Yes, it’s being discussed. There’s no funding for it at this point and it will cost billion.
One of the most amazingly ignorant arguments for such high speed rail lines – and it’s included in the TV news story linked to above — is to claim that they must be a great idea as there are a lot of flights between say Charlotte and Atlanta. But CLT and ATL are major airline hubs and most of the people flying between the two cities are connecting at one end or the other. Last June, Delta, AirTran Tran and US Airways combined to offer 23 flights a day with some 3,000 seats between Charlotte and Atlanta. Federal data shows that only 220 passengers a day each way fly between the two cities proper — everyone else on those flights was connecting to go someplace else.
Federal data is available here — select Table 6 for the quarter of interest.
Effective after Labor Day. Not a surprise really as Delta flights from Memphis have been on the decline for the past several years. Four points:
1. This is more proof that one just shouldn’t believe what airlines say when trying to sell a merger. Delta Air Lines and Northwest Airlines back in 2008 when they were merging assured anyone that would listen that the hub was safe.
2. It can take several years for the impact of a merger on an airline’s route network to full work itself through.
3. The latest cuts will reduce Delta flights from Memphis from 98 to about 60. Specific route cuts haven’t been announced yet. Delta currently has three flights a day from Charlotte to Memphis on 50-seat regional jets. Doubt those are still around come early September. CLT-MEM draws about 90 passengers a day each way with Delta having about a 30 percent market share — there just isn’t enough. (US Airways also flies Charlotte-Memphis seven times a day on larger aircraft and gets about a 60 percent market share on the route.)
4. Delta’s Cincinnati hub remains at risk. The airline offers three flights to Cincy on 50-seat regional jets from Charlotte. US Airways also flies the route.
The city has released some details on two proposals to redevelop Eastland Mall. Both are pretty laughable:
• Studio Charlotte Development wants to build a movie studio on the site.
The first phase of his project would be at the back of the 80-acre Eastland site, and would be a 270,000-square-foot building with eight soundstages, production offices and a film school that would partner with local universities. The building also would include a 50,000-square-foot museum that would “educate and entertain” visitors about the movie industry.
After that is built, Studio Charlotte Development envisions possibly a hotel, residential units and nearly 140,000 square feet of retail space, some of it along Central Avenue.
• Then there’s ARK Ventures’ proposal:
The focus of ARK Ventures is to build what could be called an entertainment/activity center on 27 acres of the site. This could include a 40,000-square-foot ski slope, a skateboard park, a wave pool, ice skating rink and a gymnasium. The first part of the project would also include a 60,000-square-foot office building.
“People are leaning towards entertainment in a healthy way,” said David Wagner of Wagner Murray Architects.
He said the $51 million center would be integrated into the nearby neighborhood.
“It’s like Coney Island in the 1920s, where the amusement park was built right next to the neighborhood,” he said. “We abandoned that, but there are historical models.”
Among the obvious issues here is the placement of a development offering high-end fitness activities in what is now effectively a working-class neighborhood with a lot of immigrants. Simply put, those currently living near Eastland aren’t exactly the target demographic for what ARK Ventures would offer.
Then there’s this:
Both proposals call for some sort of public investment, but neither gives a specific dollar amount.
If either of these concepts made sense, somebody would already be building them somewhere around the area. The fact that that isn’t the case suggests that either proposal only makes sense to the developers involved if government is assuming a significant portion of the risk. TIFs are a definite possibility and we have seen how well that work out for Roanoke Rapids. So, yes, be scared.
Bonus observation: Notice how there’s no mention of the Eastland area’s primary problem — that the housing stock is obsolescent — in the Charlotte Observer story.
Bloomberg reports that we can expect an announcement of the soon-to-merge airlines combined leadership team by mid month. Also, no major anti-trust issues have developed. As for things that directly effect passengers, there’s this:
The pace of integration will vary according to the areas concerned, the CEOs said. The companies will begin code-sharing “very soon” after the merger, though it will be three to six months before US Airways transfers to AMR’s Oneworld airline alliance from the Star group to which it belongs now.
Combining reservation systems could take as long as a year, and it may be 18 months before the pair move to a single operating certificate, allowing them to function as one airline and share crew and planes.
The Charlotte Observer offers up a preview of the 2014 U.S. Senate race in here in North Carolina. By all accounts, it will be an expensive, hotly contested affair.
A U.S. Senate race with national stakes is taking shape in North Carolina, with one Republican jumping in, one bowing out and a handful of others waiting in the wings.
They’re aiming at Democratic U.S. Sen. Kay Hagan, one of the GOP’s top targets in 2014.
She’s one of seven Democratic senators in states carried last year by GOP presidential candidate Mitt Romney. Republicans call them the “Red State 7.”
“If it’s not the No. 1 race, it’s top three for sure,” says Kevin McLaughlin, senior adviser to the National Republican Senatorial Committee. “North Carolina is very, very ripe for the picking.”
This weekend several announced and would-be candidates are expected to attend the state GOP convention, which begins Friday at the Charlotte Convention Center.
Don’t let MetLife coming to town fool you. The financial services sector continues to evolve in ways that are reducing headcount. As Bloomberg News reports:
MetLife Inc. the largest U.S. life insurer, has cut its adviser force by a third, eliminating 2,500 jobs as the company scales back variable annuity sales and turns to other nations for growth.
MetLife has about 5,000 advisers who sell insurance and investment products, down from 7,500 in February of 2012, Eric Steigerwalt, head of MetLife’s U.S. retail business, said at a May 21 investor day presentation. The New York-based firm lowered the number of agencies to about 60, from 85, he said.
“We’re not financing advisers who, frankly, were never going to make it in this business,” Steigerwalt said. “Our productivity is way up and we’re saving a lot of money.”
The UPoR has a fascinating story out about Big Art in Charlotte. Seems that the money just isn’t coming in like it use to. And there’s much more to it than just the recession; the Foundation for the Carolinas has concluded that workplace giving just isn’t going to return to to previous levels even when the economy comes back. Indeed, the Arts & Science Council raised $6.5 million in 2012, down 36 percent from a decade earlier.
“It was clear to us that the wind of change was upon us and workplace giving would never be what it was,” said Pat Riley, president of Allen Tate Co and co-chair of a new group that’s looking for a solution to the found problem.
Which brings us to another quote from Riley in the story:
Another setback has been the decline in government money, driven by budget cuts during the economic downturn, Riley said. City-county combined funding for cultural items was $6.2 million in 2012, a 25 percent decrease from a decade earlier.
“We have to figure out a new model,” said Riley. “This path we’re on is not headed in the right direction.”
All this shouldn’t come as a huge surprise. Many of the community’s arts groups weren’t in great shape when the ASC decided not that long ago that Charlotte’s greatest arts need was to build more buildings. And the resulting arts bundle deal placed a greater burden on local groups to cover their operating costs while public dollars from increased taxes were used to pay for arts infrastructure. (Funny how the ASC and friends are ignoring that part of the equation.) So now, inevitably, the other shoe drops: many arts groups are suffering exactly because they can’t raise enough money and the reduced public money they’re getting isn’t helping matters.
But there’s more to it than that. Charlotte’s power structure — and let’s be clear, the ASC was effectively operated as an extension of Bank of Wachovia when it pushed the arts bundle through — has never been a huge fan of the arts for the arts sake. Rather they see the arts as an economic development tool, a means of showing that Charlotte is an OK place for a banker from Boston, Philadelphia, or San Francisco to spend a couple of years as they climb the corporate ladder.
So this new push suggests that some powerful people Uptown feel that Charlotte’s arts scene is failing to adequately demonstrate that Charlotte isn’t a backwater. And that’s also exactly why this story ended up on the front page of today’s Charlotte Observer.
And a prediction: The new model that Riley’s group comes up with will include more public money for the arts.
JLF head John Hood has a new column out on the importance of capital in growing North Carolina’s economy. A highlight:
Let’s get real. There are many fine things that North Carolinians can appreciate and enjoy with their own time and money. But when it comes to building the fundamentals for economic success, the main contributions state government can make are 1) establishing rule of law and the security of private contracts, 2) ensuring the existence of high-quality roads and schools at an economical price, and 3) keeping tax and regulatory burdens as low as is consistent with the first two items.
These insights come from decades of empirical research. They also come from the realization that economic success flows from productive capacity — from the supply side of the economy, in other words, not the demand side. If companies become more productive, they will survive, grow, hire, and buy services. They tend to become more productive by acquiring more and better capital. That includes physical capital such as plants and equipment, intellectual capital such as inventions and innovations, and human capital such as better-trained employees and vendors.
Last week, the NASCAR Hall of Fame announced its fifth class of five inductees. And this gets the HOF to the big question: exactly how much of an honor will it be to get in? And, by extension, how much national press exposure will the hall generate in the future?
This year’s crop of inductees includes three premier-division drivers — Tim Flock, Dale Jarrett, and Fireball Roberts. And that really is par for the course; through five years, 15 of the 25 people elected to the NASCAR HOF have won a lot (30+) of premier-division races. What has happened though is the percentage of the ballot made up of premier-division drivers has dropped over time. The original ballot of 25 names had 16 drivers that won a lot of races in what’s now the Sprint Cup; this year’s ballot by contrast only had nine. In others words, top-division drivers are being voted in faster than they are being added to the ballot by the nominating committee. Of the past four years, only five such drivers have been added to the ballot.
The six carry-over drivers with big win totals for next years ballot are Bobby Issac (1 championship, 37 wins), Fred Lorenzen (26 wins), Benny Parsons (1 championship, 21 wins), Curtis Turner (17 wins, the “Babe Ruth of stock car racing”), Joe Weatherly (2 championships, 25 wins) and Rex White (1 championship, 28 wins). If past practice is any guide, most if not all of these six will be voted in in the next two years.
The quality of the eligible drivers drops substantially after those six. There are only four retires drivers with 20+ wins not currently on the ballot: Jim Paschal (25 wins), Ricky Rudd (23), Jack Smith (21), and Speedy Thompson (20). None won the championship. There are another dozen retired drivers that won 13 to 19 races and that aren’t currently on the ballot. (By comparison, 17 active drivers have won 15 or more races.)
So where exactly does NASCAR draw the line? It’s a decision that the HOF’s nominating committee — which is a collection of track owners and NASCAR officials — has to start making next year. It could slow play driver nominations, forcing the larger group that elects people into the HOF to (eventually) pick more people besides thus that drove in the sports top division. Or it could feed the apparent desire to elect three top-division drivers a year. Or the HOF itself could recognize that it needs to change its selection process lest the honor of become not much of any honor.
Bonus observation: Those not elected stay on the ballot until they get voted in. Six of the 20 people on the carry-over ballot are on the business side of the sport (promoters, NASCAR officials). This category has gotten zero traction so far with the lager voting committee. Combined with team owners Richard Childress and Rick Hendricks still being too active to get active consideration for election to the HOF, the short list of candidates for election next year isn’t that long.
So says Tom Campbell in his latest column. A highlight:
The state party is in shambles, mired in leadership squabbles, rudderless. Their response to the fast-paced Republican actions is reminiscent of childhood road trips. “He touched me,” or “she’s on my side of the car.”
Democrats don’t get it. Simply whining about what Republicans are doing is not going to win the minds and hearts of voters, most especially the unaffiliated and moderate voters Democrats need if they are ever going to retake control of state government. It is not enough just to point fingers and tell us what the current regime is doing wrong. If you want to prevail tell us your plan.