto us. Effectively doing a “Carrier” and raising prices to cover their increased costs.

Automation is everywhere, but most of us don’t notice it. Every product we buy, every service we use has been touched by automation, some more than others. Think about the products you buy about the grocery store? Come in a package? Packed by machine! Ready made meals, the whole production line from animal slaughter to food prep and cooking are all now largely automated. It’s invisible, invasive and all encompassing.