Tuesday, November 27, 2007

Sometimes I set myself up for such a big entry, I never get to it.

But here goes....

When Bruce came in to show me all the Juniper Ridge papers he'd gotten, he mentioned the 'anti-growth' slate that had once been elected to city council. I immediately thought of the 'men without ties' slate, but didn't remember them as being anti-growth so much as being anti-insider.

I'd forgotten the group that got elected later and fired Larry Patterson, a group who, while never using the actual words 'anti-growth,' seemed to have slow growth policies.

What I actually said to Bruce was, "I think this town has grown so fast, that the locals didn't have enough experience with bigger city politics, and the newcomers didn't have enough experience with Bend, and that was a recipe for disaster."

In fact, if I had to pick a moment when I think our city council went off the rails, it was the firing of Larry Patterson, who was the quintessential insider but also knew what the hell was going on. Seems like a stupid thing to do, if the majority of the city council is new, to fire the guy who knows what the hell is going on.

O.K. A few disclaimers. I only know what I read in the paper. I've lived here my whole life, but I get my info from talking to people or the newspapers. I'm basically not a meeting-goer or a politician. I'm happy alone with my thoughts, or goofin' in my store with regulars. When I read the legal papers on the Bendbubble2 blog, my eyes glaze over. Thank god there are people who are willing to do such things as read the fine print and sit in endless meetings.

But I also know what happens when you expand too fast.

I had four stores at one time. I thought I was successful with one store, so I added another, and then another and then another. But the other 3 stores were missing an essential ingredient to success -- Me. I didn't have the experience, the management style, the policies, the equipment, and the personnel to pull it off. The level of complexity seem to go up exponentially.

I also didn't realize I was riding a bubble, and that four stores weren't possible in Central Oregon over the long run selling what I sell.

When Bend expanded by four times, I think something similar happened. First, the city council misjudged the growth as solid, when a bunch of it was bubble. They lost sight of the bottomline.

But it wasn't just that it got so complex. I think the wrong kind of mentality found it's way onto the council. The 'promotional' minded mentality. I don't have any trouble with that type, as long as there is some bottomline substance underlying the promotions.

But, I'm afraid that sometimes the promotional aspects become more important than the actual reality.

So, when I listen to the city council and city administration talk about their big plans for Third Street, for instance, or Juniper Ridge, I always wonder where they think the money is coming from.

A hardheaded businessman would never have given into an ultimatum from Les Scwab, I don't believe. They wouldn't have closed off all the options for Juniper Ridge by selecting one group of developers. They would have at least done the practical, before leaping toward the improbable.

I repeat, I only know what I observe from the outside. As someone always points out, if you don't go to the meetings, you have no right to complain. But that's what it looks like from the cheap seats.

7 comments:

Duncan McGeary said...

I'll tell what I really don't understand. The stock market.

So Citibank is saved from bankruptcy because an Arab country agrees to buy a bunch of shares. That's a good thing?

Hey, that bum down there just got handed a twenty dollar bill! Hey, I think I'll hire him and put him in charge of my store! Things are looking up!

Anonymous said...

So Citibank is saved from bankruptcy because an Arab country agrees to buy a bunch of shares. That's a good thing?
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Citibank just got money, but that has been going on all summer, this is the borrower of last resort. Sort of like this summer, when Bend was SERIOUSLY thinking about borrowing $30M from AIG at 20%/yr.
Bend doesn't need to borrow money if slows down, Citibank needs to borrow to cover redemptions as there is literally a run on the bank.

Anonymous said...

So why don't you go to meeting? At the very least to see how thing work, and see who actually goes, and what they say. Your close to downtown.

Garzini was brought in from out of town back in 1998, Kuratek was brought in from out of town.

In my 40+ years when they bring in out of town guys, its simply to get un-popular shit done, and there are endless guys like this that are willing lightning rods.

Dunc, DO NOT forget Kuratek $2k/day, Garzini $333.33/day, not bad for Bend.

The sad thing in the town is that city council and county commissioners are ALL lapdogs to the higher authority, this is why City signed the Les Schwab deal, and this is why County never see's a resort it doesn't like.

Kuratek & Garzini are the lightning rods, supplied by the powers that be. Faces change in city hall, and the lightning rods come and go. But Hollern & Schwab remain over the long term and continually play the same game over & over.

The real interesting thing I see with the new batch 'running' city-hall is this OPM deal, just like our RE problem, its all about other-peoples-money, thus the newbies got Bend in a ton of debt, the old timers like Oran Teater wouldn't have done that thus, in Bend today you have two camps.

Abernethy crowd that says debt is our salvation, and Teater crow that says pay as you go. Both Teams are own by Hollern/Schwab which is maximize growth. With the Abernethy crowd the Teater ol timers are going crazy, this is why Anderson brought Garzini back from the dead. This is why the les schwab deal was forced down the throats of city-hall, to bring back some semblance of pay-as-you-go,

That said I personally call the les-schwab deal 'corporate welfare'. However, this is precisely how the rich get richer, and poor get poorer, again nothing new.

Anonymous said...

At 11% - they are getting a fantastic deal! Where can you go and get an 11% return on your money and the right to buy shares at the current price of $30-31 two years forward? Though the Abu Dubai folks might have wanted to wait a little longer, the equity price will continue to decline. On the flip side, they continue to collect 11%.
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Ok, dunc there are the facts 11% that's most what Bend would have to pay to get money, but hell that's OK, because we grow 30%/yr into perpetuity without risk, just ask any RE agent, always have, and always will.
Ok, 11% for city, then they have a 2 yr window, where they can buy stock at $30, a lot of people on the street are calling this bank-robbery. Enough said?

Simply put, citi is just like Bend, they'll do anything for money.

Anonymous said...

Todays WSJ front page "Banks depleted of cash", after years of handing out money to the stupid, dead, and dumb. Now banks have none for themselves.

Banks are insolvent for practical purposes, early on this summer citi borrowed all it could from the feds.

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This is a classic reason why BEND should be tightening the belt. Stopping ALL current, pending, and future lawsuits ( which it always loses ). Halting all projects, its going to take years for liquidity to return.
Spending & Borrowing our way out of the five-years of greed is not going to make things better. An immediate halt to non-essential services and spending ( That means Killing DVA/VCB ). Tourism is going to fall, no point in continuing to spend millions of dollars promoting bend, that which has only the purpose of creating 'jobs' for creative types in Bend.

H. Bruce Miller said...

This is not a defense of the Juniper Ridge deal, but ...

... it's annoying to see Kuratek constantly referred to as "an out-of-town developer." Or sometimes "a California developer." The guy has lived in Bend for six years, for crap's sake! How long does it take before you're considered a local?

I know that Bend is provincial, but jeez ...

H. Bruce Miller said...

"Tourism is going to fall, no point in continuing to spend millions of dollars promoting bend ..."

That, my friend, is what is known as a self-fulfilling prophecy.