Thursday, September 03, 2009

Why it's good Houston lost the 2016 Olympics, plus job sprawl, traffic, and HSR

I recently came across this story on crumbling public support for the 2016 Olympics in Chicago, as the costs, risks, and hassles become more clear.
The Tribune/WGN poll is the first measure of public sentiment since Daley did an about-face in June, saying he would sign the standard host city contract giving the city full financial responsibility for any losses -- a move that triggered a firestorm of criticism. Until then, the city had been lobbying for amendments to the contract that would recognize the city's limited guarantees.

Poll respondents made it abundantly clear that they disapprove of Daley's promise of an unlimited guarantee in the event the Games lose money, with 75 percent opposed.

In a city already upset over the privatization of parking meters and worried about further cutbacks in government services, those respondents who talked to reporters expressed concerns about the economy, the cost of hosting the Games and traffic congestion.

Even a majority of those who favor the Olympics opposed using taxes to cover losses and were against the unlimited guarantee.
...experts said the findings could hurt Chicago's chances.

"When less than half of the folks polled indicate they'd be willing to support the Olympics, that's certainly not an enthusiastic mandate for bringing the Games to Chicago," said sports finance expert Dennis Howard of the University of Oregon. "I can't speak for the IOC members who will be making the decision, but I'd be fairly certain this would not help the cause for Chicago."
The poll comes a month before the International Olympic Committee selects the host city for the 2016 Olympics. Chicago is competing against Tokyo, Madrid and Rio de Janeiro.
Sorry Chicago. I think they call it the "Winner's Curse" (they won the U.S. contest). London is also dealing with serious budget problems for the 2012 Olympics. All in all, it looks like a good thing we were bypassed.

Moving on to a few smaller items:
  • A Brookings study on increasing 'job sprawl', a big reason commuter rail makes less and less sense as fewer and fewer people (proportionally) work downtown. Some of the core points:
  1. Only 21 percent of employees in the top 98 metro areas work within three miles of downtown, while over twice that share (45 percent) work more than 10 miles away from the city center.
  2. Employment steadily decentralized between 1998 and 2006: 95 out of 98 metro areas saw a decrease in the share of jobs located within three miles of downtown.
  3. In almost every major industry, jobs shifted away from the city center between 1998 and 2006.
Study: Reducing Traffic Congestion Would Spur Huge Economic Growth
How much would your city's economy grow if its roads were free-flowing instead of jammed? A new Reason Foundation study by David Hartgen and Gregory Fields examines how reducing gridlock would increase economic output and worker productivity in eight cities across the country. In Dallas, getting rid of traffic congestion would boost the economy by $46 billion a year. Denver would get a $38 billion increase in Gross Regional Product if it had free-flowing traffic conditions. Atlanta, Charlotte, San Francisco and Seattle would all see more than $10 billion a year in economic growth if they prioritized infrastructure projects and eliminated severe traffic congestion.
Sorry, nothing specific on Houston, which I guess means they think we've done relatively well on freeway investments compared to other cities (juicer targets for their analysis). Still, I'm sure we'd see big gains from reduced traffic congestion too (probably comparable to Dallas' $46 billion/year).
I'm on vacation next week (Chicago, WI, MN), so probably no more blog posts until sometime the week of Sept 14th.

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At 12:40 AM, September 04, 2009, Blogger Alon Levy said...

The Olympics are like any other megaproject - good for the mayor's ego, but bad for everyone else. Even failed bids waste money - for instance, New York's failed bid led Bloomberg to spend $2 billion on a one-station subway extension that will serve an area where nobody lives or works, so that he can sell the surrounding land to developers he's friends with.

On another note, what you say about commuter rail is inaccurate. While American-style monocentric commuter rail networks are only capable of serving downtown destinations, more comprehensive regional rail, on the model of the RER or S-Bahn, can serve suburban job centers as well.

At 9:08 AM, September 04, 2009, Anonymous kjb434 said...

I actually agree with you this time Alon!

Your reference of the German rail S-Bahn is a good point. Germany has setup a good version of commuter rail that deals with sprawl.

I'm not a big fan of rail because of cost, but technically rail can be done to server suburban center properly.

At 5:22 PM, September 06, 2009, Anonymous Neal Meyer said...


One of the best things that happened to Houston was that we were bypassed for the Olympic Games. Alon Levy was right on the money. Any Olympic bid would have almost certainly led to tax increases, since the IOC generally requires that the host city (or state / province) cover financial shortfalls.


At 1:26 PM, September 09, 2009, Anonymous Anonymous said...

The $46 billion congestion cost for Dallas must be regarded as suspiciously divorced from production realities on the ground when the entire annual gross metropolitan product of the six million people in the Metroplex is less than ten times that figure.

At 2:05 PM, September 09, 2009, Anonymous Anonymous said...

I question the numbers. $38 Billion in Denver? Among 2.5 Million people in the MSA? Output would increase $15,000 per person (keep in mind...this includes retirees and children)?

Having just moved here from Houston...they don't HAVE traffic. Out of my 30-mile one way commute, I'm limited by something other than posted speed limits MAYBE 2 miles..on a bad day.

At 7:56 PM, September 10, 2009, Blogger Alon Levy said...

Let's look at what the Texas Transportation Institute says about congestion. The relevant data is here. Table 2 shows that congestion costs are an order of magnitude less than what Reason says they are. In Dallas, the figure is $2.8 billion a year. In Los Angeles, where congestion has the highest total cost in the US, the figure is $10.3 billion a year.

At 6:57 AM, September 11, 2009, Blogger Tory Gattis said...

It's all in the assumptions, esp. how much you value peoples' time. I could see a 10% gdp increase if people add an extra 10% to their workday that they're not spending commuting (or in traffic during their job during the day). But I'm not sure that's how the time would get spent. I haven't dug into the assumptions behind either study.

At 10:17 PM, September 11, 2009, Blogger Alon Levy said...

It's not 10%. Even in Los Angeles, the most congested metro area, congestion adds 70 hours of travel time per year, which is 0.8% of the total amount of time.

Overall, the TTI study estimates that in Los Angeles, the total amount of time wasted by congestion is 485,000,000 hours. In Los Angeles the average hourly wage is, apparently, $27, which translates to a congestion cost of $13 billion per year, assuming people would work the entire time they're missing due to congestion; gas adds an extra $1.5 billion at $4/gal. The study estimates an actual congestion cost of $10 billion a year, which, given that people spend extra time on leisure and not just work, makes sense.

At 10:31 AM, September 12, 2009, Blogger Tory Gattis said...

To clarify percentages, it's percentage added to workday, not of time across the year.

At 1:03 PM, September 12, 2009, Blogger Alon Levy said...

People don't spend every extra minute they get on work - I'm not aware of any association between congestion and shorter working hours. They might wake up later, or spend more time in the morning shower.


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