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Tuesday, January 3rd, 2012

No, Freeways Are Not Dead by Keep Houston Houston

[ Houston is a city that isn't widely regarded in urbanist circles, but some folks like it just fine the way it is. One of them is the blogger behind Keep Houston Houston, who recently resumed posting after a hiatus. He enjoys putting out the other side of the case, so I though I'd share a piece with you. This one examines whether or not the era of the freeway is over in light of a number of recent freeway removals. Even if you don't agree, I hope you enjoy - Aaron.]

I think this is probably the third article I’ve read in the last month asking: “Are Freeways Doomed?” “Is THIS the post-freeway age?” “Are Urban areas moving on?”

Uh, no.

All of these pieces work like any “bogus trend” piece – string together a few anecdotes, posit a trend, quote a couple authoritative-sounding people, call it a day. And indeed, more than one freeway has been removed in this country. But there’s no trend toward de-freewayization; quite the opposite in fact. What’s missing, then, is the underlying reasons for the changes.

Fundamentally, there are two reasons for US freeway closures:
(i) The freeway was replaced by a newer and bigger freeway, built to better design standards, at which time the old facility was abandoned.
(ii) The freeway was part of a link in a grand “master plan” that was truncated by the “freeway revolts” of the 70′s. In other words, it was pre-obsolesced by non-completion of the network.

Some examples:

Tom McCall Waterfront Park, Portland, Oregon
Berkeley’s “Preservation Institute” says: “When Portland decided to tear down the Harbor Drive freeway, the city made one of key decisions that transformed it into a national model for effective city planning.” Well… maybe. What actually happened was that they had one freeway built to 1942 standards, and in 1964 they opened up another freeway half-a-mile away built to 1964 standards. That was I-5 – the Eastbank Freeway – and it’s still truckin’ almost 50 years later.

Now it’s true that some traffic engineers freaked out about the idea. Even if Harbor Drive only had 24k ADT (which is well down into arterial territory), it was still predicted the city would grow. And considering how slowly traffic crawls across the Marquam Bridge today, you know, there was probably a grain of truth in the forecast. But what the engineers didn’t predict was that Portland would soon enact a ridiculously strict downtown height and FAR ordinance in an effort to ward off further skyscrapers in favor of the existing Glazed Terra Cotta building stock. This essentially killed office development downtown and pushed the region’s employment base into an intensely suburban, office-park-dominated form. In fact, low-rise office parks are the very first thing you see when you cross the UGB into Greater Portland, whether you’re coming in on 26 East or I-5 North.

Those silly traffic engineers thought Downtown office space would keep expanding, like any American city. Instead the downtown office market was frozen in time, new construction confined only to condos and fair trade vegan clothing boutiques. But what really cinched the deal was when they went and built yet another freeway less than a mile away. Sandwiched by parallel north-south freeways of (then) modern design, serving a downtown whose development would be forever stunted, there would never be a need for the widened and straightened Harbor Drive.

Park East Freeway, Milwaukee, Wisconsin
Milwaukee is a case where the infrastructure was obsolesced by the freeway revolts. In the original plan for Milwaukee’s freeway system, there were two north-south trunk highways – one inland, and one along the lake. While the inland route got built as planned (and is now signed as I-94 and I-43), the Lakefront route was only half finished. Thus the Park East Freeway – which, as designed, would’ve been an important connector distributing traffic between Lakefront and Inland routes – was rendered a fairly truncated spur. Not really necessary in its original form. And while Milwaukee gets New Urbanist props for killing the spur, it’s instructive to note what they replaced it with.

A brand-new surface street, striped for four lanes but obviously designed for six, got put right in its place. Now, from my perspective, as an infrastructure guy, I think this is pretty sweet. The original freeway was designed primarily as a connector (with distribution functions secondary), so it didn’t utilize a lot of the Milwaukee grid. A proper downtown highway spur should crap traffic out onto every surface street in sight, like 527 does. Thus the new surface street does a better job at fulfilling its primary raison d’etre, since it was actually designed for that purpose. It’s also more amenable to condos than an elevated highway is, which can be good for property values – and good for the local government, if they don’t piss it all off into 20- and 30-year tax abatements like PDX does.

But a green eco-symbol this is not; it’s just the engineers replacing a middling facility with a better one.

Claiborne Expressway, New Orleans, Louisiana

This one is actually still there, although there’s a good chance it’ll disappear in the next decade. If you’ve read Divided Highways you’ve read the tales of Claiborne’s vibrant business and music scene before the coming of the elevated. The pictures I’ve seen show a mostly auto-oriented strip of gas stations and buy-here-pay-here lots. But these also have their charm, and I’m sympathetic to the argument. Perhaps it shouldn’t have been put there.

What we do know for certain is the Claiborne didn’t last ten years before it had been supplanted with I-610, which cut several miles off the route for through-traffic. At this point the Claiborne became essentially just a spur, albeit one masquerading as a through route.

Even just as a spur, there would be a pretty decent argument for the Claiborne’s continued existence… except that the downtown NOLA office market isn’t exactly booming. In fact the consensus is, during times when a surface-street Claiborne would be slow, all the extra traffic could just be routed up the Ponchartrain, which is a solid eight lanes with full-width shoulders and feeder roads. Even CNU proposes that they add a direct connector for this purpose.

Transportation improvements are GREAT. Just don’t try to front like it’s some sort of repudiation of the basic need to move large quantities of cars in and out of a city.

Mas
You can find more examples wherever you look. The Embarcadero Freeway in San Francisco was supposed to have been a vital shortcut between the Bay Bridge and the Golden Gate, providing a downtown through route to complement the east bay’s 580. In fact they only got it about 1/3rd built before they ran into rich white people neighborhoods and the rest of it got canceled. The truncated version lasted until an earthquake killed it, at which point it was deemed not worth saving. But what if they’d finished it?

It’s not too hard to figure out what would’ve happened, since basically the same freeway got constructed in Seattle – the Alaskan Way Viaduct. When that freeway got wounded in a quake, they just patched it up with duct tape and JB Weld and set about planning Seattle’s Big Dig as a replacement. If the Viaduct had been cut off halfway – say, if it never went north of the Seneca exit – well, it’d probably have been torn down by now and replaced with a tourist trolley. Conversely, if the Embarcadero had been completed as designed, San Francisco would have almost certainly embarked on its own “Big Dig.”

The West Side Highway in New York… are you kidding me? New York was broke in the 70′s. The highway collapsed because there wasn’t enough money to do even preventive maintenance. And certainly not enough to rebuild. In fact, they didn’t even tear it down for another 15 years – it just sat up there, closed to traffic. Yet even this gets spun as some sort of “cities transcending the freeway” narrative.

The Freeway Revolts Are Over

Assuming our economy doesn’t implode into one big Teapartian circlejerk, we’ll continue to build newer and better highways that obsolesce old ones. And when that happens, those old ones will make great spots for redevelopment. If I was Houston, I’d seriously be looking at I-10 between Crockett and Jensen – which has, by far, the worst geometry of any of the downtown freeways – and moving it about a half a mile north, opening up more of the north side of the Bayou to development.

What’s not going to happen anymore are the truncated spurs, the freeways rendered obsolete by revolts. It’s not because the concerns over freeways – legitimate and NIMBY alike – have gone away. It’s just that engineers have become sensitive to them.

The master freeway plans of the 40′s and 50′s were models of rationality and efficiency. But they didn’t really account for anything besides rationality and efficiency. Houston largely followed theirs and it’s one of the reasons the place is so easily navigable today. But the original plans also sliced right through parks, forests, wetlands, whitepeople neighborhoods. And thus the revolts.

It’s arguable that we’ve lost something. Newer highway alignments are no longer quite the paragons of scientific virtue they were in the drafting easel era. In a smaller, newer city like Tulsa, you can see the difference between 50′s and 60′s alignment studies versus modern ones.

I look at the alignment for SH 130 south of Austin and I has a sad. So many squiggles. “YO DAWG, WE HEARD YOU LIKE CORNERS SO WE PUT A 3-DEGREE REVERSE CURVE IN HERE SO YOU CAN AVOID ANY TAKINGS FROM DA MOBILE HOME PARK.” This doesn’t necessarily result in better highways. What it does result in is highways that will be built.

And this is where the post-freeway era ends. There’s a very limited supply of highways that are “overbuilt” as a result of their connections never materializing. New construction isn’t going to provide us with any more because they’ll detour and slosh around anything that might have put up a fight 40 years ago. As time goes on, the pace of freeway removal will *slow*, not increase.

Clickbait article writers, take note.

This post originally appeared in Keep Houston Houston on December 7, 2011.

Tuesday, October 4th, 2011

Race Matters in Milwaukee – Part 4: Segregation and Education by Nathaniel Holton

It has been suggested that education is the civil rights issue of our time, and there is no question that the black community continues to lag behind when it comes to all matters of education. This is especially so here in Milwaukee, where MPS reading scores lag behind those of other major urban school districts, state black reading scores are the worst in the nation, and the percent of blacks with a college education is lower here than it is in most other places. These are crisis-level facts.

This has not completely escaped the community’s notice. Everybody understands the importance of improving Milwaukee Public Schools. And while massive disagreement concerning proposed changes ultimately resulted in the prevailing of the status quo, rather than some sort of meaningful compromise or reform, at least the community showed that it was energized and willing to fight for local education.

But one thing that seems to continue to escape notice, maybe since the time that Chapter 220 was created, is the impact that segregation has on education.

Segregation and 4th Grade Reading Scores

The landmark study on segregation by the U.S Census Bureau ranked several dozen metro areas in terms of how segregated each is. Meanwhile, the Trial Urban District Assessment ranked 18 participating urban school districts in various standardized test scores. In total, 14 metro areas, including Milwaukee, were included in both studies. Each of these urban school districts contends with the issues of poverty and parenting that are frequently cited as the primary reasons for MPS’ struggles.

The graph below shows the level of segregation and the 2009 black 4^th grade reading scores of the 14 districts that were included in both studies.

The link between segregation and black 4^th grade reading scores is “significant“ at the 99% level, and segregation “explains” 45% of the variance in the reading scores. Note also that the link between segregation and overall reading scores (for all races) is significant at the 95% level and explains 37% of the variance in the reading scores. Milwaukee black 4th grade median reading score was second worst, ahead of only Detroit.

Segregation and Bachelor’s Degrees

The yearly American Community Survey keeps track of how many people ages 25 and older have acquired a bachelor’s degree. The graph below shows metro area segregation and the percent of the black population within the metro area that has a bachelor’s degree, averaged from 2006 to 2008. The correlation is significant at the 99% level and explains 32% of the variance in the percent of the black population that has a bachelor’s degree.

In this time, 12.3% of the black population in metro Milwaukee had a bachelor’s degree, the worst out of all of the metro areas included in the segregation study.

The graph below shows metro area segregation and the white/black bachelor’s degree disparity, defined as the ratio of percent of white people with a degree divided by percent of black people with a degree. Once again, correlation is significant at the 99% level and this time explains 30% of the variance in the white/black disparity.

Metro Milwaukee’s white/black degree disparity of 2.79 (34.3%/12.3%) was the worst out of all the metro areas in the segregation study.

What Does It Mean?

It is pretty clear that segregation and poor education outcomes correlate with one another. This does not prove that segregation causes poor education outcomes, or even that poor education outcomes cause segregation. But, as is the case with other socioeconomic indicators, segregation can be tied to the problems of Milwaukee that we all experience and are concerned with. It will be hard to move Milwaukee forward in jobs and education without impacting our segregation. With all of the talk about jobs and education during this election season, this is something that ought to be kept in mind.

This post originally appeared in The Milwaukee Drum on September 29, 2010.

Tuesday, September 27th, 2011

Race Matters in Milwaukee – Part 3: The Effects of Milwaukee’s Segregation by Nathaniel Holton

Racial segregation is one branch in a thicket of economic and quality of life issues that together form the challenges of the day for Milwaukee. As Part 2 of the series suggested and as various researchers have shown, segregation is both cause and effect of such challenges as income disparity, wealth accumulation, brain drain, unemployment, education disparities, health disparities, and so on.

Oftentimes it seems that civic leaders don’t talk of the problems of racial segregation, and instead focus on non race-centered issues that relate to it, such as jobs and education. These are more tangible and politically sensible, but the fact of the matter is that Milwaukee’s thicket of issues is a package deal, and ignoring racial segregation imperils efforts to attack the issues that relate to it. Jobs aren’t gained or lost in a vacuum, and our childrens’ education can’t be separated from the structure of the communities that our children reside in. For Milwaukee to truly move on its issues, the battle against segregation has to be waged alongside the battle for jobs and education.

To make this point clear, information on segregation and income described in earlier articles in the series can be viewed together to see how they are connected. The metric used for segregation in the graphs below is the average metro black/white segregation ranking, which was taken from the U.S Census Bureau’s study on segregation (see Part I). In this metric, recall that metro Milwaukee was ranked as #1, the most segregated metro area in the country.

In the graphs below, each blue dot represents a different metro area and the trend line shows the overall correlation between segregation and the other statistic. Also, each graph can be clicked on to see a larger view.

Black Income



Segregation can most easily be connected to black family income. As previously discussed, low average incomes in the black community bring about segregation. Meanwhile, segregation decreases black income in part because it limits access to employment.

The connection between segregation and black income is significant. If a city were to improve by ten spots in the segregation rankings (e.g. going from 1st to 11th), that would correlate to a rise in black median family income of over $3,800 per year.

This is not surprising. In the famous Gautreaux housing mobility experiment, statistically identical groups of low income families were either assigned to live in low-income housing in segregated areas or were given vouchers to live in mostly white suburbs. Those families that moved to the suburbs saw higher employment, higher income, and better results in education compared to the families that remained in segregated environments.

Income Disparity

Segregation decreases the black community’s piece of the pie. Seven of the top ten metro areas that had the worst income disparity were also in the top ten for most segregated metro areas. One of the three exceptions, Kansas City, is just outside of the top ten, at 11th most segregated. If you want the black community to stay poor relative to whites, keep the black community highly segregated.

Gross Domestic Product

While decreasing segregation correlates with higher black income, what needs to be emphasized is the fact that decreasing segregation benefits the entire metro area. Gross domestic product (GDP) is a measure of economic activity for a metro area. Since metro areas with larger populations will naturally have more economic activity than metro areas with smaller populations, GDP per capita* can be used to make apples-to-apples comparisons between metro areas. When politicians talk about growing the economy, they are talking about increasing Milwaukee’s GDP per capita.

Less segregated places tend to have stronger economies than more segregated places. For the average metro area, a ten spot improvement in the segregation rankings correlates with a GDP per capita increase of over $1,600 per year. Suburban communities suspicious of any talk of decreasing segregation should be apprised of this.

* The number used here is the average metro GDP per capita between 2001 and 2008, in chained 2001 dollars.

White Income

Those who have put in hard work trying to uplift the black community often run into resistance from suburbs that consider community uplifting proposals to be a direct attack on their own quality of life and well-being. However, it has to be stressed that decreasing segregation benefits everyone, this doesn’t have to be a zero sum game. Good strategies that reduce segregation would directly benefit white households as well as black households. A ten spot improvement in the segregation rankings translates to an increase in white median household income of over $1,300 per year.

Racial Animus

Advancing mutually beneficial policies that would decrease segregation requires the entire community to understand that they have something to gain from this effort. Unfortunately, in a catch-22, metro Milwaukee’s segregation separates people and makes it difficult for us to see our shared fate.

Ever since the Milwaukee Journal-Sentinel opened up comments on its online articles, there have been many examples of the sorts of outrageously ignorant, racially-tinged comments that could only be made by individuals who have no understanding or experience with people who don’t look like them. Here are a few unedited examples:

I suggest building an enormous wall with borders of 43 to the east, 94 to the south, 84th st to the west and brown deer to the north and then pull all city services out of that area and let the inhabitants figure it out for themselves. I’m so sick of hearing how bad they have it and about the terrible crime it is such BS. Stop making excuses for your inability to pull yourselves up by your bootstraps like every other immigrant that came to america over our 235 year history. Even the mexicans have made something of themselves, they might be just as violent but at least they aren’t lazy and many of them can’t get welfare so they bust their asses trying to make a better life for their families.

-poundsb27, 2/27/2010, City’s mean streets hard on young blacks

This is a character issue and all about common decency; a civil society must follow the rules that are in place. It just so happens that the people in this society that have the most problem with common decency are black. Its just a fact, society has to deal with this every day.”

-OneTug, 3/1/2010, MPS, Ald Will Wade butt heads over hat removal policy

Get all these stupid liberals together in one spot, load them on a bus, and ship them all out of town. When the hell are blacks gonna stop ruining the city and get their crap together?

-SkylarTatlock, 3/1/2010, MPS, Ald Will Wade butt heads over hat removal policy

We can only work together on our problems when we can look at our fellow citizens and see a reflection of ourselves. Decreasing segregation would help increase this sort of shared understanding, but increasing the shared understanding is required to collectively agree to do something about segregation. It’s a chicken and egg problem.

Job Growth

With good reason, Milwaukee’s most preeminent civic leaders are falling over each other talking about jobs. Whether by advocating for the magic of tax cuts or by celebrating the bribery of businesses, jobs are the main issue. But in case we start losing sight of the forest for the trees, or the rhetoric and ribbon cutting for the reality, we need to note that metro Milwaukee lost over 30,000 civilian jobs from December 2007 to December 2009. Jobs are obviously critical. Creating them and obtaining the socioeconomic benefit that comes with higher employment will be fleeting at best if Milwaukee’s segregation is not addressed.

Milwaukee’s job loss since the beginning of the recession (December 2007) represents a 3.85% decrease in the number of civilian jobs in the metro area. Most communities have been hit hard by the Great Recession, but as always seems to be the case, Milwaukee has been hit harder than most others. No local politician can control local job growth. The global economy can and does overwhelm even the best laid local plans at a moment’s notice. Local leaders can only be responsible for ensuring that Milwaukee fares better through the ups and downs of the global economy than other metro areas. Instead of making promises that only an uncontrollable global economy can make good on, our local leaders should be working on ensuring that metro Milwaukee outperforms our competitors.

In this effort, our local leaders have failed. Metro Milwaukee had the 6th worst civilian job loss amongst the 36 cities that were measured on segregation. Using a different metric and comparing metro Milwaukee to the 38 areas that have a workforce of at least 750,000, Milwaukee had the 3rd worst job loss in 2009.

The reasons for this are surely complex, but what has to be understood is that Milwaukee’s segregation puts it at a competitive disadvantage in today’s global market. Until it is adequately addressed, we will continue to see metro Milwaukee underperform relative to other cities.

This post originally appeared in The Milwaukee Drum on March 8, 2010.

Tuesday, September 20th, 2011

Race Matters in Milwaukee – Part 2: The Causes of Milwaukee’s Segregation by Nathaniel Holton

[ This week we continue with our Race Matters in Milwaukee series by Nathaniel Holton. Please keep in mind when viewing that they do not have a zero origin - Aaron. ]

Racial segregation is a phenomenon with complex historical roots. The legacy of slavery, discriminatory housing policies, redlining, employment discrimination, tax inequity, racist covenants, and a wide variety of other practices swirled together to create a segregated Milwaukee. For an exhaustive documentation of Milwaukee’s history of segregation, I highly recommend “A Report on Past Discrimination Against African-Americans in Milwaukee, 1835-1999,” by Ruth Zubrensky (available in most Milwaukee Public Libraries). We won’t know where to go until we understand how we got here, and Zubrensky does a wonderful job of tracing that path.

While Milwaukee’s history is unique, social forces and government policies created and fortified residential segregation throughout the country. So why is it worse in Milwaukee than most anywhere else?

Income Disparity and Housing Disparity

On average, housing in the area’s suburbs is considerably more expensive than housing within the City of Milwaukee. In looking at the ten biggest municipalities in metro Milwaukee, the recent median selling price of housing in the City of Milwaukee was well below every other municipality.

That suburban housing is more expensive than city housing isn’t unique. What distinguishes metro Milwaukee from other areas is the incredible racial disparity in median household incomes in metro Milwaukee, which prevents many minorities from being able to afford suburban housing. According to the most recent American Community Survey, metro Milwaukee has the 2nd worst black/white household income ratio amongst the country’s 50 largest metro areas. The median white household earns $79,145 while the median black household earns $33,273. This amounts to black households earning 42 cents on the white dollar.

Riverside, CA had the best ratio at 85 cents on the dollar, twice as good as Milwaukee. The bottom of the chart was dominated by Midwest cities, who tend to have relatively similar socioeconomic issues. However, even amongst this less competitive group, Milwaukee is still underperforming.

The income disparity reveals Milwaukee’s unique racial issues. One explanation for it is the education disparity. Just in the city alone, blacks are about twice as likely as whites to not have a high school diploma, and are almost three times less likely to have a college degree.

Worse yet, metro Milwaukee has the largest disparity between black and white unemployment in the country! This disparity can be partly explained by the spatial mismatch between black residents and jobs (which, in a circularity, is largely a result of racial segregation). Literally all of the net job growth in metro Milwaukee over the last several decades has taken place outside the City of Milwaukee. Meanwhile, black residents are concentrated in the city’s northside and are far less likely to own a car. This is especially important because public transportation in metro Milwaukee is sorely lacking. It’s hard to have a job when you can’t get to it.

(from Milwaukee Urban Atlas)

Yet another reason for the racial income disparity is brain drain. Many of black Milwaukee’s brightest young minds leave the city to pursue an education and never come back, resulting in the cream being continuously skimmed off the crop. Oftentimes, they wind up in the south, where racial income disparities are less extreme and where educated blacks can feel at home in many cities. Many educated blacks look at Milwaukee as a city in decline, a city with awful race relations, and a city where educated blacks have few peers and fewer opportunities for career advancement (I know folks in this boat, and I was formerly in this camp as well). In yet another circularity, segregation is bred by income disparity which is bred by black brain drain which is bred by a negative racial climate which is bred by segregation.

Just this cursory look hints at the complexity of Milwaukee’s racial income disparity. Each of the mentioned elements, along with others unmentioned, cause and affect each other and perpetuate segregation. But even this web of income disparity-linked socioeconomic issues cannot fully explain the extreme degree of Milwaukee’s segregation. Higher incomes for minorities do not protect against segregation, as segregation nationally among blacks with incomes over $60,000 is almost as large as the overall racial segregation that persists.

Personal Preference

Much of the area’s segregation is the result of personal preference. The Public Policy Forum conducted a local survey on housing preferences in 2004. Significant majorities of whites, blacks, and Latinos agreed that “most people” take racial characteristics of the community into account when deciding where to live. When speaking for themselves, the survey revealed that the racial or ethnic makeup of a neighborhood was of great importance to 32% of blacks, 25% of Latinos, and 12% of whites.

A majority of whites who gave an answer said that, in their ideal neighborhood, nearby black families would be less than half of the population, only a few in number, or nonexistent. A majority of blacks who gave an answer said the same thing about nearby white families.

A separate 2006 survey found that a majority of whites and 60% of blacks believe it is common sense for whites to avoid non-white neighborhoods. On the flip side, over 40% of both blacks and whites believed it was common sense for blacks to avoid white neighborhoods.

Just as with the income disparity, personal preference is a cause and an effect of segregation. It shouldn’t be a surprise that people who grow up surrounded by people who all look like them end up preferring to live amongst people who look like them.

Milwaukee Residency Requirement

Both the City of Milwaukee and MPS require their employees to reside in the City of Milwaukee. While metro Milwaukee is only about 16% black, the city and MPS workforce are each around one-quarter black. The residency requirement disproportionately impacts black residents.

More to the point, black city and MPS employees represent a sizable share of black residents with enough income to afford to live outside of the city. According to the American Community Survey, there are approximately 16,000 black households with an income over $50,000 in metro Milwaukee, a range that will capture most public employee households. According to the above sources, the City of Milwaukee and MPS collectively employ somewhere around 3,500 black residents. If one assumes that some of these employees are married to each other, such that 3,500 employees make up 3,200 households, this means that 20% of metro Milwaukee’s mobile black households are forced by their employer to live in the City of Milwaukee.

These are “back of the envelope” calculations, but it wouldn’t be a surprise to find that Milwaukee’s residency requirement is a contributing factor to segregation in metro Milwaukee.

Racial Discrimination

Of course, direct discrimination still has a negative impact on segregation. Exclusionary zoning, predatory lending, and discrimination in homeowners insurance are all causes of Milwaukee’s segregation.

Employment discrimination persists. People with “white-sounding” names on their resume are 50% more likely to get a call back from an employer than those with “black-sounding” names on an otherwise identical resume. A study done in Milwaukee showed that white felons were more likely to get a call back from a potential employer than black applicants who have clean records. Those that blame black people exclusively for Milwaukee’s income disparity should mind these examples of overt and explainable-only-by-racism discrimination that persist in our society. That said, focusing too much on discrimination makes it acceptable to avoid personal responsibility in the black community. Things won’t improve until personal responsibility is broadly embraced.

Conclusion

The above list of segregation causes is not meant to be exhaustive or authoritative, but it’s enough to provide a framework for further discussion. Feel free to add in other causes and elements of Milwaukee’s segregation in the comments section.

This article originally appeared in The Milwaukee Drum on February 1, 2010.

Tuesday, September 13th, 2011

Race Matters In Milwaukee – Part 1B: How Segregated Is Milwaukee? (con’t) by Nathaniel Holton

[ You can read Part 1A of this series here. ]

It turns out that Milwaukee is not the most segregated metro area after all.

Racial Map of Milwaukee

***

Racial Map of Detroit

(Both graphics by Eric Fisher)

***

The landmark report on segregation by the U.S Census Bureau published five measure of segregation. As previously discussed, this report ranked metro areas with a sufficiently large black population on how racially segregated they were. Then, the U.S Census Bureau averaged these rankings, and used that average to conclude that Milwaukee was the most segregated metro area in the country.

After all of the sophisticated statistical analysis that went into the production of the five segregation measures, it is surprising that the U.S Census Bureau would produce an overall segregation rank by averaging the segregation measure ranks, and not the measures themselves. As the following example shows, this distorts things.

Imagine three people whose wealth is measured in three different ways. You want to rank them in overall wealth by averaging their wealth from each measurement. In parenthesis below is the rank of how wealthy each person is compared to the other two people.

If you’re just averaging the money in each measurement, Aaron is the wealthiest person and would rank number one. But if you average the rankings, Brett’s average ranking (the average of 1, 1, and 2) is better than Aaron’s average ranking (the average of 1, 2, and 2).

Detroit is like Aaron. It has the worst segregation measures, but not the worst average ranking. Milwaukee is like Brett. We do not have the worst segregation measures, but we do have the worst average ranking.

When the segregation measures are standardized and averaged, Detroit comes out as the most segregated metro area in the country. Milwaukee comes out at number two. Here are the top five segregated metro areas using this way to measure:

The U.S Census Bureau may have had a good reason for going with their method. And, none of this changes the fact that Milwaukee is highly segregated, and that this remains a central challenge to our future. There’s little excitement in knowing that Milwaukee is “second only to Detroit” in yet another measure of socioeconomic health. At the same time, the stigma of being the most segregated place in the country is a damaging one. As it turns out, it’s not necessarily legitimate.

Sometime next year, the 2010 Census should be completed and we will be able to see how Milwaukee stacks up in segregation and many other areas. In the meantime, it is still important to look at the impact that segregation has on our health and our future.

This article originally appeared in The Milwaukee Drum.

Wednesday, September 7th, 2011

Race Matters In Milwaukee – Part 1A: How Segregated Is Milwaukee? by Nathaniel Holton

[ Over the next few weeks I'm going to be presenting an important series called "Race Matters in Milwaukee." Written by Nathaniel Holton, this series originally appeared in The Milwaukee Drum. Here is the first installment, which examines the question of how segregated Milwaukee actually is - Aaron. ]

9/27/2010 update: When properly standardizing and averaging the U.S Census Bureau’s five published segregation measures, Milwaukee goes from being the most segregated metro area to the second most segregated metro area, behind Detroit. Read more.

Milwaukee is a wonderfully diverse city full of unique cultures and a broad array of worldviews and life experiences. But like many cities, these cultures and worldviews are too often walled off from one another due to the effects of segregation. Such segregation, and the racial climate that is part and parcel to it, create challenges and inertia that reach every significant issue that the city ever faces. Issues of citizen empowerment, education, economic development, poverty, public service levels, and countless others are all intimately impacted by the state of Milwaukee’s racial climate. The poor racial climate makes collective action difficult and sometimes impossible, burdens business attraction, fosters brain drain, and reduces quality of life in the entire region. If it doesn’t improve, the city’s potential will forever be constrained. While there’s commendable activity taking place at the individual and grassroots level to improve racial climate, civic leadership in this fundamentally important area tends to be absent.

Residential segregation is a worthwhile starting point when examining Milwaukee racial climate and what can be done to improve it. The following is the first in a multi-part series that will take a look at the prevalence and impact of segregation in the Milwaukee area. The meaning of segregation, its causes and effects, how it can be addressed, and how it impacts racial climate are all issues that will be examined in this series.

It’s commonly accepted that Milwaukee is very segregated, but how segregated is it really? First, most information on this involves not the City of Milwaukee itself, but rather the Milwaukee Metropolitan Statistical Area (“metro Milwaukee”), a region that includes the entire counties of Milwaukee, Waukesha, Ozaukee, and Washington. Second, there are lots of ways to measure segregation, and it’s not easy to tell which measures are better than others. Third, the mainstream measures of segregation can only handle two races at a time. The publicized segregation claims tend to involve only white and black populations, excluding Latinos, Asian-Americans, and Native Americans entirely.

So when it is said that “Milwaukee is the X most segregated city in the country,” what is really meant is that “the area comprised of Milwaukee, Waukesha, Ozaukee, and Washington counties is the X most segregated area in the country when it comes to black and white residential patterns based on some measurement of uncertain quality.”

Maybe the most respected measures of segregation are drawn out in a study done by the U.S Census Bureau. This study focused on five measures of segregation: dissimilarity, isolation, delta, absolute centralization, and spatial proximity (for descriptions of these measures, see U.S Census study, pages 8-10).

The study analyzed data from the 2000 census, compared metro areas that had a large enough minority population to analyze, and then ranked these metro areas in terms of segregation, with a ranking of 1 being the most segregated. The following table displays metro Milwaukee’s segregation rankings in terms of black/white segregation and Hispanic/white segregation. It also shows metro Detroit’s black/white segregation rankings for context. Metro Milwaukee did not have a large enough Asian-American or Native-American population for analysis, so there aren’t rankings for those populations.

There is a user-friendly website that focuses on the dissimilarity index. This website ranks metro Milwaukee 3rd, behind Detroit and Gary, IN in the black/white category.

In response to the U.S Census rankings, researchers from UWM created their own ranking system based on the number of blocks in an area that had populations that were both at least 20% black and 20% white. They created their rankings “not as a competitive model for ranking cities and metro areas, but to expose the biases and limitations of the segregation indexes” (which they describe in their report). Metro Milwaukee ranks 43rd in this ranking system, substantially better than its rank in any of the Census’ measures.

The publication of the UWM report created an impassioned debate, with various individuals and groups coming out in support of or in opposition to UWM’s rankings. Marc Levine, a highly respected UWM social scientist, slammed the UWM report as “a blend of shoddy research and specious analysis” in an op-ed that systematically critiqued the report. John Gurda, Milwaukee’s foremost historian, wrote that the UWM report confirmed his firmly held impression that Milwaukee was “somewhere in the middle of the pack” when it comes to integration.

When the UWM report questioned the severity of metro Milwaukee’s segregation, some politicians and business leaders took this as an opportunity to gloss over the area’s racial issues for the purposes of improving the city’s image, an image that consistently makes business and talent attraction difficult. Some black leaders expressed outrage at the UWM report and responded by citing racial disparities and using those disparities to reaffirm the victimization of the black community in Milwaukee. If the UWM report placed segregation into question, the response to the report left no question that the city’s racial climate is poor.

This spring, the 2010 census process will begin. The result will be an updated view of Milwaukee’s demographic and socioeconomic standing. This sharing of new information and insight will provide Milwaukee the perfect opportunity to reassess its level of segregation, what it means for us, and what can be done about it.

Confronting metro segregation is critical, as Milwaukee’s economy spans across municipal and county borders. Action here involves heavy cooperation between the City of Milwaukee, its suburbs, surrounding counties, and the State of Wisconsin. Historically, such cooperation has been difficult to sustain (to say the least).

Almost as importantly, Milwaukee must examine the level of segregation that exists in the city itself. Such segregation works to frustrate cooperation and unity of purpose amongst the city’s population. As a result, the city often is not able to put up a united front when seeking action and cooperation with surrounding suburbs and the state. Before the City of Milwaukee can secure this cooperation, it first needs to get its own house in order.

This post originally appeared in The Milwaukee Drum on January 24, 2010.

Sunday, June 5th, 2011

Replay: Metropolitan Linkages

[ The New York Times ran an article recently discussing the trend of big city law firms hiring non-partner track attorneys in smaller cities to handle routine work at lower cost. It reminded me of this post where I floated a similar idea back in 2009. I hope you enjoy - Aaron. ]

In my kickoff of the year of celebrating the 100th anniversary of the Burnham Plan in Chicago, I argued that while Chicago was performing well in a globalized world, it was only riding the wave of globalization and wasn’t defining its own uniquely successful future, one where it first and most fully grasped the implications of our new world. I also promised ideas on where to look to do that, starting with re-embracing its own unique culture and identity, resisting homogenization.

Today I start a four part mini-series looking at another opportunity area. It’s been widely noted that globalization has worked to separate global cities from their traditional city-regions. Indeed, Chicago and others have almost deliberately turned their back on their past in this manner to focus exclusively on the global conversation. With most global cities doing that, the question immediately comes to mind: is there overlooked opportunity in the hinterland? I argue that there might be, and I’ll look at two specific items: metropolitan linkages and on shore outsourcing. Each of these will have a main article with a follow-on more fully discussing a particular aspect. Today, we talk about metropolitan linkages.

There have been many calls for greater cross-regional (or “mega-regional” or “pan-Midwest”) cooperation. The idea is that similar challenges beset the Midwest as a whole and they are best solved collectively. There’s a certain surface appeal to this, but I’ve been reluctant to accept it before. The basis of my argument is in my previous posting “Mega-Skepticism“. My problem is fundamentally that people don’t explain what it is we are actually supposed to do to implement cross-regional collaboration, and there are few tangible benefits offered for it. Consider: we’re told to build a Midwest high speed rail network. Ok, but so what? I built it. What does it do for me? What does this allow Minneapolis and Chicago to do today, for example, that hourly shuttle flights on multiple airlines don’t? What’s going to be different once it’s built? This is the great unanswered question. We must be able to articulate the value levers we want to pull (for example, scale economics, specialization, or purchasing power) and why and how places will take advantage of them.

Having the Midwest try to work as a whole is a “boil the ocean” type solution. I’m not convinced rural areas, small towns, small manufacturing cities, and larger cities intuitively have enough common ground to try to create fully common solutions. Even among just the Midwest’s large cities, there is incredible diversity. Again, how much in common do Chicago, Detroit, and Columbus have? And to do so so would require enormous trust and consensus building.

So what I’m going to suggest today is that we narrow our focus to specific city pairs, and see if we can articulate a basis for cross-regional cooperation. For my example, I’m going to use Chicago-Milwaukee and Chicago-Indianapolis. Why? Several reasons:

• They are all cities that have the minimum scale to have economies that can operate effectively in the globalized world. Indeed, Chicago is a successful global city, Indianapolis is by many measures the most successful city in the Midwest, and Milwaukee is hanging in there. This isn’t a “dinosaurs mating” type situation where a bunch of failing cities try to band together. Rather, it is looking at reasonably successful places. Can they enhance their success even further through cooperation?

• Chicago is the logical place to start because it was historically the dominant city of the Midwest. To envision a highly successful cross-regional collaboration that does not somehow involve Chicago is hard to do. Also, because Chicago is such a unique place in the Midwest, smaller cities like Indy and Milwaukee don’t have to feel bad about playing second fiddle in some respects. Those places know they aren’t Chicago. Whereas trying to get the “3C’s” in Ohio to agree on things would be much tougher. I use the term “hinterland” in the title deliberately, despite its pejorative connotations. That’s because I think there may be opportunities to re-create a true urban hierarchy in some ways.

• These cities are highly complementary, especially Chicago and Indy. That is, each is strong where the other is weak. This means they are not natural competitors and there is reason to believe that specialization and the division of labor – one of the key advantages of scale – can work. By contrast, Indianapolis and Columbus are nearly identical cities. Specialization is harder for them to do, so there would have to be another basis for cooperation to have benefits.

• Their common culture eases the path of cooperation. America 2050 has an interesting framework for relationships that create mega-regional linkages. Their relationships include environmental systems and topography, infrastructure systems, economic linkages, settlement patterns and land use, and shared culture and history. It is easy to see how these apply here.

• They are geographically close, which would seem to simply matters. I include both Indy and Milwaukee because in fact Milwaukee is so close that it is possibly experiencing the “sixth borough effect” we’ve see in NYC and Philly, where Chicago’s massive growth is just taking Milwaukee into its orbit. Indy provides a control study for that to make sure we are dealing truly cross-regionally

Considering these cities, we now have to ask ourselves the question: how do they cooperate? The globalized economy seems to have two sorts of operations: one tends towards “flattening”, where routinized operations like manufacturing or answering phone calls can be done anywhere in the world. The other is towards “spikeyness” and valuing the face-to-face interactions of highly creative people in the cores of places like Chicago. Is there an model somewhere between them that we can imagine?

Richard Florida just issued a call in this month’s Atlantic Monthly to build “rail connectivity within the mega-regions. There are the fast trains along the Boston/New York/Washington corridor that have allowed Washington, in effect, to become a commuter suburb of greater New York. But how about a place like Detroit? If Detroit were better connected to Chicago, one could imagine Detroit having a better reason for existing. Or Pittsburgh. If Pittsburgh were better connected to Chicago or even to Washington, D.C.—it’s only a four-hour drive—that could spur growth.” I won’t use his example cities, but will assume in our example that we’ve got high speed rail between Chicago and Milwaukee and Chicago and Indy that provides a terminal to terminal journey time of 90 minutes. In the case of Milwaukee, this is actually already true – future rail upgrades will only shave that time down even further.

What could we imagine the benefits of this being? I see two: a labor force play and a division of labor play.

The labor force argument goes something like this. You’ve got these highly creative jobs in Chicago. But not everybody is a trader at the Merc making megabucks. There’s a lot of joe average type white collar jobs too. Many of these pay solidly, but the quality of life you can purchase for the money in Chicago might not be the greatest. Chicago may not have high taxes and housing prices compared to the coasts, but its does compared to the Midwest. Some people crave urban excitement, shopping at Neimans, the opera, etc., but a huge number just go home to the suburbs. I’ve long argued that if you don’t take advantage of the things that only Chicago gives you, and are just trying to live an average suburban lifestyle, that’s crazy. Why pay the premium to live in a Chicago suburb in terms of housing, taxes, and above all congestion when you aren’t getting much more than you’d get elsewhere? Obviously lots of people are asking themselves that question, because Chicago’s metro area had net domestic outmigration to the tune of 57,000 people last year – a pace of almost 600,000 per decade. Of those, a net 7,000 moved to Indianapolis in just the last few years. Now I don’t know the makeup of this. Some of it may be second order Latino immigration or something. But I’ve got to believe some of it is Chicago’s precious talent bleeding away because they cost/benefit isn’t worth it to them.

Now consider what a 90 minute train ride does to the equation. If you are a suburb dweller who loves that lifestyle, you can now move to someplace like Carmel, Indiana outside Indianapolis. You cut your living costs dramatically and increase your quality of life. Plus, you can realistically commute to Chicago, at least 2-3 days a week. That’s a PITA in a car @ three unproductive hours, but when you can work on the train for 90 minutes with wi-fi, it’s a different story, even with collection/distribution tacked on at each end. Combine this with modern flexible work arrangements and you’ve got the makings of an extended labor pool. It could be a win-win-win. Chicago gets the access to talent it would otherwise lose. The worker is happy with access to both great job opportunities and higher quality of life. And Indy get the imported income and improved connectivity to the global economy via Chicago. I already know several people who routinely make the trip up and down I-65 in car or fly every single week. It is easy to imagine this exploding with 90 minute train service with wi-fi and electric power outlets. This both makes the time productive and makes it feasible to do daily commuting, skipping the hotels, nights away from home and other assorted costs.

A similar effect could happen with Milwaukee. Indeed, I already see people commuting down from Milwaukee. But I imagine a separate demographic. To me, Milwaukee is a bit of a “mini-me” Chicago. So what you get are people who want the more urban lakefront experience, but can’t afford or don’t want to pay for Chicago. You are already seeing this happen a bit I think. Same dynamics apply.

The other direction, think about what it does for Indy and Milwaukee in terms of ability to attract their labor force. Both cities have dramatically upgraded their offerings from the day when you couldn’t get a good meal or a decent cup of coffee. Both of them now have a nearly full spectrum of urban amenities. But what they are missing is that creme-de-la-creme. They don’t have elite international opera or true high end shopping. But by putting Chicago within easier daytrip reach via train (imaging sipping champagne on the trip back from your Oak St. spree), Chicago’s amenities become more accessible to people in those other cities. This helps them in recruiting people as well. Oh, and those Chicago workers can now work “domestically” if there is an option. Increasing the labor supply even further. And, people who come to work locally might be more willing to do so knowing that commuting to Chicago (again, only part time using flexible working arrangements as is becoming more common) means they aren’t captive to the “only game in town” for employment prospects in a smaller market like Indy or Milwaukee.

I don’t know if this will really work out or not, but it seems surface plausible – if you had the rail connections at true high speed service levels and the right amenities and price point. This might not involve huge numbers, but it might not take a huge number to move the needle if it is the right kind of people with the right skill sets.

The second point involves re-establishing the regional division of labor. As Chicago becomes more specialized, and its urban core more successful, that will push costs up in that city, making creative but lesser value-added functions less competitive. Is there an opportunity to offload some of that to an Indy or Milwaukee where the highest functions are done in Chicago but lower value added – but still high knowledge worker content, creative type work – is done in those other cities?

Again, as I said in my original posting, I can’t promise The Answer, only an exploration of the problem space. I want to use one sample industry to consider this: law. One, it is harder to offshore legal work I think. Even my own employer won’t let routine work be passed on by someone who isn’t domestic. Two, I was intrigued by something I noticed something the other week when I saw Tristan und Isolde at the Lyric Opera. I opened up the program guide and what did I see but a full page ad for Barnes and Thornburg. This is one of the largest law firms in Indianapolis, yet they have a full page ad in Chicago. I’m told they have a rather large office in Chicago too. What is the reason for this? It could just be expanding where the action is. On the other hand, is there a basis for cooperation between law firms where a large international Chicago firm is the lead firm handling the orchestration and most complex portions of the work there while sending some work to lower cost firms in Indy and Milwaukee, using those firms’ Chicago points of presence and the capability for easy face-to-face meetings to make it happen?

I don’t know a lot about the law business, but I do know that they are under enormous price pressure and even many very successful firms are doing layoffs. I expect a major transition where old school type relationships don’t necessarily translate into premium pricing opportunities anymore when there is lower cost competition for what is effectively commodity work in many cases. I’ve seen this in other industries and it seems reasonable that is could happen in law. Could this ability to tap a “near shore” pool of lower cost lawyers give Chicago firms an advantage? It might be the only elite city in the country where you can get access to a far lower cost point just by going beyond the immediate metro area.

I’ll admit, I’m speculating here, but it is the general concept that is important. It goes something like this. The most specialized components are in Chicago where it justifies the cost of being in the Loop. Specialized but less value added work that nevertheless requires close coordination, time-zone commonality, and potentially significant face to face meetings are in Milwaukee or Indy. I don’t know for sure what, if anything might be out there that fits this. Maybe law, maybe something else, or maybe nothing. But those to me seems the characteristics of the types of work that would lead to cross-regional collaboration.

If you are able to make these two cross-regional items work with Chicago, Indy, and Milwaukee, then you can look to see if they scale up or extend across distances.

So the question is, how do you go about making these sorts of relationships happen? Good question again. I don’t have the answers. But perhaps this is where the “holding conferences” aspect of mega-regionalism comes in. That is, you get business, academic, community, and political leaders talking to each other, establishing trust, and seeing what collaborations might form. This also brings up another good point as to how to implement it. Chicago has long been the magnet for young, ambitious people from the greater Midwest. Look at all the Big Ten sports bars in Chicago for an example of that. So can you mobilze those expatriate or diaspora communities to form the “glue of the relationship”? I noted before the concept of the “urban alumni association“. Something like this could be leveraged to help forge those business and cultural relationships. In fact, there is already an organization called the Indiana Society of Chicago. I believe this is mostly a networking club. Could organizations like this, plus Big Ten alumni associations, be used as a catalyst to make things happen?

I think this is an area that warrants further research and discussion. The general idea is to figure out how to give Chicago’s companies competitive advantage through an expanded labor pool and potentially lower cost operations that don’t involve the messy coordination of a far flung network. At the same time, it provides mutually beneficial returns to smaller cities in the region.

Reconnecting the Hinterland – Additional Previous Entries:
1B – High Speed Rail
2A – Onshore Outsourcing
2B – On Innovation

This post originally appeared on February 11, 2009.

Tuesday, May 24th, 2011

The New Provincials by Jason Tinkey

America has never been a very curious nation. Sure, we’ve produced great inventors and entrepreneurs, but you could probably count the great “American philosophers” on one hand (at least one of whom, de Tocqueville, wasn’t even American). Americans are not prone to world travel, evidenced by the fact that only 37% of us own a passport. A lack of curiosity is not the sole blame, obviously it costs us far more to travel abroad than it does for Europeans, with flights so cheap they make Southwest look like a legacy carrier. But in the wake of the 9/11 security changes, lack of a passport means 2/3 of Americans aren’t even flying to Canada, Mexico or the Caribbean, destinations which are often cheaper than, say, Florida.

I have long posited that we are victims of our own geography. The vastness and relative emptiness of the North American continent gave the young nation room to grow and flourish, while leaving it free from foreign influence. Immigrants were generally eager to assimilate, as the threat of repeated bodily harm at the hands of nativists would entice you to try and blend in. Europe consisted mainly of poor, oppressive backwaters in those days, so most didn’t see much point in holding onto the old ways in a land that gave them an opportunity to reinvent their identities.

Last month, I attended the Global Metro Summit here in Chicago. One of the panelists, Barcelona Deputy Mayor Jordi William Carnes, made the observation that “America is important to the rest of world, but spends too much time looking inward”. I would agree, but even within the United States, infighting and provincialism rule the day. As Richard Longworth has written extensively, the states compete against one another for finite resources, whether in the form of federal transportation dollars, or in wooing corporations to set up shop. This is a losing battle, since state borders are completely arbitrary lines which have no real effect on the life of metro areas, other than to unnecessarily complicate things. Eight of the twenty-five largest metros in the US span state lines that were established two centuries ago. In effect, we govern ourselves under a system that was designed for the 1820s.

This provincial attitude reared its tiny head again this past week, when Wisconsin Governor Scott K. Walker (that “K” is crucial to avoid denigrating the proper Scott Walker) slammed Illinois for it’s tax hike and invited businesses to relocate to his state. As James Warren wrote, this shows a lack of a broader vision on Walker’s part. He’s playing for votes within his own little fiefdom, seemingly oblivious to the fact that if Chicago’s economy were to fail, Wisconsin’s would go down right beside it. As much as I love our neighbors to the north, Milwaukee does not have the transportation infrastructure necessary to link it to a global marketplace. This is the same guy, mind you, who basically ran for office on his opposition to high-speed rail, which would be one of the best possible assets in building a regional economy.

So allow me to state for the record my philosophy of how the future is aligned: neighborhood – city – region – planet. Note that “county”, “state” and “nation” do not exist. These are eighteenth-century constructs that serve little useful purpose in a connected, digital global economy. The hard question is asking what it will take to achieve this in these “United” States. No politician has ever voted themselves out of a job, and yet a thorough realignment of local and federal governance is necessary. Industrialized Europe had to be more or less leveled in World War II for the stakeholders to recognize the value of cross-border cooperation and a free exchange of people and ideas. I certainly hope we don’t need such a serious jolt.

Wisconsin and Illinois, despite their football-based loathing, have too many issues which demand cooperation. And you can add Michigan, Ohio, Minnesota, Pennsylvania, New York and Ontario to that mix, as well. In coming decades, stewardship of the Great Lakes will become crucial to the region and to the world. Transportation linkages already radiate from Chicago like an octopus, in a common region with common concerns, these absolutely must be brought up to speed with the rest of the developed world. There is really no other option.

This post originally appeared in The Planner’s Dream Gone Wrong on January 17, 2011. Reprinted with permission of the author.

Tuesday, April 26th, 2011

Amtrak Should Innovate with Hiawatha Service Pricing by Jeramey Jannene

[ I'm delighted to provide a sample of what you'll find over at Milwaukee's premier urbanist site: Urban Milwaukee. It is of course very Milwaukee-centric, but this piece has a lot of interesting ideas with potentially broader applicability - Aaron. ]

If you want to ride Amtrak’s Hiwatha Service line between Milwaukee and Chicago, the cost is $22 per ticket. If you buy your ticket in advance, the cost is $22 per ticket. If you ride on the weekend, the cost is $22 per ticket. If you want to ride in the middle of the day, you guessed it, $22 per ticket. With Interstate 94 under construction between the state line and Milwaukee for the next few years, new equipment on the way from Talgo, a new Milwaukee Intermodal Station train shed coming, and a route extension to Madison under construction, it’s time for Amtrak, iDot, and WisDOT to explore new pricing models for the state-sponsored rail service to encourage more riders and raise more revenue.

Amtrak, to their credit, does offer discounts for children (ages 2-15) who ride for $11 each with the purchase of an adult ticket (up to two discounted tickets per adult ticket). They also frequent rider discounts, in the form of a ten-ride ticket for $165 (that expires in 60 days) and an unlimited route ridership pass for a calendar month for $358. Those options leave a lot to be desired though.

Before I propose my list of pricing suggestions, it’s worth noting that the 2010 Amtrak Fiscal Year (October 1st, 2009 – September 30th, 2010) resulted in record ridership and record ticket revenue for the Hiawatha Service (and Amtrak as a whole). The Milwaukee to Chicago route had 783,060 trips and generated $14,092,802 in ticket revenue, for an average of $18.00 per ride. More valuable than the average revenue per ride would be to know both how many riders paid full price (and at what time of the day and day of the week), but unfortunately Amtrak doesn’t release that data. For the sake of this article, we’ll use my informal observations from riding and the data we have available to assume that a very high percentage of unique, adult riders pay full fare.

The pricing suggestions I propose are aimed at increasing ridership and marginal revenue simultaneously, while not requiring any service changes. They might have the added positive externalities of reducing congestion, reducing pollution from automobiles, improving the reputation of Amtrak, and encouraging travel and business between Milwaukee and Chicago, but if any of those things happen it’s merely a bonus.

Pricing Suggestions

Megabus Model - Megabus is famous for their $1 tickets, despite the fact that rarely anyone actually gets to buy one. The service is sold on a yield management pricing model, where the first one or two tickets are $1 with prices increasing incrementally from there. Amtrak could offer the Megabus pricing model not on all trips, but on the lowest ridership ones. This is likely to be especially valuable given that Megabus has drastically scaled back service out of Milwaukee.

Badger Bus Model – Badger Bus, the bus company that currently offers inter-city bus service between Madison and Milwaukee, has a pricing model for frequent riders that allows the company to collect interest off future ticket purchases. Amtrak currently offers a 10-ride ticket for $165, but it expires within 60 days. Using the Badger Bus model, Amtrak would allow customers to give the customers a large sum of money up-front in exchange for a discount whenever those funds are used to buy a ticket. In the case of Badger Bus, a $125 deposit gets you $175 in purchasing power (29% discount). The benefit maxes out at a $325 deposit ($485 purchasing power, 33% discount). If Amtrak were to offer something similar, they could be collecting interest on my money just like Badger Bus is (the last time I put $125 with Badger Bus it took me two years to use it all). An added revenue bonus is available with the model in the form of permanently unused funds, similar to gift cards that go unused. Amtrak would need to analyze exactly what deposit amount to collect, and how big of a discount to give.

Hessenticket Model – Germany has an innovative weekend pricing model available with their national rail system. The state of Hesse (home to Frankfurt) offers a weekend pass for 29 euros, where you and up to four others can ride the system’s non-high-speed all day on either Saturday or Sunday, anywhere you wish to go, getting on and off as you please. Their is a national pass with similar rules available for 33 euros as well. Implementing the idea between Milwaukee and Chicago might not work quite as well, but with future service extending to Madison it might make more sense. It seems reasonable to assume Amtrak could offer up a four-rider, $50 weekend day-pass with the requirement that the riders sit together (to prevent abuse).

Off-Hours Pricing – The current system prices every single-ride ticket equally, regardless of the time of day or day of the week. It’s worth exploring the idea of pricing lower ridership trips at a cheaper fare.

Wisconsin Vouchers – Scott Walker has managed to make an Amtrak service extension as political as possible (see: NoTrain.com). The victor on November 2nd would be wise to explore sending a non-transferable voucher to every taxpayer when the new Talgo equipment is put into service, giving them one free one-way ticket on the Hiawatha. It would be great for Illinois to do the same (tourism dollars on top of increased revenue). It’s hard to find someone who has ridden the service, but dislikes the quality of the ride. It is, however, easy to find someone who thinks the service is a “boondoggle” and has never ridden. The vouchers would serve as a new-customer acquisition strategy, generating a lot of new customers who would effectively be getting a half-off first trip. The long-term value of those new customers could be enormous. As an added bonus, angry Journal Sentinel commenters no longer can argue they get nothing in return for the state sponsorship of the rail line.

Corporate Pass – What if businesses got a discount when they purchased tickets? Could the company car be replaced (or the least supported) by the company rail pass? A program where the more tickets a business buys annually results in a greater and greater discount could increase revenue.

Advance Purchase Discount – Hotels often offer a price discount for booking your room early, Amtrak should do the same. Even if it’s only a 5% discount, or the ticket has to be bought at least 6 months in advance, Hiawatha ridership might increase (and Amtrak might collect interest) if customers book their tickets early.

Buy-One, Get-One – As one boards the Hiawatha they notice that the greatest unused inventory isn’t two empty seats together, but the empty seat next to a rider. To make better use of the marginal inventory, Amtrak should offer some form of buy-one, get-one free (or half off) for riders that sit together.

What are your ideas for Hiawatha Service pricing?

This post originally appeared in Urban Milwaukee on October 25, 2010. Reprinted with Permission.

Tuesday, July 27th, 2010

Mike Doyle: Meet Me In St. Louis, Not Milwaukee

Recently, two other fine Midwestern cities, St. Louis, MO, and Milwaukee, WI, launched tourism campaigns aimed at attracting Chicago visitors. Raging urbanist that I am, I love spending time in nearby metropoli, and have a particular fondness for our sister city to the north. It’s the Windy City’s smaller, quieter, less-flashy Lake Michigan alternative–and that’s why Milwaukee’s current tourism campaign has me wondering whether the city’s overselling itself in a potentially damaging way.

This summer, the Brew City’s ads are posted on Chicago ‘L’ trains and buses with powerful headlines claiming things like, “If I had a week, I’d spend it in Milwaukee.” Follow up those ads with a browse of the VisitMilwaukee website and you get more hubris-induced marketing messages claiming the city sits “At the Intersection of Water and Fun“–not to mention celebration, success, and value, too.

Considering that most Chicagoans have likely been to Milwaukee before–and, not for nothing, live in Chicago, already–you have to wonder why Milwaukee’s tourism board would think the ads would be effective here. I mean, I enjoy Bayview restaurants, the Art Museum, and the Domes as much as the next Windy Citizen. Send me to State Fair or Summerfest for a weekend and I’m all set.

But a week? Really? I have never met a Chicagoan willing to spend a week of valuable vacation time in Milwaukee and I probably never will. When we have that much time to get away, we tend to head for O’Hare and Midway airports to really get away–usually from the Midwest entirely, much less from just the Lake Michigan shoreline.

And call me a stuck-up Chicagoan, but those “At the Intersection of Water and…” tourism messages sure sound a lot like Chicago, to me. (Well, except maybe “value.”) Reading them on the VisitMilwaukee website, I couldn’t help thinking how generic and misplaced they were.

VisitMilwaukee sure doesn’t sound like it knows who Milwaukee is, what its values are, or where it wants to be. You can’t tell potential visitors–especially potential visitors from a world city like Chicago–that your town’s worth a week of their time, and then support your grandiose claim with a series of generic marketing messages that could have just as easily been written about any other Great Lakes city. If there’s anything unique or special communicated about Milwaukee in these tourism ads, I don’t see it. And as a result, even as someone who likes the place, they don’t particularly make we want to visit it.

***

I am dying to visit St. Louis, however. Unlike Milwaukee, I’ve never been there, but I’ve been curious about the city since moving to Chicago in 2003. I always say I want to visit, I just never seem to get around to it. Imagine my surprise to discover that hiding behind the KidnappedChicagoan ads festooning CTA transit vehicles (and at least at the moment, positively peppering the Adams/Wabash ‘L’ station) was a cleverly covert tourism campaign for St. Louis.

You don’t know that when you see the ads. They don’t tell you anything except that an average Chicagoan has been stolen away to an interesting place–that it’s not far away, he’s not angry at being kidnapped there, and you’d want to be him if only you could figure out where he’s been taken. Holy Interactive Interest Raiser, Batman!

Every time I saw these ads I thought, “Dammit, I keep meaning to go to that website!” When I finally did, I was greeted by a curiously familiar map with clickable push pins, and an invitation to click through to try and figure out my kidnapped compatriot’s current location. Mousing over each push-pin opened a photo and capsule summary about an interesting tourist destination–a museum, or historic site. Or an arch, for that matter.

I chuckled when I saw the message that sat below the map:

“Okay, so you’ve figured out which city—St. Louis. Der. But admit it. You were a little surprised by all the stuff there is to do in the Gateway City.”

You know what? I was. And without the help of an overblown, generically empty ad campaign, either. Unlike Milwaukee’s currently hard-to-believe tourism claims, the soft-shoed Explore St. Louis approach sends potential visitors on an Internet adventure to learn the city’s glories for themselves. Did I mention the Foursquare badges for checking in at locations he’s visited? (Earlier this week I sang the praises of Chicago’s own Foursquare-based tourism campaign.)

By mischievously whetting their whistle for adventure and then letting them learn about the city from their own task-oriented click-throughs, Explore St. Louis’s Kidnapped Chicagoan campaign gets potential visitors to arrive at the conclusion that the city is an interesting place on their own. (While I’m at it, feel free to check out the ongoing CityToRiver campaign to rebuild the urban fabric of the St. Louis waterfront.)

And in my book, letting the wonders of your city speak for themselves beats unstrategically overselling it any day.

Mike Doyle is a communications strategist and scribe of the CHICAGO CARLESS blog. A native of New York, he fell in love with Chicago and moved there for life in 2003. But he still has no plans to learn to drive a car.

This post originally appeared in CHICAGO CARLESS. Reprinted with permission of the author.

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