Planners from hell – The Supreme Court’s bad breadth

Posted on March 21, 1999 by urbanrenaissanceinst

The Next City
March 21, 1999

 

OVER THE LAST TWO DECADES, DELHI RESIDENTS HAVE WATCHED THEIR CITY’S air pollution soar to record levels. India’s capital is now the fourth most polluted urban centre in the world, yet government departments — beyond issuing comforting bromides to silence critics — undertake few concrete measures. Fed up with this governmental indifference, some nonprofit organizations and environmental lawyers petitioned the Supreme Court of India to take action against the polluters.

In doing so, the petitioners relied on section 32 of the Indian Constitution, which entitles anyone to apply directly to the highest court in the land for enforcement of his fundamental rights. Based on this constitutional provision, the Supreme Court over the years has started numerous proceedings in response to petitions, letters, and even telegrams from complainants seeking legal redress, earning for itself a reputation as a very activist court. Recently, Chief Justice A. M. Ahmadi boasted that India’s Supreme Court is the world’s most powerful because of its broad authority and its enthusiastic activism.

The environmentalists had many reasons to complain. During December and January, when the cool weather traps airborne contaminants close to the ground, Delhi is transformed into a veritable gas chamber. A soot-filled pall hangs over the city, blotting out the sun and the sky for days on end. “Every time you come into your house at night,” says a long-time resident, “you wash a grey black film off your hands. When you wipe your face, your handkerchief turns a filthy shade of grey.” There is a foul odor everywhere, as if the very air has curdled and turned rancid. The sulphur level of the diesel used in Indian trucks and buses is 100 times that permitted in Europe, and two-stroke scooters and auto-rickshaws run on cheap, adulterated gasoline.

When asked how they feel, residents invariably complain about their itchy eyes, their sore throats, and their recurring bouts of bronchial congestion. The city’s rate of lung cancer and respiratory ailments is 12 times the national average, and according to one estimate, 10,000 residents annually die of pollution-related diseases. The levels of noxious pollutants such as nitrogen oxides, sulphur dioxide, solid particulate matter, hydrocarbons, carbon monoxide, benzene, and lead are three to five times higher than acceptable standards set by the World Health Organization.

According to the evidence produced at the Supreme Court hearing, emission from vehicles is the single biggest source of the city’s dangerously high pollution levels, accounting for 67 per cent of the total, with old commercial vehicles being the worst culprits. Thermal power stations, factories, and homes are responsible for 13 per cent, 12 per cent, and 8 per cent respectively.

After hearing the evidence, the Supreme Court ordered all commercial motor vehicles 15 years and older — in all, 17,000 trucks, taxis, auto-rickshaws, and buses, constituting 12 per cent of the city’s commercial fleet — off Delhi’s roads by December 31, 1998.

Pollution control experts scoff at the suggestion that the Supreme Court’s intervention answers Delhi’s air pollution woes. They point out that this stopgap measure will not lower pollution levels without a broad range of changes from responsible government bodies. These include revamping the city’s lamentable public transportation system, introducing mass rail transit, building new highways, upgrading fuel quality, requiring vehicle manufacturers to use environmentally clean engine technology, halting gasoline adulteration, emphasizing efficient traffic management, and vigorously enforcing traffic laws.

Such a multifaceted campaign calls for an activist executive rather than an activist Supreme Court. In order to successfully execute this campaign, governments at all levels — national, state, and municipal — would need to get serious.

Sat Kumar

The art of mismanagement

TROIS-RIVIÈRES’S MUSÉE DES ARTS ET TRADITIONS POPULAIRES DU QUÉBEC opened in June 1996 amid much hoopla. Its creation was the dream of ethnologist Robert-Lionel Séguin, whose assortment of 18th- and 19th-century objects is the museum’s cornerstone, along with a large assembly of prehistoric artifacts. The city could now boast of a museum of national importance. To its imposing granite structure, the Vieille Prison (built in 1822, on what became the museum’s lot, and closed in 1986) was incorporated as an added attraction.

At the ribbon-cutting ceremonies, Claude Masson, assistant editor of the Montreal daily, La Presse, praised the museum: “It’s the cement that will reunite all the other great achievements of Trois-Rivières.” The city’s mayor, Guy LeBlanc, was equally upbeat: “They say that the people are critical, in the positive sense of the word, and when they see what belongs to them, I’m sure that they’ll become the first sellers of this jewel that will help us to develop tourism.” With a team of 50 employees, the museum received over 60,000 visitors in its first year.

But behind the platitudes lurked financial problems. The museum’s construction cost $15.6 million — paid with $7.6 million in provincial money, $6.5 million in federal funds, and a museum loan. Some people wondered whether a community of about 50,000 inhabitants justified such a costly investment. However, for the museum’s planners, thrift wasn’t a priority. Lise Bissonnette, former editor of Montreal’s Le Devoir, echoed the prevalent spirit of nonchalance: “Somebody asked me if I didn’t think there were too many institutions and not enough money to pay for them. I told them no. Questions of budget are only passing questions, these will work out in the end. The important thing is that the museum got off the ground.”

In March 1997, after the museum’s first fiscal year yielded a $540,000 deficit, the museum’s director stepped down, along with the president of its administrative council. More alarming, the number of visitors began to drop. During the museum’s second year, about 40,000 people visited, while only 24,500 are expected in the current year.

In September 1998, the new museum director, Sylvie Dufresne, declared that the museum was unable to pay the interest on its $1.5-million building loan. In addition, she had to set aside a $300,000 litigation fund because the Cogerex construction company had sued the museum for just under $2 million in allegedly unpaid bills. She also dismissed most of the museum’s remaining 33 employees, leaving only a dozen on the payroll. “We were used to living in luxury,” explained Dufresne, “now we must get used to living reasonably.”

Le Musée des arts et traditions populaires stands out in Trois Rivières’s run-down Ste-Cécile neighborhood. This quarter’s inhabitants don’t need a museum to see the past. They are surrounded by the abandoned hulks of dilapidated buildings — souvenirs of a time when the area had a grim semblance of hope. Ste-Cécile provided lodgings for factory workers during the industrial boom years of 1910 to 1930, but almost all these enterprises have since moved or shut down. It is now the poorest section of the city with the highest unemployment rate in Canada; over half of Ste-Cécile residents live at or under the national poverty level.

The occasional museum visitor might wonder, “So many millions for this?” No architect has publicly taken credit for the museum’s squat, ungainly structure, composed of great rectangular blocks, some of which are arranged in front of the building, resembling sarcophagi. The interior is equally void of warmth. The museum’s exhibits are of the static, don’t-touch variety, largely consisting of items that can be bought at a nearby flea market for less than the museum’s price of admission. Aside from one current exhibit — Parole, gestes et mémoire, which features popular tales, songs, and dances — the most interactive part of this museum is the visitor’s voice and footsteps echoing through its corridors’ stony emptiness.

Last fall, museum officials closed the Vieille Prison, which can temporarily be visited with a reservation. Though some fear that a similar fate might await the museum itself, its administrators — who are hoping for $150,000 from the provincial Ministry of Culture and Communications to reduce this year’s projected deficit — are gamely planning exhibits up to the year 2003. At the time of writing, Minister Louise Beaudoin was withholding this sum until she saw guarantees of support from the community. Officials have often accused Trois-Rivières’s citizens of not doing their part. As Mayor LeBlanc said last fall: “The people must take hold of the museum. It’s always been seen as somewhat of an orphan.”

The museum’s financial woes won’t disappear tomorrow. The cost of heating its 110,000 square feet of dead air continues to contribute to its deficits. Trois-Rivières has built a costly mausoleum to display its culture; this edifice is the city’s quaint, provincial version of Montreal’s Olympic Stadium. Le Musée des arts et traditions populaires represents two legacies that continue to trouble Trois-Rivières: the art of mismanagement and the popular tradition of bankruptcy.

Robert Rebselj

Utah’s sober liquor laws

REMNANTS OF PROHIBITION LINGER ON IN UTAH, WHERE STIFF LAWS REQUIRE a private club membership of anyone wanting to drink liquor outside his home or outside specially designated lounges such as the one at the Salt Lake Airport. Clubs must charge at least $12 for a full-year membership, but their fees are often higher: Salt Lake City’s Lumpy’s social hall charges $20 for the privilege of drinking there for a year. If you are, perchance, interested in a night of barhopping, you must join every club you visit, although you can save some money by buying two-week temporary memberships for about $5. People with memberships can sponsor friends free of charge, but they must accompany their guests at all times. Once inside, state law prohibits bartenders from serving patrons a double, but enthusiastic imbibers can circumvent this regulation by ordering what Utah residents call a sidecar — a shot that they can pour into a drink themselves.

Utah beer drinkers have only a slightly easier time of it. Although taverns don’t require memberships, they can only serve beer with a maximum alcohol content of 3.2 per cent by weight, compared with a 5 per cent Canadian average. Restaurants are allowed to serve any alcoholic drink, but servers must wait for the patron to broach the subject before they can bring a drinks list. As for private consumption, Utah residents can drink whatever they like, but they’ll only find 3.2 per cent beer in their grocery and convenience stores. Only state-owned liquor stores can sell full-strength beer, liquor, and wine.

The Utah Hospitality Association, which lobbies for liquor law reform, faces tough opposition in the state legislature. About 90 per cent of Utah legislators belong to The Church of Jesus Christ of Latter-Day Saints, which bans alcohol drinkers from its temples. A church spokesman recently defended the state’s liquor laws: “Utah’s record in limiting the disastrous social and health effects of alcohol is second to none. The state needs to preserve that remarkable record while allowing people reasonable access to alcohol.”

Shinan Govani

Regulations ruffle ostrich ranchers’ feathers

STEVE WARRINGTON WANTS U.S. LAWMAKERS TO GET THEIR HEADS OUT of the sand. As head of Ostriches On Line, the world’s largest international ostrich company, Warrington is spearheading a petition to declassify the birds as exotic — a designation that requires inspection fees that inflate the cost of ostrich meat by as much as $2 per pound. With more than 5,000 American ranchers now raising up to 500,000 ostriches, he argues, the birds are hardly “exotic” anymore.

“Beef, chicken, turkey, pork, and other agriculture industries do not have to pay these fees,” says Warrington, “so we are not competing on a level playing field.” The regulations also affect the prices of byproducts such as ostrich leather (prized for its distinctive quill pattern and suppleness), feathers (used in costumes and in the automobile and electronics industries), and oil (touted as a superb skin care product). According to Ostriches On Line, the fees hamper America’s competitiveness in the growing worldwide ostrich market since no other country has comparable legislation.

The punitive regulations also assail consumers looking for nutritious, environmentally friendly meat. Despite the flavor and texture of beef, ostrich boasts only 2.8 fat grams per 100 grams of cooked meat and less cholesterol and calories than either chicken or turkey. In addition, ostrich farming requires only two-thirds of an acre for a trio of ostriches, and the birds have the best feed-to-weight ratio gain of any land animal.

Warrington is on target to collect 250,000 petition names to present to the 106th Congress. Mississippi Representative Bennie Thompson is expected to introduce an amendment to the Poultry Products Inspection Act to include birds of the Ratitae order (ostriches, emus, and rheas), thereby erasing its exotic classification, sometime this year.

“Once amended, consumers should begin to see a steady decline in the retail price over a two- to three-month period,” pledges Warrington.

S. G.

Posted in Culture, Regulation | Leave a comment

Editorial – What it takes to become filthy rich

Posted on March 21, 1999 by urbanrenaissanceinst

Lawrence Solomon
The Next City
March 21, 1999

 

SOME FABULOUSLY WEALTHY PEOPLE INHERITED THEIR RICHES. OTHERS earned their wealth through their exceptional skills. But a significant number of the extremely rich — perhaps the majority of those who made it on their own — lucked into it. This group includes the Reichmanns, ranked fourth in Forbes 1991 list of the world’s richest people, just behind King Fahd of Saudi Arabia; the Belzbergs, the notorious “greenmailers” who preyed on vulnerable multinationals; Jack Poole, whose high flying Daon Development ruled the West in the 1970s; Garth Drabinsky, who created the Cineplex Odeon and Livent empires; and William Zeckendorf, who built Montreal’s Place Ville Marie and provided the land the United Nations needed to build its edifice. It includes, in short, most of those celebrated as financial geniuses who were — in fact — not geniuses at all. They were gamblers in grey suits who, unbeknownst to them, kept betting against the house. This ignorance, which also blinded them from seeing that they were repeatedly betting the farm, took them straight to the top as long as their luck held. When their luck ran out, so did their fortunes.

Billionaires numbered but a handful during the early 1980s. Starting in the mid-1980s, their number exploded — due partly to President Ronald Reagan’s wealth-promoting tax cuts (one-third of the world’s billionaires are American), partly to the many new fortunes in the computer industry and related technology, and partly to a revolution in financial markets whose myriad mergers, leveraged buyouts, and other innovations permitted rapid wealth creation based on little equity and much debt. Billionaires have become so numerous — Forbes compared them to an unchecked deer population — that, to keep its 1997 numbers manageable, the magazine culled its list of the idle rich. But even without kings, queens, dictators, retirees, and others Forbes calls coupon-clippers, billionaires have became too humdrum for all to merit attention. The magazine now limits itself to the top 200 working billionaires, lists another 150 worthy of honorable mentions, and gives the brush-off to the littlest billionaires and mere megamillionaires.

This explosion in the billionaire population, though impressive, would pale when compared with the number that would exist if everyone followed the example of the reckless rich. It doesn’t take great intelligence, judgment, skill, or connections, or an Ivy League degree to pull off a rapid ascent to wealth (58 of the last Forbes 400 richest Americans didn’t finish college). Quite the contrary. Intelligence and especially judgment prevent most middle-class people from trading their bird in the hand for a billion in the bush.

Robert Campeau demonstrates how someone quite unexceptional in many respects, but possessed of an extreme recklessness, can acquire exceptional wealth.

One of seven children born in Sudbury, Ontario, in 1923, Campeau, the son of a blacksmith/mechanic, quit school in the eighth grade to sweep floors at 50 cents an hour. He then tried millwrighting, hauling logs, and running a small grocery store before noticing that a cousin, who built a home in his spare time, doubled his money when he sold it a few months later.

Campeau and his cousin joined forces, bought a house in Ottawa for $5,000, fixed it up themselves, then sold it for $7,500. This led to more buying and selling of houses, then to the creation of subdivisions on the outskirts of Ottawa, all using borrowed money. Campeau became rich during the post-Second World War building boom, which was fuelled by returning servicemen holding government subsidized mortgages. At that time, gung-ho real estate developers who bet on a continuing building boom borrowed to the hilt and became very rich; cautious ones became less so.

Campeau soon built apartment buildings, office towers, and in a daring move, condominiums and the Harbour Castle Hotel along Toronto’s derelict waterfront, which proved prescient when the city’s waterfront revival occurred. Campeau’s string of successes produced an enterprise worth $200 million. A person with judgment would survey his accomplishments and grant some credit to providence — to make his fortune, Campeau had required not only a robust real estate market but also numerous political decisions to go his way. A person with judgment would minimize his risk by selling some assets to reduce his debt. Campeau was not such a person. He kept betting double or nothing.

Campeau flung himself into other pursuits — a TV station, a life insurance company, a trust company among them — before veering south of the border, first in search of a savings and loan institution (these would soon collapse in one of the greatest financial fiascos in U.S. history), then in an attempt to acquire R.H. Macy, the fifth biggest U.S. department store chain.

He lost Macy’s to one of the continent’s pre-eminent retailers, Edward Finkelstein, Macy’s chairman, who pulled off a $3.6-billion leveraged buyout. Undeterred, Campeau bought the sixth-biggest chain, Allied Stores, in a $3.5-billion hostile takeover that had him frantically trying to cobble together his last bit of financing at the eleventh hour.

Awash in debt and entirely inexperienced in managing department stores, Campeau then plunged himself into a bidding war for Federated, America’s biggest department store chain, against none other than Finkelstein, who was also awash in debt. Campeau emerged the winner with a final bid of $6.5 billion.

Did he pay too much? Many thought not, since Finkelstein was willing to pay as much, and seemingly savvy lenders were backing them both. In truth, Campeau and Finkelstein were in a race to see who would go bankrupt first. Campeau finished ahead of Finkelstein here, too: Allied and Federated entered bankruptcy proceedings in January 1990, two years ahead of Macy’s. Finkelstein is now a consultant in Manhattan; Campeau has started over in Austria, developing a Berlin housing complex with money borrowed from sources unknown. The German press calls him Mr. Bankrupt.

Campeau’s gift was a willingness to repeatedly go for broke, and an ability to find lenders and others willing to join him. The Reichmanns had the same ability, but they exercised it on a grander scale. When the Reichmanns’ luck ran out, they may have accumulated more debt than any other commercial enterprise in history. Like Campeau, Paul Reichmann, too, has started over, in his case with the same development — Canary Wharf in London — whose failure brought down their empire in 1992.

According to Paul Reichmann, luck had little to do with his family’s success or failure. Today, still oblivious to the manner in which they had put their empire at risk, Paul Reichmann blames their downfall on investments in oil, gas, and forestry — outside the real estate sector that was their ken. But the Reichmanns’ folly actually lay in reckless judgments — among them backing the Campeau Corporation, a $600-million-plus mistake — and their reckless assumption that the real estate market would not badly slump. Like Campeau, like the presumed financial wizards in so many other financial sagas, the Reichmanns built a house of cards that came crashing down when the inevitable — a recession or a downturn in an industry — occurred.

The Reichmanns were not alone in making reckless assumptions. Most banks extended credit entirely on the strength of the Reichmann name. Forbes made reckless assumptions, too, in placing the Reichmanns’ wealth at $7 billion in 1991. “We seem to have been off by a nice, round $9 billion,” it admitted in 1992.

EVERY CITY IN THE COUNTRY HAS MIDDLE-CLASS DISTRICTS WHOSE HOMES average $300,000 or more in value. If, through some collective madness, every homeowner was willing to go for broke and risk his home by betting it all in a volatile market — say, on Indonesia’s rupiah during the Asian meltdown or on oil during the next oil crisis — every middle-class neighborhood would be sprinkled with megamillionaires and billionaires: In highly leveraged investments, which let investors borrow 90 or 95 per cent of the amount that they’re betting, that $300,000 could easily become $100 million after just two successful plays and $1 billion after a third, in far less time than Campeau, the Reichmanns, and others became rich.

Because part of the population is attracted to get-rich-quick schemes, the Internet is full of high-risk investment opportunities, and television ads on some U.S. networks promise viewers opportunities to double their money in a matter of months. Some doubtless will. But most people, by temperament, shy away from high-risk investments. The public’s conservatism explains the growing popularity of index funds, which allow investors to invest in the broad economy, and of mutual funds, which typically reduce risk by eschewing debt and diversifying portfolios, among other techniques. Polls show that people invest more to protect what they have than to rapidly augment it. While we may envy the flashy investors who strike it rich, we also regard their successes with a jaundiced eye, in the back of our mind remembering that the bigger they are, the harder they fall. When they fall, they often lose more than their money. Some, such as Campeau, lose their wives to divorce, their relationships with their children in financial disputes, their mental health, and their reputations.

Simply becoming a millionaire is easy, and it also doesn’t require great intelligence, skill, education, or connections. Or luck. Any waitress, mechanic, bus driver, or secretary who puts aside $2,000 at age 20 and increases the previous year’s amount by $200 each subsequent year, investing it at a modest six per cent, will retire a millionaire at age 65. Because this plodding path to modest wealth is so easy to pursue, the majority of millionaires, as documented in The Millionaire Next Door, a 1996 study by Thomas Stanley and William Danko, are plodders — the guy who owns the gas station or the bowling alley down the street.

For most people pursuing financial goals, whether to aim to be a millionaire, or a billionaire, comes down to a lifestyle choice. Methodical savers become millionaires; reckless borrowers — when blessed with luck — become billionaires.

Some mythologize billionaires as risk takers. Yet many billionaires do not deserve our admiration because bad judgment — not good — often took them to the top. Others castigate billionaires merely by virtue of their extreme wealth. Billionaires also do not deserve our opprobrium. In the end, billionaires enliven the world with their insane risk taking at no cost to the general public, much as Evil Knievel did. We can sit by the sidelines and marvel at their feats. And politely decline when offered the choice of great exploits, on the one hand, and of ruin, on the other.

Posted in Culture | Leave a comment

The Book of the Fair: fairs of the past

Posted on March 15, 1999 by urbanrenaissanceinst

Paul V. Galvin Library Digital History Collection

March 15, 1999

World’s Columbian Exposition of 1893

Before and during the middle ages fairs were of unquestionable benefit, bringing distant communities into closer contact with civilization, and affording an opportunity for comparing home-made and foreign goods.

Click here to view .pdf document

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Selling Toronto Transit for savings and profit

Posted on February 6, 1999 by Other News Sources

Larry Solomon
The National Post
February 6, 1999

Following global trend to privatization could produce big dividends

Here’s the deal. In exchange for some Toronto Transit Commission assets, Mayor Mel Lastman and Toronto’s 56 councillors receive a lump-sum payment of $500-million to spend buying snow-clearing equipment, housing the homeless, promoting the arts, or any way they say.

Plus, Toronto taxpayers save the $150 million now required annually to subsidize public transit – enough to let Mr. Lastman honour his election pledge and freeze property taxes for the 44% of Toronto homeowners who otherwise face increases averaging $700 over the next five years under the city’s new current value assessment.

And, public transit users – whose fares soared 80% amid service cuts over the last decade – get guaranteed fare freezes, guaranteed increases in frequency and kilometres logged, and a guarantee of no further loss of routes over the next decade.

These godsends could come courtesy of London, England-based GB Railroads, a firm started by two Canadians, which now owns railways serving commuters in London and several Australian cities. “We’d love to be the winning bidder in a TTC privatization,” says former Torontonian Michael Schabas, a founder and director, who has been bidding to operate commuter railways, subways and streetcar systems in several countries. Or the godsends could come from dozens of other transportation companies, including airline tycoon Richard Branson’s Virgin Rail group and the U.K. transit powerhouse Stagecoach, two big players in the emerging world-wide trend toward transit privatization.

The renaissance in public transit, which began in the U.K. in the 1980s, was entirely unintended. U.K. Prime Minister Margaret Thatcher, determined that nothing obstruct the advance of “the great car economy,” set about destroying public ownership of U.K. transit systems by squeezing their subsidies and promoting their privatization. Today, the privatization is largely complete, and 85% of public transit routes operate without subsidy.

But instead of helping the automobile, removing public transit subsidies reversed the fortunes of transit, which had been losing customers for decades in the U.K. as in North America.

Transit’s U-turn is a traffic stopper: In the two decades prior to Ms. Thatcher’s rise to power, passenger rides in London plummeted by over one-third. In the two decades since, they’ve soared by more than one-third. Ms. Thatcher’s desires notwithstanding, it is the advance of the car economy that has stalled. In the 1990’s, the almost unimaginable occurred – growth in the U.K.’s car use sputtered and, in mid-1998, came to a full stop.

To get people out of their cars and into public transit vehicles, transit companies are going that extra mile. They’re running more buses more often – 10 years after deregulation, London buses logged 30% more kilometres at 41% lower cost – making public transit reliable and convenient. On busy rush-hour routes, the average wait has become 1.5 minutes; elsewhere, the wait averages 6.6 minutes. Buses have become smart looking, bus drivers have become courteous, bus routes now venture into once-neglected areas, bus fares have dropped relative to inflation and bus passengers have given transit a second look. To capture the growing market of elderly and disabled passengers, 90% of new buses sport senior-friendly features. The car is in no danger of disappearing from city streets, but the more unbridled competition sets the rules of the road – and London still has a long way to go – the less the automobile will rule.

Once the U.K. results sunk in, cities around the world took action. Stockholm, which cut subsidies and turned to competition in 1993, saw costs drop 20% and service increase 13%. Helsinki’s operating costs dropped 33% while ridership rose. Rio de Janeiro’s subway and commuter rail systems – on the verge of collapse before privatization in 1993 – have more than doubled their ridership while losing most (and in the case of one company, all) of their subsidies. Melbourne – after deregulating its bus system – is now selling its subway, streetcars and commuter rail.

In most privatizations, city-wide transit monopolies are broken up into separate businesses that have an incentive both to compete for passengers and to cooperate in making transit their preferred choice. In Melbourne, streetcar lines, though divided into two separate networks, will sometimes share tracks. And although Melbourne’s subways, commuter rail and streetcars are being sold to different buyers, passengers will seamlessly move from one to the other via common tickets, free transfers and a city-wide transit pass.

While transit systems around the world are modernizing, invigorated by the challenge of serving ever-growing numbers of passengers, the TTC is bracing itself for another exodus. Its workers, who have shown no reluctance to strike in the past, are bitter about their average remuneration of $29 per hour, up one-third from $21 a decade earlier. Fare increases to pay for wage hikes will lead many riders to desert the system, while a major strike – leading commuters to permanently change their travel patterns – could be fatal.

The $500 million the TTC could fetch is modest: It assumes privatizing only part of the system. A full privatization of the TTC system, including not just its vehicles but also its stations and the right-of-ways it uses, would fetch several billion dollars.

Cash aside, privatization would bring back the 60 million passenger trips per year lost over the past decade, entice people out of their private automobiles, relieve congestion, reduce pollution and let Toronto function efficiently.

“The TTC is one of the world’s premier transit assets. It should be winning more passengers every year through improved service and affordable fares,” concludes Mr. Schabas, who returns to Toronto regularly since moving to London in 1989. “Privatization would bring the investment and management freedom the TTC needs to grow.”

Competition improves safety

Before the London Underground faced competition, it pooh-poohed the public’s concerns about safety, citing statistics showing the public’s fears to be exaggerated. Under threat of privatization, it changed its ways. As explained by a chastened London Underground in its official handbook:

“By the 1990s much of the Underground’s culture had stagnated for many decades. For example, the conditions of service governing most front-line staff had been unchanged since 1922. In response London Underground evolved its Company Plan, launched in November, 1991, to improve safety, quality and efficiency … The whole thrust of the changes was to focus all staff on meeting customer needs.”

The Underground stopped citing favourable statistics, admitted that crime had been steadily increasing, reaching a peak in 1987, and set to work. It hired security staff and made its existing staff more visible. To ease fear of crime for those travelling alone, refurbished train cars allow passengers to see into the next carriage. The Underground has also linked up with a mini-cab company willing to take passengers home from the subway line for a flat fee of £2.50 — 50 pence less than the normal charge for entering a cab.

As a result of the Underground’s new attitude, crime on the Underground has dropped by over 40%, contributing to its ability to reach an all-time peak in ridership.

Posted in Public transit | Leave a comment

3600 No-Fault Compensation Systems

Posted on January 1, 1999 by Other News Sources
R. Ian McEwin
Case Associates, Sydney, Australia 

January 1/1999

This chapter surveys the no-fault compensation literature and concludes that the main focus has been the adequacy of the tort system as a system of compensation and deterrence.

Posted in Automobile | Leave a comment