Double Blind

While the BC Ferries strike was making all of the media headlights, this gave the Translink board the perfect (stealth) opportunity to approve a tax for all residents of the lower mainland to the tune of $2.4 billion over the three years between 2005 to 2007. You can read about the report by clicking on Translink’s 10-year outlook. While reading this report, I was utterly disgusted at what seems to be a fundamental lack of one assumption: people will overwhelmingly choose to take their cars to work every day.

If you take a look at the report’s executive summary, there is a suite of improvements concerning bus service, the Skytrain and the Seabus. In particular, Richmond will finally see a much-needed link to Vancouver via Skytrain and Coquitlam will get connected to the Skytrain via the Lougheed Mall station. They will be spending about $800M on these two projects alone. I think this is a good use of capital expenditures, especially since there is a guaranteed amount of commuters that will take the line. Skytrain in these areas will essentially replace the “B-line” bus routes that are currently in place. This will enable Translink to concentrate on what they are seriously lacking in, which is suburb to suburb traffic. In particular, service from Richmond to Burnaby and back is horrible. This will be rectified with the expansion of the Skytrain westward from the Commercial Drive station which should end at an underground station on or very near the corner of Granville Street and Broadway.

While Skytrain cannot possibly match up with a real underground subway system that cities like New York, Moscow and London have, it is the next best alternative for moving people around. A “poor man’s tube” so to speak. Skytrain is automated, been proven to be very safe, and quite reliable. The area of Vancouver west of Granville Street will never see Skytrain due to the NIMBY (Not In My Back Yard) factor, but they’ll just have to live with just-as-noisy busses instead.

My problem with the spending is that it doesn’t reflect the real goal of any transportation plan: to ensure that people (and to a lesser degree cargo) can move around the city in an efficient (i.e. speedy) manner. This is done by maximizing the volume of traffic that can travel from city to city in the regional district. If there is too much traffic on the streets, the road network becomes saturated and then everything stops moving.

Skytrain is good – the ability of Skytrain to move people around is not dependent on the number of cars in the fleet, nor is it dependent on the amount of people that use the service. It is a completely scalable transportation solution with a cap on maximum capacity that is not a forseeable issue in the future. This is why I do not mind spending my tax dollars on such a service even though I probably will not use it most of the time.

My problem is the road network – there isn’t a sufficient network of high-volume roads that can move traffic to and from Vancouver efficiently. There is one freeway (Highway 1) clipping the northeastern side of the city, and this freeway only benefits those that come to the city from the eastern suburbs (Langley, Abbotsford). Additionally, if you wish to connect to this freeway from Richmond or south of Richmond, you have to take Highway 99 northwards, and then Highway 91 east until you reach New Westminster, where you will have to then face about 20 minutes of traffic before you can connect to Highway 1. This is seriously inefficient. There is also no effective way to connect traffic to the downtown core of Vancouver. The Translink plan makes no attempt at addressing these issues.

Instead, the bulk of the budget for roads ($600M out of approximately $800M) has been devoted towards a toll bridge crossing of the Fraser River from Pitt Meadows to Langley. While this crossing is needed (and would relieve stress on the Albion Ferry to the east and the Port Mann Bridge on Highway 1 to the west), this doesn’t address this simple problem: Vancouver doesn’t have a real freeway network.

Back before I was born, in 1959 city planners realized that population and driver growth would result in the saturation of the existing road grid. Their solution was to implement a freeway system (similar to what Los Angeles and practically every other metropolitan jurisdiction in North America did) in anticipation of growth. There was a public outcry, and then the Vancouver council made the decision that there shall be no freeways constructed in the city. Fourty five years later, traffic is of course worse and there is not any point driving downtown from 7am to 7pm since what should be a 20 minute drive will actually be over an hour if you’re coming from Richmond or Burnaby. To discourage people from coming to the city with their car, the city has to implement pathetically high parking taxes (1 hour at a parking meter downtown costs $4) and this kills commerce since nobody wants to shop there because they can’t park their cars anywhere. What do they do instead? Park their cars in Metrotown in Burnaby and shop there.

But why can’t (or rather, why don’t) people that don’t live near a skytrain station take transit? Because the busses use the same road network as cars do and thus the busses get to their final destinations slower than you would otherwise had you taken your car in the first place! The solution to this is to develop a high-volume freeway system so that vehicles could get from point A to point B quickly. In this case, this meant from everywhere else in the lower mainland to downtown.

What the report suggested was that a minimal freeway network be constructed:

The thin white lines is a sketch of part of the Greater Vancouver Regional District. The solid thick white lines is what the minimalistic freeway plan suggested constructed for 1985. The dotted blue is existing freeway in 2004. Observe one extra freeway that was never proposed originally was constructed – Highway 91 connecting Richmond to Surrey and New Westminster.

What is missing between today’s reality in 2004 and the 1985 plan is the freeway link between the Oak Street Bridge and downtown Vancouver (this would carry the majority of traffic from Richmond to Vancouver); the west-east links between downtown Vancouver and Highway 1 (via Hastings and Broadway/12th streets); and the ‘wrap-around’ freeway where Beach Avenue is today in downtown that would take traffic to North Vancouver – little did they know that the Lion’s Gate Bridge would still be three lanes in 45 years!

When you drive in the Lower Mainland, this is exactly what you observe is missing: There is no easy way to get from Richmond to Vancouver; there is no easy way to get from downtown to Highway 1, and there is no easy way to get from Richmond to Highway 1. All these routes involve multiple traffic lights and congestion. What happens is that Granville, Oak and Knight street take all the north-south traffic to and from Richmond; Hastings and Broadway take most of the west-east traffic to and from downtown to Highway 1. Each of these streets has around 20 traffic lights from origin to destination.

Now what is interesting is that the Translink plan is attempting to replace both the North-South freeway deficiency to and from Richmond with Skytrain, and the West-East deficiency (the northern one) with Skytrain. They are not correcting the root problem, which is the lack of highspeed controlled access freeways in these areas!

The other two issues in Vancouver’s transportation plan is Highway 1 and Highway 7 (Lougheed Highway). I will cover these one at a time.

Highway 1 handles all the traffic coming from Surrey, Langley and Abbotsford and has a massive bottleneck at the Fraser River crossing, the Port Mann Bridge. Currently, this bridge has three lanes going eastward and two lanes going westward. Think about this for a moment – a freeway that has to service 120,000 cars each day has two lanes heading westward into the city.

Highway 7 handles the traffic from Maple Ridge, Port Coquitlam and Mission. This highway is heavily congested during rush hour (although nowhere near as bad as Highway 1), but growth is highly anticipated in this region. This highway needs will need to be converted into a freeway to handle the traffic density. Unfortunately, the resulting traffic will just end up in Highway 1 west, but thankfully it will be after the Port Mann Bridge.

Unfortunately, I don’t see any spending initiatives where it really counts: More roads. Establishing the next best thing, Skytrain in the major transit routes from Richmond to Vancouver and from Coquitlam to Lougheed will help keep the busses off the road (and thus keep our roads more free for regular commuter traffic), but these sparse improvements will not nearly be sufficient to address the huge transportation issues that this region has. For now, I hope your car engine idles well while you wait to get on the Port Mann.

The Whispering Wheel – Here is an article about a bus that has four re-engineered electric motors. The innovation is that the moving part of the electric motors is actually the wheel itself, hence four electric motors. The only problem with devices such as these is that the power source is probably standard lead-acid batteries and powered by a diesel engine. This is unfortunate, since these batteries have most of their effectiveness in the first half of their lifespan and then they start to degrade. Anybody remember nickel-cadmium batteries for laptops that were made 5 years ago? They lasted about a year before they started to seriously degrade. So while you could have a small percentage of your fleet consisting of these silent busses, you would never be able to have all of your fleet consist of hybrid-electric busses since there wouldn’t be nearly enough of a logistical support network to keep these busses properly maintenanced. The costs of building these busses and maintenance is prohibitively expensive. This is my gripe about hybrid-electric vehicles: they are expensive and while on the city streets they are very efficient, on a Toyota Prius, you still have to replace their batteries every 8 years at a cost of US$3000. The initial costs of purchasing such vehicles is still not worth it.

This simple analysis illustrates my point:

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The gasoline savings doesn’t approach the price difference – if you drive 12,000 miles per year at 50mpg in a Prius, you use 240 gallons of gasoline. At 35mpg in a Corolla, you use 343 gallons. At $2.30/gallon, the difference is $237/year. There is no discount rate that makes the Prius a better value because of its fuel savings – even at today’s temporary high price. Gasoline would have to go to at least $8/gallon to justify the extra cost of a Prius – and it won’t ever reach that price. Higher annual mileage generally doesn’t affect this conclusion because the Prius freeway mileage advantage is very small.

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Notice nowhere in the silent bus article did it mention that the cost of running such a bus is at all comparable to the cost of running standard diesel busses. This is the ultimate problem of transportation – there is no better concentrated energy source than petroeleum. The energy density of hydrogen is too low, there’s not enough sunlight to make solar power viable in current form and there’s no way that people will want automobiles powered by nuclear reactors (despite the fact that you’d only have to fill up your car once every five years). Gasoline is here to stay – every other alternative solution either has their own costs, both monetary and logistical.

Here’s an interesting article that claims that a bunch of scientists believe that the amount of light reaching the Earth’s surface is declining. If true, this is yet another demonstration on how the absolute certainty the pro-Kyoto accord proponents have in terms of their staunch belief that the Earth is going to hell in a hand basket is garbage.

The real issue about global warming (or as the politically correct now call it, “Climate Change” since they no longer want to restrict their claims that only warming is bad for the planet) is far more complex than what current research has determined. My small take on it is that we are not headed to hell. Changes made to the Earth’s atmosphere will have effects, however, the Earth has spent millions of years in a very livable equilibrium that should continue despite the fact that carbon dioxide levels are increasing. You hear all of the doomsday scenarios, i.e. the polar caps melting, ocean levels rising, hurricanes everywhere, tornadoes, volcano eruptions, etc.

This of course is a false representation. It’s kind of like saying that if I get slammed by a drunk driver on the road, I will get injured. Since I don’t want to get injured, I shouldn’t drive. This argument is consistent, but of course what’s missing is that the probability of getting slammed by a drunk driver on the road is next to nothing and thus I really shouldn’t have to worry about driving on the road since there isn’t much I can do to mitigate getting hit by a drunk. Similarly, global warming proponents claim that the oceans will rise because the Earth’s average temperature will rise ten degrees.

The other argument is that global warming will adversely affect everybody on the planet. I would claim that the positive and negative effects from global warming, if it indeed is the case, is a wash. If you live in a cold area, there is a high degree of probability that you will gain if the world is indeed warming. If you already live on the equator, you will probably suffer due to global warming. Russia, Canada and the northern European states probably stand to gain the most from global warming.

Anybody pushing extreme arguments (such as claiming that the only solution to “Climate Change” is to cut greenhouse gas emissions to 10% less than 1990 emission levels) has to be viewed with a suspect eye, especially since their science that they’re pushing is mostly junk.

What does global dimming have to do with this? Nowhere did this critical aspect of change ever appear in any climatic models. Since light levels are proportional to the rate of growth for plants across the world, this would effect rates of carbon dioxide consumption. This would be a significant effect of most climate models. If strong variables such as light levels are not calculated in these climate models, what makes people think that there could be any confidence in the long-term predictive value of these models? My gut instinct says none at all.

CNN: First U.S. Case of Mad Cow Disease Discovered – The big headline on the news lately (besides for the overwhelming amount of consumers shopping in the Xmas mania) is that there was an American cow that got caught with Bovine Spongiform Encephalopathy (BSE), otherwise known as Mad Cow Disease. About half a year ago, a cow in Alberta was caught with BSE and the USDA (Department of Agriculture) was all too willing to shut down practically all imports of Canadian beef in the US market, despite the fact that this was a statistical blip. This crippled the industry and the Canadian beef industry still hasn’t quite recovered from the shock. Public hysteria caused the closure of imports and of course no government official would ever say “The probability of anybody getting BSE is so close to zero and any resources would be better off fighting the flu or improving road safety.”

Now, the Americans are claiming that just because one animal tested positive, there’s no need to panic. “Consumers should continue to eat beef with confidence” were the words uttered by a representative of a US cattle and beef association. What hypocracy compared to the previous reaction on the Canadian mad cow indicent where if you just touched Canadian beef, you’d of course catch the human version of BSE and die.

Just in case if you were interested: You need to eat neurological matter out of infected cattle (e.g. their brains or their nerve tissues) in order to catch the human version of BSE. There is practically no danger of getting a disease eating infected beef that you pick up from the supermarket. Mad Cow Disease reminds me of the SARS virus – both of these have been hyped up to epic proportions by the media, and this forces governments to wastefully allocate more resources than they otherwise should for what are inherently small issues.

Does the fact that you stand nearly a zero chance of getting the human version of BSE ever make it to the media? Of course not. What the media concentrate on is the death, gloom and destruction aspects of BSE. It’s much easier showing pictures of cows getting slaughtered in England and then putting somebody from Greenpeace on camera screaming “You will all turn into vegetarians or you will die!”. They don’t tell you that your chances of getting the human form of BSE is slimmer than getting slammed by a drinking driver when you get in your car every day. There have been 139 reported cases of human-Mad Cow Disease worldwide reported up to May 2003. Compare this to the 50,000 deaths caused by rabies in the world. How many North Americans do you think die of rabies in a year?

I don’t know about you, but I’ll be eating some steak tonight.

Link: The Fiscal Monitor – The critical paragraph can be said here, bold emphasis mine:

The budgetary surplus is estimated at $635 million for the April to October 2003 period, down $3.6 billion from the restated surplus of $4.2 billion reported in the same period of 2002�03. Budgetary revenues were up marginally, $0.2 billion or 0.2 per cent. This largely reflects the recent economic weakness due to a number of domestic shocks that have hit the Canadian economy. Program expenses were up $4.6 billion, or 6.2 per cent, primarily due to new spending initiatives announced in recent budgets. Public debt charges were down $0.8 billion, or 3.9 per cent, reflecting lower interest rates.

This is garbage. The government has a $635M surplus for the quarter which is all fine and everything, but the problem is the explanation for the sudden drop of the surplus – the link claims that it’s because of “domestic shocks” (e.g. SARS, Mad Cow Disease, etc.) but as a practical matter, these two had a negligable effect on the economy (unless if you were an Albertan cattle rancher, which most of us are not!). The real reason why the surplus is dropping like a rock is because of what I highlighted up above – Jean Chretien is spending money like mad in his retirement. Now that we’ve got the budget balanced (half of it due to offloading the tax burden on the provinces) the government is starting to relax and is starting to ignore fiscal concerns once again.One “domestic shock” that isn’t so domestic is the rise in the Canadian dollar – since we do a lot of exporting, this will slow down our sales internationally and this will affect the amount of revenues we collect from abroad.

This is all bad news. This $635M surplus should really be a $5B surplus, and we should be applying all of that money to punching down the Federal debt (some $600B when I last checked) since it’s the only guaranteed 5% return on capital that any Canadian will ever see out of their government (i.e. for every dollar of debt we pay down, we will never have to pay $0.05/year in perpetuity ever again). The problem is that surpluses don’t last forever since the revenues will start to collapse if the country ever gets into a recession we’ll start seeing big deficits again, especially with the rate that the government is increasing their spending into the bottomless hole of bureauocracy. Let’s hope Paul Martin can get his act together, tighten the belts of the government and start working on a grand plan to pay off the debt.

Paying $600B is no easy feat for a country to perform, but it can be done over the span of 30 years with conscious fiscal planning. Such a committment will keep interest rates low, and keep this country very competitive in the future. Thankfully, the USA is screwing up their fiscal act so badly that it might give us a chance to embarrass our friends down south.

If the Canadian government kept spending at the rate of inflation since 1998 and applied the proceeds towards the debt, we could have paid off $100B of federal debt by now. Not only would we be a hundred billion closer to our goal of a debt-free nation, but we would also be saving approximately $5 billion in yearly interest payments that could have been used to build roads, hospitals and universities, but also to pay down yet more debt.

Imagine if you were working with a $30,000 annual income and a $150,000 loan at 5% interest. You have to pay $7,500 each year just for the interest on your debt payments. What do you do with the other $22,500? Do you spend it on frivolous stuff, or do you tighten up and start paying down that $150,000 loan? This is effectively a decision the country faces today. My vote is simple. Pay down the $150,000 loan first and then ask where you’re going to spend the money. Because right now, you don’t have any until the bills are paid off first.