National Harbor, MD--A Visit To The Twilight Zone

A recent trend in shopping center development is the outdoor "mall" where the center is laid out in street grid form, kind of like the old downtown Main Street shopping areas. A good example of this is the Americana in Glendale, a highly successful shopping (actually mixed use) area built on faux streets which do not appear in the Thomas guide.

Such a center exists along the Potomac River in Maryland, no more than 10 miles south of downtown Washington D.C. National Harbor is the Americana and more, the more being a number of convention sized hotels, full to the brim with people like myself attending business meetings. So why, then, are the streets of National Harbor deserted and its trendy stores and restaurants virtually devoid of patrons?

At first I thought that National Harbor had just opened up. However it's already been open for over 2 years, so that's not the explanation. As I walked the deserted streets, I also noticed that while there were plenty of higher end stores and restaurants such as Fossil, Godiva Chocolates, Dolce Restaurants, Rosa Mexicano, there wasn't anything in the way of ordinary retail--no chain drug stores (though one is under construction), no place to buy groceries (though a gourmet store is promised), no familiar casual or fast food dining options. Maybe I had fallen into an episode of the Twilight Zone that I hadn't remembered.

Part of the explanation is the weather. Crowds of people do come to the hotels of National Harbor for business meetings, but when it's 95 degrees and humid, none of them have any desire to step outside to explore the neighborhood, even if it is immediately adjacent. But the main problem seems to be the demographics. The closest housing to National Harbor (aside from the high end condos currently being peddled there) is apparently of the Section 8 ilk. The closest part of Washington D.C., is the Southeast quadrant, clearly the sketchiest part of the city. While crossing the border into Maryland does present a visually more suburban environment, the demographics are still working class. A more likely customer base lies on the other side of the Potomac in Arlington, VA, but there's no bridge over the river and you have to take a water taxi between the two.

Maybe there's more activity in National Harbor on weekends. Maybe there's more activity when it isn't so hot and humid. Maybe there will be more activity when the Cirque de Soleil theater opens up in a few weeks. Or maybe National Harbor was a bad idea built at a bad time.

Governmental Poison Pills - Not A Good Idea

In the corporate world there's a debate whether poison pill provisions, which trigger unpalatable consequences if outside interests acquire too much of the corporation's stock, is a good thing or a bad. One viewpoint is that they stop greedy corporate raiders from pillaging helpless enterprises, while the opposite view is that they protect entrenched management which may be operating inefficiently.

One clear thing, however, is that poison pills in the government context are absolutely ludicrous. But that's what we have here in the city of Los Angeles, which last year agreed with city unions that if the city laid off city workers, the remaining workers would automatically be entitled to a pay increase. This is the height of idiocy, particularly since this is a new provision that was actually crafted in a time of budget distress. Where labor costs both in the aggregate and per unit needed to be reduced, the city agrees to increase its cost of labor. All this proves is the oft made contention that the city of Los Angeles is controlled by the public employee unions. Incredibly, despite this poison pill provision, the city wants to lay off city employees, triggering this automatic pay increase for the survivors. This could make sense if you laid off enough employees to offset the cost of the pay increase, but that's not what they're doing.

However, this episode demonstrates a much wider shortcoming in the way government is operated. Politicians are always talking about cutting the fat and inefficiencies from government. Indeed, this is the rallying cry for anti-tax activists who resist increasing government revenues at all costs because there are so many inefficiencies in spending that can be attacked. But this is government we're talking about, Alice In Wonderland in its most extreme incarnation. The sad fact is that it is impossible to cut most of the fat out of government spending. Cutting the fat implies the existence of a surgical knife that can disintiguish between fat, muscle and bone. Such an instrument does not exist. It appears the only government tool available is a hacksaw which cuts equal portions of fat, musicle and bone. I have personally heard of two situations in different departments of city government where individuals are paid highly for doing nothing, but in this era of tight budgets, have absolutely no fear of losing their cushy jobs. My sources do not know why these people are protected, but this just adds to the tons of evidence that government is dysfunctional and is incapable of efficient financial operation. Sad but true.

Amazing Stockton Street

On both an economic and cultural level, Stockton Street in San Francisco Chinatown, particularly between Jackson St. and Broadway is absolutely incredible. Due to the plethora of grocery stores here, if you lived anywhere in the vicinity you would have no need for a refrigerator, except perhaps to store leftovers. A dozen or more of these storefronts line both the east and west side of the street. Dry packaged goods take up a relatively small portion of the floor space of these stores, which allocate the lion's share of their premises to fresh produce, meat, and seafood. The volume of fresh food handled by these stores is mind-boggling. In each store you're likely to see probably six to ten butchers busily serving their customers. Meanwhile, a like number of produce ladies are continually taking fruits and vegetables out of their boxes and putting them on display. Think about it--each one of these tiny stores probably has a crew of produce, meat and seafood workers well in excess of what you see at your local Ralphs or Albertsons. These stores are packed with shoppers, all day long, from 7 am to 6 pm, and there's always a line to pay at the cashiers, who are stationed side by side against the wall.  And when fresh cartons are poured into the bins, stay out of the way, particularly from the little old Chinese ladies, who have no qualms about pushing or shoving their way to get the best new merchandise, or to get into line to pay.  (For proof, check out this television story about a fight over eggs on Stockton Street.)

And not only are Chinatown shoppers blessed with the convenience of fresh food, the prices at these stores are incredibly low. Why pay $4 a pound for cherries at Whole Foods when they're 69 cents a pound on Stockton Street. Yes, the Whole Foods cherries might be a little bit bigger, and you won't find any with double pits. But hey, for an 80 percent price discount, who cares? That's why every time we visit San Francisco, we come back with every day produce items purchased at the lowest price imaginable.

So how are the prices on Stockton Street so low?  Well with regards to the produce, it appears the trick is eliminating the middlemen.  San Francisco Chinatown is close enough to the agricultural fields of the San Joaquin Valley that many growers pack their trucks early in the morning and head straight to the grocery stores on Stockton Street in time for the 7am to 8am opening of those stores, bypassing the wholesale produce markets.  In addition there is very little spoilage because many of the Stockton Street stores discount that day's unsold produce at the end of the day, and if there's anything left, discount them more the next morning.   Plus with the volume and turnover, Stockton Street grocers can operate on a very thin margin and still do well.

Laura Ling Names Baby After Bill Clinton

I read today where journalist Laura Ling named her new baby after Bill Clinton. This is certainly understandable and a fine gesture given Clinton's role in getting the journalists released from North Korea. The problem is that the baby is a girl. How do you name a baby girl after Bill Clinton? Well, the baby's middle name is Jefferson. I hate to say it, but Jefferson is not an appropriate middle name for a girl. There's nothing wrong with using a surname as a middle name, but since Jefferson is both a surname and a boy's first name, that just doesn't sound right. It probably would have been more meaningful to use Clinton as the middle name.

I often wonder what Ling and Euna Lee thought when they were led out of their North Korean jail cells only to see Bill Clinton there in person. If it was me, I would have thought "Oh no! Now they've captured Bill Clinton."

Impeach Bud Selig! This Neanderthal Must Go

Baseball is the only popular 19th century sport still being played in the United States. Yes, football and basketball are 19th century creations, but they've changed with the times. Baseball, on the other hand, is still mired in a previous century, perhaps the early 20th century if not the 19th century. Only baseball has ridiculous rules preventing a player from re-entering a game, mandating an equal number of at-bats for all players, in the National league requiring pitchers to bat, silly rain-out rules that truncate, negate or result in no contest games, and others I can't think of immediately. And of course, almost no use of instant replay. It is fitting that such a backwards game is led by such a Neanderthal as Bud Selig. With Armando Galarraga being jobbed out a perfect game by an admittedly erroneous umpiring call, Selig could easily have reversed the decision, particularly since the mis-call came on an otherwise game ending play. But slug that he is, Selig declares it's back to the future and refuses to do the right thing. I'm surprised people still go to baseball games given the state of the sport.

A Window To The Future

A good thing about trading markets is that it gives (usually) an objective view of current thinking about the subject matter being traded. Indeed, sports odds are in concept another form of trading market to give an unbiased view as to how a sporting event is likely to play out, and as such is very useful to sport fans as to creating expectations. An interesting website is that established by Intrade, which creates markets for specific future events, including but not limited to political and financial events. More than just being fun, Intrade can give you an insight into current events when an unfiltered reading of the news media is inconclusive. Case in point was the last few days before passage of the health care reform bill. Democratic leaders expressed confidence that the bill would pass, but other news stories hinted that they were a handful of votes short, or that a hitch developed because no single representative wanted to be the person to cast the decisive vote. However, turning to Intrade saw passage futures trading at 80 percent, so I knew that it was a done deal. One interesting current contract is that Arlen Specter's prospects of winning his primary race have dropped from 80 to 20 in just a couple of weeks. Also the chances of the Republicans winning the House this fall are currently pegged at 44, though they hit slightly over 50 a few days ago.

Of course this is not meant to say that the predictions are highly accurate in the long run. If these futures contracts were that predictive, we'd be in the second term of the Kerry administration, as his futures soared on election night as results of the subsequently discredited exit polls portended a big Kerry victory. But these futures seem to be as predictive as sports odds, and that's a pretty good record.

The Chandavkl Inept Organization Award--LAUSD

While there are many incompetent organizations running around, the one that takes the cake is the Los Angeles Unified School District. I was initially alerted to the dysfunctional nature of LAUSD when I once shared a table at a seminar with a senior executive of a major Los Angeles based corporation. In an unsolicited comment, he indicated to me that along with a number of other local business leaders, he had worked with LAUSD to try to improve the organization's structure and performance. However, he sadly concluded that LAUSD was totally beyond repair.

Over the years we have had many glimpses of this organizational train wreck, charitably described by the Los Angeles Times as a civic disgrace. We all know about the payroll system boondoggle that cost the district tens of millions of dollars. Now outdated and inefficient government computer systems is nothing new. But the specifics of the problems with the LAUSD payroll system were truly alarming. So many arcane job and payroll categories that it is no wonder why sophisticated computer consultants could not put together a working system. (An amazing 1,100 pay categories for fewer than 100,000 employees.) No single person at LAUSD in charge of the payroll project. Using an inappropriate software package. And poorly trained clerks trying to crank out the monthly payroll.

Time after time the same message reverberates. Nobody in charge and overlapping responsibilities. Separate departments for elementary school bilingual education and high school bilingual education--and no communication or co-ordination at all between the two groups. Is this any way to run an organization?

Which leads me to the incident that triggered this essay. LAUSD is not only incompetent at the big things, it's also inept when it comes to the little things, too. Mrs. Chandavkl is an employee of LAUSD and as such is entitled to an LAUSD email account. She really doesn't use it, but I do monitor it for her from time to time. Well, visiting the LAUSD email account this weekend, I see a notice that her 80 mb mailbox was at capacity and could not receive any more communications. Well first of all, these days what emailbox is limited to a rinky dink capacity of 80 mb? Even then, remember that Mrs. Chandavkl doesn't use this account. So how did it fill to capacity? Well, it's chock full of communications from Superintendent Cortines and other LAUSD mucky mucks. Well, that's fine, certainly a proper use of the LAUSD email system. But how does it fill up 80 mb? After all, 80 mb is sufficient to support 8,000 messages of 10,000 bytes each. The answer is that LAUSD doesn't send messages to employees in text form. Rather, it sends them as attachments, quite often Acrobat files of 500 kb. (And don't get me started on the fact that these documents cannot be opened out of the email view--they have to be saved to disk, unless you use your browser's "Open new view" option.) Why do they do it this way? From what I can tell, it enables them to message employees on letterhead bearing the colorful LAUSD logo on it. And of course, these messages are important, aren't they? Certainly yes, like the 1 mb color poster informing employees that they need to move their clocks forward for daylight savings time.

The shortcomings of the LAUSD email system may not be significant in and of itself (certainly LAUSD demonstrates higher levels of incompetency on a daily basis), but it demonstrates further that they are incapable of doing anything correctly.