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  • Archive for the 'Chicagoania' Category

    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

    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.

    Read the rest of this entry »

    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.

    Read the rest of this entry »

    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.
    Read the rest of this entry »

    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.
    Read the rest of this entry »

    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

    Election Day

    Posted by Michael Kennedy on 4th November 2014 (All posts by )

    Election Day in California is pretty dull because California is a one party state with Democrats and their illegal alien voters running things.

    ya vote

    “We don’t need no stinkin’ voter IDs !”

    Elsewhere there is excitement. Voting machines in multiple states are changing GOP votes to Democrat.

    The Cook County Board of Elections Deputy Communications Director Jim Scalzitti said the machine’s failure was “a calibration error of the touch-screen on the machine,” and that Moynihan’s votes were not actually registered. Scalzitti said that voters are always asked to double-check their votes before they’re counted.

    The same “error” is occurring in North Carolina and Maryland, the latter a state where the Democrat governor is in trouble with a GOP challenger close in polls.

    Naturally, that is where voting machine “errors” will cluster.

    Read the rest of this entry »

    Posted in Big Government, Chicagoania, Elections, History, Illinois Politics, Obama, Political Philosophy, Politics | 28 Comments »

    Mike Lotus Participates in Immigration Reform Panel & Discussion, John Marshall Law School Federalist Society, November 5, 2014

    Posted by Lexington Green on 3rd November 2014 (All posts by )

    Mike Lotus will participate in an Immigration Reform Panel & Discussion at John Marshall Law School Federalist Society, November 5, 2014, 5:00 p.m., State Street entrance.

    I am looking forward to the discussion.

    Note the critical language: Food will be served.

    Drink may be imbibed afterwards, as well.

    Posted in America 3.0, Chicagoania, Immigration, Law | 3 Comments »

    Tributosaurus Plays “One Hit Wonders of the ’80s” at Copernicus Center in Chicago

    Posted by Carl from Chicago on 18th October 2014 (All posts by )

    Tributosaurus is a Chicago cover band that has been around over a decade and has covered an astonishing range of songs and artists. When they cover a song they go to great pains to sound as close as possible to the original song – this usually involves multiple guitarists to do overdubs which are tracked in the studio, horns, strings, and an array of drummers, synthesizers and backup singers. Here is their web site and they are a lot of fun. I have seen them do XTC, Pink Floyd, the Rolling Stones, Dire Straits, and most recently the “One Hit Wonders of the ’80s” at Copernicus Hall at Jefferson Park in Chicago (it is a few blocks off the blue line stop; we took the train and walked).

    Here they are at the start of the show. Later they bring on the horns, the strings, more backup singers, and more of everything. It was a lot of fun – they played a lot of forgotten songs like “This Beat Goes On / Switching to Glide” by the Kings which got the whole place rocking (it was a huge hit in Chicago) and also Dexy’s Midnight Runners with real banjo players.
    Read the rest of this entry »

    Posted in Chicagoania, Music | 6 Comments »

    25 Stories About Work – Office Hoteling and the Elusive Consultant Desk

    Posted by Carl from Chicago on 16th October 2014 (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)…

    Chicago, the ’90s…

    When I first started out as an auditor I had a tiny cube that consisted of just a desk and a chair with a big phone in a giant warren full of other cubes. There was a big bay window that let in the sun and lights far overhead. I didn’t know anything and was happy just to have a place to call my own.

    How accounting worked at the time was that you were assigned to clients and were “on the road”. If you were in the office you charged a code for down-time and struggled for something to do. You could take a training class, do research in the library, or more often than not you’d be assigned some sort of drudgery administrative work. Most of the time I ended up photocopying our audit files when clients transitioned to new auditors, which is much more work than it sounds because you had to dis-assemble the work papers, copy them, and then re-assemble the files again. The copier tended to regularly jam and you soon learned how to take that copy machine apart, as well. Not a good use of a master’s degree…

    After a while the managers learned who was good and who wasn’t and I was constantly busy as a result. We worked and traveled all the time and often I had overlapping clients, meaning that tasks I couldn’t complete onsite piled up for me at the little cube while I was at a different client. This was before any concept of telecommuting and we didn’t even have our own laptops. The only way to get work done was to show up at the office (on Saturday or Sunday, since I traveled all week) and do the remaining tasks.

    One time our office engaged in some sort of ISO process and they decided that having a “clean desk” was mandatory. So the (usually worst) staff that were in the office packed up everyone’s desk and sent it off site so that when the office tour occurred, my little rat cube was completely clear. Thus when I showed up on a Sunday a couple of weeks later to follow up on some annoying task from a parallel client, all of my papers were gone and that was an entirely wasted day. The fact that I still remember this over 20 years later shows how angry I was at this bureaucratic stupidity.

    Read the rest of this entry »

    Posted in 25 Stories About Work, Business, Chicagoania, Personal Narrative | 6 Comments »

    Thank you to the Chicago Young Republicans

    Posted by Lexington Green on 9th October 2014 (All posts by )

    MJL at CYR

    (That is me on the far right, where I belong!)

    My thanks to the Chicago Young Republicans, who invited me to speak to them last night at their monthly meeting. It was an enjoyable and educational event.

    I was on a panel with the very distinguished Dan Proft of, inter alia, 89 WLS and Jonathan Greenberg of the Illinois Policy Institute.

    The topic of discussion was the upcoming election. One theme was the concern that Bruce Rauner may end up losing to Pat Quinn, despite Quinn being an unmitigated disaster. Polls show Rauner slightly ahead, but the trends are bad. Rauner has not yet closed the deal with Illinois voters, who are upset and concerned about the direction the state is going, but who are not yet convinced that Rauner is the guy who can fix the problems. I hope Rauner manages to make that connection with voters before election day.

    Read the rest of this entry »

    Posted in America 3.0, Chicagoania, Illinois Politics, Politics | 9 Comments »

    Regulatory capture is normal, and that’s the problem

    Posted by Lexington Green on 3rd October 2014 (All posts by )

    portraits of Julian Sanchez and Megan McArdle

    You must read this excellent piece by Megan McArdle, It’s Normal for Regulators to Get Captured. “regulatory capture is not some horrid aberration; it is closer to the natural state of a regulatory body.”

    This is true. That is why the entire modern administrative state has to be re-thought, re-configured and replaced. It does not work, it never worked, it cannot work.

    The regulatory state is the defining feature of the Industrial Era, America 2.0 state. It needs to be shut down, wrapped up and replaced.

    This does not mean return to the law of the jungle. It means making laws that actually align incentives with desired ends, as imperfect as that always is.

    Read the rest of this entry »

    Posted in America 3.0, Book Notes, Chicagoania, Economics & Finance, USA | 14 Comments »

    The Restaurant and Bar Business

    Posted by Carl from Chicago on 27th September 2014 (All posts by )

    I am far from an expert on the Restaurant and Bar Business segments but as a long time resident of Chicago in various areas packed with these establishments from Wrigleyville to Bucktown to River North I am at least a frequent regular qualified to throw my 2 cents in. I hadn’t thought too much about the economics of this until I talked to a friend who recently opened two great pizza places where he is the owner about what you get when you buy a used restaurant.

    You get nothing… you have to re-model and start over the food concept. And when you sell, the next guy does the same.

    What makes a good restaurant as a business? There are a lot of variables and I am only speculating, but certainly timing and location are key elements. For instance you have the Twisted Spoke, a bar on Grand Avenue in what used to be a pretty sketchy part of town that is rapidly gentrifying, and they have the iconic “skeleton on a motorcycle” on permanent rotation in front. This bar has survived for a long time with a mix of hipster / biker cool, an astoundingly good drink / beer mix, and surprisingly good food and interesting / witty / iconic employees. I’d bet that back in the day this place was actually full of bikers but nowadays the crowd looked like the usual hipsters in plaid shirts. And don’t forget the enormous benefit of a rooftop – it astounds me how many bars / restaurants ignore the fact that Chicago people LOVE to sit outside during the few nice days that we receive every year and they drink like fish and eat until they can’t even move.

    Read the rest of this entry »

    Posted in Business, Chicagoania | 35 Comments »

    Riot Fest Chicago 2014

    Posted by Carl from Chicago on 16th September 2014 (All posts by )

    Riot Fest in Chicago was held over three very cold and rainy / muddy days in Chicago’s Humboldt Park in September. I went with a friend on Friday which was cold, rainy, muddy and insane and on Sunday when the weather was nice (still cold) and the mud had somewhat hardened. Riot Fest is more of a fan-friendly (cheaper) Lollapalooza with a bigger dose of punk / emo bands and without any of the EDM flavor that you get from Lolla (and get on a massive scale elsewhere). It was also held in Humboldt Park which is relatively far afield for the more gentrified classes but actually is closer to where the younger fans of this music might actually live and work. For me, it was an opportunity to see some of the bands I like such as Social Distortion, Mastodon, Slayer, Primus, Weezer and the Afghan Whigs. Definitely skewing a bit older for certain.

    Here is Gwar! I wasn’t a huge fan of Gwar before seeing them live but they put on an awesome show that needs to be seen to be believed, where they kill a giant dinosaur and banter with the crowd in a completely disturbing manner. At one point they wanted everyone to put their heads down for a moment of silence (their former front man died recently) but then their deranged emcee said that everyone was looking down for a crack rock that the band had dropped since they couldn’t do this sort of stuff sober. They also sprayed everyone near the front with fake blood which is their trademark – many fans throughout the park for the rest of the day looked a bit sunburned from the residue of their pinkish hue thanks to Gwar.

    Riot Fest had great food and it was very reasonable. They had a Cevapcici stand where I had a great Serbian sausage for about $7 and all kinds of different items, not just the usual “festival” type stuff. Fortunately they set up most of these stands on the roads that curve through the park so they didn’t sink into the mud.
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    Posted in Chicagoania, Music | 6 Comments »

    Massive Disruption To The Cable Industry Coming

    Posted by Carl from Chicago on 28th August 2014 (All posts by )

    Things that are often obvious in hindsight don’t seem so clear at the time. For instance I didn’t understand why anyone would want to send around a PDF file when you had Microsoft Word. And it wasn’t obvious to me that mobile phones would completely displace land lines.

    We are about to see something similar happen to the cable industry, which is at its oligopolist apex right now.  I don’t know when or how long it will take to have an effect, but in the end I believe that the outcome will be significant.

    MICROWAVE FIXED WIRELESS

    For large condominium buildings in Chicago, it is now the norm, not the exception, to go with Microwave Fixed Wireless for internet in the building, rather than fiber. Here is one company (I just found them on the internet, don’t know anything about them) that attempts to describe the benefits:

    Telephone and cable companies have been positioning fiber optics as the ultimate internet technology for some time, but the truth is that fiber has some inherent disadvantages that have been addressed by wireless microwave-based internet solutions. Experts across the globe are starting to acknowledge what the engineers at JAB Broadband have long been touting: microwave is a faster, lower latency, lower cost alternative to fiber and you don’t have to wait until someone decides to light up your building.

    Not to be confused with the appliance you use for heating your leftovers, microwave wireless networks transmit and receive radio signals through the air enabling high-speed data transmission with very limited latency. Benefits include:

    Limited infrastructure required on site
    Faster speeds because data travels over a direct path (point-to-point)
    Low logistical and operation costs
    Expanded availability
    Low latency

    There are many companies in Chicago that provide this service for condominium buildings and businesses. You need to have a rooftop with line of sight access to a provider and you put a dish on the roof. This dish connects to the main network of the building and is distributed just like internet service that you’d receive from a standard fiber optics provider (such as a cable company). The traditional downside of microwave transmission was unreliability – if the line of sight was obscured by heavy rain, for instance, then you don’t receive any signal. This happens today with DirectTV if the weather is bad – you receive the “all or part of this program did not record” message when you pull it up on your DVR (or it is jumpy and impossible to watch if you are looking at “live” programming). Note that DirectTV has a much more complex problem to fix with its satellites than a condo building does in Chicago because their satellites are in orbit rather than nearby with simple line of sight needs, so these problems are conceptually similar but actually very different in terms of difficulty to solve.

    The reliability issue has mostly been solved and barring catastrophic weather, your point to point wireless internet is as reliable as fiber brought into your building. Don’t forget that fiber, too, can be cut by local construction crews and other means and is also susceptible to failures of various sorts.

    Once you cut over to Fixed Wireless (microwave transmission), you have effectively moved out of the cable orbit as far as internet service.  Many facilities offer 10 meg, 50 meg, and even 100 meg connections for each condo unit, which means that the provider needs to bring that speed times the number of units with some overall reduction since everyone won’t be using the full internet all the time.
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    Posted in Business, Chicagoania | 10 Comments »

    Hope for Illinois?

    Posted by Dan from Madison on 26th July 2014 (All posts by )

    My mother, who still lives in Rockford, Illinois, sent me a link today that was pretty surprising. It says that the Republican candidate for governor of Illinois, Bruce Rauner, has an actual shot at winning, and it appears that he isn’t insane. I am going to do a mini-fisking of the article and ask some questions along the way that I hope that some of our Chicago/Illinois based readers can answer.

    Why are the stakes so huge? Because Illinois is arguably the worst-run state in America.

    I don’t think there is really any question that Illinois is THE worst-run state in America, hands down.

    Illinois could become a laboratory experiment about whether conservative ideas can work in a state that has been ruled by teachers’ unions and a self-serving political machine in Springfield and Chicago.

    How could this experiment possibly happen with a solid majority in the Illinois House and Senate? I guess Rauner could slag them unmercifully in the press when they don’t change anything, but I am not sure how that will work.

    I caught up with Mr. Rauner in Chicago last week. He’s ruffling liberal feathers by going into black inner-city schools and Hispanic neighborhoods and talking about school choice, economic opportunity, family stability, and jobs. “I’m getting standing ovations when I go to black churches and talk about school choice,” he says. “Parents understand it is their kids that are victimized by lousy public schools in Chicago.”

    This seems like very good politics to me. The Chicago Public School System is a disgrace.

    He’s running as a non-politician who has the business experience to turn around the state’s finances. He won his five-person primary by telling voters, “I’m the only one up here who isn’t a professional politician. These are the people who created the problems in Springfield.” In this era of rage against the political class, the message (and the millions of dollars he poured into his campaign) carried the day.

    Sounds like he has money and is sincere. This may be an appealing choice to the people of Illinois.

    He’s promised to take a jackhammer to the bloated state budget. The Left is already rolling off the shelf the anti–Mitt Romney campaign — i.e., rich people like Rauner don’t care about people like you.

    “The Left” won’t vote for him anyways. But again, I don’t see how effective the “jackhammer” will be without help from the House and Senate.

    Some skeptics say that even if Mr. Rauner wins, he won’t be able to overturn the corrupt machine in Springfield. Don’t be sure about that. If Rauner makes it to the governor’s mansion, he will have a gigantic mandate from voters to turn Springfield upside down and get the finances in order. The big losers will be the teachers’ unions, whose clout will be greatly diminished — it couldn’t happen to a nicer group of people.

    I hope he wins, and I hope this last paragraph is right. Maybe, perhaps, finally, the people of Illinois have had enough of the nonsense. At least this might be a start.

    Posted in Chicagoania, Illinois Politics | 16 Comments »

    High Rise Construction Views – And Taking Down A Crane

    Posted by Carl from Chicago on 21st July 2014 (All posts by )

    In River North, during the many years we’ve lived here, the skyline has been transformed with the addition of new high-rise buildings. Construction slowed after the 2008-9 crash, but is back now with a vengeance. A new apartment building is being built near my condominium. This is a view of the building while the construction workers were pouring concrete on the roof (you can see the concrete pouring arm) the same night of the “Derecho” storm which hit Chicago at the end of June.

    I’ve always wondered how they take down the crane and we got a chance to see it up close and personal. The process took all weekend, and they closed down a nearby street on Saturday and Sunday while they dismantled the crane. They put the metal “box” (it is steel colored) with three sides around a vertical crane “segment” and then the crane pulls that segment out through the gap. You can see the crane holding the segment if you look closely – which it then lowers to the ground.

    Read the rest of this entry »

    Posted in Chicagoania, Real Estate | 2 Comments »

    Adding to Illinois’ Debacle

    Posted by Carl from Chicago on 17th July 2014 (All posts by )

    This billboard is in my River North neighborhood in Chicago. It is an advertisement for a mall and entertainment location in Rosemont, a small city near O’Hare airport.

    Rosemont was profiled by the Chicago Tribune in this excellent article. A single family has run Rosemont for generations, and they benefit from a levy on taxi rides from O’Hare and spend this money on no-bid contracts for friends, family and politicians as well as large entertainment complexes underwritten by large amounts of debt.

    The suburb is digging itself deeper into debt to subsidize a new bar district, professional softball stadium and outlet mall. With $370 million in taxpayer-backed loans outstanding, Rosemont has one of the top debt loads in the Chicago region.

    Another Chicago suburb, Bridgeview, hosts a stadium for the Chicago Fire, a major-league soccer team. Their debacle is chronicled here, in a typically great Bloomberg article.

    The mayor of Bridgeview, Illinois, said building a taxpayer-financed arena for the billionaire owner of Major League Soccer’s Chicago Fire would bring hotels and restaurants to his suburb. Instead, the town has more than doubled property taxes and may raise them again to pay more than $200 million in stadium debt.

    One of the big problems in Illinois is that we have so many various overlapping public bodies, many with the ability to issue debt and all of whom have expensive board members, employees, and often public contracts doled out to associated cronies. This article, from the “Illinois Policy” web site, describes the myriad overlapping public entities in the State of Illinois and how we dwarf ALL states and especially neighboring (and much better managed) states like Indiana.

    Illinoisans suffer from the second-highest property tax rates in the nation.

    Their state is the third most corrupt in the nation.

    And driving this expensive and corrupt reality on the local level is the fact that Illinois has more units of local government than any other state in the nation. With 6,963 units of local government, Illinois beats its nearest competitor by more than 1,800.

    When Illinois finally hits the wall, and we won’t be able to issue new debt (and thus an immediate fiscal crisis will occur), we will have to have a reckoning with all of these various entities, each of whom has their own debt problems and the ability to create NEW problems by issuing MORE debt. On one hand, the market will constrain their ability to sell debt by the fact that these insolvent entities survive through the “implied” promise that they will be bailed out by some higher power, whether that is a county, state, or Federal government.

    The act of unwinding all of the problems of the inter-related corrupt and insolvent entities will be a herculean task, made even more difficult by the fact that there will be little incentive for the politicians to solve the crisis if the end result is that they won’t have these same public entities for no-bid contracts, jobs for themselves, and their campaign workers and donors once the clean-up is complete.
    The only thing for certain is that the lawyers in the state will feast at the trough of lawsuits from all parties. They just need to make sure that they find a way to get paid themselves on a timely basis…

    Cross posted at LITGM

    Posted in America 3.0, Big Government, Chicagoania, Illinois Politics | 11 Comments »

    Gary Becker ז״ל

    Posted by Jonathan on 4th May 2014 (All posts by )

    Gary Becker, one of the greatest living economists and a longstanding member of the University of Chicago faculty, has died. עליו השלום.

    Gary Becker

    (Photo courtesy Nobelprize.org.)

    UPDATE: Gary Becker links follow.

    James J. Heckman (pdf)

    The Godfather of Freakonomics Has Died — Here Are His Most Groundbreaking Theories

    Chicago Tribune

    The Wall Street Journal

    The New York Times

    Chicago Sun-Times

    The New Yorker

    UPDATE 2: University of Chicago Gary Becker Obituary

    (Links via Lex and Joseph Morris.)

    Posted in Chicagoania, Economics & Finance, Obits | 3 Comments »