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  • Archive for the 'Chicagoania' Category

    Growing up in South Shore in Chicago

    Posted by Michael Kennedy on 16th July 2015 (All posts by )

    I have a new post on my own blog which I hesitate to inflict on everyone as there is much family history in addition to Chicago history. It does have some nice photos of Chicago’s South Side many years ago. I found them in a small book of photos of South Shore published in Chicago by a man whose father was a local photographer. If anyone is interested, the link is here.

    It goes along with my other posts on Chicago history like Frank Flanagan, and Growing up in the 1940s in Chicago.

    Posted in Chicagoania, History | 7 Comments »

    Service Sector Productivity

    Posted by Carl from Chicago on 28th June 2015 (All posts by )

    Recently I went on a diet and began ordering specific drinks ordered a specific way – generally gin with a “splash” of tonic (because tonic has carbs and I want to minimize carbs, but need something to cut against the alcohol). This order, however, has become a running joke among my friends because no matter what I order I usually get the same drink every time – which is a “standard” gin and tonic (see below, the wrong order per usual).

    Unlike most people who would shrug it off or get angry, to me this is really an economics issue and not just a “bad order”. When you work with bars and restaurants and other similar industries, if you do anything “outside the norm” your odds of getting it “right” are often less than 50/50. Which leads us to the title of this post…

    Read the rest of this entry »

    Posted in Business, Chicagoania, Economics & Finance, Management | 20 Comments »

    Margie’s Candies Is Highly Recommended

    Posted by Carl from Chicago on 28th June 2015 (All posts by )

    Recently I was on the “606” Trail and visited one of my favorite spots in Chicago – “Margie’s Candies“. Margie’s makes incredible ice cream sundaes that must be seen to be believed – and they come with an actual silver pitcher of hot fudge that you can pour on the ice cream yourself. Usually I would start with a photo of the restaurant but I wanted to make sure that the “money shot” is above the fold.

    Read the rest of this entry »

    Posted in Chicagoania, Diversions | 10 Comments »

    On the 606 Trail

    Posted by Carl from Chicago on 12th June 2015 (All posts by )

    The “606” trail in Chicago opened recently. It follows an abandoned railroad track that starts in Bucktown / Wicker Park and heads west from there. I am very familiar with this track since I used to live in Bucktown a decade ago and stared at the crumbling bridges that split the neighborhood.

    The trail is named after “606” which is the first 3 digits of the zip code in these neighborhoods. I guess that is an OK name but it’s kind of an obscure reference. Does anyone even send mail anymore? The park is sometimes compared against the High Line trail in NYC but the High Line is way cooler since it moves through a heavily urban area. But the 606 is a massive upgrade from just a crumbling set of train tracks.

    Read the rest of this entry »

    Posted in Architecture, Chicagoania, Diversions | 3 Comments »

    Use of Netatmo to Measure Wealth in Chicagoland

    Posted by Carl from Chicago on 6th June 2015 (All posts by )

    Netatmo is a personal weather station that you can buy which is wifi connected and “joins” the netatmo network worldwide so that your information contributes to the grid of stations. I wrote about my experience in detail here.

    Here is what Netatmo looks like on your phone – you can see the temperature inside and outside your house (it is also connected with weather alerts) and if you turn your phone sideways you can also graph data along many time series. I find it to be very cool and check it a lot on my cell phone or ipad when I am bored and want to kill some time.

    I started looking at the Netatmo weather map on my phone and it also becomes a visual map of wealth and technology adoption in Chicago. While you can’t see all the individuals who might buy an iWatch on a map, the Netatmo weather station becomes a clear signal and it is tied to a clear physical location. Note that when you “drill in” to the map you will see many weather stations in an area such as River North – however if an area is devoid of stations entirely it comes up blank. And there’s Chicago! You can see the stations in the north side, a completely barren west side, and a mostly barren south side, except for the dot along the lake which represents Hyde Park.

    Read the rest of this entry »

    Posted in Chicagoania, Society, Tech | 6 Comments »

    Back to the old neighborhood.

    Posted by Michael Kennedy on 5th June 2015 (All posts by )

    Last month, I posted some old photos of Chicago in the 1940s. I grew up in a neighborhood that has since gone badly downhill in spite of a lot of positive features that should have kept it livable. It is South Shore and here is the previous post. We went back for a visit this week and just returned home last night. I posted some more photos of the old neighborhood Here.

    We even revisited some spots from my post about a week in Michigan from two years ago.

    Read the rest of this entry »

    Posted in Chicagoania, History, Personal Narrative | 3 Comments »

    Airline Competition Has Been Crushed

    Posted by Carl from Chicago on 16th May 2015 (All posts by )

    If you’ve flown much in the last few years, you’ve probably seen what I’ve experienced, as well – completely full planes, high prices, and aggravating extra charges for baggage, wi-fi, etc… This is really a symptom of what has actually occurred, which is that airlines have finally moved past an era of competition into an era of oligopoly.

    The real indication of their new status isn’t the high prices and full planes – it is in the stock price.

    Here you can see the major carriers which have survived and consolidated the US market – Southwest, American Airlines, Delta, and United / Continental. For years and years the stock prices of major airlines have languished – per Warren Buffet

    He said that a durable competitive advantage in the airline industry “has proven elusive ever since the days of the Wright Brothers. Indeed, if a farsighted capitalist had been present at Kitty Hawk, he would have done his successors a huge favor by shooting Orville down,” he joked. “The airline industry’s demand for capital ever since that first flight has been insatiable. Investors have poured money into a bottomless pit.”

    Each of the major airlines has predominantly broken their strong unions and taken medicine from bankruptcy to mergers in order to restore their finances. Instead of a focus on expansion, they are operationally focused in terms of filling every seat on every plane at the highest price possible, in terms of ticket costs and extra fees. Today they charge you for every sort of upgrade; “economy plus” which is a seat that you can sit in and get work done, costs extra, as well as for checking bags.

    There is absolutely nothing wrong with a company doing all they can to maximize profits, especially after savaging investors for many years with poor stock prices and a lack of dividends (and the high risk of total financial collapse). The airlines have finally figured out technology as well – if you want to upgrade any element of your flight experience, from business to first class to economy plus to a daily club pass – it is all right there as long as you are willing to give them your credit card number.

    The airlines have also figured out that their frequent flyer programs provide benefits but also can be a millstone. Rather than rewarding miles, they are looking at the prices of the tickets paid by each traveler which rewards those that actually provide the greatest benefits to the airlines. If you’ve tried to actually use your benefits (except for Southwest), you’ll find that seats are very limited and you need to plan far in advance to receive benefits from these perks.

    Read the rest of this entry »

    Posted in Chicagoania, Economics & Finance, Middle East | 12 Comments »

    Chicago – A Once Great City That Generations of Democratic Leadership Have Run Into The Ground

    Posted by Dan from Madison on 13th May 2015 (All posts by )

    Moody’s has downgraded the rating of the debt of the City of Chicago to “junk”.

    This triggers all sorts of crazy swap termination fees, accelerated payments, and the like. The damage of the downgrade is in the billions of dollars.

    The City of Chicago has been in a death spiral for a while now, and I think it is probably time to just go all “Detroit” and get it over with. The bondholders will get a haircut, as well as the pension funds and everybody else.

    But that aside, here is yet another case where if the Republicans were smart, they could simply run on a “we’re not them” platform. Every single thing that has happened in Chicago has come under the Democrats’ watch. There is no way out for them. They created it, they participated in it, and they kicked the can down the road for the current generation to watch it all implode.

    I have written about this before, but either the Republicans are too nice, or don’t care. It is so easy to put this at the Donks’ doorstep. I just don’t understand why the Republicans don’t do it.

    This implosion of a once great city is disgusting and should be front page news. But it isn’t.

    Posted in Chicagoania, Politics | 37 Comments »

    Growing up in Chicago in the 1940s.

    Posted by Michael Kennedy on 5th May 2015 (All posts by )

    I grew up in a Chicago neighborhood called South Shore. At that time, 1943 to 1956, it was one of the nicest parts of the city. Now, now, it is a cesspool of crime.

    When my father moved us to the house at 7344 Paxton Avenue, I was 6 years old. The area was quiet and peaceful. Not far away was South Shore Country Club, a beautiful club that offered golf, skeet shooting and a horseback riding to members.

    ssold1

    It was a elegant place and I visited a few times but we were not eligible for membership because my father was in the business of owning and repairing juke boxes. That was not a respectable enough occupation. Prosperity was not the criterion. Los Angeles County Club has barred people from the entertainment business for the same reasons.

    Our home had been built in 1912 and still had gas lighting fittings in the bathroom and living room, as electrical lighting was still a bit suspect.

    Paxton

    This is the house many years after we were gone. It has had the front porch enclosed in brick. Otherwise, it looks much the same. The owner saw me taking a photo and came out to ask me who I was. He insisted on showing me through the house which has had some interior remodeling. He asked if I could send him photos of what it looked like when we lived there but most of my old pictures are home movies.

    Read the rest of this entry »

    Posted in Chicagoania, Personal Narrative | 19 Comments »

    Make Them Own It

    Posted by Dan from Madison on 20th April 2015 (All posts by )

    Today we see that the latest bond offering from the Chicago Board of Education will be priced at over twice what a BBB offering demands. That is brutal. I still won’t touch that with a ten foot pole.

    It is inevitable that the State of Illinois and City of Chicago and their organs will be having major financial issues, to say the least, within a year or two. It could be Detroit on an inter-galactic scale.

    My question is this – why don’t the Republicans make the Democrats own these massive boondoggles? I understand that in Illinois, many of them are in on the fun – however, the State of Illinois, City of Chicago and Detroit have all been essentially run by Democrats for literally generations – and it is all blowing up.

    Is the issue too complex for Joe Six Pack to understand or care about? Are the Republicans afraid to be held to a higher standard? I just don’t understand why they wouldn’t shout from the mountain tops at how much graft, corruption and incompetence it takes to completely tank a city with as much potential as Chicago and a State with so many potential positives as Illinois.

    Posted in Big Government, Chicagoania, Illinois Politics, Politics | 36 Comments »

    Chicago International Movies and Music Festival

    Posted by Carl from Chicago on 18th April 2015 (All posts by )

    There is a festival here in Chicago focused on movies about music which also has a bunch of bands playing as well.  It is our attempt to have a little “South by Southwest” action in the city of Chicago.  At least they have some nice weather this year – this weekend seems to be the start of spring and everyone is out side and on balconies and has a lot of positive energy.  Here is a shot from one of the movies on the cover of the Reader.

    Unfortunately I can’t go to any of the events because I can’t stand in lines for too long and I can’t be jostled or have someone step on my foot and that’s what usually happens at a concert.  I will look for some of these movies out there on the internet though later or if they come to an art house movie theater or something.  Here is the site listing what is going on and an interview with the founder on Chicago Tonight (a great program) and below are some of the ones I’d go to see if I was able to do so.

    • Danny Says” which is a movie about the manager of the Stooges and the Ramones.  That guy must have seen a lot of crazy stuff
    • 808” a story of how a device never intended to be a beatbox helped launch hip hop and modern music
    • Morphine – Journey of Dreams” one of my favorite bands of the 1990’s was Morphine and I was very saddened when their lead singer / bassist dropped dead at a show overseas.  Also the remaining members played a show under “Vapors of Morphine” as well
    • Jaco” is about the fantastic bass player Jaco Pastorius who was a little crazy and unfortunately died young after being beaten by a club bouncer.  At the festival the bass player from Metallica (who is from Suicidal Tendencies if you go way back to “Institutionalized”) talks about Jaco, as well
    • Local H is playing too.  They are awesome and one of the few survivors of the 1990’s.  See them when they come to your town

    Cross posted at LITGM

    Posted in Chicagoania, Film, Music | 8 Comments »

    25 Stories About Work – When It All Goes Wrong

    Posted by Carl from Chicago on 4th April 2015 (All posts by )

    I was recently on a plane doodling and thought of some funny / interesting stories from 25+ years of working and traveling. So I decided to write them up as short, random chapters of a non-book with the title of this post. Hope you enjoy them and / or find them interesting. Certainly the value will be at least equal to the marginal cost of the book (zero)…

    The USA, early 1990s to early 2000s

    During the course of my career I have been involved in many cases of companies dying, bankruptcy, and other negative corporate events. At times I was there until the bitter end; often I left before the final events occurred but could see evidence of encroaching doom. When you are first starting off as an employee with little experience these signs are harder to understand; as a veteran I can now unfortunately pick them up right away.

    One of my first memories as a public accountant was the day that they fired all the administrative assistants. Not the ones for the executives – the ones that helped the new staff get orientated. These women (they were all women it was the early 1990s) ran each of the floors and it was the first time I’d seen anyone get fired en masse. This was before email I think they left us all some sort of strange voice mail or something (voice mail was big back then). It seemed very sad at the time.

    In the early 1990s there was a lot of tension in the public accounting firms between audit / tax vs. the consulting side. I was a staff person and was invited to one of the partner meetings (because I played bass guitar but that is a different story) and I could see the vitriol between the two groups. When the audit partners’ asked “how could they help” the consultants the answer was to “get out of our way”. This was not the happy story that I was being fed as a staff person, for certain.

    Later that accounting firm went belly up but I was long gone by then. We started up a small consulting firm and it was fantastic for a while. However, it all started to fall apart as key founding members left after a dispute with the main owners over compensation and eventually I was one of those that departed. The departure was even more difficult since many of my friends and family members were also involved with that firm. Unlike most of the other companies in this piece, however, that firm thrives until this day. So we can conclude that I was not indispensable…

    At various points during my career I had a “choice” between two firms. Often I chose the wrong one. At the time I didn’t realize that right before you go public, you shave out all of your costs for a quarter or two and you accelerate all the revenue into the current period (to the extent that this is possible and legal, of course) in order to make your company look great for the IPO process. Living in a company that is doing this is very painful and I left but that was before the company became one of the first successful IPOs of the era (a completely unexpected and unprecedented outcome) and I missed out on an opportunity for those founder stock options.

    As the dot.com era came to a close there was a giant shake-out in the Internet and Consulting sector. I worked with three companies in succession that eventually went bankrupt. The first of them had an IPO (in the era of voice mail plus a bit of email) and I noted that it was odd that most of the IPO funds raised went to pay out one of the primary investors (they took the cash, we retained the stock). In hindsight of course this was another ominous sign.

    Read the rest of this entry »

    Posted in 25 Stories About Work, Business, Chicagoania | 2 Comments »

    NBA Bulls at Bucks Courtside

    Posted by Carl from Chicago on 4th April 2015 (All posts by )

    Recently Dan and I went to Milwaukee to attend a Milwaukee Bucks game against the Chicago Bulls. I decided to splurge for court side seats (the Jack Nicholson type seats) because watching the game is totally different down there. We were right behind the Bulls bench as you can see (there is coach Thibs). I also love this picture because I just happened to snap it as they had entertainment right behind the coach and you can see the guy overhead who jumped off a trampoline and dunks a basketball. Also note the security guy on the right giving me the stink eye.

    Watching the game from that low is a completely different experience. No matter what the score is, the game is interesting. The players move very quickly and it is hard to understand the plays as they develop (unlike when you look from overhead or up in the cheap seats where I would normally reside). While sometimes the fouls seem fake other times they take bona-fide hard fouls; when you are six and a half feet tall and jumping way over the rim and you end up getting thrown down on the court on your back, that’s a long way to fall. The way the players shoot is also very interesting – when they do jump shots they are almost eye level with the rim and as they do layups and dunks in warmups it often seems like they are barely jumping at all.

    Half the fans at the game were from Chicago. They ought to fold that franchise in Milwaukee or find something else to bring in fans; the upper deck was mostly empty vs. Chicago and you’d have to think this is one of their bigger draw games of the year. But there is no way that I am smart enough to explain sports economics…

    Cross posted at LITGM

    Posted in Chicagoania, Sports | 1 Comment »

    Technology and Mass Transit

    Posted by Carl from Chicago on 29th March 2015 (All posts by )

    I have not seen a formal study of the impact of technology on mass transit but I believe that it has made it profoundly more valuable and useful. And I accidentally participated in an experiment that partially proved this statement in the inverse.

    In Chicago they have a CTA “bus tracker” that tells you when a particular bus will arrive at your stop. Or you can program it so that you can see all the buses from various routes that are coming past your stop (this is useful because in Chicago you can often take many different routes that go to the same place over shorter distances). It works on your phone and many of the newer stops have the bus tracker programmed into the canopy so you don’t even need to look it up on your phone.

    Sadly enough most days rather than looking up the street for buses I check the bus tracker. I can usually get from my condo down the elevator and past the lobby in 2-3 minutes so 4 minutes is the cut off time. One morning I looked and I thought I had missed the bus entirely because the next one was ten minutes away on my phone. However, instead of just trudging off, I looked up, and a bus was right there!

    I got on the bus and it was completely empty! Not a soul was on the bus. While it was a nice day, usually this bus line was crowded during rush hour, often so crowded that I don’t even bother getting on because I have to stand right in the front past the yellow line where you aren’t supposed to stand and then get on and off with every stop (to let people on and off) until the crowd thins out.

    The driver was totally bewildered too. I sat with her up front and I guess they had changed the bus she was driving to this route (from another route) and they hadn’t updated bus tracker. I said that because she didn’t show up on my bus tracker. Thus no one was on the bus – because if it wasn’t on bus tracker, it didn’t exist.

    I am sure that the River North area is one of the most technologically sophisticated areas of the city and probably in other parts of town people just wait at the bus stop for the bus to show up. But in River North – everyone has been trained to use bus tracker and rely on it and they wouldn’t contemplate a bus existing that wasn’t on bus tracker.

    For me, the bus tracker has made the Chicago bus go from something marginally useful to a highly useful way to get around town. When I lived in Bucktown we used to wait for the #50 Damen bus and 3 of 4 times we’d give up and grab a cab after waiting 15-20 minutes and the 4th time 2-3 buses would show up in a big bunch full of angry riders. If you took the bus you weren’t happy about it; it was an unreliable and slow way to get around.

    However, bus tracker is very reliable and now you have visibility of what is coming and you can plan ahead so that you are whiling away your day standing outside in the rain or snow waiting in vain for a bus that seems like it will never come. I don’t have statistics but I would bet that bus tracker increases utilization of assets for the CTA and has become a known and reliable method of transportation for those that give it a chance.

    Cross posted at LITGM

    Posted in Business, Chicagoania, Customer Service, Tech, Transportation | 24 Comments »

    “Drugs, Inc.” – the Most Important Show on Television

    Posted by Carl from Chicago on 21st March 2015 (All posts by )

    “Drugs, Inc.” is a television show on the National Geographic Channel that focuses on the business of drugs, from producers to traffickers to users to police. I can’t recommend this show enough and I watch every episode that comes up on my DVR.

    Welcome to the $300 billion industry of Drugs, Inc., where traffickers pocket huge profits, addicts become chained in a vicious cycle and law enforces wage war across diverse battlefields – farmers’ fields, shady labs, urban street corners and suburban schools. How does this business work? Can it be stopped or should it be regulated? What impact does it have on those it touches?

    Drugs Inc somehow gets interviews with drug dealers and drug traffickers. They are always wearing a mask of some sort and often their voices are garbled electronically. It isn’t clear to me why they agree to be on TV or why the authorities don’t follow up on the leads from the program or subpoena their records. I can’t comment on the authenticity but it certainly seems real, especially the interviews with the users or “fiends” as they are described by the dealers on the series.

    The first thing that the show will do for you is change how you look at homeless people. All of the users on the show are either 1) drug dealers themselves likely far down the chain in order to support their habit 2) panhandlers or some sort of schemer / prostitute. There occasionally are recreational users or those with jobs but since they typically interview hard-core drug users many of those individuals can’t do a regular 9 to 5 job.

    The panhandlers are a relentless lot. They wake up in various places, sometimes in their cars, sometimes in a tent, sometimes in an abandoned building, or elsewhere. When they get up, it is time to make some money in order to buy some drugs. They always know exactly what they are doing and have a target amount of money to “earn” in order to score what they need to stave off dope sickness.

    Read the rest of this entry »

    Posted in Business, Chicagoania, Economics & Finance, Film, The Press | 19 Comments »

    Sunset in Chicago

    Posted by Carl from Chicago on 21st March 2015 (All posts by )

    Recently I visited my friend to see their new baby and they had fantastic views of the city looking west and north. Not a bad photo from my iPhone 6… my iPhone 5 and 4 cameras were terrible.






    Cross posted at LITGM

    Posted in Chicagoania, Photos | 7 Comments »

    St. Patrick’s Day and Journalism

    Posted by Carl from Chicago on 17th March 2015 (All posts by )

    I’m going to combine two posts here that don’t sound like they’d go well together – “Day Drinking” and lazy journalism. There was an article by Stanley Bing (the pseudonym of an executive who writes for Fortune magazine) who happens to 1) be an actual business executive 2) writes effectively (and hilariously). While I can’t find the exact post I am paraphrasing below:

    Whenever I see anything written about my company in the popular press, it is generally incorrect. Thus I must conclude that most of what I see written about other companies in the press isn’t right, either.

    Business Insider is a great resource that I read on my iPhone most days when I have a few minutes to kill. They have some original content and re-post from other sources. Recently I read about the “five biggest” St. Patricks’ day celebrations (parties) which was a typical “puff piece” article for them – you can see it here.

    The only problem with this article is… that it is lazy and wrong. Our own correspondent Dan happened to be on the ground in Las Vegas for St. Patrick’s day last year and he said it was “Chicago on an inter-galactic scale” which I believe since Dan has been at a ton of drinking events through being a sports fan forever. I am having trouble verifying this on the ol’ intertubes but it is the kind of event where “hey, the Chicago River is green, we can trot this story out every year, there we are done” but the massive scale of Las Vegas means that if you have a drinking event they can just pour out of the hotels and onto the streets (that they shut down) and go crazy and drink outdoors. Probably the only way to officially verify this is to send Art Mann out to Las Vegas as the ultimate decider…

    Onto Chicago for St. Patrick’s day… we had a beautiful day and so everyone was out in force. People were lining up per usual in the wee hours (many bars open at 6am) for a long day of drinking here in River North.

    I loved this outfit… a drunk gumby up at Paris Club!

    Read the rest of this entry »

    Posted in Chicagoania, Humor | 7 Comments »

    We’re Getting Closer

    Posted by Carl from Chicago on 7th March 2015 (All posts by )

    In this post I described how Illinois could “fix itself” financially… however my more realistic post here discusses how Illinois is tilted precariously on the edge of a crisis and I believe that one major issue impacting a large entity could kick off the entire process of “going Detroit” and “paging Kevin Orr”.

    Recently the City of Chicago, facing ratings downgrades, almost triggered off some swaps payments that would come due if the credit rating was to fall down to a certain low level. Per the article:

    Chicago drew closer to a fiscal free fall on Friday with a rating downgrade from Moody’s Investors Service that could trigger the immediate termination of four interest-rate swap agreements, costing the city about $58 million and raising the prospect of more broken swaps contracts.

    The city was able to re-negotiate one of the swap agreements and was in talks with Wells Fargo about the other swaps agreement per this article. Apparently the date of reckoning has been pushed out a little further.

    The Chicago Public Schools (CPS) debt is now just one grade above “junk” status per this article.

    In making the downgrade, Moody’s cited the school district’s reliance on reserve funds for “operating expenditures, particularly pension contributions, which will steadily increase in the coming years.”Moody’s also maintained its “negative outlook” on the district’s debt, again citing the rising pension costs. From 2013 to 2016, annual retirement costs will increase to $688 million from $197 million, Moody’s stated in its rating explanation.

    Note that the budget that Rauner proposed for the state of Illinois had additional cuts for state and local government, at a time when each of them are crying to the state for relief. These cuts are also due to Rauner’s choice to let the state income tax surcharge expire rather than renewing it (as Quinn certainly would have done). Per this article:

    Governor Rauner’s office released a statement Wednesday afternoon, saying: “Governor Rauner had to make some hard decisions to balance a $6 billion budget shortfall caused by years of fiscal neglect and bad practices. The amount of money transferred to local governments has ballooned by more than 40 percent in the last decade and the reduction to local governments proposed in the budget puts Illinois in line with neighboring states. In Governor Rauner’s budget proposal, Chicago’s overall revenues are reduced by less than 2.5 percent. Through the local government task force, Governor Rauner is committed to working with local communities to reduce costs and give them increased flexibility. Additionally, as part of his Turnaround Agenda, the governor proposed empowering local residents with tools to control costs at the local level and get more value for their tax dollars.”

    It will be very interesting to see how this all plays out. Today the various governmental units and branches of our legislature and the governor are circling and eyeing each other to see who blinks first.

    Some day hopefully we can move beyond the “funding” discussion into a real discussion of how we can get our state in fiscal order; by encouraging our government to be more productive, by scaling back our obligations to unions, and by unshackling entrepreneurs in the state to create jobs and companies. No one is talking about that yet… except Rauner.

    Cross posted at LITGM

    Posted in Big Government, Chicagoania | 3 Comments »

    Rauner’s budget-Is any of this going to happen ?

    Posted by Michael Kennedy on 18th February 2015 (All posts by )

    An interesting take on the new Illinois governor’s shot across the bow.

    The Sun-Times doesn’t like it.

    If we thought Gov. Bruce Rauner’s first proposed state budget stood a chance of becoming reality, we would be appalled.

    Talk about cold. Rauner wants to eviscerate dozens of programs that serve the poorest and most defenseless among us.

    C’mon, cutting tuition aid to orphans?

    If the Sun-Times is anything like it was the last time I lived in Chicago, a long time ago, this is no surprise. It defined limousine liberal then with Marshall Field the owner.

    Marshall Field III (September 28, 1893 – November 8, 1956) was an American investment banker, publisher, racehorse owner/breeder, philanthropist, heir to the Marshall Field department store fortune and a leading financial supporter and founding board member of Saul Alinsky’s community organizing network Industrial Areas Foundation.

    I don’t know if things have changed the last 50 years.

    But the governor’s fiscal year 2016 budget has zero chance of being passed into law by the Illinois General Assembly, as he well knows. Its real value then, which we’d like to believe is by design, is to sound the alarm like never before that Illinois is sliding fast toward becoming an economic backwater, a failed state among the 50 states. Time is running out. Hard and painful measures must be taken now.

    If Rauner’s draconian plan has achieved that much, we’d say it’s about time.

    That sounds promising. Maybe 50 years of economic stagnation has made a difference. Chicago is doing fine as far as the “Near North” part of it although a woman was raped in broad daylight across the street from my niece’s apartment two weeks ago. She is a nurse on the transplant team at Rush Medical Center and should carry a gun but we all know about Chicago and guns. Only gangsters are allowed guns.

    Following that, we would expect to see a hard but healthy give-and-take, like nothing we have seen in decades, between the executive and legislative branches. And, in the end, Illinois might finally settle on a long-term spending and revenue plan that puts the state on a path toward solvency and growth for decades to come.

    Hey, we can hope.

    This sounds more realistic than I have ever heard from the Sun-Times. Is this progress? The little I know about the Tribune these days is not any more promising.

    And Wisconsin lefties thought Walker was bad !

    I’m sitting out here in La La land with Jerry Brown and 1/3 of the illegal immigrants in the US watching Los Angeles implode.

    My wife needed to renew her drivers’ license on her birthday, January 13. Unfortunately, January 1, was the day that illegal aliens were eligible for drivers’ licenses. As a result, the first day she could get an appointment, as opposed to waiting all day in line, was today more than a month later. Unfortunately, she had pneumonia last week and came home Sunday. Today she felt too weak to go to her DMV office and called to reschedule. The next date she could get an appointment was in April.

    I’m not sure Illinois is any better but at least somebody is trying to do something about it.

    Posted in Big Government, Chicagoania, Current Events, Illinois Politics | 12 Comments »

    Mike Lotus Spoke to the University of Chicago Law School Federalist Society Student Chapter on February 3, 2015 About “America 3.0 and the Future of the Legal Profession”

    Posted by Lexington Green on 5th February 2015 (All posts by )

    UChicago law school

    Huge thanks to the University of Chicago Law School Federalist Society Student Chapter on Tuesday, who invited me to speak to their group on February 3, 2015. I previously spoke at the Booth School of Business, which was also a thrill. I am most grateful for the opportunity to speak at the University of Chicago, my undergraduate alma mater.

    The event was well-attended. I attribute this in part to the drawing power of the free buffet of Indian food, and not exclusively to the appeal of the speaker. The students were attentive and asked good questions. I understand that audio of the talk will be available at some point. I will post a link when it is available.

    My topic was “America 3.0 and the Future of the Legal Profession”.

    First I spoke about some of the themes from America 3.0: Rebooting American Prosperity in the 21st Century, Why America’s Greatest Days are Yet to Come, which I coauthored with James C. Bennett. I discussed the cultural foundations of American prosperity and freedom, the role of our legal profession in American history, in particular in adapting to technological changes, I then discussed some of the major technological changes which are now sweeping our nation and the world. I said that some of them will be general purpose technologies which will cause changes on the scale of the steam engine, railroads or computing itself.

    Read the rest of this entry »

    Posted in Academia, America 3.0, Book Notes, Chicagoania, Economics & Finance, Education, Entrepreneurship, Law, Personal Narrative, Politics, Quotations, Society, Tech, USA | Comments Off on Mike Lotus Spoke to the University of Chicago Law School Federalist Society Student Chapter on February 3, 2015 About “America 3.0 and the Future of the Legal Profession”

    How To Fix the State of Illinois

    Posted by Carl from Chicago on 19th January 2015 (All posts by )

    In a previous post I discussed the high probability of there being some sort of major fiscal calamity in Illinois in the next two years. Here I propose how to solve the issues in the state. I realize that the chance of any or all of these solutions to be put into place is near zero without unthinkable changes, but in fact they are all obvious and will likely be part of the ultimate solution.

    Consolidate Governmental Entities – Illinois has over 8400 governmental entities, the highest in the USA. These entities need to be drastically curtailed and likely should number in the hundreds, and each should have professional management, strict caps on borrowing capabilities, and an inability to sign up for long term unfunded obligations (pensions, retiree health, etc…) without stringent oversight.

    Eliminate Pensions and Defined Benefit Plans and Move to Defined Contribution Plans – Illinois’s pension and benefits woes are myriad and well documented and extend through every city and county due to firefighters and policemen and governmental workers. Regardless of the one time pain, strikes, protests, and society-shaking impacts of these moves, these unfunded obligations are an impossible burden on the state and it must move to a 401k-like plan (similar to what Nebraska did)

    Reduce State and Local Employee Compensation Pay by 25% or More – The government faces a simple choice between paying its employees what they think they deserve (ever more) and the government’s obligation to provide services to its citizens at a price that does not drive excessive taxation. This deal is broken and a large part of the burden will have to rest on governmental employees. If they do not like this solution they will be free to find employment in the private sector where it is unlikely that they will be able to match the same package of benefits and compensation. We will know that the model is in balance when the turnover rate of government is equal to that of the private sector.

    Outsource 33% or More of Governmental Jobs – There are large opportunities for efficiencies in the governmental sector, through use of the Internet, changes in processes, and injection of competition into areas traditionally done by the government. Even within areas that are generally governmental functions (like the police), a significant portion of the functions such as administration could be done by third-party or online vendors.

    Reform Purchasing By Use of Modern Techniques and Focus on Outcomes Not Political Concerns – Our procurement systems in Illinois are riddled with favoritism, opaque decision methods, and a focus on aiding politically connected firms. In addition, payment of vendors is very slow which rules out many smaller and less capitalized vendors. We need to focus on market based outcomes (quality of service, cost reduction, speed to market), and reward vendors with consistent and timely payments rather than focusing on political connections and long term relationships which favor a few incumbents.

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    Posted in Big Government, Chicagoania, Economics & Finance | 15 Comments »

    Illinois Government, Broadly Defined, Will Have A Major Crisis by 2017

    Posted by Carl from Chicago on 19th January 2015 (All posts by )

    The fact that the State of Illinois has dire fiscal problems is well documented. If you just type in headlines like “Illinois is broke” into your web browser and you can spend hours reading. One of the best is Illinois Policy.org which brings together articles from various news sources into a coherent theme. We have a new governor, Bruce Rauner, who is wealthy and thus unlikely to be entangled in corruption, who is pledging to take on this giant mess, which is a cause for optimism.

    The issues, however, are much larger. It isn’t just the state of Illinois which is in deep crisis – we have an interconnected set of entities all of which are on the verge of facing fiscal woes, who in turn can tip other entities off the fiscal cliff. The city of Chicago also has very significant financial problems, mostly from pensions as well, which it has been papering over for many years with debt and by allowing its unfunded pension issue to get ever larger. Cook County, too, which is one of the largest governmental counties and entities of its nature in the USA, is also facing dire challenges.

    Once you get beyond the state, the city of Chicago, and Cook County, you encounter myriad minefields from our plethora of governmental units. Illinois has more governmental entities than any other state, 8400, as you can see from this article. Most of them have various taxing powers, debt they’ve raised, and liabilities like pensions and health care for workers that are not funded. Look near O’Hare, where the (tiny) city of Rosemont has funded huge shopping malls, convention centers, and even a casino by floating debt. In the end this debt is substantially backed by the state whether that guarantee is implicit or explicit; a city of a few thousand residents can’t normally fund this sort of largess.

    But the challenges are much deeper than this. These entities, much of which are overseen on a local level, invite vast opportunities for institutional corruption. We saw this on Metra, where the scandals caused the prior president to commit suicide (by standing in the way of a train, no less) and cast a light on the squalid pay-for-play decisionmaking process of a typical entity in our state.

    The situation has become so bad that even in a time of record low interest rates, when there are many buyers of debt with any sort of return, that Illinois and the city of Chicago often cannot take advantage of municipally funded debt (which carries a lower interest rate because individuals are not subject to Federal taxes on the interest) because this debt has to be used for capital purposes and can’t just be used to pay day-to-day bills. Thus they are forced to issue “taxable” debt, and pay a higher interest rate. Many of the issues are essentially “scoop and toss” where we just take the entire principal and interest of expiring debt, refinance the whole thing, and just throw it out into the future, growing ever more indebted.

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    Posted in Big Government, Chicagoania, Illinois Politics | 11 Comments »

    Renting Vs. Buying

    Posted by Carl from Chicago on 29th December 2014 (All posts by )

    In the 2007-9 real estate boom and debacle here in Chicago there was a wave of newly built condominiums that swamped the market in River North, River East, the South and West Loop, and even Downtown. For a while the new buildings could do no wrong and then that disappeared into a pool of foreclosures and difficult times for condominium associations as they had to deal with vacant units and those that refused or were unable to pay assessments.

    In the 2012-5 period, that same area of Chicago has seen an enormous influx in new buildings, but this time it is different – they all seem to be rental units. Everyone seemed to learn the same lesson; condominiums can be hard to unload in a down market and the prices are highly variable (units sold for fire-sale prices during the nadir and condominium developers lost their shirts if they were holding inventory during that time), so let’s go with renters instead, who derive consistent returns for the building owner and lender.

    For a bit I even thought I’d try to put my condo on the market since prices have gone up. I figured I’d just rent for a while and not be exposed to future downturns. But as I looked around for equivalent value to my current condo in terms of location, views, bedrooms and bathrooms, I noted that I’d be paying $4500+ / month for an equivalent space, if I could find it at all (inventory of larger condos in modern buildings in good walkable areas was in fact very low). That just seemed crazy.
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    Posted in Chicagoania, Real Estate | 10 Comments »

    Ed Paschke Art Center – And Steve Schapiro Photo Exhibit

    Posted by Carl from Chicago on 23rd November 2014 (All posts by )

    We watched an episode of “Chicago Tonight” the PBS news program where they discussed the Ed Paschke Art Center, a museum highlighting the work of the vibrant visual artist Ed Paschke, a Chicago native who died in 2004. They also have other artists featured at the museum, and when we went it was photographer Steve Schapiro, who photographed Warhol, Reed and Bowie among many others.

    The museum is easy to reach – by car you can take the Kennedy and get off at Lawrence, and it is an easy walk from the blue line or the metra (if you take that line). Here is the outside of the building, which is painted in the style of his work. The museum is free (we made a donation) and the docent working there was friendly and interested if you had any questions.

    We talked to the museum employee and the building used to be a call center; they redesigned it to hang his big art canvas projects and set it up so that the light illuminated everything properly. Downstairs they had his paintings, and upstairs they re-created his studio, including the last painting that he was working on at the time of his death.
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    Posted in Arts & Letters, Chicagoania, Music, Photos | 3 Comments »

    Bitcoin ATM

    Posted by Carl from Chicago on 14th November 2014 (All posts by )

    Recently I was standing in the Merchandise Mart when I noticed something new – a Bitcoin ATM! This ATM allows users to utilize Bitcoin to receive dollars in exchange, in that sense being a “regular” ATM.

    This is a Robocoin kiosk. Here is a link to their site where they describe what you can do at this ATM. I like their example of someone in Argentina depositing their currency in Bitcoins to avoid the inflation (and risk of outright seizure) that Argentina faces.

    If you are interested in Bitcoins, wikipedia has an excellent summary here.

    Cross posted at LITGM

    Posted in Business, Chicagoania | Comments Off on Bitcoin ATM