Congestion solution, TX Megabus, annexation history, top rankings
Some smaller misc items to share this week:
Finally! Luxury inter-city bus company MegaBus is coming to the Texas Triangle, with service from Houston to Dallas, Austin, San Antonio, Galveston, and New Orleans. They pick up right at Polk and Travis downtown. I do think they're making one mistake, though. On the Dallas route, they need a pickup-dropoff point on the far north side (maybe The Woodlands mall or Greenspoint mall?), and on the Austin and San Antonio routes, they need one on the far west side (maybe Katy Mills mall or City Centre?). People living on that side of town don't want to come all the way downtown to just turn around and go the opposite direction, whether picking up or dropping off.
On the NYT list of 32 innovations that will change your tomorrow, Houston's biggest need is definitely #6, widespread adaptive cruise control. Simulations indicate that once 25% of cars have it, congestion could be reduced 20-40%!! That is an incredible improvement, and imagine what it might be once most cars have it?
Heck, there may even be a national cost-benefit case for the feds requiring it just like they do for the CAFE standards (in terms of time and gas saved). It's possible to imagine that Houston may have far less traffic congestion by the beginning of the next decade even without much in the way of substantial capacity improvements, which, sadly, may very well be the case with TXDoT's budget straight-jacket.
Instead of government, the big drivers of growth now appear to be three basic sectors: energy, technology and, most welcome all, manufacturing. Energy-rich Texas cities dominate our list — the state has added some 200,000 generally high-paying oil and gas jobs over the past decade — but Texas is also leading in industrial job growth, technology and services. In first place in our ranking of the 65 largest metropolitan areas is Austin, which has logged strong growth in manufacturing, technology-related employment and business services. Houston places second, Fort Worth fourth, and Dallas-Plano-Irving sixth. Another energy capital, Oklahoma City, ranks 10th, while resurgent New Orleans-Metairie places 13th among the largest metro areas.
Finally, embedded below is a pretty cool history of Houston annexation video. I laughed out loud so hard at the 1836 map note "the freeway network is for reference purposes only - it did not exist at the time." Revised Houston history: "the Allen Brothers discovered the confluence of 3 bayous and a mysterious network of roads created by an ancient civilization (or aliens?), and decided it seemed like a good place to found a city... even though they recognized the long-term inadequacy of the 290 corridor..."
I'm back from my California trip - beautiful state, beautiful weather, completely dysfunctional government. For example, even with massive fiscal problems it's still trying to build a vastly expensive high-speed rail line from San Francisco to San Diego. On a related note, a private group is exploring building a Houston-Dallas HSR line with no subsidies of any kind. I'm totally okay with private efforts. I'm probably even okay with a little eminent domain to get the right of way at a fair price. I hope they can make it work.
Here's a great alternate perspective on HSR: a TED talk on the value of perception and psychology vs. economics and technology. Go to the 6:12 point to see a great example of the Eurostar train, where they spend a vast amount of money to reduce travel times by 40 mins, when for 90% or 99% less money they could have improved the experience instead and actually gotten higher rider satisfaction. I believe the absolute same principle applies to bus vs. rail, whether intra- or inter-city: spend 1% or 10% of the same money improving the bus service and get higher customer satisfaction than the rail line would generate. (hat tip to Karl)
And Greyhound is doing just that, learning from Megabus and upgrading their service with wifi, power plugs, and nicer seats with more leg room. With that kind of service option available at say $30 one-way within the Texas Triangle, how many people do you think would pay $150+ to go on HSR? On second thought, maybe nobody should mention this possibility to the Texas HSR group... ;-)
Metro's rail budget boomerang, third coast's rise, F500, architecture, and more
Some misc items this week. I'm in CA next week, and may or may not get in a post before leaving. If not, see ya after Memorial Day.
"Metro is shrinking, could get worse". I don't want to be obnoxious about it, but it's time for a giant "I told you so". What, a transit agency over-promised and under-delivered on budget projections for rail, and is now up against a wall and demanding more money? That's a first (insert eye roll here).
The Mayor, county, and small cities negotiating with Metro board on giving them back part of the general mobility funds, which is kind of funny when you think about it, because the Mayor *controls* the Metro board (she can re-appoint a majority of members at any time), so she's sort of negotiating with herself. The standard politician response would be to hold on to the money for the rest of her administration, but agree to turn it over to Metro after that, leaving a giant hole in the budget of her successor. But I think she cares about Houston's long-term future more than that - let's hope that's not the legacy she leaves.
McKinsey has a report on U.S. cities with a lot of interesting data. If you download the main report pdf and search on Houston you can find our data points pretty easily. We show strong population growth (esp. given our large size), but relatively weak GDP growth per capita. I see two reasons for that. First, they measure from 1978, near the peak of the previous oil boom before the crash. Second, over the last few decades, most cities have ramped up land use regulation and constricted housing supply, increasing prices (often dramatically) and driving less affluent populations away (or at least not attracting them). That naturally increases GDP/capita, although not in a healthy way if you ask me. Houston (and most of Texas) has not gone that way, thus we have stayed affordable and are attractive to migrants as a city of opportunity. People definitely move up the economic ladder here, but new migrants move in right behind them, limiting overall GDP/capita growth. We've got the right model - ignore the deceptive statistic.
"Yet it’s Houston’s star that is shining brightest. Over the past decade, when the country actually slightly lost jobs, the Houston-Sugarland-Baytown region expanded its employment by over 15%. Since 1990, the number of jobs has risen by 46%, more than twice the national average. Over a period of ten years, the region’s population has soared 26%, the most of any of the country’s largest metro areas, and again better than twice the national norm. Migrants are coming not only from other countries, but from much of the rest of the U.S., particularly the industrial Midwest, Northeast, and California.
Optimism among businesspeople on the Third Coast is infectious, as can be seen in the expanding footprint of the Texas Medical Center, the world’s largest such facility. Much of the money for this amazing complex comes from a similar boom in oil and gas."
"To the uninitiated, Houston looks like a jumbled tangle of buildings placed haphazardly atop the coastal plain — which, of course, is a fair assessment for a city with little zoning. But this sprawling, boundless urban scene is, at the same time, what makes the Bayou City so unique with its patchwork of architectural gems and oddities."
United recently released their own web site and "study" (pdf) arguing against allowing Southwest to compete internationally at Hobby. Overall, I'd say it's one of the most impressive acts of FUD (Fear, Uncertainty, Doubt) inducing, hand-waving, smokescreen obfuscations I've seen in my lifetime. I'm sure Southwest will successfully refute it point-by-point for City Council on Tuesday (UPDATE: here it is, with excellent counter-arguments, even better is the presentation here), but there are some key arguments I'd like to dismantle here. Italics are direct quotes from the United report.
But first, here is the absolute core rebuttal: every argument United marshals against international service at Hobby could also apply to domestic service at Hobby, yet do any of us really believe Houston would be better off if we didn't have vigorous competition from Southwest at Hobby? When seen through this lense, all of United's arguments crumble.
Metropolitan areas with multiple airports providing international service have seen virtually no growth in international capacity over the past five years, as compared to more than 6% growth for unified international gateways overall and nearly 8% for IAH.
Clever implementation of the old "lies, damned lies, and statistics" cliche. Cities with multiple international airports are the very largest in the nation (NYC, LA, Chicago, DC, SF, Miami, etc.), and, as a whole, they are not substantially growing - thus their service is not particularly growing. High growth air service happens at high-growth hub cities, which tend to be smaller with a single airport. The highest-growth single airport they point out is Charlotte, where US Air has been increasing their intl hub service - a high growth city about the size of Austin. They are mixing up the cause and effect. In reality, the fact that Houston is now large enough to support multiple international airports is a sign we're joining the big boys.
In another case, the HAS Hobby Study purports to show that the incumbent network carrier, American Airlines (American), expanded service at its Miami International Airport (MIA) as the result of LCC entry by JetBlue at Fort Lauderdale (FLL), when, in fact, MIA grew as a result of American dismantling its nearby San Juan hub (which itself resulted from JetBlue’s entry).
When AA announced that it was cutting the San Juan hub in July 2008, they cut it from 55 to 35 departures a day, while announcing Miami would pick up the lost Caribbean service with an increase of 7 departures a day to 258. A year later they were operating 276 flights/day out of Miami, and as of Feb 2011 it was 317 departures/day, with service more than doubling since 2006, while JetBlue and Spirit ramped up discount international competition at Ft. Lauderdale the entire time, lowering fares and driving up demand. Does the scale of that growth sound like it merely happened because they cut 20 daily departures from San Juan? No, I don't think so.
United has argued a competing international airport would siphon off connecting passengers and force it to move planes out of Houston
In response to one analyst's question about Southwest's bid, Smisek said United depends on connecting traffic at Houston's Bush Intercontinental Airport, the airline's largest hub, to fill planes. (source)
United can't legitimately link "siphoning off connecting passengers" with Hobby going international. Connecting passengers have choice of many connecting flights/hubs to get to their final destination. SWA could "siphon them off" with intl flights from just about any airport in the south, including San Antonio, Austin, New Orleans, Atlanta, Orlando, Tampa, or Ft. Lauderdale. By UA's definition, every competing airline that serves a destination is "siphoning off" connecting passengers they could be routing thru IAH - that's called competition.
What they are actually concerned about is "siphoning off" local passengers, not connecting traffic. Those are the people who want to fly nonstop from Houston and have no choices other than UA. UA charges them a stiff premium for that benefit. They make minimal profit off of connecting passengers (because of all the competition), but lots of profit off of local passengers (as they have a monopoly on nonstop service). That profit would of course be reduced if SWA competed with them nonstop on the same routes.
What they are pretending will happen is that the fares and number of passengers on any given route are static, and that by splitting them with SWA, they will have to cancel IAH flights (because there aren't as many passengers to fill their planes - SWA is "siphoning them off"). What happens in reality is the famous "Southwest effect": SWA reduces fares, UA matches, and demand increases because the price dropped (simple supply-demand curve economics). SWA does not have to actually have lower costs than UA to reduce fares (although they do), they simply have to be willing to give up some of the fat monopoly profit margins UA currently enjoys on those routes. Even if their costs are exactly the same as UA, fares will come down and demand will be stimulated. This terrifies UA, of course, because not only do they lose the fat monopoly profit margins, but they have to offer more flights to meet the demand surge, pulling planes from elsewhere (either that or just cede market share to SWA). Of course, Houston wins all the way around: lower fares and more service.
I know it's sort of a subtle argument, but next time you hear "siphons off connecting passengers", you can correct them with a simple "Couldn't Southwest siphon off connecting passengers just as easily by offering international service from their other major airports?"
And here's a Bloomberg story confirming those fat profit margins United makes off Houstonians:
Southwest’s plan would create Houston competition for some flights to Latin America, the region where United posts its highest yields, or average fare per mile, according to data compiled by Bloomberg. Latin America produced a bigger gain in first-quarter yields than routes in the U.S. or across the Atlantic and Pacific, United said.
In a sad sign of their precipitous decline since the merger, aviation writer Joe Brancatelli recently declared United to be the worst airline ever, again! (an exaggeration, but still a sad indicator) They gave up on us and shifted the headquarters to Chicago (a big cause of the disastrous effects of the merger, from what I've heard). Why again do we owe them a protected monopoly on international service?
It's important to keep up the pressure on City Council, which you can do by signing the Free Hobby petition here, or, better yet, attending the City Council meeting or at least weighing in at one of the public meetings, which I fully expect to be stacked with United employees and lobbyists.
Here's a core problem with rail that really undermines the economics. When you build a road between two cities, it serves both people and cargo between those two cities, as well as all points in between and the entire road network beyond (i.e. going north on 45 from Houston can take you to any city on the way to Dallas, to Dallas, or beyond Dallas). When you build a multi-billion dollar airport, it can serve flights to just about every other airport in the world. Both of those lead to very high utilization and lots of passengers to spread the costs over. Now think about rail between two cities like Houston-Austin or Houston-Dallas. If you put many stops along the way, it really slows the net speed, so it doesn't really serve points in between (esp. since they're low population). And if your final destination is beyond that city, you're probably going to either drive or fly - so you don't get the network effects/benefits. So, at the end of the day, those very expensive tracks (and trains) only really serve people going specifically between those two cities, which vastly limits the number of passengers to spread the costs over. The only scenarios where trains really work economically is when there are a linear string of population centers relatively close to each other so the tracks can serve multiple origin-destination pairs, like the DC-Baltimore-Philly-NJ-NYC-CT-RI-Boston corridor, or the country of Japan.
CA has vastly more people than TX in a nice linear city configuration, but is struggling to figure out how to justify cost estimates that have soared north of $100 billion. I agree there is a productivity boost for riders, but 1) would it be for enough people? and 2) will they pay for it? Would you pay $100 each way to visit Austin? Especially if you could pay $30 on a luxury bus with wifi and get the same productivity boost? Or if you could just drive and improved voice recognition in your phone could keep you productive? (it's coming fast) And the environmental benefits are only good if the trains are reasonably full. That usually means reduced frequency, which further inhibits ridership. Buses get the same or better environmental benefits and can perfectly tailor capacity to demand while keeping up frequency (because of the smaller capacity increments than trains).
There's also technology risk: what happens to rail ridership when we have very high MPG, self-driving Google-cars in a decade? I'm not sure when the self-driving will be really reliable on local streets, but I have no doubt they'll get it pretty solidly reliable on long-distance suburban/rural interstates.
Another thought experiment. Two options to connect two cities. Option 1 goes 200mph and requires billions of dollars of infrastructure between here and there, including cutting through landowners and making absolutely sure no vehicles or cattle/large animals can ever get in the way - or, for that matter, that any terrorist can sabotage the route (catastrophe), a challenge similar to securing our border. Option 2 goes 500mph and requires no new infrastructure (it already exists), nothing at ground level to cut through landowners or provide a safety risk. Security is only needed at the endpoints. Framing it that way, the answer seems obvious.
I'm not saying rail doesn't have a definite cool factor (and it does work well in certain parts of the world). I'm just saying the alternatives, costs, network limitations, and technology trends leave it with too small of a niche market to make economic sense in most of the U.S., including Texas.
Three different items to share this week with a common theme of getting realistic about mobility improvements. The first excerpt is from a Wall Street Journal op-ed on "California Declares War on Suburbia":
The love affair urban planners have for a future ruled by mass transit will be obscenely expensive and would not reduce traffic congestion. In San Diego, for example, an expanded bus and rail transit system is planned to receive more than half of the $48.4 billion in total highway and transit spending through 2050. Yet transit would increase its share of travel to a measly 4% from its current tiny 2%, according to data in the San Diego Association of Governments regional transportation plan. This slight increase in mass transit ridership would be swamped by higher traffic volumes.
Higher population densities in the future means greater traffic congestion, because additional households in the future will continue to use their cars for most trips. In the San Diego metropolitan area, where the average one-way work trip travel time is 28 minutes, only 14% of work and higher education locations could be reached within 30 minutes by transit in 2050. But 70% or more of such locations will continue to be accessible in 30 minutes by car.
(sidebar: more on California in yesterday's WSJ interview with Joel Kotkin "The Great California Exodus", #1 most read, emailed, and commented WSJ story this weekend)
I've said it before and I'll say it again: any urban area that did most of it's growth in the post-WW2 automotive era is simply not going to be transit friendly, and that cannot be substantially changed. Yes, you can create a few New Urbanist neighborhoods around a light rail line, but they will always be trivial in the overall context of the metro area.
That said, there's a lot that can be done to make simple bus transit much more attractive in these urban areas (and it's already dramatically more affordable than rail), as this Salon article "It's time to love the bus" describes:
But one thing is certain: When it comes to improving mass transit, there’s a lot of low-hanging fruit on the humble city bus. The vital connective tissue of multi-modal transit systems, the bus could be an efficient — nay, elegant — solution to cities’ mobility woes if only we made it so.
And yet we rarely do. Streetcars are replacing bus routes in cities across the country, and billions are thrown at light rail while the overlooked bus is left to scream “Marsha, Marsha, Marsha!” “If you decide that buses don’t merit investment, you’re going to miss a lot of opportunities to help people get where they’re going, and to expand their sense of freedom of movement, just because you don’t like the vehicle they’re riding,” says transit consultant Jarrett Walker.
The article goes on to list a litany of potential improvements, including better bus design, BRT, sidewalk bulbing, frequency, real-time information, mobile phone alerts, better maps, better bus stops, bike racks, wi-fi, electrical outlets, and more. Unfortunately, most transit agencies are totally focused on overpriced rail projects and ignore easy, affordable improvements to the bus system.
Finally, completing our theme of realistic mobility improvements, here's a clever intersection design for busy arterials when grade separation is either too expensive or not an option. In fact, this one is a simulation of our own Highway 6 - Westheimer intersection, before and after a potential conversion to turn-right-to-go-left (RTL). Average delay/vehicle is 46.5 sec less with RTL. If you're interested in learning about more types of clever and unconventional intersection design, check out the video here from the HGAC YouTube channel. Let's hope Houston adopts more of these in the future.
Update: apologies for the bad formatting - a side effect of bad html cut-and-pastes. No easy way to fix it in Blogger without losing all of my links.
Free Hobby!, mobility's economic boost, Jane Jacobs for car-based cities, top rankings
This kind of Chicago corruption coming to Houston is so depressing I don't really feel like posting this week (evidently United has contributed to all of the City Council members re-election campaigns), but I will press on. Please don't forget to sign the petition and share it with all of your social media channels. The City Council really must feel the pressure from the voters or they will just fall in line with what United tells them to do.
On to some of the ever-growing stack of smaller items.
The Urbanophile reposted two of my favorite old posts on rethinking Jane Jacobs' tenets for car-based cities and density, vibrancy, and opportunity zones. They must be provocative because they set off a firestorm in the comments - woo-eee did they. Poked a hornet's nest there. People clearly don't like their sacred cows getting tipped. Aaron may be re-thinking re-posting me... ;-)
Finally, a strong item from Bob Poole's Surface Transportation Innovations newsletter at Reason on why Houston needs to keep making mobility investments, especially in freeways and congestion pricing. The benefits are strong. A truly devastating argument against the "it'll just fill up again anyway" crowd:
Congestion’s Impact on Urban Economies
Several years ago in this newsletter I reported on the work of economists Remy Prud'homme and Chang-Woon Lee. Using data on travel times and labor productivity from cities in France and South Korea, they found a robust relationship. The effective size of an urban region's labor market is bounded by how long it takes to make a typical journey to work. When shorter travel times increase the size of the labor market by 10%, the productivity of the metro area increased by1.3%. In the United States, Robert Cervero of UC Berkeley found that a 10% increase in commuting speed in the San Francisco Bay Area increased economic output by 1%. And more recent studies by David Hartgen and Gregory Fields, using data for eight U.S. metro areas, found similar effects—specifically, that the ability to go 10% farther in a commuting time of 25 minutes would lead to a 1% increase in regional economic productivity.
I recently came across another study addressing basically the same question, using a different methodological approach. The paper is "Does Traffic Congestion Reduce Employment Growth?" by Kent Hymel, then at UC Irvine and now at Cal State University Northridge. It appeared in the March 2009 issue of the Journal of Urban Economics. Hymel employs an econometric approach drawn from the city growth literature, which focuses on the economics of agglomeration. He sets out to assess whether there is empirical evidence for the hypothesis that congestion reduces employment growth in a metro area. This turns out to be more complicated than it sounds because, as he notes in the introduction to the paper, the two variables interact: employment growth leads to more workers, who generate congestion, and congestion then "discourages [further] employment growth by raising workers' reservation wages and increasing shipping costs for goods." So he comes up with a number of clever methodological approaches to deal with this problem. Since I am not an econometrician, I will not attempt to summarize them for you, but will skip to his conclusions.
The last table in the paper provides results for the 10 most-congested metro areas in 1990 (based on data from the Texas Transportation Institute's Urban Mobility Reports. For each of them, he provides an elasticity of congestion with respect to freeway capacity and an elasticity of employment growth with respect to congestion. This allows him to compare actual employment growth from 1990 to 2003 with two counter-factuals—a 10% increase in freeway capacity and a set of congestion tolls that would reduce congestion by 50%. For Los Angeles—then as now the most congested metro area—estimated employment growth would have been 8% greater if there had been a 10% increase in freeway capacity. Even more impressive, if congestion pricing reduced congestion by 50%, employment growth would have been 23% greater.
I get frustrated when elected officials tout infrastructure projects because of "jobs, jobs, jobs"—by which they generally mean short-term construction jobs (which could also be generated by building pyramids or by digging holes and filling them in again). By contrast, productive infrastructure investments are those which make an economy more productive, generating an increased gross regional product. Hymel's findings join those discussed above in bolstering the case for investing wisely to reduce commuting time in urban regions.
I find the Customs and Border Protection argument disingenuous, given the pressures already in the customs hall and the growth projections that are already part of the IAH Master Plan and the fleet growth plan of United, insofar as I can guess what it is from the Boeing order book.
It’s the customers who have the most to gain from a Hobby expansion gateway. And as a customer, I’ll bet on Southwest working in my interest before I’ll bet on the “new” United.
But here's the smoking gun that just devastates United's argument: Ft. Lauderdale (in the Miami metro) has vastly expanded discount international flying with airlines like Spirit and JetBlue, among others, yet over the last six years American has doubled the number of departures from its Latin America hub at Miami (source).
Definitely a lesson for Houston here. United’s threats to cut service are a smokescreen. Profits may drop, but service will only increase and fares will drop for the citizens of Houston.
"United says it will hurt its traffic, and that could result in the city losing service. It also says that this will take away customs and immigration resources from Intercontinental, making for a worse experience for travelers there. Oh please.
These are always the arguments used to fight competition. American used even more ridiculous ones in the Love Field fight, so this shouldn’t be surprising. And it isn’t.
Really, if you’re United, wouldn’t you fight this? I mean, you certainly don’t want more competition, so you should put some effort into trying to keep it out. But in this case, it should be a losing battle. Hobby should get a customs facility, and I imagine that’s what we’re going to see happen."
Moving on to some smaller misc items:
While we're on the topic of airports, here's an infographic on the waste and ineffectiveness at the TSA. Just sort of turns your stomach to read through it. We definitely need to decentralize security back to the airports (albeit with some sort of federal standards). Hat tip to Tony.
"In the full list of the richest and poorest metropolitan economies, only Houston finished in the top 20 among both the richest and the fastest-growing metros. That's a remarkable accomplishment for the Texas energy hub"
If you're interested in the ongoing expansion plans for the 290 corridor (including the Hempstead toll road), check out this comprehensive video by HGAC. Some good visualizations make it easier to understand all the improvements. They also discuss the financial crunch that TXDoT is facing with the gas tax not being adjusted for inflation. They only have funds to fix bottlenecks at 610 and Beltway 8, but they need a lot more to implement the plan throughout the entire corridor, which is one of the most congested in the city and the state. Now it looks like the plan might be shifting somewhat (Chronicle story), with toll lanes in the center of 290 instead of the Hempstead corridor. This is probably not a bad intermediate term plan, as long as those lanes could be converted to free lanes down the road when the Hempstead tollway becomes more viable.
Finally, if you'd like to hear my thoughts on the present and future of education, I was recently interviewed by Larry Payne on the HCC TV show "Dialogue Houston". He interviewed me because of an education technology startup I'm working on, but because that's still somewhat in "stealth mode", he attributes me to the blog, although education is not a common topic here. If you'd like to learn more, email me - tgattis (at) pdq.net.
The video can't be embedded (as far as I can figure out), so to watch it, go here, click on episode 189, and then zoom ahead about 31 minutes in. The segment is about 12 minutes.
One last note: apologies for the unpredictable blog posting schedule the last few weeks - crazy schedule, hoping to be back to a regular night soon (probably Sunday or Monday evenings).
It's time for the Winter 1Q12 quarterly highlights post. These posts have been chosen with a particular focus on significant ideas I'd like to see kept alive for discussion and action, and they're mainly targeted at new readers who want to get caught up with a quick overview of the Houston Strategies landscape. I also like to track what I think of as "reference posts" that sum up a particular topic or argument; and, last but not least, they've also been invaluable for me to track down some of my best thinking for meetings or when requested by others (as is the ever-helpful Google search). They're not quite as useful as they were when I was still doing multiple posts each week, but still have some value (at least for me).
Don't forget we offer an email option for the roughly once/week posts - see the Google Groups subscription signup box in the right sidebar. An RSS feed link is also available in the right sidebar. As always, thanks for your readership.
And don't forget the highlights from the first few years. For what it's worth, I think the best ideas are found there, often in the first year (I had a lot "stored up" before I started blogging) and most definitely in the 5th birthday retrospective.
In a stunning development, the City of Houston announced today that it will begin the process of closing Hobby airport, while shifting control of Intercontinental to United, which will further enable the closing of the city's aviation department yielding substantial savings to taxpayers. The new plan emerged from discussions with United regarding Southwest's request to allow competing international service at Hobby. United pointed out that competition from Southwest would reduce the obscenely profitable fares they charge Houston residents on most international nonstops from Houston, meaning they might have to reduce some service. The City, easily convinced by this argument, asked if they might get more international service if they removed international competition at IAH from carriers like British Airways, KLM, Air France, and Emirates. United assured them they would. The City, intrigued by this possibility, asked if the same would be true for domestic service. United assured them that it also would, although the competition from Southwest at Hobby would limit the potential for additional domestic service. To maximize the potential, Hobby would need to be closed too.
So a plan was developed to close Hobby and turn over complete, exclusive control of IAH to United. Giving United a monopoly franchise on all air service to Houston will allow United to substantially increase the size of their hub here. As an added benefit to the citizens of Houston, the "very modest" fare increases that United expects will reduce the crowding on flights, allowing even half-empty flights to be profitable for the airline. Residents that can afford the $700 fares will enjoy their roomy, comfortable flights to Dallas.
Spokespersons for both the City and United called the landmark agreement a "win?-WIN!!!" for both sides.
Hope you enjoyed this year's April Fools post (after I skipped a few years). Here are previous years if you missed 'em and would like a chuckle:
Getting serious, Kuff's wife has a great analysis of the United vs. Southwest controversy over internationalizing Hobby. My own thoughts: The bottom line is that this will lower fares for Houstonians, and that's a good thing. Yes, United will no longer be able to gouge the locals with the only nonstops to a few nearby destinations - it will mildly hit their profitability. But they have no other hub even remotely as well positioned to serve the Latin America market, and as the world's largest airline, they have to serve it just for the sake of their network. So they're not going anywhere. And I do want to see them continue to do well and grow here, but I think they burned their goodwill here when they moved the HQ (both executive and operations) to Chicago. On the other hand, Southwest has plenty of other options to connect people to Mexico, Central America and the Caribbean, including Orlando, Ft. Lauderdale, Atlanta, Austin, or San Antonio. It will definitely be our loss if we turn them away. In fact, I can't really believe this is up for serious debate. If city council does anything other than heartily endorse Southwest's generous offer to fund their own international expansion at Hobby, I will be sorely disappointed. It would mean that United has successfully exported Chicago's infamous government corruption back to Houston.
Ashby, top rankings, smarter city, vs. Chicago way, importing talent, and more
Just back from a family visit to SoCal, and the smaller items have been stacking up fast...
NYT op-ed on how young people are less and less willing to move. I think the rise of the Internet is a big factor - it can satisfy those bouts of boredom or restlessness that push people to move, either virtually or by helping you discover new options in your own region - plus I think we might also be learning the true value of social networks and how they relate to our happiness. In any case, it means Houston will need to work harder on growing our own highly educated talent, because importing it is just getting harder and harder. UPDATE: NYT story on the depressing long-term homesickness often found in people who move for economic reasons.
"...the report documents a pattern of crime that has become synonymous with the Chicago or Illinois “way” of doing things. All the corrupt governors and 26 of the aldermen had tried to extract bribes from builders, developers, business owners and those seeking to do business with the city or the state. Those who paid bribes either assumed, or were told, that payment was necessary for zoning changes, building permits or any other government action."
Houston most diverse city in the country. I wish the Chronicle had put comparative U.S. metros and local cities data graphs from the print edition online. They were pretty interesting.
I was lucky enough to get to attend the premiere of Dr. Stephen Klineberg's new "Interesting Times" documentary (from Rice's Kinder Institute for Urban Research) on the past and future of Houston at the MFA. It is very well done - compelling and engaging - but unfortunately they are holding back from putting it online, at least for now (just an excerpt here). I'll let you know if that changes. In the meantime, you can read CultureMap's excellent coverage here or the Chronicle's here.
Pretty interesting NYT story on the topic of "how many people can Manhattan hold?" It's nowhere near full compared to some of the denser cities of the world.
The mayor has announced a settlement of the lawsuit, and the Ashby high-rise is moving forward. South Hampton residents should take solace in the fact that there are several high-rise towers around River Oaks, yet property values and quality of life are holding up quite fine there. And if the true concern was traffic, they should be thankful they didn't stick something much worse there, or even just a Whole Foods...
Today is the 7th anniversary of Houston Strategies. After 947 posts (cream of the crop here), almost half a million visitors, and thousands of comments in an epic dialogue about Houston, I thought this would be a good time stand back, look at the big picture, and ask "What should be next for Houston?" while linking back to some of the gems from that archive.
First, let's look at where we are currently. Our foundation is in great shape. Houston has started the 21st-century with a set of rankings and amenities 99% of the planet’s cities would kill for: a vibrant core with several hundred thousand jobs; a profitable and growing set of major industry clusters (Energy, the Texas Medical Center, the Port); the second-most Fortune 500 headquarters in the country; top-notch museums, festivals, theater, arts and cultural organizations; major league sports and stadiums; a revitalized downtown; astonishing affordability (especially housing); a culture of openness, friendliness, opportunity, and charity (reinforced by Katrina); the most diverse major city in America; a young and growing population (fastest in the country); progressiveness; entrepreneurial energy and optimism; efficient and business-friendly local government; regional unity; a smorgasbord of tasty and inexpensive international restaurants; and tremendous mobility infrastructure (including the freeway and transit networks, railroads, the port, and a set of truly world-class hub airports).
To those I'd add:
A philosophy of Opportunity Urbanism, with the highest standard of living among major metros in the country and probably the world (i.e. how well the median income household lives)
We offer a "best of both worlds" between a big, multi-ethnic, international city with great amenities, culture, and opportunities, while also being affordable and fast-growing with a feeling of community (the "big small town").
With all that, it's really easy to get complacent. In fact, in some ways I think we might be coasting a bit now. But coasting is definitely not how we got here. Big initiatives are a proud tradition here: dredging the original port, founding the Texas Medical Center, establishing the Johnson Space Center, and being the first in the world to build a gigantic, futuristic, multi-purpose domed stadium - just to name a few examples. But what should be next? Where should the world's Energy Capital put its energy, so to speak?
I was recently inspired by the Urbanophile's post on Indianapolis' 40-year economic development and tourism strategy built around sports. Starting with nothing but the Indy 500 they've built a string of wins all the way up to hosting one of the most successful Super Bowls ever last month. We need that same sort of sustained, long-term strategy that goes beyond specific projects to a theme we can weave into everything we do over the decades ahead. We need to take the energy boom we're currently enjoying and invest it to secure our long-term prosperity no matter how technology shifts in the future (most especially energy technology).
In an unpredictable world, the only safe bet is a talent base that can adapt. With the Texas Medical Center, we concentrated health care talent in a district that has grown and adapted into the largest medical concentration in the world with an array of world class facilities. We've done the same on an even larger scale with energy and engineering talent. The next step is to take that strategy and generalize it to focus on being the global capital of applied STEM (Science/Technology/Engineering/Math) talent. We need to mobilize the city around a common purpose of building this human infrastructure. We need to embed it into our education, tourism, cultural and economic development strategies. It's just a perfect fit for Houston on so many levels:
It provides metrics we can measure to track our progress, like STEM degrees, jobs, tourists, and students
There seems to be a broad consensus across the community about its importance
Our diverse set of ethnic and national communities means all cultures can be comfortable here, attracting both talented students and foreign subsidiaries from around the globe
In particular, I think we should focus on applied STEM - systems-based problem solving (engineering) over pure knowledge (where we are at a competitive disadvantage with many university clusters around the country). Facilitating man's progress through innovative problem solving.
Building on two of the most famous Houston quotes from the Apollo 13 mission: "Houston, we have a problem" and "Failure is not an option" - the greatest single instance of problem solving in Houston's history.
Part of this strategy includes tourism, articulated in more detail here. We need the big tourism experience of other world class cities, and STEM is a unique niche we can build around, with a primary focus on families, schools, and STEM-related conferences. We already have some of the assets in place - JSC and Space Center Houston, the Natural Science Museum, the Health Museum, the Children's Museum, Moody Gardens - and others with more potential, like the Texas Medical Center. But we need that signature attraction: the world's largest institute/museum of technology. Not just a history-focused museum, but an institute actively involved in the community with a strong focus on the future. Local kids should spend frequent school days and summer camps there on fun and inspiring STEM activities. It could provide educational STEM experiences both online and on-site, helping to attract talented global youth to Houston for amazing experiences that draw them back later for college or after graduation. It should have the world's largest hackerspace. It should be an inspiring space that attracts global academic and professional STEM-related conferences (building on the OTC) - groups trying to solve big problems and contribute to humanity's progress (imagine a Davos or G8 of STEM...). Each conference could leave behind a new exhibit on its subject area, building the collections over time. And since it has the event space, we might as well open it up to festivals to expose more of our community to that same inspiration.
The natural place for such an institute is clearly the Astrodome, our historic icon looking for a second life. We should embrace the Astrodome as Houston's architectural icon like Paris does the Eiffel Tower, New York does the Statue of Liberty or Empire State Building, Rome does the Vatican or Coliseum, and San Francisco does the Golden Gate bridge. It can find a second life as our inspiring cathedral to man's technological progress (along with some fun mixed in - Robot Rodeo anyone?). Most importantly, it has around a million square feet of space. Here's how it compares to other top museums:
But unlike every other museum in the world where exhibits are carved up into a series of halls, almost all of them could be visible in a giant 360-degree panorama while standing on the floor of the Astrodome. How amazing would that space be?
The cost, you ask? Easily in the hundreds of millions. But if LA can come up with $1.2 billion to build the Getty Museum, I have no doubt that Houston can muster the needed resources. It's a tiny fraction of the wealth of Houston's 14 philanthropic billionaires, much less the broader base of wealth in this booming city. We can come together to make this happen before the Astrodome's 50th birthday in 2015, and it can put us on a path to greatness for our bicentennial in 2036 that Houston's and Texas' founding fathers could never have imagined.
We, the citizens of Houston, aren't the types to get complacent and rest on our laurels. That's not the legacy previous generations left us. It's time to step forward and tackle our next great challenge. Are you in?
An open dialogue on serious strategies for making Houston a better city, as well as a coalition-builder to make them happen. All comments, email, and support welcome.
Social Systems Architect, consultant and entrepreneur with a genuine love of my hometown and its people. I cover a wide range of topics in this blog - including transportation, transit, economic development, quality-of-life, city identity, and development and land-use regulations - and have published numerous Houston Chronicle op-eds on these topics. I also co-authored the Opportunity Urbanism study with noted urbanist Joel Kotkin and others, creating a city philosophy around upward social mobility for all citizens as an alternative to the popular smart growth, new urbanism, and creative class movements. I am a native Houstonian, 6th-generation Texan, attended Rice University for my BSEE and MBA, and a former McKinsey consultant and adjunct faculty member with Leadership Houston. I have had a long career in information technology, and am currently the founder and president of OpenTeams, a web-based collaborative software company that emphasizes openness and transparency inside large organizations. CONTACT EMAIL in no-spam format: tgattis (at) pdq.net - send me an email if you would like to receive these posts via email, or see the Google Groups signup box below.
