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To: stockman_scott who wrote (1445)1/21/2012 7:14:41 AM
From: Glenn Petersen
2 Recommendations   of 2290
A Mess on the Ladder of Success

New York Times
January 18, 2012

Throughout American history there has almost always been at least one central economic narrative that gave the ambitious or unsatisfied reason to pack up and seek their fortune elsewhere. For the first 300 or so years of European settlement, the story was about moving outward: getting immigrants to the continent and then to the frontier to clear the prairies, drain the swamps and build new cities.

By the end of the 19th century, as the frontier vanished, the U.S. had a mild panic attack. What would this vibrant, entrepreneurial country be without new lands to conquer? Some people (I’m looking at you, Teddy Roosevelt) decided to keep on conquering (Cuba, the Philippines, etc.), but eventually, in industrialization, the U.S. found a new narrative of economic mobility at home. From the 1890s to the 1960s, people moved from farm to city, first in the North and then in the South. In fact, by the 1950s, there was enough prosperity and white-collar work that many began to move to the suburbs. As the population aged, there was also a shift from the cold Rust Belt to the comforts of the Sun Belt. We think of this as an old person’s migration, but it created many jobs for the young in construction and health care, not to mention tourism, retail and restaurants.

For the last 20 years — from the end of the cold war through two burst bubbles in a single decade — the U.S. has been casting about for its next economic narrative. And now it is experiencing another period of panic, which is bad news for much of the work force but particularly for its youngest members. The U.S. has always been a remarkably itinerant country, but new data from the Census Bureau indicate that mobility has reached its lowest level in recorded history. Sure, some people are stuck in homes valued at less than their mortgages, but many young people — who don’t own homes and don’t yet have families — are staying put, too. This suggests, among other things, that people aren’t packing up for new economic opportunities the way they used to. Rather than dividing the country into the 1 percenters versus everyone else, the split in our economy is really between two other classes: the mobile and immobile.

Part of the problem is that the country’s largest industries are in decline. In the past, it was perfectly clear where young people should go for work (Chicago in the 1870s, Detroit in the 1910s, Houston in the 1970s) and, more or less, what they’d be doing when they got there (killing steer, building cars, selling oil). And these industries were large enough to offer jobs to each class of worker, from unskilled laborer to manager or engineer. Today, the few bright spots in our economy are relatively small (though some promise future growth) and decentralized. There are great jobs in Silicon Valley, in the biotech research capitals of Boston and Raleigh-Durham and in advanced manufacturing plants along the southern I-85 corridor. These companies recruit all over the country and the globe for workers with specific abilities. (You don’t need to be the next Mark Zuckerberg to get a job in one of the microhubs, by the way. But you will almost certainly need at least a B.A. in computer science or a year or two at a technical school.) This newer, select job market is national, and it offers members of the mobile class competitive salaries and higher bargaining power.

Many members of the immobile class, on the other hand, live in the America of the grim headlines. If you have no specialized skills, there’s little reason to uproot to another state and be the last in line for a low-paying job at a new auto plant or a burgeoning green-energy cluster. The surprise in the census data, however, is that the immobile work force is not limited to unskilled workers. In fact, many have a college degree.

Until now, a B.A. in any subject was a near-guarantee of at least middle-class wages. But today, a quarter of college graduates make less than the typical worker without a bachelor’s degree. David Autor, a prominent labor economist at M.I.T., recently told me that a college degree alone is no longer a guarantor of a good job. While graduates from top universities are still likely to get a good job no matter what their major is, he said, graduates from less-exalted schools are going to be judged on what they know. To compete for jobs on a national level, they should be armed with the skills that emerging industries need, whether technical (computer science) or not.

Those without such specialized skills — like poetry, or even history, majors — are already competing with their neighbors for the same sorts of mediocre, poorer-paying local jobs like low-level management or big-box retail sales. And with the low-skilled labor market atomized into thousands of microeconomies, immobile workers are less able to demand better wages or conditions or to acquire valuable skills.

So what, exactly, should the ambitious young worker of today be learning? Unfortunately, it’s hard to say, since the U.S. doesn’t have one clear national project. There are plenty of emerging, smaller industries, but which ones are the most promising? (Nanotechnology’s moment of remarkable growth seems to have been 5 years into the future for something like 20 years now.) It’s not clear exactly what skills are most needed or if they will even be valuable in a decade.

What is clear is that all sorts of government issues — education, health-insurance portability, worker retraining — are no longer just bonuses to already prosperous lives but existential requirements. It’s in all of our interests to make sure that as many people as possible are able to move toward opportunity, and America’s ability to hurl people and money at exciting new ideas is still greater than that of most other wealthy countries. (As recently as five years ago, U.S. migration was twice the rate of European Union states.) That, at least, is some comfort at a time when our national economy seems to be searching for its next story line.

Adam Davidson is the co-founder of NPR's Planet Money, a podcast, blog, and radio series heard on “Morning Edition,” “All Things Considered” and “This American Life.”

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To: stockman_scott who wrote (1445)1/31/2012 1:24:47 PM
From: Glenn Petersen
1 Recommendation   of 2290
Segregation Hits Historic Low

Flight From Rust Belt Cities, Immigration Boost Integration in Cities, Study Says

Wall Street Journal
January 31, 2012

An exodus of African-Americans from struggling industrial cities such as Detroit and the growth of Sunbelt states have pushed racial segregation in U.S. metropolitan areas to its lowest level in a century, according to a new study.

The report, released by the conservative Manhattan Institute, said U.S. cities are more integrated now than at any time since 1910, based on analysis of census data from neighborhoods.

Fifty years ago, nearly half the black population lived in a ghetto, the study said, while today that
proportion has shrunk to 20%. All-white neighborhoods in U.S. cities are effectively extinct, according to the report.

Immigration and gentrification have helped convert ghettos into racially mixed communities and contributed to diversifying suburbia
, said economists Edward Glaeser of Harvard University and Jacob Vigdor of Duke University, who co-wrote the study. "Segregation is as low as we have ever seen it," said Mr. Vigdor. "It's an unprecedented scenario."

Some scholars said the report, titled "The End of the Segregated Century: Racial Separation in America's neighborhoods, 1890-2010," paints too rosy a picture and argued the country is far from being fully integrated.

"That segregation is declining in most places is a real plus," said John Logan, a Brown University sociologist who has published research on the topic. "But it is declining at a rate that will leave the country with a very high level of segregation for a long time."

From around 1910, rural blacks began moving in large numbers to urban centers in search of work, in what became known as the Great Migration. Government policies and discriminatory practices in areas such as mortgage lending promoted residential segregation, which peaked in the 1960s. The civil-rights movement then paved the way for integration, and the 1968 Fair Housing Act specifically banned housing discrimination.

By the 1980s, blacks were moving to suburbs, which both altered the face of the urban areas they left behind and created racially mixed neighborhoods where they settled.

Using the most common measure of segregation, the "dissimilarity index," the authors found that segregation is lower now than it was in 1970 in all but one of the 658 housing markets tracked by the Census Bureau. Between 2000 and 2010, segregation declined in 522 out of 658 housing markets, the report said.

The index of dissimilarity measures how evenly two groups are distributed in a neighborhood. The score indicates what share of the members of one group would need to move neighborhoods to enable the two groups to be equally distributed.

In 2010, Dallas-Fort Worth and Houston were the country's least segregated large cities. Atlanta's index fell 28 points to 54.1 in 2010 from 82.1 in 1970; Dallas-Fort Worth's fell to 47.5 from 86.9 over the same period.

Still, segregation hasn't been eliminated. The typical urban African-American still lives in an area where more than half the black population would need to move to achieve overall integration.

"There are still segregated places, like the South Side of Chicago, the East Side of Cleveland and Detroit," said Mr. Vigdor. "But those places have fewer people."

Many of the people leaving industrial cities moved to the Sunbelt, which stretches from California to North Carolina and has experienced rapid growth in recent decades. As cities such as Phoenix, Houston and Charlotte expanded to accommodate the new population, many neighborhoods became more racially mixed than those left behind in the Rust Belt, Mr. Vigdor said.

The beacon of economic opportunity is luring ambitious young African Americans such as Willie Payton Jr., 28 years old, who left Cleveland for Houston a year and a half ago for a promotion in the Veterans Administration. He now manages outpatient care at Houston's Michael E. DeBakey VA Medical Center.

"It was a good promotion, and with the economy being the way it is, it was too good to pass up," said Mr. Payton.

Royce Hardin, 59, who moved to Phoenix from Racine, Wis., in 1987 to run a janitorial business, said: "Everybody here came from somewhere else so they are not just living next to their own kind."

Immigration has been a factor in desegregation. The Hispanic population has climbed and spread across the U.S. since the 1990s, with Latin American immigrants settling in both predominantly black and white neighborhoods, the report says. The typical African-American now lives in a neighborhood that is 14% Latino.

Access to credit has also fostered mobility and integration. Minority home buyers were affected by the subprime mortgage crisis, but many buyers were able to stay in their homes, the report said.

But the decline in desegregation in residential areas hasn't meant an end to racial inequality. Minorities at every income level tend to reside in poorer neighborhoods than whites with comparable incomes, according to Mr. Logan, the scholar at Brown.

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From: richardred2/17/2012 12:01:47 PM
3 Recommendations   of 2290
Greek yogurt on a growth spurt
Published January 23, 2012

Associated Press

Jan. 13, 2012: Greek yogurt now accounts for a quarter of the total yogurt market after a dizzying growth spurt that is especially apparent here in the heart of upstate New York. (AP)

Chobani is making Greek yogurt as fast as Americans are eating it.

Its plant here in upstate New York farm country already pumps out 1.5 million cases of the thick yogurt every week, and pallets are stacked four stories high in the chilled warehouse.

But like other Greek yogurt makers, Chobani is expanding. Greek yogurt now accounts for a quarter of the total yogurt market after a dizzying growth spurt that is especially apparent here in the heart of upstate New York. The nation's No. 1 and No. 2 Greek yogurt brands — Chobani and Fage, respectively — are both expanding plants within 60 miles of each other, and another company is building a plant in western New York. The expansions come as the big U.S. yogurt makers are focusing on Greek products, too.

Greek yogurt is made a bit differently than the thinner, more watery product that dominated U.S. supermarket shelves for decades. The whey is strained off, leaving a creamier yogurt high in protein and low in fat. While the quick growth has some hallmarks of a food fad — think cupcakes or bubble tea — the long-term investments point to a widespread industry belief that many Americans will continue to like their yogurt a bit richer.

"I personally do not believe that the yogurt story has started yet. I believe the yogurt story in this country is about to start," Chobani's founder, Hamdi Ulukaya, said during an interview in his office. "The magnitude hasn't started yet."

Ulukaya has harnessed the Greek yogurt boom more successfully than anyone. In 2005, he bought an old Kraft Foods plant southeast of Syracuse with plans to make the kind of yogurt common in his home country of Turkey. He believed the standard yogurt found on many supermarket shelves "wasn't made right."

His company, Agro-Farma, started by making yogurt for Stonyfield Farm other companies before launching Chobani in 2007 with limited runs to stores in the New York City area. The Chobani plant today bustles with 14 production lines mechanically squirting yogurt into plastic cups that zip down conveyor belts.

The company said production will increase from 1.5 million cases a week to more than 2 million when the current $134 million expansion is completed this year. Another $128 million Chobani plant being built 2,000 miles west in Twins Falls, Idaho, will add still more.

About 60 miles northeast, the Greek company Fage (pronounced FA'-yeh) is in the early stages of doubling the capacity of its 3-year-old plant in Johnstown, N.Y. to about 160,000 tons of yogurt annually. By multiple accounts, the seeds of the Greek yogurt boom were planted years ago through Fage imports to New York City. Fage opened its U.S plant in 2008 to keep up with growing demand. Russell Evans, Fage's marketing director, said sales have grown on average of 50 percent a year for a decade.

"It's going up exponentially every year," he said. "It's constantly expanding." Though often pricier, Greek yogurt is increasingly becoming a refrigerator staple as consumers seek healthy, "authentic" foods. Kate Winnebeck, a 30-year-old Rochester, N.Y., resident, likes its tanginess, but said it was nutrition that initially attracted her.

"I was looking for ways to get even more protein into my diet," she said. "And I didn't want to, at the time, eat a lot of eggs in the morning. I don't have time for that. I work full-time." The NPD Group, a consumer marketing research firm, reports that Greek yogurt appeals most to adult females and that it's more popular in smaller and higher-income households.

The Chobani and Fage two plants are a boon to upstate New York's ailing economy, not only for the more than 1,240 full-time jobs combined, but because of their voracious demand for milk from New York's dairy farmers (it takes roughly four gallons of milk to make one gallon of Greek yogurt). Fifty or more tanker trucks make daily deliveries to the Chobani plant alone.

Little wonder Gov. Andrew Cuomo's administration chipped in $16 million in state incentives for the Chobani expansion, and the governor became personally involved in ironing out a local intra-community dispute that was holding up the Fage expansion.

"It's been very good for the dairy industry," said Greg Wickham, chief executive officer of Dairylea Cooperative Inc., which supplies milk for Chobani. Another manufacturer, Alpina, plans to open a plant to the west in Batavia this summer that will make both Greek and Swiss-style for a yogurt and granola product.

At least initially, Greek yogurt zoomed to popularity without a lot of attention from the major yogurt makers. Citigroup Global Markets in an analyst report last month said its growth to $1 billion in annual sales — out of total yogurt sales of $4.1 billion — caught the major U.S. yogurt makers "flat-footed."

The result: Chobani had 53 percent of the Greek yogurt market, followed by Fage with 17 percent, France's Danone (its subsidiary Dannon makes Oikos) with 14 percent and General Mills (Yoplait Greek) with 5 percent, according to Citigroup. The big players have clearly taken steps to grab some of the market back. General Mills added capacity and Dannon is in the process now, according to representatives of the two companies. General Mills this winter will introduce Yoplait Greek Parfaits with granola and new flavors of Yoplait Greek yogurt in multi-packs.

"I think that you're going to see a very high level of innovation in the yogurt category generally and in Greek yogurt specifically over the next 6 to 12 months," General Mills chief executive officer Kendall J. Powell told a conference call with analysts last month. General Mills and Dannon also began TV advertising this past summer.

Oikos took direct aim at Chobani with a TV ad claiming their Greek yogurt was preferred 2-to-1 in a taste test. UBS analyst David Palmer said Greek yogurt's momentum continues and the market shift to Chobani has accelerated. Still unclear is where the Greek market will top out, or whether it will crash back to earth like the old low-carb craze. Few expect a drop off anytime soon.

"We believe it is not a fad but rather a part of the market that is here to stay," said Dannon spokesman Michael Neuwirth said. "At what level, I can't predict." One note of caution comes from one of Greek yogurt's U.S. pioneers, outgoing Stonyfield CEO Gary Hirshberg, who said he's noticed "a little bit of a rebound" for regular yogurt recently.

He said just recently some supermarkets that swapped out regular Stonyfield yogurt for its Greek Oikos yogurt (Danone owns a majority share of Stonyfield) have asked to swap back. "It's hard to tell where this is going," Hirshberg said.

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To: stockman_scott who wrote (1445)3/6/2012 8:37:59 AM
From: Glenn Petersen
1 Recommendation   of 2290
As New iPad Debut Nears, Some See Decline of PCs

New York Times
March 5, 2012

The chief executive of Apple, Timothy D. Cook, has a prediction: the day will come when tablet devices like the Apple iPad outsell traditional personal computers.

His forecast has backing from a growing number of analysts and veteran technology industry executives, who contend that the torrid growth rates of the iPad, combined with tablet competition from the likes of and Microsoft, make a changing of the guard a question of when, not if.

Tablet sales are likely to get another jolt this week when Apple introduces its newest version of the iPad, which is expected to have a higher-resolution screen. With past iterations of the iPad and iPhone, Apple has made an art of refining the devices with better screens, faster processors and speedier network connections, as well as other bells and whistles — steadily broadening their audiences.

An Apple spokeswoman, Trudy Muller, declined to comment on an event the company is holding Wednesday in San Francisco that is expected to feature the new product.

Any surpassing of personal computers by tablets will be a case of the computer industry’s tail wagging the dog. The iPad, which seemed like a nice side business for Apple when it was introduced in 2010, has become a franchise for the company, accounting for $9.15 billion in revenue in the holiday quarter, or about 20 percent of Apple’s total revenue. The roughly 15 million iPads Apple sold in that period was more than twice the number it sold a year earlier.

In the fall, Amazon introduced the iPad’s first credible competitor in the $199 Kindle Fire. Although Amazon does not release sales figures for the device, some analysts estimate it sold about four million in the holiday quarter. Later this year, tablets from a variety of hardware manufacturers based on Windows 8, a new, touch-screen-friendly operating system from Microsoft, could further propel the market.

“Tablets are on fire, there’s no question about that,” said Brad Silverberg, a venture capitalist in Seattle at Ignition Partners and a former Microsoft executive, who hastened to add that he was speaking mainly of the iPad, which dominates current sales.

Tablets are not there yet. In 2011, PCs outsold tablets almost six to one, estimates Canalys, a technology research company. But that is still a significant change from 2010, the iPad’s first year on the market, when PCs outsold tablets 20 to one, according to Canalys. For the last two years, PC sales were flat, while iPad sales were booming. The Kindle Fire and Barnes & Noble’s Nook gave the market an additional lift over the holidays. Apple is banking on the tablet market. Its iPad brought in nearly 40 percent more revenue during the holidays than Apple’s own computer business, the Macintosh, did.

“From the first day it shipped, we thought — not just me, many of us thought at Apple — that the tablet market would become larger than the PC market, and it was just a matter of the time that it took for that to occur,” Mr. Cook of Apple said recently at a Goldman Sachs investor conference.

Gene Munster, an analyst at Piper Jaffray, estimated that Mr. Cook’s prediction would come true in 2017, but others contend tablets will be on top sooner than that.

For example, in a blog post on Friday, Horace Dediu, an analyst with Asymco in Finland, made a detailed argument that tablet sales would pass traditional PC sales in the fall of 2013. His projections rest heavily on an assumption that Apple will face more serious competition in the tablet market from Amazon’s Kindle Fire, Windows 8 and a wave of other devices based on Google’s Android, an operating system that has been mostly successful in the smartphone market.

Tim Bucher, an entrepreneur who has held senior positions at Apple, Microsoft and Dell, said tablet sales would “absolutely” pass those of PCs, a trend he argued would become even more pronounced as a younger, tablet-savvy generation ages.

“I think the older generation does not pick up on the way of interacting with the new devices,” Mr. Bucher said, contrasting older people with the next generation. “I don’t know how many YouTube videos there are out there showing everyone from babies to animals interacting with iPads.”

Where does that change leave the PC, the lowly machine that defined computing for decades?

At a technology conference in 2010, Steven P. Jobs, then Apple’s chief executive, heralded what he called the post-PC era and compared personal computers to the trucks that prevailed in the automobile industry until society began moving away from its agrarian roots. PCs are “still going to be around and have a lot of value,” said Mr. Jobs, who died in October. “But they’re going to be used by one out of X people.”

Even Mr. Cook in his recent speech said he was not predicting the demise of the PC industry, although he did say the iPad was cannibalizing some computer sales, more Windows PCs than the much smaller market for Macs. One category of PCs where that is especially true is netbooks, the inexpensive notebook computers that have had a steep decline in shipments in the last couple of years. “What the iPad is doing is taking growth away from the PC market that would have gone to a secondary or tertiary device,” said Mr. Dediu. “It’s not so much people are going to drop PCs. They’re going to add this additional device.”

Traditional PCs are not standing still. Boxy desktop computers are an ever-diminishing part of the PC business, while Apple’s MacBook Air and a category of Windows laptops with Intel processors called ultrabooks have reinvented traditional clamshell notebooks as superthin devices that turn on instantly like tablets.

Microsoft’s introduction of Windows 8 promises to shake up computer designs further. Microsoft and its hardware partners have shown laptops with keyboards that can be swiveled around or removed altogether, turning them into tablets.

“The tablet and PC markets are all going to blur,” said Tim Coulling, an analyst at Canalys. “We’re going to see a lot of form-factor innovation. We’ll be asking, What is a tablet and what is a traditional PC?”

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To: stockman_scott who wrote (1445)3/24/2012 10:10:49 AM
From: Glenn Petersen
2 Recommendations   of 2290
Generations come and generations go, but the earth remains forever. - Ecclesiastes 1:4 (New International Version, 1984)


The Lower Ninth Ward in New Orleans Gives New Meaning to ‘Urban Growth’

New York Times Magazine
Published: March 21, 2012

Andrew Moore for The New York Times
Two houses on Alabo Street, one abandoned, one occupied.

“We have snakes,” Mary Brock said. “Long, thick snakes. Kingsnakes, rattlesnakes.”

Brock was walking Pee Wee, a small, high-strung West Highland terrier who darted into the brush at the slightest provocation — a sudden breeze, shifting gravel, a tour bus rumbling down Caffin Avenue several blocks east. But Pee Wee had reason to be anxious. Brock was anxious. Most residents of the Lower Ninth Ward in New Orleans are anxious. “A lot of people in my little area died after Katrina,” Brock said. “Because of too much stress.” The most immediate sources of stress that October morning were the stray Rottweilers. Brock had seen packs of them in the wildly overgrown lots, prowling for food. Pee Wee, it seemed, had seen them, too. “I know they used to be pets because they are beautiful animals.” Brock corrected herself: “They were beautiful animals. When I first saw them, they were nice and clean — inside-the-house animals. But now they just look sad.”

The Lower Ninth has become a dumping ground for unwanted dogs and cats. People from all over the city take the Claiborne Avenue Bridge over the Industrial Canal, bounce along the fractured streets until they reach a suitably empty area and then toss the animals out of the car. But it’s not just pets. The neighborhood has become a dumping ground for many kinds of unwanted things. Contractors, rather than drive to the city dump in New Orleans East, sweep trailers full of construction debris onto the street. Auto shops, rather than pay the tire-disposal fee ($2 a tire), dump tires by the dozen. The tire problem has become so desperate that the city is debating changes to the law. (One humble suggestion: a $2 reward per tire.) You also see burned piles of household garbage, cotton-candy-pink tufts of insulation foam, turquoise PVC pipes, sodden couches tumescing like sea sponges and abandoned cars. Sometimes the cars contain bodies. In August, the police discovered an incinerated corpse in a white Dodge Charger that was left in the middle of an abandoned lot near the intersection of Choctaw and Law, two blocks from where Mary Brock was walking Pee Wee. Nobody knew how long the car had been there; it was concealed from the closest house, half a block away, by 12-foot-high grass. That entire stretch of Choctaw Street, for that matter, was no longer visible. It had been devoured by forest. Every housing plot on both sides of the street for two blocks, between Rocheblave and Law, was abandoned. Through the weeds, you could just make out a cross marking the spot where Brock’s neighbor had drowned.

It is misleading to talk about abandoned lots in the context of the Lower Ninth Ward. Vast sections of the neighborhood have been abandoned, so it’s often unclear where one property ends and the next begins. (An exception is the sliver of land on the neighborhood’s innermost edge, where Brad Pitt’s Make It Right Foundation has built 76 solar-paneled, pastel-hued homes — though this seems less a part of the neighborhood than a Special Economic Zone.) To visualize how the Lower Ninth looked in September — before the city’s most recent campaign to reclaim the neighborhood — you have to understand that it no longer resembled an urban, or even suburban environment. Where once there stood orderly rows of single-family homes with driveways and front yards, there was jungle. The vegetation had all sprouted since Katrina. Trees that did not exist before the storm are now 30 feet high.

The cartoonish pace of vegetation growth resembles something out of a Chia Pet commercial, but it is hardly surprising to New Orleanians long accustomed to roads warped by tree roots and yards invaded by weeds. The soil in the Lower Ninth is extraordinarily fertile, thanks to centuries of alluvial deposits from the Mississippi River, which forms the neighborhood’s southern boundary. From the river, the neighborhood descends, like a long ramp, down to an open-water, brackish marsh called Bayou Bienvenue. This back part of the neighborhood, which, at its lowest point, is four feet below sea level, was the most devastated by the storm and remains the least inhabited. Its population has decreased by 85 percent since 2000.

Many of the ruined buildings have been cleared away, and most of the old foundations are obscured. The inhabited lots, about one per city block, are the exception. With their dutifully trimmed lawns, upright fences and new construction, they stand out like teeth in a jack-o-lantern. But wilderness encroaches from all sides. “My neighbor just saw a little family of coons parading across the street,” said Don Porter, who lives south of Claiborne Avenue, in one of the more occupied areas of the neighborhood. There are four houses on his block, and only two are vacant. “And you see rabbit,” he said. “You see egrets. Pelicans.”

“A raccoon climbs on top of our roof,” said Terry Jacko, 23, who stood with his brother Terrence, 19, in the front yard of their Reynes Street house. “It’s huge. The first time I heard it, I thought it was a dude.”

“I saw a possum in the backyard the other day,” Terrence said. “Its teeth were about this big. I killed it with a stick. It was coming toward me, so I hit him. He just flipped over. I stayed inside after that.”

There have been sightings of armadillos, coyotes, owls, hawks, falcons and even a four-foot alligator, drinking from a leaky fire hydrant. Rats have been less of a problem lately because of the stray cats and the birds of prey. But it’s not just animals that emerge from the weeds. “Sometimes I see people coming out of there,” Terrence said, pointing at the ruins of two houses, shrouded in weeds, across the street. “They’re trying to get in my home.”

Johnny Windsor, who lives with his wife in a rebuilt house nearby that is surrounded on every side by forest, has seen even more disturbing things. “They drag bodies in there,” he said, pointing to a thicket across the street. Bad things have been happening in the abandoned lots. While walking home from school one evening, a 16-year-old girl was dragged into a blighted house and raped. Now Windsor and his wife take turns sitting outside, keeping watch. “You never know,” he said, “if someone’s lying in the grass, ready to shoot.”

For six and a half years, the neighborhood has undergone a reverse colonization — nature reclaiming civilization. Residents have fought with hatchets and weed trimmers to rebuff the colonizers: Southern cut grass, giant ragweed, Chinese tallow trees. But the effort has been largely futile. The lots require constant vigilance. A lot left untended for three months will be thick with knee-high weeds; after five months, saplings begin to rise. By last August, the sixth anniversary of Katrina, it was clear that nature had triumphed.

In September, the mayor of New Orleans, Mitch Landrieu, announced what amounted to a troop surge in the battle for the Lower Ninth. He called it the Nuisance Lot Maintenance Pilot Program. It was the city’s third attempt to clear the overgrown lots in the Lower Ninth. The first contractor chosen for the job was revealed to be a convicted felon; the second contractor, hired a year ago, was asked to clear each lot only once, which was not particularly helpful, because the vegetation grew back within months. This time, the city decided to handle the job itself, using municipal agencies to hire workers and oversee the project. The pilot program consists of a single crew of 12 men — all residents of the Lower Ninth or ex-offenders. They have waged a block-by-block campaign to reclaim the land. The program concludes at the end of this month. At that point the cycle will begin again.

To understand why New Orleans ceded an entire neighborhood to nature for six years, it’s necessary to revisit a chapter from the post-Katrina era so painful that few in the city have the stomach to discuss it. The Tulane geographer Richard Campanella has called it “the Great Footprint Debate.” With most of New Orleans in ruins, the city had to decide how to rebuild: which areas should receive priority and which should be redeveloped?

The problem, as some saw it, was mathematical. In 1960, the population of New Orleans peaked at 627,525. To accommodate the boom, the city expanded into low-lying marshland that was previously considered unfit for human habitation. These newer, lower-lying neighborhoods were hit hardest by the storm. (The Lower Ninth is higher, on average, than New Orleans East, Gentilly, Broadmoor and Lakeview, but it suffered the most damage because of the two breaches of the Industrial Canal levee, which serves as the neighborhood’s western boundary.) A year after Katrina, the city’s population plunged to about 200,000; meanwhile, the street grid, since 1970, had increased by more than 10 percent. Could a city built for 627,000 maintain a population less than a third of its size? Could taxpayers afford to maintain services like garbage removal, policing, sewer pipes and miles of perpetually eroding streets? And if not, what should be done with the lowest-lying areas and their exiled inhabitants?

A panel commissioned in 2005 by Mayor Ray Nagin, Landrieu’s predecessor, recommended converting large sections of the hardest-hit neighborhoods into “green space.” This activated the survival instinct of local community groups, who saw it as a covert attempt to eradicate the city’s poorest (and blackest) neighborhoods. These suspicions were not allayed by statements like the one made by Joseph Canizaro, a wealthy white property developer who led Nagin’s panel: “As a practical matter, these poor folks don’t have the resources to go back to our city just like they didn’t have the resources to get out of our city. So we won’t get all those folks back.”

Nagin rejected his commission’s recommendations and adopted in its place an approach that most generously might be described as laissez-faire. Residents were allowed to return to the Lower Ninth — which, at 2.25 square miles, is more than four times the size of the French Quarter — as they desired, and the city’s footprint would be preserved. According to the recent census, 5,560 people now live in the area, nearly three-quarters fewer than in 2000. There is currently no police or fire station, supermarket or hospital. Most residents haven’t returned — some because they cannot afford to, others by choice. Between its light population density and lack of basic services, much of the Lower Ninth has fallen into the very condition that New Orleanians after the storm were desperate to avoid: it has become green space.

Landrieu, elected in 2010, has directed considerable amounts of federal and local financing to construction projects in the Lower Ninth. These include $60 million for street repairs, $50 million for rebuilding schools and $14.5 million for a new community center. But clearing the lots is the logical first step. How can you repair a street if you can’t see it?

“The debate about the footprint is history now,” Campanella says. “You can’t reintroduce that question six years later, given that the city, the state and the nation as a whole has already committed recovery dollars to rebuilding houses and fixing utilities. To go back and reopen the wound — it’s too late. The baby’s already born. Maybe next time we could revisit this. I hope there isn’t a next time. But of course there will be.”

When Landrieu took office, New Orleans had the highest percentage of blighted properties of any American city — higher than Cleveland, Flint, Mich., and even Detroit, which, during the last 60 years, has lost 1.1 million people, roughly the population of Dallas. But unlike those of the Rust Belt cities, the population of New Orleans is growing — it is now 356,000 — and its blighted properties have been decreasing. In 2008, one of every three New Orleans properties was uninhabited; today, the number is less than one in four.

Landrieu has emphasized blight reduction and generally spent the government’s money according to his constituents’ wishes. For this he has earned their appreciation; a poll conducted in November gave him an 88 percent favorability rating. “The people of New Orleans, through their elected officials and their advocacy, have decided to rebuild every part of New Orleans,” Landrieu told me. That decision “necessarily put us on a longer course and created a challenge that is hard to achieve, especially with a limited amount of money. But I think that you can, with a lot of good strategy and thought, rebuild neighborhoods. We’re in an exercise now that’s attempting to prove that point.” It remains to be seen what point will be proved by this approach, but Landrieu is not wasting any time. He has promised to complete more than 100 “recovery projects” within four years, or just in time for the next mayoral campaign.

Campanella operates on a different time frame. As a geographer, he has the luxury — or Cassandra’s curse — to contemplate the city’s future three decades, even three centuries from now. The walls of his Tulane office are decorated with giant photographs of New Orleans, the Mississippi River and the United States taken from outerspace.

Few cities have been more acutely influenced by their geographical location than New Orleans, which the geographer Pierce Lewis once called the “inevitable city on an impossible site.” Here, location is destiny; or, more precisely, elevation is destiny. The oldest, wealthiest, whiter, “historic” neighborhoods, where most transplants reside, are on high ground. Most of the newer and poorer neighborhoods, where the greatest concentration of native New Orleanians live, are at, or below, sea level — and sinking. The difference between the French Quarter, which survived Katrina relatively unscathed, and the back section of the Lower Ninth, is nine feet.

Campanella’s geographical history of New Orleans, “Bienville’s Dilemma,” is essential reading for those new to town. Readers often ask him where in the city it is safe to live. “I tell them that the higher the elevation, the closer to the river and the closer to the historic urban core, the less vulnerable you will be,” says Campanella, who is himself a transplant. This is not immediately apparent because the port accents of Brooklyn and New Orleans share the same progenitors. “The population we have now is roughly the population we had a hundred years ago, in the 1910s,” he said. “I would love to see our current population living on higher ground, in neighborhoods teeming with life — people on the streets, walking and taking the streetcar to work, living within proximity of most of their needs. I realize that we cannot go back in history. There are 100-year-old cultural transformations that you can’t just ignore. But that is what I would hope for, to the extent that it’s possible.”

The ruination of the Lower Ninth has attracted geographers and ecologists from around the world, especially those in the burgeoning field of catastrophe studies — a field with a busy future. “It’s a fascinating natural laboratory,” Michael Blum, an ecologist at Tulane, says. “New Orleans in general is an outstanding arena in which to understand basic ecological principles related to disturbance. The Lower Ninth lies at the heart of that.”

The closest analogy to what happened in the Lower Ninth, Blum says, is a volcanic eruption on the order of Mount St. Helens. The next closest is the tsunami that hit Japan’s northeast coast a year ago. This is what distinguishes the Lower Ninth from the most derelict neighborhoods in cities like Detroit and Cleveland. Katrina was not merely destructive; it brought about a “catastrophic reimagining of the landscape.” As in Japan, a surge of water destroyed most human structures. In much of the neighborhood, nothing remained — neither man, plants nor animals. The ecological term for this is simplification. “In 2007, before rebuilding started, when you went down there, it was like going to an agricultural field,” Blum says. “Literally it was wiped clean.”

What happened over the intervening years has made the Lower Ninth one of the richest ecological case studies in the world. Ecologists hypothesize that, after a catastrophic event, human communities and ecological communities return at the same rate. But this theory has not been tested in real time. Blum is among a coalition of scientists — ecologists, ornithologists, botanists, geographers and sociologists — that is studying the Lower Ninth’s recovery to learn how man, and the environment, will cope with future catastrophes.

In the race between nature and man, nature has jumped out to an early lead. But the pattern of growth has been bizarre. The Lower Ninth has been besieged by a flora feeding frenzy. A chaotic mix of plant species, many of which have never existed on that land, are battling for dominance. Before the area was cleared for plantations in the mid-1700s, the Lower Ninth was divided into three ecosystems, depending on elevation. The riverfront was lined with reeds and brambles; behind that was a dense hardwood forest; and farthest back, where Mary Brock and Pee Wee live, lay a cypress swamp populated by stands of palmettos. Today there are very few species native to the land, other than several kinds of sedge and aquatic grass. Only a handful of palm, live oak, pine and bald cypress trees survived the storm.

A variety of species, some exotic, have moved in, among them crepe myrtle, black willow and golden rain trees laced with vines. The undergrowth is a chaotic mix of weeds as high as basketball hoops and flowering shrubs like lantana, oleander and oxalis. Invasive species have infiltrated the neighborhood from the major avenues, the seeds transported by the flatbed trucks that drive to the city. The plant and animal life varies quixotically from plot to plot, as the new species entrench themselves, mustering strength, before fighting for additional territory.

The ecological composition of the neighborhood may be diverse, but it is also extremely unstable. “It’s a very odd mix, one that you wouldn’t other­wise see in nature,” Blum says. “It’s a Frankenstein community.” Ecologically speaking, Katrina has created a monster.

The 12 men hired to tame this monster meet in the Lower Ninth every morning at 7:30. They wear sunglasses, jeans, boots and bright green city-issued T-shirts. On the back of each shirt is a fleur-de-lis; the front bears the slogan “Fight the Blight.” The Nuisance Lot Maintenance pilot program clears 20 properties a day. When the crew first arrives at a lot, several men tramp through the bramble, dragging to the curb any large pieces of garbage or tires they find. Then comes the tractor, a two-wheel-drive Mahindra 4025, which a crew member drives through the property like a battering ram.

“I haven’t seen any bodies or skeletons,” Enri Jacques, one of the older members of the work crew, said. “Just wild rabbits, coons and garter snakes.” After Jacques lost his home in the storm, he slept on the Claiborne Bridge for four nights. He learned about the pilot-program job from his probation officer. “It beats being incarcerated,” he said. “It was very hard for me to find work. This job is a blessing of Christ. My house is still not totally livable right now, but now that I’m working, I’m able to put a little money aside.”

After the tractor finishes its circuit, two men stroll through the lot waving weed trimmers, the gasoline-powered machines used for residential lawn cutting. They resemble a fencing foil, only the tip culminates in a small mechanical spool that spins roughly a hundred times per second. Weed trimmers are powerful enough to cut most plants and shrubs, but not trees. When Adrian Tillman, a lanky, 28-year-old member of the crew, uses a trimmer, he wraps a black shirt around his head so that the flying debris won’t cut his face.

Tillman did construction work at Jackson Barracks, the military base in the Lower Ninth that is still being repaired. After being laid off, he struggled to find a job until his mother told him that the city was looking for people from the Lower Ninth to cut grass. Since Tillman must constantly cut the grass around his own house, he was prepared for the work. “It’s a laid-back job,” he said, especially because the crew was told to stay clear of any trees or ruined structures. His neighbors thanked him for his work. “When they see us coming,” Tillman said, “they clap their hands.”

A property is crossed off the list once the grasses and weeds are cut and the sidewalk swept clean of debris. To be clear, a “cut” lot does not resemble in the slightest a mowed lawn. The field is often reduced to a pockmarked stubble, bald patches alternating with tussocks of jaggedly shaved 6-inch weeds. In other lots the quantity of vegetation is so great that, when the crew’s work is done, the ground is covered by a heavy carpet of mowed grass. But it doesn’t last long. Plots cleared this December are already sprouting wildflowers a foot high.

Not everyone in the neighborhood has been satisfied with the work of the Nuisance Lot Maintenance pilot program. A Mr. Harris, who declined to give his first name, stood on a viewing platform built on the flood wall at the edge of Bayou Bienvenue. He ate sunflower seeds while three friends, lifelong residents of the Lower Ninth, baited lines for drum and redfish. Harris gestured at a cleared lot near Florida Avenue, at the edge of which stood a pile of construction debris left behind by the crew.

“If we’re going to pay you money to do that, I want professional work,” he said. “Hire some real professionals. I don’t want it to look like that there.”

Harris spit out his sunflower shells in disgust. A luxury motor coach, filled with tourists behind tinted windows, trundled down Florida Street toward the Make It Right houses. Seventeen expletives have been edited out of the following paragraph:

“Every day 20 tour buses come down this street to look at this neighborhood and take pictures,” Harris said. “Don’t tell me they’re just touring the city. If you’re trying to tour the city, then you’re in the wrong neighborhood. They just ride around in the part that’s been devastated. Lower Ninth Ward ain’t receiving a single penny for that. Why can’t I get something? Why does the man driving the bus get all the money? I ain’t a guinea pig. I don’t want to be put under a microscope. We’re the ones that suffered down here, who lost everything. There are still dead people that they haven’t accounted for. It’s frustrating. It took almost seven years for the Ninth Ward to look like what it looks like now, and it still don’t look like [anything].”

The going rate for a Hurricane Katrina tour of the Lower Ninth Ward is $40. Motor coaches are operated by Big Easy Tours, Historic New Orleans Tours and Gray Line, which offers customers an “eyewitness account of the events surrounding the most devastating natural — and man-made — disaster on American soil!” plus the chance to “drive past an actual levee that ‘breached.’ ”

Tauck, the upscale guided-tour operator, spends one morning in the Lower Ninth as part of its eight-day New Orleans package (from $2,750). The day begins at the Greater Little Zion Baptist Church, which was founded in 1900 and rebuilt a year after the storm. The 42 members of the tour, almost all of whom are white and appear older than 60, sit patiently in the pews, cameras in laps, while a video showing the destruction is projected on the sanctuary. An introductory talk about the horrors of Katrina — the unmarked graves, the toxic mold, the cruel bureaucratic inanities of FEMA — is presented by Laura Paul, a 41-year-old Canadian who came as a volunteer aid worker after Katrina and never left. In her previous life, Paul was a client coordinator for global express aircraft at Bombardier Aerospace outside Montreal. Now she runs, a nonprofit organization whose volunteers rebuild homes, operate an urban farm and collected the data on abandoned lots that was used to develop the Nuisance Lot Maintenance pilot program. Tauck donates $25 per tour participant to

“The issue with the neighborhood is not the tours themselves,” Paul said, “but the fact that people are making bank on them and not giving anything back to the community. And they can be disrespectful: people get out of the buses, trample private property and take pictures. I really do think that Tauck is doing the right thing. I like the company, I like the tour guides, I like the people they bring to the neighborhood. You’re talking about upper-class, predominantly white people. They have a lot of money.” A woman from a Tauck tour once sent Paul a check for $5,000.

“Getting money after a storm is like shooting fish in a barrel,” Paul added. “But long-term recovery? People just don’t want to know how long it takes. The truth is discouraging. It could easily take another 10 years. We’ll work until we run out of money. The problem is that someday — and this might already be starting — people will be like: ‘Seriously? Enough with the Katrina stuff. Please, just stop.’ ”

The only person on the Tauck bus who seemed truly uncomfortable about the tour was Renee Whitecloud, the tour guide. Whitecloud, who grew up in New Orleans, carries in her wallet a photograph of her flooded street in the Broadmoor neighborhood. By the time she returned home after the floodwaters receded, mold had crept all the way up to the second floor. The mold was “psychedelic,” she said. “Green, orange, yellow, all different colors.” She developed asthma and allergies and suffered frequent migraines. “I love the city,” Whitecloud said, “but this is a hard day for me.” She stood outside the bus while her tourists walked through a house on Caffin Avenue that rebuilt. “It’s in your face,” she said. “Every time I do this tour, I have to revisit the trauma.” When the Katrina video plays in the church, she stands outside.

Because the motor coach is too large to negotiate the broken residential streets, it drives in a rectangle around the most devastated section of the Lower Ninth, sticking to the major thoroughfares. During a tour in October, it drove alongside the Industrial Canal, pausing so that the passengers could see the area where the levee breached. As it slowly passed through the Make It Right houses, a teenage boy ran to the curb, and the driver — whose own house is still gutted from Katrina — pulled over. The door opened and the boy stepped on. The bus filled with the kind of silence that follows a popped balloon. The boy held a carton of homemade pralines.

“Three for $10,” he said. “Buy one for a good cause.”

The 42 members of the tour group sat stiffly in their seats, staring forward in silence.

“Like to donate a dollar? Anyone?”

Nobody moved.

“Going once, going twice . . . Sold! To the guy in the black jacket!”

The man in the black jacket flinched violently.

“No? O.K., then. Going once, going twice . . . Sold! To this woman here in the front row!”

No one offered the boy any money. After another excruciatingly long pause, he stepped out onto the street. The motor coach scuttled back to the French Quarter.

The Nuisance Lot Maintenance pilot program has now cleared more than 1,200 lots. The transformation of the neighborhood is stark. Ruined houses still tilt like old prizefighters on nearly every street; the roads are chassis-rattling slalom courses; and there are few people, other than tourists, in sight. But no longer are there full blocks of uninterrupted jungle. The worst parts of the neighborhood are desolate but neat. It is uncertain what exactly will happen next to the cleared lots. As Jeff Hebert, the executive director of the New Orleans Redevelopment Authority, said, “Cutting grass once isn’t really a good option.” In the Lower Ninth, a property remains cleared for only three to six months. A Chinese tallow tree, for instance, will grow from seed to two-foot-high sapling in a summer and six feet within a year.

When I asked Landrieu what might be done next with the lots, he had no specific answers but emphasized the need for private development. “We don’t know what the end looks like,” he said. “We think we know what the process looks like. We want to get those lots back in the hands of private-property owners so that they can take responsibility for them. Anything we can do to make them attractive to private investors, we want to do.” He acknowledged that, while the city has made significant progress in fighting blight in other poor neighborhoods, the Lower Ninth “has become a symbol of New Orleans’s rebirth, whether that’s justified or not.” Nor is it simply a question of restoring the conditions that existed before the storm. “I keep telling people that we’re not putting things back like it was,” he said. “We’re building the city we want to become.”

Hebert wasn’t any more specific. “All properties will receive a level of maintenance until such time as there is interest in the property for new housing or alternative uses like parks, community gardens, etc.,” he wrote in an e-mail. “It is not the goal of the city to maintain in perpetuity.”

I recently accompanied Peter Yaukey, an ornithologist at the University of New Orleans who has been surveying bird life in the Lower Ninth for six years. On his first visit, a month after the storm, he was not allowed north of Claiborne Avenue because the authorities were still searching for bodies. The first thing he noticed was the silence. When a sound editor from the HBO show “Treme” asked him what type of birds were heard in New Orleans after the storm, Yaukey said there was a nearly complete absence of bird song. The city had no ambient sound. You could hear a boombox from three blocks away.

Many of the birds that used to be common in the Lower Ninth — like mourning doves and house sparrows — had almost entirely disappeared and only now are beginning to return in small numbers. But over the course of several years, as the lots grew thick with weeds and the rodent populations increased, Yaukey observed that something strange was happening. Large predators, which feed on rats and mice, began to appear in high numbers. So high, in fact, that there was soon a much greater concentration of hawks, falcons and shrikes in the Lower Ninth than would be found in a rural environment. He suspected that barn owls were building nests in the blighted buildings. The word Yaukey used to describe the concentration of raptors was “supernatural.” Both senses of the word seemed to apply.

Yaukey, who bears a strong resemblance to the actor Thomas Haden Church and has the same raspy voice, began spotting birds through the windshield as soon as we turned off Claiborne. He wore a pair of binoculars around his neck, but he didn’t need them to identify the birds that glided hundreds of feet overhead: a white ibis, a red-tailed hawk, a turkey vulture and an osprey, clenching in its talons a fish plucked from the Industrial Canal. There were plenty of species at street level as well: blue jays, cardinals, American crows, Eastern phoebes, killdeer, loggerhead shrike, kestrel falcons, bronzed cowbirds and, rarest of all, an open-ground woodpecker. A great egret, regal and stiff, promenaded down the middle of Choctaw, stalking lizards. A flock of roughly 300 European starlings pecked at insects and weed seeds on the Caffin median. An exceedingly plump red-shouldered hawk perched on the bending branch of a mulberry tree. To Yaukey’s amazement, the hawk did not budge even when we came within 10 feet. “It looks pretty tame,” he said. “Almost to the point of being goofy.”

Yaukey was surprised by how substantially the lot-maintenance crew had altered the landscape. He pointed out that the overgrown lots that did remain were rapidly changing. The tall weeds were being crowded out by saplings and trees, especially the aggressive and omnipresent Chinese tallow, whose leaves had begun to turn yellow, crimson and purple. If left alone for another five years, the Chinese tallow might conquer every inch of land in the Lower Ninth, creating a suffocating monoculture, but for the time being, a wide variety of plants thrived in the understory. He was especially eager to find a dense lot that he could explore with the hope of finding birds, like sparrows, that favored brush. He found a suitable spot — three contiguous abandoned lots — at the corner of Jourdan and Law. We were just a few blocks behind Brad Pitt’s houses and across the street from the Industrial Canal levee. It was at this spot, more than six years ago, that four of the concrete slabs cracked, the soil gave way and the inundation of the Lower Ninth began.

Before the car came to a complete stop, Yaukey was out the door, tramping into the weeds. Birds started hopping and darting about. He made birdcalls: pish-pish-spish-spish-SPISH. Wee! Weeweewee! And another that is difficult to transcribe but sounded like a rotating lawn sprinkler.

By the time I locked the car, he was 20 feet away, obscured to his neck by the high weeds. The birds were calling back to him. “Field sparrow,” he marveled, cocking his head. “Swamp sparrow.”


“I’ve gone whole winters without seeing a field sparrow in the New Orleans vicinity. Field sparrows, swamp sparrows, simply do not winter in residential New Orleans. So this habitat . . .,” he trailed off. “I can come here and see them.” The excitement was high in his voice.

It was difficult to keep up — he had the bounding energy of a child let out to recess. The brush was so dense that it was impossible to find secure footing. Every step cracked a branch. Thorns tugged on pants. Cordlike vines noosed around ankles like booby traps. I kicked a concrete slab, concealed beneath a mound of dirt — the foundation of the house that once stood there.

“Rattlebox!” Yaukey said, pointing to an invasive South American tree he spotted in the middle of a thicket. Clusters of dark brown pods dangled like earrings from its stalks. Only a sandy tuft of Yaukey’s hair was visible now. His voice was hard to make out, and I had to ask him to repeat himself.

“Orange-crowned warbler!” he shouted back at me. “Ruby-crowned kinglet!”

Finally I gave up. Yaukey was too deep in the woods. It was no longer possible to distinguish which calls were his and which the birds’. He walked around a stand of 15-foot Chinese tallow trees, the green and crimson leaves waving mournfully in the wind. And then he was gone. The wilderness just swallowed him up.

Nathaniel Rich is the author of " The Mayor’s Tongue." He lives in New Orleans.

Editor: Jon Kelly

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From: Hustlenflow4/12/2012 8:28:35 PM
   of 2290
What do you guys think of ANCI? It's got an uptrend plus insider buying. Anything under .70 cents is super cheap imo. it also has a good balance sheet, what are you guys opinion on it? I think it could double before the year is over

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From: Glenn Petersen4/24/2012 5:42:35 PM
2 Recommendations   of 2290
A trend that needs to be reversed:

The phenomenon in which a sizable chunk of the workforce gets stuck in place, and in effect becomes permanently unemployed, is known by economists as hysteresis in the job market. This is, arguably, what happened to many European countries in the nineteen-eighties—policymakers did little when joblessness soared, and their economies got stuck, leaving them with seemingly permanent unemployment rates of eight or nine per cent. The good news is that there’s not much evidence that hysteresis has set in here yet.

No End in Sight

by James Surowiecki
The New Yorker
April 30, 2012

The talk in Washington these days is all about budget deficits, tax rates, and the “fiscal crisis” that supposedly looms in our near future. But this chatter has eclipsed a much more pressing crisis here and now: almost thirteen million Americans are still unemployed. Though the job market has shown some signs of life in recent months, the latest figures on new jobs and on unemployment-insurance claims have been decidedly unimpressive. We are stuck with an unemployment rate three points higher than the postwar average, and the percentage of working adult Americans is as low as it’s been in almost thirty years. What’s most troubling is that so much of this unemployment is long-term. Forty per cent of the unemployed have been without a job for six months or more—a much higher rate than in any recession since the Second World War—and the average length of unemployment is about forty weeks, a number that has changed very little since 2010. The economic recovery has now lasted nearly three years, but for millions of Americans it hasn’t yet begun.

Being unemployed is even more disastrous for individuals than you’d expect. Aside from the obvious harm—poverty, difficulty paying off debts—it seems to directly affect people’s health, particularly that of older workers. A study by the economists Till von Wachter and Daniel Sullivan found that among experienced male workers who lost their jobs during the 1981-82 recession mortality rates soared in the year after the layoffs. And the effects of unemployment linger. Many studies have shown that the lifetime earnings of workers who become unemployed during a recession are permanently reduced, and von Wachter and Sullivan found that mortality rates among laid-off workers were much higher than average even twenty years afterward.

Unemployment doesn’t hurt just the unemployed, though. It’s bad for all of us. Jobless workers, having no income, aren’t paying taxes, which adds to the budget deficit. More important, when a substantial portion of the workforce is sitting on its hands, the economy is going to grow more slowly than it could. After all, people doing something to create value, rather than nothing, is the fundamental driver of growth in any economy.

Most worrying, if high unemployment persists it could start to feed upon itself. Right now, unemployment is mainly the result of what economists call cyclical factors: during the recession, demand plummeted, and during the recovery consumer spending, government stimulus, and exports haven’t been sufficient to make up the difference. But if high long-term unemployment continues there’s a danger that, sooner or later, cyclical unemployment could become structural unemployment—that is, unemployment that won’t go away once the good times return. The longer people are unemployed, the harder it is for them to find a job (even after you control for skills, education, and so on). Being out of a job can erode people’s confidence and their sense of possibility; and employers, often unfairly, tend to take long-term unemployment as a signal that something is wrong. A more insidious factor is that long-term unemployment can start to erode job skills, making people less employable. One extraordinary study of Swedish workers, for instance, found that there was a strong correlation between time out of work and declining skills: workers who had been out of work for a year saw their relative ability to do something as simple as process and use printed information drop by five percentile points.

The phenomenon in which a sizable chunk of the workforce gets stuck in place, and in effect becomes permanently unemployed, is known by economists as hysteresis in the job market. This is, arguably, what happened to many European countries in the nineteen-eighties—policymakers did little when joblessness soared, and their economies got stuck, leaving them with seemingly permanent unemployment rates of eight or nine per cent. The good news is that there’s not much evidence that hysteresis has set in here yet. The bad news is that we can ride our luck only for so long. If the ranks of America’s long-term jobless don’t start shrinking soon, it’s less likely that they ever will, and we’ll be looking at a new “natural” unemployment rate for the U.S. economy. This economy would be less productive as a whole (since there would be fewer workers), meaning that everyone would be less well off.

You’d think that Congress and the Federal Reserve would be straining every sinew to avoid such a fate. It isn’t as if they’re out of tools. A more aggressive monetary or fiscal policy, or both, would help put lots of Americans back to work. We could also follow Germany’s example and subsidize job-sharing programs, which have helped Germany bring down its long-term unemployment rate despite the recession. Sadly, there’s little sign that policymakers have much interest in using these tools. The inertia can be chalked up, in part, to ideological hostility from those who are opposed to more government spending or to anything that might increase inflation. But the bigger obstacle may be psychological: the longer unemployment stays high, the likelier people are to get used to it. Five years ago, an unemployment rate of seven and a half per cent would have seemed outrageous, but it’s possible that five years from now it will seem not so bad. A long-term crisis, after a certain point, no longer seems like a crisis. It seems like the way things are.

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To: stockman_scott who wrote (1445)5/11/2012 3:08:55 PM
From: Glenn Petersen
1 Recommendation   of 2290
The Silver Lining to the Drop in Startups

By Scott Shane
Bloomberg BusinessWeek
on May 08, 2012

A long-term trend toward fewer business failures. That’s what you could have titled the recently released Kauffman Foundation-Census Bureau study (PDF) on U.S. entrepreneurship, entitled “Where Have All the Young Firms Gone?” While the report focuses on the decline in business creation, implicit in the data it discusses is a long-term decline in the failure rate of businesses.

The study discusses the dramatic drop in startup activity in the United States over the past three decades: U.S. Census data reveal that the share of new businesses shrank, from 13 percent of U.S. employers in 1980 to 8 percent in 2010 (when measured as the number of new ones formed as a percentage of all those in operation in the prior year). While the press release that accompanies the report implies that the decline is problematic because new businesses have historically been an important source of job creation, the interpretation need not be so dire.

Created from Census Bureau dataThe data also suggest that existing business owners have gotten better at running their companies, thereby reducing the business failure rate and destroying fewer jobs via shut-downs. While the number of new employers dropped by half between 1977 and 2010, the number of employers in operation grew 5 percent when the two are measured on a per capita basis. The only way to explain this: Failure rates must’ve dropped, too.

While the decline in the formation rate has accelerated during the Great Recession and that of the failure rate hasn’t, both display long-term downward trends from 1978 to 2010. This pattern means the U.S. economy has become less dynamic, with fewer new companies replacing old ones.

That might not be a bad thing. Most new businesses replace existing small businesses and serve the same customers with similar products, researchers have shown.

Perhaps fewer people are starting new companies to meet old needs by replacing existing companies because the guys already doing it have learned a thing or two. With existing business owners are doing a better job, their companies have become less likely to fail, so fewer people are starting businesses to replace them.

What about the report’s observation that new companies are a less-important source of employment than they used to be? It’s true that the number of startup jobs has declined over the past three decades: In 2010, new businesses employed 2.1 percent of private-sector workers, vs. 5.9 percent in 1977.

But the Census data show that this decline in employment by new businesses has occurred without any reduction in the ability of the private sector to provide jobs. From 1977 to 2010, American industry increased its employment, from 30 percent to 36 percent of the population. Therefore, the decline in hiring by new businesses was countered with a rise in hiring by existing businesses—and then some.

That’s because the decline in new-business job creation has been offset by a decline in existing-business job destruction, particularly job destruction from business failure. While the job-creation rate of new ventures dropped, from 9.2 percent of employment in 1977 to 4.3 percent in 2010, the job destruction rate also fell, from 15.2 percent in 1977 to 14 percent in 2010. Moreover, job destruction from businesses that shut down declined, from 6.1 percent of employment in 1977 to 4.1 percent of employment in 2010.

In addition, existing businesses have gotten bigger over the past three decades. The Census data show that their average size has grown, from 19.3 employees in 1977 to 22.2 in 2010. That means we need fewer businesses to provide the same number of jobs.

We should pay attention to the decline in business-formation rates, but we need to think about the different reasons why this might have occurred. Where the pessimist sees a loss of job-creating startups, the optimist sees better management of existing businesses. Both are plausible hypotheses. Before policy makers try to counteract the fall in startup rates, they first need to figure out which one is most consistent with the data.

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To: stockman_scott who wrote (1435)5/13/2012 4:33:37 PM
From: Glenn Petersen
5 Recommendations   of 2290
The "skyboxification of American life":

This Column Is Not Sponsored by Anyone

New York Times
May 12, 2012

PORING through Harvard philosopher Michael Sandel’s new book, “What Money Can’t Buy: The Moral Limits of Markets,” I found myself over and over again turning pages and saying, “I had no idea.”

I had no idea that in the year 2000, as Sandel notes, “a Russian rocket emblazoned with a giant Pizza Hut logo carried advertising into outer space,” or that in 2001, the British novelist Fay Weldon wrote a book commissioned by the jewelry company Bulgari and that, in exchange for payment, “the author agreed to mention Bulgari jewelry in the novel at least a dozen times.” I knew that stadiums are now named for corporations, but had no idea that now “even sliding into home is a corporate-sponsored event,” writes Sandel. “New York Life Insurance Company has a deal with 10 Major League Baseball teams that triggers a promotional plug every time a player slides safely into base. When the umpire calls the runner safe at home plate, a corporate logo appears on the television screen, and the play-by-play announcer must say, ‘Safe at home. Safe and secure. New York Life.’ ”

And while I knew that retired baseball players sell their autographs for $15 a pop, I had no idea that Pete Rose, who was banished from baseball for life for betting, has a Web site that, Sandel writes, “sells memorabilia related to his banishment. For $299, plus shipping and handling, you can buy a baseball autographed by Rose and inscribed with an apology: ‘I’m sorry I bet on baseball.’ For $500, Rose will send you an autographed copy of the document banishing him from the game.”

I had no idea that in 2001 an elementary school in New Jersey became America’s first public school “to sell naming rights to a corporate sponsor,” Sandel writes. “In exchange for a $100,000 donation from a local supermarket, it renamed its gym ‘ShopRite of Brooklawn Center.’ ... A high school in Newburyport, Mass., offered naming rights to the principal’s office for $10,000. ... By 2011, seven states had approved advertising on the sides of school buses.”

Seen in isolation, these commercial encroachments seem innocuous enough. But Sandel sees them as signs of a bad trend: “Over the last three decades,” he states, “we have drifted from having a market economy to becoming a market society. A market economy is a tool — a valuable and effective tool — for organizing productive activity. But a ‘market society’ is a place where everything is up for sale. It is a way of life where market values govern every sphere of life.”

Why worry about this trend? Because, Sandel argues, market values are crowding out civic practices. When public schools are plastered with commercial advertising, they teach students to be consumers rather than citizens. When we outsource war to private military contractors, and when we have separate, shorter lines for airport security for those who can afford them, the result is that the affluent and those of modest means live increasingly separate lives, and the class-mixing institutions and public spaces that forge a sense of common experience and shared citizenship get eroded.

This reach of markets into every aspect of life was partly a result of the end of the cold war, he argues, when America’s victory was interpreted as a victory for unfettered markets, thus propelling the notion that markets are the primary instruments for achieving the public good. It was also the result of Americans wanting more public services than they were willing to pay taxes for, thus inviting corporations to fill in the gap with school gyms brought to you by ShopRite.

Sandel is now a renowned professor at Harvard, but we first became friends when we grew up together in Minneapolis in the 1960s. Both our fathers took us to the 1965 World Series, when the Dodgers beat the Twins in seven games. In 1965, the best tickets in Metropolitan Stadium cost $3; bleachers were $1.50. Sandel’s third-deck seat to the World Series cost $8. Today, alas, not only are most stadiums named for companies, but the wealthy now sit in skyboxes — even at college games — that cost tens of thousands of dollars a season, and hoi polloi sit out in the rain.

Throughout our society, we are losing the places and institutions that used to bring people together from different walks of life. Sandel calls this the “skyboxification of American life,” and it is troubling. Unless the rich and poor encounter one another in everyday life, it is hard to think of ourselves as engaged in a common project. At a time when to fix our society we need to do big, hard things together, the marketization of public life becomes one more thing pulling us apart. “The great missing debate in contemporary politics,” Sandel writes, “is about the role and reach of markets.” We should be asking where markets serve the public good, and where they don’t belong, he argues. And we should be asking how to rebuild class-mixing institutions.

“Democracy does not require perfect equality,” he concludes, “but it does require that citizens share in a common life. ... For this is how we learn to negotiate and abide our differences, and how we come to care for the common good.”

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To: stockman_scott who wrote (1445)5/31/2012 4:28:52 PM
From: Glenn Petersen
1 Recommendation   of 2290
Soda Makers Scramble to Fill Void as Sales Drop

New York Times
May 15, 2012

In much the same way their ancestors on the prairie had to check their guns at the door of the saloon, the 320 students in the Faulkton Area School District in tiny Faulkton, S.D., will be required to dispose of all carbonated soda containers before stepping into school buildings.

“We’re not trying to be the pop police or anything, but we felt like we were sending a mixed message by having a healthy lunch program and yet letting everyone walk around with sodas with a bunch of sugar in them,” said Joel Price, superintendent of the district.

Although schools have been removing sodas and other sugary drinks from vending machines for the last few years, the Faulkton district is one of the first in the country to institute a ban, according to the Alliance for a Healthier Generation, which works to reduce childhood obesity.

The school cafeteria will serve water, low-fat milk and fruit juices, and those beverages, as well as sports drinks and noncaffeinated diet sodas sold in vending machines, are all that will be available on school property. “Sure, there will be some opposition to it, but this is the way things are changing, like it or not,” said Kyle Ortmeier, the 17-year-old behind the school’s wellness campaign.

Cold, bubbly, sweet soda, long the American Champagne, is becoming product non grata in more places these days. Schools are removing sugary soft drinks from vending machines at a faster pace, and local governments from San Antonio to Boston are stepping up efforts to take them out of public facilities as the nation’s concerns about obesity and its costs grow.

Last year, the average American drank slightly under two sodas a day, a drop in per capita consumption of about 16 percent since the peak in 1998, according to Beverage Digest, a trade publication.

What began as a slow decline accelerated in the middle of the last decade and now threatens some of the best-known brands in the business. Coke and Pepsi are relying more than ever on the “flat” drinks and bottled waters in their portfolios and on increases in the price of sodas, forcing die-hard drinkers to pay more to feed their sugar habits.

“The question is, Are we seeing a modest, multiyear decline that will bottom out? Or are we seeing the beginning of a paradigm shift away from carbonated soft drinks?” said John Sicher, publisher of Beverage Digest and a longtime observer of the industry. “I don’t think anyone knows yet, but I think there are continuing headwinds against the category that aren’t abating.”

Health advocates are cautiously optimistic about the decline. “It is really important because sugary soft drinks are the No. 1 source of calories in our diets,” said Margo Wootan, director of nutrition policy at the Center for Science in the Public Interest. “We get more calories from sodas and sugary drinks than any other individual food — cake, cookies, pizza, anything.”

But Ms. Wootan and others are worried about what may be taking the place of carbonated soft drinks in the American diet. They note the increasing appetite for energy drinks, loaded with sugar as well as caffeine, and noncarbonated sports drinks, which may have as much sugar as sodas.

“This is the next stage of where battle lines being drawn,” said Dr. Harold Goldstein, executive director of the California Center for Public Health Advocacy, who often totes around a jar filled with two and a third cups of sugar, the amount consumed by drinking a soda every day for one week. “Beverage companies are putting more and more emphasis on selling fortified beverages, as if fortified means healthier when in fact it often means more salt added to sugar.”

Not surprisingly, the country’s largest soda companies insist their carbonated soft drinks business will still grow, if not at as fast a clip as it has historically. “This is not a zero-sum game,” said Sandy Douglas, president of Coca-Cola North America.

But even they concede that unless the industry stumbles upon what it calls the holy grail, an all-natural sweetener with no calories, the future is going to be more firmly anchored in noncarbonated drinks. “The health and wellness trend is huge, permanent and important,” Mr. Douglas said. “My crystal ball says that a smart beverage company will sell a variety of products, and some of them will have bubbles and some of them won’t.”

Coca-Cola and its competitors have spent the last two decades decreasing their reliance on carbonated soft drinks anyway.

For most of its history, for instance, PepsiCo sold Pepsi. It bought Mountain Dew in 1964 and 20 years later, introduced a soda called Slice. Then it added 7Up and Mug Root Beer in 1986.

It played around with those brands, adding diet and other versions. Then, in 1992, it signed a deal with Lipton to sell ready-to-drink teas that initiated a spate of joint ventures, acquisitions and new product introductions. It added brands like Aquafina, SoBe and Sierra Mist — many not carbonated.

“As a business, we first saw this coming several years ago, which led us to get ahead of it with things like Gatorade and Tropicana that have done very well for us,” said Simon Lowden, chief marketing officer for PepsiCo’s North American beverage arm.

The competition, Coca-Cola and Dr Pepper, pursued much the same strategy. All three companies amassed stables of brands that took them far beyond their foundations in carbonated soda, though it remained the cash cow.

At the time, Mr. Lowden said, they were driven by growing multiculturalism on the home front and their expanding global footprint, but their broad portfolios also have cushioned them from the impact of changing attitudes toward soda as the nation wages its war on obesity.

Rufina Cowboy realized how big a role it played in her weight when her daughters Tamara Lewis, 12, and Lisa Cowboy, 11, persuaded her to go on a diet after participating in a program in their hometown, Cuba, N.M. The program, aimed at teaching children about healthy eating, is underwritten by the Robert Wood Johnson Foundation.

Ms. Cowboy started walking more, eating fresh fruits and vegetables and cutting back on meats. “I kept in there, walking on the trail here and eating better, trying to lose weight, but it wasn’t working,” she said.

Her doctor told her it might be the soda she was drinking. “I said, ‘I don’t drink that much,’ but then he added up the sugar in what I was drinking, and it was 25 pounds a year,” Ms. Cowboy said. “I said, ‘Oh, my gosh.’ ” She now drinks mostly water.

Lisa used to drink Dr Pepper. “It makes you dehydrated,” she said. Both she and Tamara, who has juvenile diabetes, have lost weight. Their mother has lost 20 pounds.

In spite of consumers like the Cowboys, beverage companies have been making more money on carbonated soft drinks by raising prices. That allowed revenue from carbonated soft drinks to reach a record high last year of $75.2 billion in the United States, according to Beverage Digest.

In one effort to assuage health-conscious consumers, the companies have been making smaller packages with a wider range of calories. Coca-Cola used to sell roughly eight sizes of packaging, from six-packs of 8-ounce cans to 2-liter plastic bottles. Today it sells more than twice as many types of packages, from a 32-pack of cans sold in warehouse stores to six-packs of 7.5-ounce “mini” cans, sales of which, Mr. Douglas said, “are on fire.”

The big three beverage companies are also endlessly tinkering with combinations of sweeteners and sugars to lower calories without altering taste. PepsiCo, for instance, introduced Pepsi Next, which uses a blend of sweeteners to deliver half the calories of a standard Pepsi, and on Monday, Coke announced it would test-market similarly slimmed-down versions of Sprite and Fanta

Dr Pepper Snapple has gone even further with 10-calorie versions using a blend of artificial sweeteners and high-fructose corn syrup in many of its carbonated soft drinks. “We have to innovate in ways of getting calories out of beverages and still providing the taste experience people don’t find in today’s diet drinks,” said Jim Trebilcock, executive vice president at Dr Pepper.

Most recently, the beverage companies have gone on the offense against New York City’s longstanding campaign against soft drinks with their first advertising ever in the city subways, promoting these strategies as strides to combat obesity. “We’re dedicated to helping you choose what’s right for you,” one ad says.

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