On one of many flights this week I was asked the question, “what would you do with the $700 billion of bailout money?” Not an easy question to answer and there has been lots of arm chair quarterbacking on the topic. I’m hardly an expert on financial policy, but in short this was my layover induced answer.

There seem to be two fundamental problems, of many, worsening our current economic quagmire. 1) The housing bubble pushed home prices to levels most working Americans could not afford and to keep the bubble going the financial community became very creative with mortgages and how the risk associated with them was calculated. The end result was lots of people in houses they could not really afford and very little transparency in the risk this created in the financial markets. There is a lot more to the story but for the sake of brevity we’ll leave it at that. 2) Credit liquidity in the current market has almost ossified causing our collective economic gears to come to a rattling halt. Wall Street freaks…the media freaks…the consumer freaks (no spending)…sales of goods plummet…Wall Street freaks again…media fuels more freaking…rinse and repeat.

To break the cycle it would seem logical that liquidity needs to be injected into the market. A lot of pundits have looked at this being solved by the government buying up the bad assets, giving capital to the banks in return for equity stakes, and several other derivative plans. While all these ideas have their merits and risks the idea I exposed on the plane was slightly different. Back to the core issues - I saw the biggest failing being lack of market transparency and a fundamental mismatch between supply and demand in the housing market. So how could we restore transparency to the market while getting people in homes they can actually afford thus freeing capital for consumer spending and financial investment.

My answer was a foreclosure clearing house. This may be Polly Anna and not feasible, but it made for a fun intellectual exercise. There has been lots of talk around providing bail outs to people whose homes are foreclosing, but even this will be short term and will not solve the fundamental problem that they are in a home they cannot afford. The only real solution is to put these individuals and families into homes they can afford. The easy credit and risk shell game that banks ran has created a basic mismatch of people buying supply with demand they did not really have.

The clearing house is a simple idea of providing a transparent market place where people can trade down to houses they can afford and have new loans guaranteed to do so. The loans could be guaranteed by the government but competed for by the banks. Banks that already have the mortgages on existing properties could have the choice of refinancing the house so the owner could afford the payments (that would be their own risk calculation) or entering the home into the clearing house. Also the home owner could have the choice to enter their home into the clearing house if they would like to trade down voluntarily.

The clearing house itself could run like many of the existing home real estate market places matching buyers and sellers (Zillow, Trullia. RedFin etc.). In fact the government could probably contract with one of the sites to run the technology side of the clearing house at a reasonable cost. Once a person’s home was identified for purchase they would then be free to look for a new home in the clearinghouse they could afford. The government backing would allow loans to be made so the individual, now free of the foreclosed home, could buy a new home they could afford. Banks would still compete to provide the best rate and terms to new owner, but the risk would all be transparent to the government since they would be providing financial backing and to the owners so they were not mislead into buying more house than they could afford (again).

In theory this should introduce liquidity back into the market and with a little time put liquidity back into the consumer market since the majority of a person’s paycheck would no longer be going to a mortgage. The market would be transparent again but not run or partially owned by the government. I would argue that it was not capitalism or the market economy that broke during this financial crisis, but a loss of transparency and a resulting hiding of risk. In fixing the crisis the government’s role should be ensuring transparency in the market place so that it can function effectively. My idea is most likely off the deep end, but I do hope government action is centered around restoring transparency and restoring liquidity to the market. If you were Sec. Paulson for a day what would you do with $700 billion? There are no shortage of smart people around the globe. Can we crowdsource an answer?

Popularity: 18% [?]

James Fee joins in and shares his insight on supporting ESRI’s Geodatabase format and how a File Geodatabase can be shared efficiently. He agrees that the more file formats supported by a GeoData application, the more likely people will use it.

The election rallied much excitement, perhaps due in part to several compelling mapping implementations. The media, for example CNN, turned to maps to present data regarding the election. Maps compiled included locations of candidate rallies and the country’s standings (color-coded in red vs. blue). We even provided our own analysis post-election. (And maybe the most well know, SNL’s Magic Map….)

Jeff Thurston discusses GIS implementation across large energy companies, specifically at Saudi Aramco and BP. Saudi Aramco has 15 GIS units where contractors and numerous amounts of sensors that feed SCADA systems are all dynamically linked through GIS. As for BP, the company embarked on an innovation strategy that seeks to embed GIS and spatial information across the company. Thurston states he knows ‘of a few operations using GIS at the scale and complexity of Saudi Aramco’ and has seen ‘few companies attempt to extend the application of GIS in strategic role beyond practical and operational considerations.’

Google Maps now offers a feature that enables you to download your search results as a waypoint into your GPS system. The feature supports Garmin, TomTom and Pioneer. Make sure you have the correct software installed on your computer.

The KML Handbook by Josie Wernecke is now available for pre-order. Wernecke is a Google tech writer and explains the various elements and features of KML in her brand new book, including topics like Regionation and View Based Refresh.

Popularity: 16% [?]

By the end of today we will know who our next president is going to be. The first polls close at 6 p.m. in Indiana. Virginia, Georgia, Florida, and New Hampshire follow shortly after at 7 p.m. The last polls close in Alaska at 12 p.m. It seems as though the media, pundits, and pollsters are predicting a lopsided win for Barack Obama.  The current data and polls may suggest a win for Obama, however there is still plenty of gray area in states where John McCain could succeed enough to win.

The following maps have been created in Maker to reveal pertinent election coverage and data that my fellow data colleagues and I thought would be helpful going into the big election tonight.

This map displays early voting data for selected states from yesterday:

Pay close attention to Virginia—a highly contested swing state —because if Barack Obama can win in the former Old Confederacy capital of Richmond then the odds of him winning the election will be in his favor.

The following is a map of active registered voters in Virginia:

Here is the latest polling data that shows Obama’s lead vs. McCain’s:

Here is a link to the data set in Finder: http://finder.geocommons.com/overlays/5911

And a link to the map in Maker: http://maker.geocommons.com/maps/1311?page=

Popularity: 20% [?]

There has been a lot of talk about Barack Obama’s tax plan this political season. The biggest question seems to be, who will see their taxes increase? Well we decided to take a closer look at WHERE in the U.S. people will be most affected by the Obama’s tax increase.

First, to clarify, families with an income above $250,000 dollars would see their tax rates return the levels from the 1990’s. According to the Obama campaign, this tax increase will affect about 2% of the population.

So where are these people who earn $250,000? Are they from Republican or Democratic states? Are they concentrated or dispersed?

Since the US Census only provides data for incomes of $200,000 or more, I decided to look at house prices. An individual or family earning $250,000 a year could afford a home valued at about $1 million so we thought that, aside from the obvious margin of error, homes valued at $1 million or more would be a good indicator of who would be affected by Obama’s tax increase. The U.S. Census 2007 American Community Survey 1-Year Estimates provides the number of $1 Million+ Owner Occupied Housing Units by state and county. After uploading that data to Finder!, we played around with some maps in Maker!and found some interesting patterns.

See the datasets (states, counties) and map.

Most of the states that had the most $1 Million + Homes were no surprise, however a few were unexpected. Take a look…the first map shows the number of $1 Million + Homes per state as well as 50 counties with the most $1 Million + Homes and the second shows just the counties have the highest number of $1 Million + Homes.

See the datasets (states, counties) and map.

It’s interesting that some of the states with the most homes only have one county that appears in the top 50 list. These counties, such as King County, WA, Maricopa County, AZ, Fulton County, GA, Hennepin County, MN, and Cook County, Il, have more than a third of all of the $1 Million + Homes in their state.

See the datasets (states, counties) and map.

So we know where the people are. Now, how might that affect the election?

Let’s take a look at the most current presidential election polls from USA Election Polls. This map shows that many of the states with the highest percent of $1 Million + Homes are also leaning toward Obama in this year’s election. In other words, the states that have the highest percent of residents that earn over $250,000 and therefore will be most affected by Obama’s tax increases are in states that are voting for Obama.

Of course, a few of those states are highly contested states including Florida, Virginia, and Colorado. Why is that? Well, its important to point out that the percent of million dollar home owners is only around 2% so they are not going to have a huge impact on an election. However, this demographic may be more likely to vote in an election than those earning less money.

See the datasets for states and polls.

The pattern that million dollar home owners tend to live in democratic areas, is also evident at the county level. This map shows the top 50 counties based on who they voted for in the 2004 presidential election. Of the 50 counties, 30 voted for Kerry and 16 voted for Bush. Most of those counties that voted for Bush are in Southern California, Texas, New Jersey, and Illinois. All but Texas voted for Kerry and are in no threat from turning red this year. Of course, taxes did not play as big a role in the election in 2004.

See the dataset and map.

So why is the McCain campaign making such a big issue of the Obama tax plan? Since it will affect mostly people in blue states, maybe they hope to change some minds there. However it seems that such a scenario is unlikely even though people who earn more money do tend to vote Republican. Exit polls from 2004 show that those who earned $50,000 or more voted Republican.

Perhaps the Obama tax plan, which claims it will give tax breaks to those earning less than $200,000, may persuade some of the 98% + of those in the red states who would qualify to vote for Obama. By appealing to the $200,000 earners, maybe Obama is attempting to raise the democratic appeal to income levels above $50,000. It will be interesting to see what happens on Tuesday, especially to see how the richest counties vote this time around.

Popularity: 15% [?]

Much has been made during the 2008 Presidential Campaign about the errors John McCain has made about geography. He made a reference to Czechoslovakia still existing and also said that the countries of Iraq and Pakistan border one another.

These are major world geography errors that McCain has been heavily criticized about, but he has been good about not making geographical errors about his own country. These errors belong to Barack Obama, the other candidate for President. Obama has on several occasions during the 08 Campaign made errors about geography throughout the U.S. including calling a city/state he was visiting by the wrong name. He has done this on three different occasions in Sunrise, FL, Sioux Falls, SD, and the state of Wyoming. He also was recorded saying that there were 57 states in the USA, that Kentucky was closer to Arkansas than Illinois, and referred to Brownsville, Texas as Brownville, Texas. The map below shows the locations of where Obama has made Geographical Gaffes. The map can be found on Maker! at this link: Obama’s Geographical Gaffes, USA, 2008 Campaign.

These mistakes were probable mere slips of the tongues or occurred from being tired while campaigning. Not much should be made from the errors in my opinion, but since my work deals with geography I must say I’m a bit saddened.

Popularity: 13% [?]