Route to Recovery

A trip through the epicenters of the recession

Austin real estate investors are aggressive in recession

Dec 9, 2009 20:19 UTC

Following our Route to Recovery special report, we asked contributors from Associated Content to tell us their stories about the recession.

By Melissa Plondke

My husband and I are some of the fortunate in Austin, Texas. As a bookkeeper for small businesses and individuals, I know how hard the recession has hit the country. I’ve witnessed local businesses falter and fail. A wealthy client of mine had to liquidate his portfolio, and he only recently has ventured back into investing. A retail client struggled mightily as customers disappeared. Friends have been impacted by pay cuts and job losses.

But we were frugal before the recession. We lapped up conventional financial wisdom. We fully funded Roth IRAs and contributed generously to a 401(k). We carried no credit card debt or auto loans. We paid some extra monthly on our 15-year fixed-rate mortgage. I was just starting my business after leaving a hospitality career.

We were poised to be the opportunists of the recession — late 20s, plenty of cash and excellent credit. But, because we were so aggressive, this year was our most financially harrowing. We ended up in a precarious position with one home too many.

Since the recession began, we have acquired two properties — a single-family rental house and a new home. We purchased both houses at value prices with hefty down payments, yet financing each was a nightmare. The investment property came first, and we suffered from the sins of previous investors.

Although many new homebuyers have less than a 20 percent down payment, some banks would not consider our application without 35 percent down. Every element of our application was scrutinized, and the financing we took to closing was a 15-year note at 8.14 percent despite pristine credit.

While it is not the double-digit interest rates of the eighties, it exceeded our expectations for a mortgage. We refinanced two months later privately at 6.21 percent. By that time, investors were looking for anything more palatable than the wild roller coaster of the stock market.

This spring, we again found ourselves in the real estate market. We happened across an under-priced home in an excellent neighborhood, one we previously could not afford. We discovered we were not the only bargain-hunters in Austin; in the three days the home was on the market, at least a dozen others viewed the home. Our offer secured a contract on the house, and we raced to meet the owner’s four-week closing deadline. We used a mortgage broker to locate affordable financing that fit within our time constraints. This time around, we obtained a 4.75 percent 30-year mortgage. We later joined record numbers of Travis County homeowners protesting their property taxes with new market values.

Our net worth was tied up in the equity of the three houses, and home equity laws in Texas would only permit us access to those funds through the sale of our previous house. We discussed the sale with a real estate agent, but negotiated the sale to colleagues prior to listing the house. Instead of a commission, the agent addressed the necessary paperwork for a fee of $2,000.

We breathed a sigh of relief when the sale closed in August. With cash in hand, we are hunting for another opportunity. Our good habits prior to the recession are paying off as others struggle.

Click here for more Route to Recovery

COMMENT

I CAN CREATE 15 MILLION JOBS ALMOST OVER NIGHT in America..

If America Pulls out of NAFTA and WTO so many jobs will be created we can not fill all of them.

I will bet anyone one million dollars to a donut that I can create 15 Million JOBS if I was President. America would instantly kick into overdrive and you would see more Jobs created than Americans could fill almost over night.

The American people have been screwed for the last 80 years and they do not even have a clue of what is happening.

All the Democrat or the Republican Congress/people and Presidents for the last 80 years in Washington D.C. of both parties do not care about America or the American People.

Most of the American Politicians have been either been bought off by the wealthy Council on Foreign Relations (CFR PARTY) or they just sit on their hands and go along to get along.

The CFR Party was founded by JP MORGAN , Paul Warburg (Jew), John D. Rockefeller (Jew), three super wealthy CFR members back in 1921 with the specific goal to control the American people by buying control of all means of communication to control and generate public support to advance the CFR Party agenda.

With control of the people they could now buy off and elect American Politicians of both parties to carry out their CFR PARTY agenda which is called International Free Trade.

But how can any country survive when all of the Politicans advocate sending all of the best paying jobs off shore to China and watch millions and millions of deplaced workers walk the street, lose thier homes, families go hungry in the name of International Free Trade.

That is exactly why the American Government is shipping all the American Manufacturing Plants off shore to China as fast as they can in the last 16 years. You are watching the largest transfer of wealth is the history of the world (from America to China). The American Federal Government is serving up all of the America wealth to China on a silver Platter.

Please tell me how America and our way of life will survive if the politicans continue destoying America?

At some point American workers will be required to compete with the Chinese workers for Slave Labor $2/day jobs. Every American regardless how much money you have will be affected in one way or another because a lowering tide will automatically lower all boats.

I think we are in the about the 8th inning right now.

If you think I am wrong I have only two questions for you to think about.

Why would AMERICA the most Wealthiest, the most Advanced, the most Strongest Country in the entire World, want to enter into NAFTA and the WTO and want to try to compete with third world Countries where the Workers are forced to work for Slave labor wages at $2/day?

There can only be one out come. All of the American International Manufacturers will be forced to move all of our great Factories that won world war II and our Technology off shore to Communist CHINA. Please tell me how that is in the best interest of the American People?

The American People has no choice in the matter either the USA pulls out of NAFTA and the WTO or at some point our country will just sink into the Abyss. You absolutely cannot have a complete Economic Recovery without Creating Good High Paying Jobs. Flipping Hamburgers at McDonald’s and working as a store clerk at Wal-mart will not do the trick.

I heard today on the news that the President Obama is going to start sharing America’s top nuclear secretes with China?

A country that has no Manufacturing base is called a THIRD WORLD COUNTRY. That is exactly where America is headed.

Once all the high paying manufacturing jobs are sent off shore to China. Please tell me where the America government will collect tax revenues to support our way of Life?

The CFR PARTY Global International Trade policy will end up driving America into total Bankruptcy, that is exactly what is happening right now. When the America people finally figure this out what is really happening it will be too late to stop it.

You want me to tell you why I already know this is the long term Plan.

Why don’t President Obama create those 15 million JOBS right now as the USA desperately needs additional Jobs?

My answer is because President Obama is a card-carrying member of the CFR Party and they have a concerted plan to redistribute all the American People’s wealth to all of the Third World Countries.

It is called enslaving the American workers and the total destruction of America as we know it. If you beat the American Worker down far enough he will be ready to accept anything you offer to feed his family.

All of you people who have money in the Bank and well fix and you love this International Trade, just wait till you lose everything then tell me about how smart you was.

Back to my Question:

How I would create 15 million jobs almost over night?

There is one thing the America Government has total Control over and that is WHERE and WHO will produce all of the products the American people buy and use on a daily basis.

I would PULL OUT OF NAFTA and the WTO and close the doors to the American Consumer Market (the biggest consumer market in the world) and I would tell the entire world if they want sell their Products in America they must build their products in America. This is exactly what China does.

I know all of you American people have been told for 80 years that protectionist will hurt the USA even more because all other countries around the world will stop buying American made products and the USA will lose a lot more American JOBS than they ever gain.

That my friend is just not true.

How can anyone make that statement without at least evaluating the Export and Import numbers?

Normally that answer is true. But, the American International trade deficit has grown so super huge in the last 16 years (and still growing); that if America just stops exporting anything and just produces the items we use on a daily bases that we are now importing mainly from China, we can create 15 million additional new jobs almost instantly.

In fact I really do not care if the rest of the world buys even one penny of American made Products from America. If America just manufactures all of the products we use on a daily bases right here in America, we will create an additional 15 Million Jobs automatically.

Also, the USA yearly National Budget Deficit will automatically be lowered by $760 Billion because that Trade Deficit Money will not be transfer off shore to China like now. The Federal Government will get a huge boost in Tax Revenues from the 15 million American higher paying Jobs.

The American Government must understand they can not continue to allow sending all the high paying American JOBS off shore to Mexico, India, China and Japan and still have enough JOBS to support the American way of life.

YOU CAN NOT GIVE SOMETHING AWAY AND STILL HAVE IT. . . .

Right now all of them 15 Million Jobs I am talking about have all been moved off shore to China, Mexico and Japan, Germany, India. They are producing all of those goods and are shipping it back to America to supple our daily needs.

Then when this very same goods is imported back into the America, the American Government who is broke, must borrow money from China and Japan to buy the very products that should have been produce right here in America in the first place.

This is Equivalent to our Stupid American Government forcing the American workers to sit on his Hands and then tell China to produce all of the goods America consumes and then when the goods is imported back into America the Federal Government is broke and are forced to borrow money from China and Japan to purchase all of this goods we are using on a daily bases.

This has got to the most stupid damn bunch in Washington or they are just conspiring to bankrupt and destroy America?

If you think I am wrong. You can goggle it and check it out for yourself. Then go to “youtube.com” and do some key word searches and listen to some of the videos and do your own research on the web.

I CAN CREATE 15 MILLION JOBS ALMOST OVER NIGHT right here in America ! ! !

Here is my Job creation Computations:

America Imported in 2006 mainly from China, Mexico, Japan and India well over $760 Billion Dollars more than we exported in 2006.

The $760 billion dollar import number that I am quoting includes Oil Imports which is something that America cannot change over night therefore must be subtracted out of total import number. The total U.S. crude oil imported during 2006 amounted to: $309.4 billion dollars of crude oil in 2006.

So, $760 billion minus $309.4 billion = $450.6 billion dollars worth of Manufactured Goods that could have and should have been produced right here in America.

Based on conventional wisdom in job creation, if you take $450.6 billion dollars worth of imported goods / $30 billion to create one million jobs = 15.02 million jobs would be automatically created almost over night.

++++++++++++++++++++++++++++++++++++++++ +++++++++
Now because some of you people still do not get it I am going to recalculate the cost of the Trade Deficit in just Jobs.

So please do not tell me the stock CFR PARTY answer: “YEA, but look at all of the EXPORTS JOBS the USA will LOSE.”

The American people have been BRAIN WASHED by the CFR PARTY into believes in that GLOBALIZATION is in the best interest of USA. I think they are trying to destroy the USA because that will be the final outcome.
++++++++++++++++++++++++++++++++++++++++ +++++++++

Total USA Imports in 2006:
———————————-
$ 2,211.7 billion ——- (this is the total Import number including all Oil Imports in 2006)
$ 309.4 billion less — (minus the total amount spent on Imported Crude Oil in 2006)
————————————————–
$ 1,902.3 billion / 30 billion=63.41 million jobs from Import. ======================================== ==========

Total USA Exports in 2006:
———————————-
$ 1,451.7 Billion / 30 billion=48.39 million jobs from Export.

If USA Pulls out of NAFTA and WTO right now:

USA could possibly lose 48.39 million Jobs from EXPORTS.

However, I am sure many countries will still export many items from the USA because they will be forced too. That would create even more jobs gained than I have estimated.

USA would absolutely gain 63.41 million Jobs from IMPORTS.

So, 63.41 minus 48.39 = 15.02 million NET JOBS GAIN.

My calculation means an ABSOLUTE 15.02 million Jobs gained if the rest of the world did not buy one penny of USA EXPORTS.

But, instead the Washington Politicians with all their Infinite Wisdom elected to move all of that manufactured goods off shore to China. Even as America has up-ward of 17% unemployment rate and climbing.

Then to make things even worse the Federal Government must borrow money from China and Japan to purchase back these very products as they are being brought back into America.

I think we are witnessing the Federal Government in the process of transferring all the America Assets off shore to Communist China on a silver platter.

The CFR PARTY goal is to turn America into a Communistic “North America Union” state consisting of Mexico, USA and Canada. The CFR are in total control of the American Government and have been for well over 80 years.

Why would the American Government sit on their hands and watch as all the Manufacturing Base and all our high Technology are being shipped off shore to a Communistic Country like China?

Make no mistake about it China is still a Communistic Country.

We are handing all of the American Military Defenses and our entire manufacturing base over to China on a silver platter.

Please tell me; “What the HELL are we going to do if we get into a War with Russia and China”?

I guess we’ll just concede the War without firing a shot like Poland did to Hitler during World War II. It looks like we would have been better off too have lost World War II to Hitler, at least we would not be forced to work for $2/day slave labor.

They must be stopped or one day America will wakeup under total Control of China Government.

This is so sad because we had it all and our Federal Government just transfers everything we own off shore to China, Mexico and India.

Have you ever asked yourself?

Why is it “when we elect a President from a different party and he always looks and acts almost identical as the last President”?

It really makes no difference who you vote for President as you will still end up getting the same party and it is called the “CFR PARTY”.

If you think I am crazy go Google it on “youtube.com”. Then Google any name along with “member of CFR”. Then start reading, reading and reading.

The American people have absolutely nothing to say about it.

You will never take back your country with the Ballot Box. I personally think it will require an all out Civil War. At some point the American People will say ENOUGH is ENOUGH and that is when all hell is going to break lose.

The Presidential Elections have been predetermined by the CFR PARTY since 1921.

Why is it every Presidential Candidates of both the Democrat and Republican Parties are always all members of the Council on Foreign Relations (CFR) which is controlled by the most wealthiest Jews in the world?

The “CFR Party” has tons of money so they figured out in 1921, if you want the President of the USA to be a card-carrying member of the “CFR Party”. They simply BUY OFF all the Presidential Candidates of both the Democrat and Republican Parties before the election even starts. Then the “CFR Party” WINS EVERY ELECTION before anyone ever casts a single vote.

Where is Joseph McCarthy when you really need him?

All of these politicians should be tried for treason and every penny of their ill-gotten wealth from all of these lobbyists confiscated and returned back to the U.S. Treasury.

This has to be a Concerted Conspiracy because most of these politicians hold Major Educational Degrees from some of the best colleges in America.

I worked as Industrial Engineer working as an Expert in Industrial Relocation, Manufacturing Efficiency & Engineering, Industrial Economy Analysis, etc. for Rockwell International. Most of my adult life was spent studying the very things of which I am posting about. So, please trust me I know exactly what I am talking about because that was my job for 30 years.

Here is the Main Problem in America.

The American People keep thinking their Representatives in Washington are looking after your interest and will always solve problems and do whatever is best for America and the American People.

Wrong!!!

If you do not listen to me then you are part of the problem too. If you think I am wrong go Google it and check it out. Then go to youtube.com and do key word searches and listen to the videos. Start thinking for yourself and doing your own research.

This is about Presidents and congress of both Democrat and Republican Representatives in Washington who have turned the operation of running the Federal Government entirely over to the Council on Foreign Relations (CFR PARTY).

This is also why Israel always gets exactly whatever they want from America. America has been helping Israel in every way possible even to the point of using borrowed money to support them.

Here is some of the things that should be done to make America Great again.

Add an amendment to eliminate all forms of “affirmative action” in every school, college and all other organizations in America.

Add an amendment to eliminate the American Electoral College System.

Add an amendment that Federal Elected Offices must have a majority of the total vote to win Office.

Add an amendment for Term Limits on all Federal Congressional Offices.

Add an amendment to abolish the Federal Reserve System because the America Treasury should be printing all money under the direction of the American Congress.

Add an amendment to put America back on the Gold Standard.

Repeal the State Home Land Security Act.

Build a Concrete Wall 15 feet high and 3 feet wide on our Southern Border and topped off with razor wire.

Rescind the Anchor Baby Law back to its original inception.

Any Illegal Aliens caught on American Soil would be given a mandatory 20 year prison sentence. Then watch them all run south back home.

Bring home all America Soldiers all over the world and shut down all of the Foreign Military Bases. We are not going to be the policeman to the rest of the world.

Add an amendment to make Lobbyist Illegal with a Mandatory 20-year prison sentence.

Appoint Ron Paul as Secretary of Treasury and very close adviser.

Appoint Lou Dobbs as Secretary of State.

Then hold the 2008 elections all over again for every office in the Federal Government.

Is there no end to the ruthlessness of the most Super Wealthiest People in the World?

If the American people wants their great Country back. There is only ONE WAY to get it back and that is march on Washington and physically take it back.

Did you think for one minute that all of those Prima Donna in Washington will give up all of that Power and money easily?

The CFR PARTY members always win the Presidential and Key Congressional elections and because it is absolute impossible to vote the CFR PARTY out of office.

You see if you control all the money in the world then you can always buy anything you want, even the United States Government.

The CFR PARTY buys-off all the main Candidates of both parties, then the American people elect one of the two carry-carrying members of the CFR PARTY every time.

The CFR Party has totally controlled the American Federal Government for well over 80 years.

So, if you want to end up working for $2/day just like the Chinese slave labor, just keep votes for your favorite Republican and Democrat Candidate. They are all a bunch of damn greedy Crooks.

SO MOTE IT BE. . . . .

Do you truly want to help straighten out the United States Government now? Then, copy and post this article everyplace on the Internet you can post.

The American People have a right to know exactly who runs our Federal Government.

BY: Harry Dingey

Have a good day my friends.

Posted by Harry Dingey | Report as abusive

Racetrack owners wait out the recession in Austin

Dec 9, 2009 20:07 UTC

Following our Route to Recovery special report, we asked contributors from Associated Content to tell us their stories about the recession.

By Dacia Rivers

Peaches. Strawberries. Bell Peppers.

I have memorized the USDA’s dirty dozen list. These are my luxury items, the ones on which I splurge for organic at the government’s recommendation to protect my family from pesticides.

We have a grocery budget of $100 per week. Keeping a budget is new for us. I used to plan meals around whatever I felt like eating. Fresh tuna. Duck breasts. Expensive cheeses. Now I plan our menus using the sales flier from local Austin, Texas, grocery stores. Duck and tuna never go on sale, so we’ve traded them for chicken thighs and frozen cod.

We used to go out to eat once or twice on the weekends, but now we eat all of our meals at home. For lunch we’d hit a favorite Thai or Persian restaurant, but over the past two years we’ve eaten far more hard-boiled eggs than I care to think about.

My husband and I have always been bound by our love of travel. In our nine years of marriage, we have journeyed extensively together, always looking for new experiences. Before we had to tighten our purse strings, we would take at least one vacation a year. Even in lean years, we’d jaunt down to Mexico or off to the West Coast for a week.

But now it’s been three years since either of us have had our feet anywhere but on Texas soil.

Five years ago, my husband left his high-stress job as a producer of political campaign ads to start his own business — a sports car racetrack, where anyone with a performance automobile could pay to drive like a Formula One star without worrying about traffic or tickets.

Two years ago, our first child was born, and I left my job to stay at home with her. The racetrack had just opened, and we knew that times would be tough for a while, but we were prepared. I had saved up enough to take care of our $1,000-per-month mortgage for six months. After that, we figured the racetrack would at least be able to cover our bills.

It didn’t exactly work that way. The economy slumped and people stopped spending money on things they didn’t need. Things like racetrack memberships.

We took out a home equity loan to consolidate our bills. We cut back on anything we didn’t need, canceling our accounts with Netflix and Sirius, and buying an antenna to watch TV so we could cancel the cable.

I looked for work, but it was hard to find. I scoured Craigslist for part-time jobs, but what I found wouldn’t even cover the cost of child care. I started selling off items around our house on eBay and searching for work-from-home jobs.

I finally found one nine months ago and have since spent every minute of my daughter’s naps working. I earn enough that we can now cover bills and groceries.

Business at the racetrack is holding steady. New members trickle in, but old members are leaving at a distressing rate. Most of them are feeling the economic pinch, especially those in construction.

We do what we can and remain hopeful. We talk about the trips we will take some day. We talk about the meals we’ll have that won’t involve boiled eggs.

But for now we wait.

Click here for more Route to Recovery

To help the homeless, housing first

Nov 20, 2009 20:24 UTC

ROUTETORECOVERY/

PROVIDENCE, Rhode Island – Homelessness is a complex problem, and often includes a constellation of issues, including substance abuse, mental illness and unemployment.

But a new strategy has emerged in Providence: Ignore the other problems and provide housing first.

Longtime advocates for the homeless were way of the approach. When Don Boucher got involved with the Housing First project, which puts homeless people in affordable housing without preconditions, he was skeptical that it would succeed.

Nor did he ever expect that it could save thousands of dollars per person on the emergency services that are provided to the homeless.

“I complained that they were taking away my teeth,” said the program director of Housing First RI/Riverwood Mental Health Services.

Prior to the launch of the program in 2006, being sober and drug-free were preconditions for getting into housing, and Boucher was able to take punitive action against those who disobeyed the rules. But there was a very low success rate under the old system, with the overwhelming majority of tenants ending up back on the street.

“It is typically very difficult to get people to sort out the problems that accompany homelessness before they got into housing,” said Karen Jeffreys, spokeswoman for the Rhode Island Coalition for the Homeless.

Under the Housing First program, as long as tenants obey the rules that apply to tenants in normal housing, they can do what they want.

“With the old system if they broke the rules we could throw them out into the street in January, which didn’t solve anything,” Boucher said. “Now if I turn up and they’re drinking alcohol, they can say ‘go away, it’s my place and I can do what I want.”

ROUTETORECOVERY/

Boucher was surprised by the results of the program. It has had a 90 percent success rate among the 130 c

hronically homeless people who have been given affordable housing as part of Housing First. As well as staying in their apartments and paying rent, around 20 percent have jobs.

Up to 60 percent of those given accommodation under the Housing First program are incapable of work due to mental and physical disabilities, but everyone pays rent, equivalent to a third of their income or benefits. And Boucher said they are all doing better.

“Their health is better, their hope is higher and their substance abuse is down,” he said. “It’s a great model and has been a great success wherever it’s been implemented.”

According to a study by Eric Hirsch of Providence College and Irene Glasser of Roger Williams University, the Housing First program in Rhode Island has led to a reduction in hospital emergency room visits, detoxification services, prison services and homeless shelter use. They said the average savings per person for the first year after they entered the program was nearly $8,000.

April Metts, 39 (above), who has been living in an apartment provided by Housing First for two and a half years said that it had transformed her life.

“I am so lucky to have had this opportunity,” she said. “I’ll do everything it takes to stay in this apartment.”

Across the city, Amos House, which runs a soup kitchen and provides temporary housing for the homeless, has a cooking course and carpentry program that provides the homeless with skills to help them find employment. Of the eight students who graduated from the last three-month carpentry class in September, four have so far found work.

ROUTETORECOVERY/

Jim Webster has a group of students working on a house across the road from the Amos House, which will be used to house mothers and children who have been victims of domestic abuse.

“When they finish this course they could easily be hired as carpentry assistants,” he said. “Or they may be able to make a living out on their own fitting windows and doing other work.”

Phal Phann, 30, is scraping the kitchen walls ready for painting and says the course has been very useful for him.

“This is definitely going to help me a whole lot,” he said. “Once I’m done here this will help me look for a job.”

Photos by Brian Snyder

Click here for more Route to Recovery

Audio Slideshow: Stories from the Route to Recovery

Reuters Staff
Nov 13, 2009 18:32 UTC

Reuters Photographer Lucy Nicholson captured these images and stories along the Route to Recovery.

A tribute to Frankie Walton

Nov 10, 2009 20:32 UTC

DALLAS, Texas – Frankie Walton is as smart as I am stupid.

Frankie called me on Saturday night while Lucy and I were driving around northwest Arkansas on our way to an interview.

“Is that Mr. Nicholas Carey?” Frankie asked. “Have you lost your passport, Mr Carey?”

Excuse me?

He repeated the question and after a moment of blank incomprehension I realized: Yes, I had.

Frankie, an American Airlines employee, told me that my passport was at the Dallas-Fort Worth airport, where we had made our connecting flight from Austin. He wanted to know how to get my passport to me and when I said that I was coming back through Dallas two days later, he told me where it would be because he would not be there when I landed before 8am.

I asked how on earth it was that he had tracked me down. Frankie responded that using my passport he had located my reservation, which included my cell phone number. He could have just taken the passport to the lost and found office, but he went above and beyond the call of duty to track me down.

I had to use my international driver’s license to get back to Dallas, which involved a few tense moments trying to get through security (Note to self: time to get a U.S. license).

The kind American Airlines lady at the gate informed me of where I was going to land at Dallas, where I could pick up my passport and where I was expected to fly out of. If we landed on time I could just about make it.

Not only did we land on time, but I made it to the gate where my passport was kept. I was introduced to Frankie’s supervisor, who eyed me rather warily when she was told I was a customer who wanted to talk to her.

Her face brightened immediately as I launched into a grateful babble about how great it was that Frankie had found me.

Through all of this I was far more lucky than I deserve. Thank you, Frankie.

Austin banks on its “mind factory “

Nov 9, 2009 19:03 UTC

NCAA/After decades of growth, Austin’s future success may come down to one thing: the University of Texas.

“The future of the U.S. economy lies in becoming a knowledge-based economy,” said Michael Rollins, head of the Austin Chamber of Commerce. “UT will be the key to our future.”

“Much of America’s basic manufacturing has gone overseas and we can’t compete on cost with other countries for that manufacturing,” he explained. “But we can still design the products that get manufactured.”

Austin – also the state capital and thus home to the state government – has grown dramatically in recent decades, driven in large part by UT. The city has gone from being a middling city of a few hundred thousand dominated by state government in the 1970s to one with a population of 1.5 million. The Austin metropolitan area led the country in job creation from 2003 to 2008.

Former mayor Lee Cooke says that this has been a deliberate strategy over the decades to make Austin a destination for hi-tech and other cutting-edge industries – companies like Apple, IBM and Samsung have facilities here – plus encouraging an eclectic and lively musical culture.

“For a long time what we have been all about is kowtowing to the creative classes,” Cooke said.

The cornerstone of that strategy has been the University of Texas with its 50,000 students and its research facilities, which Michael Rollins said has been a great draw for prospective employers.

From 2004 to 2008, 144 companies relocated to Austin, including 17 software companies and 13 life science firms.

The University of Texas has just reached an affiliation agreement with the University of Texas Southwestern Medical Center at Dallas that will bring medical students and research that Rollins said should attract more medical and life science companies here.

Gary Farmer, president of title insurance firm Heritage Title Company of Austin Inc, said that keeping educated students in Austin using a top university and research center will be vital to the city’s growth as retaining young people in the state.

“We can ill afford to send our best and brightest to research centers in other states,” Farmer said.

Texas State Senator Kirk Watson (a Democrat) talks about the University of Texas in industrial terms, referring to this institute as the “mind factory.”

“Now the asset is the mind,” he said. “What is going to happen with ever greater frequency is that if you’re trying to lure cutting-edge companies to your community, you won’t even be in the game unless you can show them that asset.”

For much of the latter part of the 20th century, there was an easy path into the middle class in America via blue-collar manufacturing jobs where workers could make a decent wage with relatively low skills.

ROUTE-RECOVERY/

But as American manufacturing jobs have dwindled, it has become increasingly difficult to live that particular American dream. Dave Porter, head of economic development at the Austin Chamber of Commerce, said this latest recession has all but ended that way of life,

“That easy shot into the middle class is gone,” he said. “Now the way into the middle class is going to be through a good education.”

“For those communities in America without a top university with a research center, life is going to get pretty tough down the line,” he added.

Photos by Jessica Rinaldi and Lucy Nicholson

Click here for more Route to Recovery

COMMENT

I agree with all of the above. Austin is no different except UT and the Government protect us from having higher unemployment numbers than other states. I know many college graduates who now can’t find jobs or decent paying jobs because we have outsourced all our good jobs. When will the start ups and Samsungs of the world be given an economic stimulus?

Posted by Sbell | Report as abusive

Rural communities in Falls County, Texas, marred by decline

Nov 9, 2009 18:47 UTC

ROUTE-RECOVERY/

MARLIN, Texas – Our journey to Kosse, Texas, to see the food bank in operation took us through Falls County, which is one of the poorest counties in America.

And it showed, with rural decay all too evident as we drove through the area.

We passed through the town of Marlin, just 30 miles from Waco, where the siege at the Branch Davidian ranch at Mount Carmel in 1993 ended in a fire that killed 76 people. Four agents from the U.S. Bureau of Alcohol, Tobacco and Firearms and six Davidians were also killed in a firefight.

Marlin’s main street looks like it has been struck by a disaster and it has, though the disaster here is purely economic.  Most of the shop fronts are closed and faded, a sad echo of an era gone by when this was clearly a bustling little town.

Apart from agriculture, the town thrived in the late 19th century with the discovery of mineral water said to have curative qualities. For a time the town took the moniker of the “Mineral Water City of Texas.”

Those days are gone, as is clear from the nearly deserted main street.

Even worse of is the small village of Chilton, some 10 miles away, where the only business open on the main street is a branch of the U.S. Post Office. All of the other buildings along the road are in an advanced state of decay.

Figures from the U.S. Census Bureau tell a tale of decline in Falls County.

The median household income in Falls County in 2007 was $30,265, some 40 percent lower than the national median income of $50,740. The poverty rate in Falls County is nearly 28 percent, more than double the national rate of 13 percent.

Even more important, and an ominous sign for the future of this area, the population of Falls County fell 9 percent between 2000 and 2008, while the population of America grew 8 percent during the same period.

Traveling through this area was a saddening experience, all the more so because the ruins of Marlin’s main street are a depressing reminder of how prosperous this community once was.

Picture of a farmer preparing to work on his fields in Marlin by Lucy Nicholson

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In Austin’s office property market, waiting for something to happen

Nov 9, 2009 18:26 UTC

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AUSTIN, Texas – Chris Perry says that virtually everything that is wrong with Austin’s office property market is global.

“The problems we’re facing are not local in the making,” said Perry, a realtor at AQUILA Commercial, LLC.

The freezing up of the credit markets following the implosion of Lehman Brothers in September 2008 plus the virtual collapse of the global financial sector have left this market in suspended animation. That’s occurred even though Austin has lower unemployment than the national average and none of the structural problems of northern industrial cities like Detroit.

Austin’s housing market has also got off lightly. While some parts of America have seen steep drops in property prices, the median home price in Austin was down just 0.1 percent in the second quarter.

But nothing is happening in the office property market here.

“We haven’t seen a single major transaction in this area this year because no one really knows what properties are really worth,” said Michael Kennedy, president of commercial real estate company Commercial Texas.

Gary Farmer, president of title insurance firm Heritage Title Company of Austin Inc, described the office property market as “constipated.”

“The capital markets are in disarray, debt is hard to come by so everyone is waiting for the market to settle and find out what is the new normal,” he said. “Things are pretty much frozen right now.”

Nationally, some analysts believe that the office property market, and commercial real estate as a whole, has yet to truly suffer following the crisis in U.S. residential real estate.

According to Perry, part of the problem in the office market is that sellers and prospective buyers have vastly different expectations.

“There is a major disconnect between what sellers think they can get for a property and what the vultures out there think they can pay for a property,” he said. “The real value lies somewhere in between, but no one has got there yet.”

Perry said there are doubtless financially distressed office property owners out there who are holding on for now, but cannot do so forever if the market doesn’t pick up.

“There has yet to be some kind of reckoning in the market,” he said. “The majority of people in this business still think that the worst is yet to come.”

Photo by Lucy Nicholson

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A growing struggle to feed the hungry in central Texas

Nov 8, 2009 12:54 UTC

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KOSSE, Texas – By the time the mobile food pantry rolls to a halt in this struggling rural community of 479 people, the parking lot of the local social hall is already full and a line of people snakes out of the door.

Half a dozen ladies in their 50s and 60s swarms the truck and within minutes they have set up tables and are bagging up food with an efficiency and single-mindedness that is impressive to watch.

The Capital Area Food Bank of Texas, which covers 21 counties and an area twice the size of the state of Massachusetts, makes monthly visits to Kosse. Every month this year it has set new records for the amount of food it hands out — currently about 2.2 million tons. CEO David Davenport said he expects that number to rise as unemployment forces ever more people to become “food insecure.”

“The makeup of the hunger line has changed a great deal over the past two years,” he said. “We’re seeing more educated people and those who have been laid of in well-paying industries like the tech sector.”

“These are people we would never have expected to see lining up for food two years ago,” Davenport added.

The food bank has seen a 60 percent increase in demand for free food and in some places, including parts of the state capitol Austin, demand is up 300 percent.

Jason Steelman, 32, who is here with his girlfriend Amber Nash, 22, was a computer software analyst – a trade he picked up in the armed forces – but hasn’t worked in his chosen field for more than three years. He managed to make ends meet working as a truck driver, but the recession put paid to that job.

“All the work that’s left in this area is either seasonal jobs on the farms or working at gas stations,” he said. “We have three kids between us to feed and it’s tough to put enough food on the table.”

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As Texas does not support the government food stamp program, the food bank is reliant on the U.S. Department of Agriculture and local donors like supermarket chain HEB.

“Without HEB we’d have problems finding enough food to hand out,” Davenport said. “On the state government level there is an unbending political belief in Texas that when you’re in trouble you have to pull yourself up by your boot straps.”

“That’s assuming that you’re not too hungry to pull them up,” he added. “Or that you even have boots.”

The first time the food bank came here six months ago, 60 families showed up for food. That number has now reached nearly 170.

According to the most recent statistics from the USDA, more than one in 10 Americans had low or very low “food security” in 2007, even before a the recession that began in December of that year. The recession may have ended in the third quarter of this year, according to recent U.S. government statistics, but one in five Texans are now hungry, as are one in four children in the Lone Star state.

“It comes down to economic hardship,” said Kosse mayor Ben Daniel. “There aren’t many jobs in this area right now. It’s hard times for folks around here.”

Danee Binion, 21, here with her seven-month-old daughter Madison, looks after her disabled mother and mentally disabled sister. Her husband works on a ranch, but the full household has stretched their means.

“We need some help to get by,” she said.

Janice Procter, 49, said that he husband, 66, is retired and just had knee surgery, and they have two children at home under the age of 18.

“We’re finding it tough to make ends meet and every little helps,” she said.

Democratic Senator Kirk Watson said that “Texas could do better in providing for its people,” and that the state government must take action as the level of hunger in parts of the state has reached crisis proportions.

“Our political leadership should be ashamed of itself,” he said. “Here we are in a state that produces enough food to supply the entire country. Yet we can’t even feed our own people.”

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Photos by Lucy Nicholson

COMMENT

I have difficulty having sympathy for the people of Texas. The “political establishment” that doesn’t want to provide food stamps was voted into place by many of the people complaining about the system. If you don’t like it vote those folks out of office and change the law. You reap what you sow. If Texas has a crisis of not being able to feed it’s own people, it is their own making.

Posted by BB | Report as abusive

Elvis lives on in famous Austin Tex-Mex joint

Nov 7, 2009 14:04 UTC

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AUSTIN, Texas– Even before we got to Austin, we were presented with a bold claim by residents – that Austin is home to the best Tex-Mex in the world.

We decided to put this claim to the test and, after consulting with Mike Rollins and Dave Porter of the Austin Chamber of Commerce, we chose Chuy’s.

Apart from the fact that this chain with restaurants in Texas and Tennessee comes highly recommended for the food, we were reminded that the Chuy’s restaurant nearest to us was where Jenna Bush, daughter of former President George W. Bush, ended up in trouble for underage drinking in 2001. If it was good enough for Jenna, we thought, then it was good enough for us.

A popular place – it was a long wait for a table – this Chuy’s also turned out to be a massive memorial to Elvis. Evlis posters on the walls, a guitar decorated with images of The King and a couple of full-on shrines.

One of them was located just inside the front door, complete with a blue bust of Presley with an inscription on it that read “Elvis lives.”

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Our unflappable waitress Michelle told us that the Elvis shrine had built up over the years with donations from regulars customers who no longer have room for their collections at home.

“Now those customers can come here and see their Elvis memorabilia while they eat,” she said.

There is also the Elvis Presley Memorial Combo on the menu, an artery-congealing medley with enchiladas and queso wings – essentially deep-fried tortillas with melted cheese on them – which The King would doubtless have been proud to eat. Tasty, but deadly.

On the whole the food was good. The fish tacos were great, the fresh salsa with jalapenos was fiery and fantastic and the tortilla chips freshly made. Like the queso wings, the creamy jalapeno sauce was just a little odd and rather dangerous.

Definitely worth a repeat visit for the Elvis memorabilia alone. As for the claim that Austin has the world’s best Tex-Mex, our test was inconclusive, We’ll just have to come back for more.


Photos by Lucy Nicholoson

COMMENT

Oh, please… everyone knows San Antonio has the best Tex-Mex food. Austines are known to travel down the road for the real stuff, not some chain restaraunt. Might as well eat at Taco Bell…

Posted by Jim in SA | Report as abusive
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