ommittee and for Amherst is when you go to UMass, when you apply for a permit, you say, I'd like a permit and I'd like it here. And maybe in five years, they will give you that one. And so you don't really have any control about what UMass can say that you're parking. And so without, I would, so, you know, okay, so I think your people can park in there and they can assert their rights and hope not get towed and get to a mess. But I also think you could talk to UMass saying, you know, my tenants for these buildings need to park here. Let's work this out, because we have a right to park. If they apply for a permit, they need to get a permit and it needs to be there. And so I think that would make me feel a lot better.  And so, you know, I've talked to a professor who said, yeah, it took me, you know, five years to get next to my building and, you know, where I work. And so I would love to see that tied down with some more agreements with UMass that anybody who lives in that building can apply for a permit and get a permit to park in those things, in those lots. So, you know, otherwise, I think you can just assert your rights.  We know that UMass is maxed out for the last two years. I don't know, we know that's gonna be true in the future, but I think that, you know, people in that building are gonna have cars undergraduates more likely than anybody from what I can tell. So I'd like to see that tied down. Another question I have about cars is, you know, electric charging stations, are there any around there? Cause I think that's gonna be the, most people will be charging their cars close to home and are there charging stations in these lots? Kyle, any knowledge about that? I do not know if there's charging stations on the lots relative to asserting rights. I mean, we're trying to be good neighbors. We're trying to work with a system that obviously already works. If we had a big problem, I'm sure you would have heard about it or found it. And I think that we get housing or parking. Those are the two options that we have before us now and we're obviously trying to advocate for as much housing as we can. Yeah, Kyle, do your tenants in Olympia Oaks, I mean, Olympia Place know that they have a right to park anywhere in those lots? Have you told them that? Our tenants have, as ownerships, we have deeded rights to those lots. Maybe we could just talk through this, Janet. If we wanted to just say to our tenants, why don't you just go park? We don't really, even though we're the neighbor of UMass, even though the university is someone we wanna work with, why don't you just go over there and make John King's life completely miserable? Park wherever you want. And then John's gonna have to follow us and chase people down and say, are you 57 Olympia? Are you not 57 Olympia? Let's set up a separate, permitting, let's set up a separate sticker. Let's set up and do all these different things. We could do all that, but we've found to be most effective is to allow UMass parking to continue to manage this as they manage a vast majority of it and all our tenants to buy a permit if they have a car. Okay, so I'm not encouraging you to do that thing, but it seems to me if you have- But I think you are, that's what you're asking. You'd like me to solidify something and assert my rights and say that I'm gonna occupy this many parking spaces for a parcel that has deeded rights for amongst us and the university. We're trying to do it in a way that is working with the university is something that already works with university and I'd like to obviously continue to do so. And no, I'm not encouraging a path of conflict, but I do, I would like to make sure that people in those buildings have places to park and I know those plots are full already. And so- And I think that you should also see if the university is in fact full this year because- Yeah, I would question whether the, to my knowledge, they're not all full. Chris, can you get some information on that? I thought- It's just anecdotal. Oh, because I thought Chris got an email saying that they were maxed. Chris? Yes, I received an email from Nancy Buffone saying that this past year, the parking lots were full, were maxed. She did say that, yeah. So I would like to see a way to make sure that people in that building have parking. And I don't wanna tell you what to do, but I have, you know, that's a suggestion past the work it out somehow. All right, Janet. I guess in kind of in response to that, another way to think about this is it looks like Kyle is willing to put a whole lot of money into building this building, trusting that UMass will take care of the parking issue. And Kyle will be the first one to know if UMass is not doing a good job of providing parking for his tenants, if they need it. I mean, you could say he's building a building that's gonna require people to use the bus because he's not providing any parking. And so he's, you know, I think it's in the interests of the town for him to build these beds so that we don't have more students going out into houses that we'd rather have families in. And so, you know, I don't see the problem here at the moment. All right, I don't see any other hands at the moment. Board members, why don't you take one last thought about whether there's anything you want from Kyle for the next meeting? Hey, Mr. Marshall, you've frozen up on us once more. Does anyone have any last comments? I see, Karen, go ahead. Yeah, I wonder, I wonder, Kyle, if for the next meeting, if you could look at if there's some way to have some covered, maybe even solar covered bicycle stands, if you could somehow envision encouraging that too, just because it isn't done right now, there aren't good bicycle paths. You have to compete with on the road. It's not so safe. You need a critical mass to get this really going. And I think it would be a great opportunity. So I wonder, I'd like to know how many bicycle stands there are and if there was some way you could encourage this, if you could look at it, is there a good path? I guarantee if there's a wonderful path that isn't on the road to the university and great stands, you're gonna up the amount of people and you would take care of the times in between when there isn't so much bus traffic and that's what I'd like to encourage. I wonder if that's possible. Yeah, Kyle, maybe. And I know that there's a downtown, you've done some internal or interior bike storage areas. Just interested maybe if there's a number you can put out for us next time we meet. There's how many bikes might be stored inside, outside and that might be helpful. Okay. I hear both of those. Can you all hear me? Yes. Okay. I seem to be having trouble tonight. Thanks, Tom, for jumping right in. Chris, it looks like you're the next hand I see. I wanted to encourage board members to look at the emails that they've received in the last three days, Monday, Tuesday, Wednesday because there has been new information. Kyle has presented much of it tonight but I encourage you to look at that. We'll try to include it in your packets. Maybe Pam has included it in the packet for tonight but I just didn't want that information to get lost. So please look at those emails. Thank you, Chris. All right, Janet, what do you need from Kyle for our next meeting? Well, I didn't get the packet but I was interested in what the concom was requiring and we looked at that slide really quickly like where the buffer zone lines were and then I'm interested is the concom, do they want to keep people off the area in the back and then the covered porch access? I was just trying to think, I think that Andrew had thought that would be a nice place for people to go outside and maybe do some sitting or hanging out and you went really quickly through that slide. It might be in our packet, it might be late breaking news. I just wanted to just get a little, because that slide went by really fast and I'm speaking a little bit from, I don't have a full set of whatever's. Yeah, I think that one. So where are the buffer zones on that? I can't quite see that. So the red line is the 100 foot buffer. Okay. And then you have 50 foot buffer that is the one that just touches the edge of the property right there. Okay. And then did the concom want people not to be in the 100 foot or the 50 foot buffer zone? No, it wasn't about people. It was really about work. So trying to make sure that any stormwater was outside of the 50 foot, trying to make sure that any plantings within the 100 foot were all native, trying to make sure that the work for stormwater retainage, which these are the retainant structures that are below grade were managed properly and were planted over properly. It wasn't a discussion about access or, I mean, there's a trail through the center of the wetland.  Yeah, so I think Andrew had been interested in access to that trail from the back and maybe using that back as a seeding area. So I wondered if that was possible. And then there's a cover. I think that, Janet, real quick, the grading back here makes that a little difficult to make it accessible. And more so when we're working with stormwater and working with concomitants. And the covered porch is only accessible from inside the building, is that right? Yeah. Okay, how big is that? That's this lighter gray portion here, which is just a rough couple on our square feet. Okay, thank you. All right, Bruce. Oh, I am already unmuted. Oh, one of the things we received was a traffic study and very elaborate. And I had to say that, and this may be a question for staff, I think. I wasn't so concerned about traffic here because I thought that this was basically a place where hundreds of cars got parked and were coming and going. And what might change here, some of those cars might be used by people in this building, but most of them won't be. And the number of cars that comes in and out of this site would seem to be largely generated by the size of the existing parking. And so the question for staff is, would this building really have any effect on traffic? As I understood, the traffic study didn't seem to think it was going to be a big deal, but it seemed to me that this was one of the few times when you might imagine that a building would have almost no impact on traffic. Is my comments, what I might consider common sense, a flawed here, or is it broadly correct? Chris? I think that's what essentially what the traffic study said that there wouldn't be much impact on the traffic on East Pleasant Street. But you also have to factor in whether that parking lot is full or not. And it was full last year. So I think your surmise about, they're not being a lot of change in the amount of traffic. If the parking lot is full is right, but if the parking lot isn't full and this building is added, then there would be a change. So I think you should read the parking study carefully. There's just three pages that are really full of information. The rest of it is all parking counts and peak hours and that kind of thing. But if you read those three pages, you'll really see that there is not a significant impact based on this building to traffic at that intersection. And Doug, if I may, I also noticed, and I can't remember where I saw it because these things were flying around, but whether it was in Kyle's management plan or whether it was in your development report about low-flow plumbing fixtures. And to the extent that we have any control over that, which I don't know that we do, but if we do or encourage, if we're going to mention low-flow plumbing fixtures, if anyone's going to mention low-flow plumbing fixtures, I would encourage that it's be associated with numbers that say, well, I'll use those because low-flow is really a meaningless term to me because it's just, you can say it's just lower than whatever you want to compare it to when there's no standard. So can we substitute any reference to low-flow fixtures with numbers, which for gallons per minute for showers and gallons per flush for toilets and things like that. There's only four or five, so maybe not even that, three or four fixtures for which those numbers would be relevant. And I think we, instead of using a wave, arm-waving term like low-flow, we should, in parenthesis, put the proposed flow rates for each of the fixtures involved. Kyle, do you think that was in some of the material you provided and how would your fixtures differ from the flows that are required by the plumbing code? Well, I think we're fortunate that the plumbing code in particular, the stretch code, is forcing all these buildings to get better and better. And as of January, the HERS rating on new buildings has to be 45, which is less than the 55 and less than the 65 when the stretch code was implemented. So I think that code and efficiency are working hand-in-hand together. Obviously, when we go and seek lead certification for these buildings, achieving lead gold is based on having fixtures that have actual flow rates to them for each of the faucets and toilets and shower heads and so on. So we have to do that within energy star ratings, within lead and obviously in order to meet stretch code. All right, but your intent was not to do fixtures that were any better or used less water than the plumbing code. Your intent was to meet the stretch code and the lead requirements and that was it. I was basically interested in whether you were applying Californian standards or whether you were applying Massachusetts standards. We haven't, I'm not familiar with the California standards. I think that the low flow in our minds is the fixtures that we've installed in all the projects to, you know. So I guess I was just saying they're therefore code compliant low flow.  So it's just a matter of communication. So code compliant low flow sounds like what is intended here. Okay, that would be a better way to say it. Okay, good. Thanks, Bruce. Karen. Okay, Karen's was a legacy, okay. And I've just turned off my camera to see if this will stop getting my Zoom interruptions. So, Bruce, your hand is still up, is that a legacy? It is, my hand is up and my mute is off. That's right, so let's, okay, good. Any other board comments? Let's look and see if there are any hands. Okay, Pam Rooney from the public, please bring Pam over and let's get her name and her address. All right, Pam. Hi, thank you, Pam Rooney, 42 Cottage Street. I would appreciate actually if the packet could include the updated floor plans and package that Mr. Wilson has provided. I've only seen earlier versions of it. So having current versions would be good. A question for Mr. Wilson, in the era of private public partnerships, I'm wondering if Archipelago is interested or could be asked to provide some benefits in the form of improving bike lanes on the stretch of Olympia Drive from his buildings out to East Pleasant Street to facilitate, in fact, the use of bicycles. And if Archipelago could also be asked or required to provide a couple of electric vehicle charging stations all in the name of, because he's not having to provide any parking spaces for his tenants and he's relying entirely on PVTA circulation, that there's maybe some quid pro quo that would be appropriate to help facilitate the transfer of students from his building to campus. And I think it's totally appropriate for that kind of contribution to the greater good. Thank you. Thank you, Pam. Chris. I just wanted to respond to one of Pam's comments. As soon as we get a document in email to us, I forward it to the planning board members and I forward it to Pam and to Nate. And then I ask Pam to post it in the packet. And so almost instantaneously, Pam posts things. So if you wanna look at the packet for tonight's meeting, you will see the most updated information that has been made available by the applicant. Thanks. All right, thank you. All right, so if there aren't any more, oh, I do see Jennifer Taub's hand. Why don't we bring her over? Jennifer, can you give us your name and your address? Yes, thank you. I'm Jennifer Taub at 259 Lincoln Avenue. And I just had a small comment which was regarding students and bringing cars to school, you know, that why they would need parking, even if the Libya place is relatively close to campus and there's bus access, that many students bring cars to school because that's how they get from their hometowns to school and not even that they may not even be using the cars on a daily basis, but they do need a place to park them. So, you know, that's why we caution that even with, you know, transportation available that students will still need a place to park. And, you know, again, for students not parking every day, they may not need them to be as close to Olympia place as if they're driving to school. Although I would, you know, I would echo what Janet McGowan said in that I think it's important to determine where those parking spaces would be that the university would provide. But it's just, it's been my experience in my neighborhood and then, you know, just generally what I've observed that even, you know, again, if they're using the PV, the Pioneer Valley Transportation or even walking to school, that that doesn't mean that they're not bringing cars to campus, you know, with them when they come at the beginning of the semester. All right. I'll smile when we comment, thank you. Thank you. All right. Maybe that's the last hand I've seen from the board and the public. So maybe we can have a motion to continue this hearing. Chris, should we move it? Should we have it continued on the 16th? And maybe what do you want to do? What time? The 16th would be good. And you could continue it to seven o'clock, although you're probably, you know, gonna take it later than that. But just in case something happens with food and drink establishments, and it makes it vanish at night, it would be good to have Kyle back at seven. All right. Tom, is that? So moved. All right. Thank you, Andrew. Seconded. All right. Any more discussion for tonight? Not seeing any hands. All right. Let's continue to talk about vote to continue. Yes, vote is we will continue to November 16th at seven o'clock. Bruce. Yes. Tom. Aye. I also want to thank Kyle for his responses to all of our questions and probing about all of these different issues and coming back with answers. And I think it's fantastic. So thank you. So aye. Aye, okay. Andrew. Aye. Janet. Aye. Karen. Aye. And I'm an aye as well. Six votes in favor. The motion passes. Kyle, we'll see you in two weeks. Thank you for everybody's time. Appreciate it. All right. Good night. Good night. Okay. So we'll now move on to item six on our agenda. The time now is 9.52. Chris, do we have any old business topics not anticipated 48 hours in advance? No old business that I know of. Thank you. All right. Janet. You are muted. Oh, I'm back. So I wanted to ask the questions that Elizabeth Veerling asked about the downtown or Amherst Center design guidelines and then the banks parking lot engineering analysis and then is the planning department looking at other parking lots? Because I was kind of wondering that too. I didn't know about the grant that sounds good. So maybe Nate can answer that. Is he's most familiar with those questions? Sure. Yeah, the downtown design standard guidelines. As some of the staff I've discussed changing a little bit now with the grant, we may add that in. We haven't confirmed the timeline if the planning grant can coincide with when we wanted to have the project move forward. But it may be that we could augment our budget and services with this planning grant to do. What we had in the downtown RFP was some mention of streetscape standards and what we applied for was a more in-depth look at it. With the roadways, bike lanes, with the sidewalks, amenities, types of site furnishings. And so it goes hand in hand. So we just have to determine how that could be incorporated or not. So did the RFP go out? I guess that's my... No, no. After the last planning board meeting, there were a few really good points raised about how many meetings could be over Zoom or in person. And how could we kind of describe the scope? Was it looking at three different types of building typology, urban center, maybe transitional and then residential. And so staff has met a few times and we've been refining the language, but when we heard probably two weeks ago that we might be in this planning grant, we just waited to see if we could, what that would mean. And what about the garage? The garage, we were getting under contract with Desmond Design Management. They're an engineering firm that is often used with municipalities when they do garages. They're based out of Boston. They actually worked on the original garage as the design consultant. They helped Greenfield do their garage. And they're kind of one of the leading firms. And so we've contacted with them to provide a technical assessment of the existing boatwood garage, a visual inspection and then also a review of the existing, they have the drawings. And so the kind of do load calculations and co-compliance to determine if additional levels could be added. And so preliminarily, they think they could be, they have to examine it more. I mean, honestly, the exterior load bearing points of the garage are so close to the adjacent buildings now. I think their study will then help us ask the question, would we really want to do this? So then it'll look at like, this traffic circulation ramps, height of deck, proximity to building, and they're going to say if it's feasible or not. And then I think really it becomes a question for the town, would we actually move forward with something like that? We haven't looked at studying other sites. I think that would be after this study. All right, thanks, Nate. Chris, do you have a follow-up? Yeah, I just wanted to note that they're going to give us some concept sketches and they're also going to try to give us ballpark cost estimates, particularly with regard to cost of a space, for instance. If you build a space on a virgin site that hasn't been built on before, that's one cost. But if you try to retrofit an existing parking lot, that's another cost. So they're going to help us out with that as well. And there was one other question that Pam Rooney asked, and I had to do with whether we're looking at other potential parking lot sites, parking garage sites. And we have not had time to do that, but we do intend to, the staff intends to make a, what should I say? Not a very technical pass at that, but a kind of conceptual pass at that, but that has not occurred yet. All right, thanks, Chris. And Janet, I think that takes care of your questions. Okay. All right, so that's it for old business. And now we'll go to topic seven. The time is 9.58, new business. And Karen, you had a topic you wanted to introduce to us. So we'll have a, why don't you introduce it? And then we can have a short period for comments tonight. Yeah, thank you for taking this up. I thought Pam Rooney made such a good pitch to Kyle saying, could we have a quick quote, a contribution that you somehow work together with the university to facilitate a good bicycle path to East Pleasant, and then maybe through some of their land to the campus. I don't know what role the planning board can take to somehow facilitate the fact that we really have to move to a completely different way of moving around, especially students who are prime people for getting into alternative ways of transportation. If we had bicycle paths, as I know in Europe and in Berlin where I'm kind of my second home, the bicycle paths are not on the street very often. They share the sidewalk, they're a different color brick and as a pedestrian, I know my husband always pushes me out of the way and says, you're in the bicycle path and you have to sort of get used to that. But it really makes bicycle riders feel much, much safer than if they have to share the road. So that's something to look at. And what role does the planning board have? How can we move this along? Because I think it's a really important step that's coming. I see all the paths that are sort of delegated as bicycle paths downtown. I think it's great. I think the university does realize it has to move in this direction. But developers, especially this Olympia Drive, that's something that's happening right now and it's in the prime location. So can we make demands? I'm not quite sure. I'm such a new member, what we can do and I'd love to hear what other people think about this. Thanks. All right, does anybody want to respond to Chris? I just wanted to recommend that you talk about this in a very generic way because Kyle is not here right now. And so if you wanted to talk about this in relation to his project on Olympia Drive, you would really need to talk about it with him because it relates to that public hearing. So just talk about this in a generic manner for now. And then when the hearing is open on November 16th, you can bring this up in a specific way related to that project. Thanks, you're right. Bruce. Two comments. I'm broadly interested too in this and the other sorts of things that we might encourage such as for example, solving the problem of providing charging stations for apartments, I have thoughts on that. I'm not going to say them now, but it's the same sort of thing. But in the case of bicycles and pathways and so forth, I'd imagine we don't really have leverage except that we might if we think about it from the point of view of parking waivers and so forth. We're not obligated to ground parking waivers. But I know that we've been doing that creatively in many ways for many, many years for all sorts of reasons. And we could imagine that in the future we might on certain projects where it's appropriate, we could tie a parking waiver to some kind of gesture in this direction where it may be putting a roof on a parking bicycle station, maybe extending it, maybe making these bicycle storage more secure and sheltered. We might also seek to think of accommodations for probably what will be increasingly small electric propulsion for bicycles which are going to make those bicycles heavier and that's going to change some things about them which they're not going to be able to bring them up into their rooms, perhaps probably because they're heavy but they're going to be valuable. So we're going to be, people are going to be interested in different ways of securing them. So I think we should be mindful of all that and that's probably part of what Karen's thinking ahead to as well. So I think this is something that we can think of in respect of applications to come before us. All right, thanks Bruce. I guess when I heard this about this topic, the things that came to mind were that Karen or somebody might take the town plan and figure out where you would want to put bike paths. And then that would essentially prompt a conversation about how might the town get the rights to have a public bike path through what is now private property? And would that be eminent domain? Would it be attacks on real estate sales or how would you do that? But I think I would start by thinking about where are the lines of demand for a more convenient bicycle connection that isn't already served on a road or isn't already provided? And I will second Bruce's comment about electric bicycles. We just spent a couple of weeks in Europe and saw a lot of parking spaces reserved for bicycles. So, you know, if the town really wanted to encourage bicycles, I think there's some acts that the town could take to say, this is what we want to do. And then we might be in a position to say to a developer, look, your property's right next to a location that we want to do a bike path. Now's our chance to persuade you to help us build it. So, but until we have a vision, I don't know, I don't think it's going to be easy to be telling people what to do. Janet. Karin, I would encourage you to talk to Tracy Zapien, who's the chair of the Transportation Advisory Committee. I think following up on Doug's suggestion, I think they already have figured out where they want more bicycle use and better pedestrian movement. So that might be, she's like a, she has tons of information. I also think we really do need covered and secured bike things. And I think we could require that of developers because especially electric bikes, I have a friend who has one, she uses it as it's our only transportation and it is too heavy for her to carry upstairs. And she's very worried about it. She lives in San Francisco of having it stolen because it's worth thousands of dollars. And so I think that's a great issue. And then in terms of where to put the, how to get the access rights, like I have a 30 foot public right away. So the town of Amherst could always put a bike lane on my front lawn basically. And I think at this point in our climate crisis, I would invite that just to move things a little better. So I think there's a lot of public rights away on the main roads that are much wider than the road that you're, or sidewalk you're looking at. All right. Chris. I just wanted to mention that there is a pedestrian and bicycle plan that was done in coordination with the Pioneer Valley Planning Commission a number of years ago. There's a text that was written and there are maps that are in a kind of incomplete state. The text is finished, but the maps are, as I said, incomplete the tack, the Transportation Advisory Committee has an intention to work with DPW to finish the maps, but Karin and others may wanna take a look at that. And if you email me, I can send you a link. I'm not sure I could tell you today exactly where to go to find that document. All right. It has it up already. Thank you, Chris. Bruce, go ahead. I think I'd like to try to close this conversation soon. So it's getting late. A question, I think a quick one, but if not, it can be answered later of staff, I think, apropos of a potential funding source for some of the things that you, Doug, were mentioning about bicycle lanes and so forth or creating them. I thought, well, the CPA fund sounds like a fund, but the question is, is the CPA fund restricted by Massachusetts statute to the four portals that currently is or could bicycle transportation be imagined to be something that could be supported through the CPA? Chris? I think if you could characterize it as recreation, it could be supported because that is one of the things that's supported by CPA. I don't know if transportation would be considered, but we're always looking for grants. And one of the grants that we just got was for work on Belcher Town Road, and we're hoping to incorporate some bicycle, which should I say infrastructure into Belcher Town Road. And it's always sort of in our minds when we're thinking about working with Department of Public Works on roadways. So just wanted to talk. And bicycle lanes could be part of the streetscape design standards too, whenever that happens. Okay, so why don't we, at least momentarily, there aren't any other hands. So let's close this item and move on. Time is 10.09, and Chris, is there any other new business for tonight? Just one thing. I wanted to let you know, and I could do this in report of the chair, but I'll just tell you now, we are very sad to be losing Ben, who has been with us for two and a half years. He's going to work with the Massachusetts Department of Transportation. And he's been terrific to work with. He's really innovative, and he's got all kinds of skills, and we're really gonna miss him, but we wish him good luck in his new position. But in the meantime, we're gonna have a lot of work to do to fill Ben's role until we hire somebody to replace him. So Nate and I are gonna be working over time to try to fill Ben's role. Mostly Nate, but we try to not burden Nate too much. Anyway, yeah. I know, very sad. Yeah. Okay. Number eight, form A, A and R subdivision applications, Pam. No, not tonight. All right, ZBA applications? No, I haven't heard of anything. SP, SPP, SPR, SUB. Yes. There is one for, kind of think of what it's for. Is it Belcher Town Road? No, it's not Belcher Town Road. But we have a couple of them. They haven't been formally brought into the system yet. So we'll let you know about them next time around. All right. All right. Great. All right. Number 11, committee and liaison reports. Bruce, anything on PVPC? Well, I'm still not formally appointed, but I have been relying on Jack and his reports of activities of the commission have been forwarded to us all, I think. So basically my report would be what you've received from Jack. Okay. Chris, is there any way to expedite getting Bruce appointed? I did email the town manager. I don't know if it was last week or the week before, and I copied Bruce, I believe. And the town manager has been embroiled in other topics recently, but I will email him again. What's that? All right. Andrew, PV or CPAC? Yeah, thanks Doug. First I'd say thanks Chris for sending out the list of projects and would encourage folks to please send over any questions they have. I did get some already that I was able to forward on to the applicants and you can share them with me up until the last minute and I'll bring that forward. I don't know that I'd mentioned before. We have, right now we have about $1.8 million that that number could go up. We have a budgeted reserve, which we could tap into as well, but let's just call it 1.8 for right now. We have $6.4 million more than that in projects, right? There's over $8 million of projects that are being proposed, so we definitely won't be able to do all of that. Again, any questions you have that you would like me to forward on, please do the presentation start next Thursday and they will be held, I believe, over the next three weeks. Andrew, are there any particular projects that are being proposed that you think have close sort of impact are some things that we would be particularly interested in from the planning board? Yeah, it's a good question. I don't know that they're necessarily is. I think the community housing, that's, you know, there's a lot of money that's being allocated towards that. It's something that we've talked about, a fair amount over the years in this. So that could be an area and you could take a look at some of the community housing projects that we have. Aside from that, there is an open space proposal, which we haven't had one for a while. And yeah, other than that, I would say, you know, take a look at the projects, which are of interest to you personally, as well as in your capacity as a planning board member. All right, thank you. Tom, DRB. Sure, I mean, I will follow up to say that I don't think there's anything of significant impact that we've been reviewing. I mean, a lot of it's just been signage and wayfinding within town. So there's, you know, it's cool that we get to see like new businesses and kind of where they're going and when they're opening waiting for everybody else does. But, you know, there's a juice cafe that we approve some signage for. There's a Chinese or Asian restaurant at 63 Main, so that's right downtown. They have some new signage and screens in their windows. The spoke has some new signage that we've approved. The, you know, it was pretty minimal, pretty clean. And then the drink has had several kind of iterations of signage that we've been reviewing and approving. So there's just been a lot of like, you know, really small, but let's just say maybe somewhat important revisions to the urban landscape from an aesthetic perspective. That's really it. All right, thank you. Janet, solar bylaw. And our last meeting we met briefly, the GZA associates were doing a solar assessment, which is sort of a technical look at where solar could work in Amherst, like rooftops and parking lots. And then there'd be limitations, not just physical limitations, but it might be legal limitations, like on certain types of land. And then also they'll be doing kind of a community outreach to figure out like what the value, community values of Amherst are. I don't have that much information on that yet. And then one of our members who is, she was giving us a talk about solar siding, like all the steps involved in siding a large scale array, which takes at least two years. And it seems almost a miracle that anything ever gets built between all the permitting. And then even if you get all your permits, you might not be able to like, be able to send your power to the grid. So it was brutal, but interesting. And then we're gonna look at the economics of arrays and stuff like that. So it's totally interesting. Great. All right, Chris, CRC, or Nate? Yeah, so well, the CRC has been looking at the flood mapping and they recommended all four aspects of flood mapping, the firm maps, the flood insurance study and the two things that you looked at tonight. So they've made positive recommendations on those. That was last week or two weeks ago. And then, or maybe it was last week, then this week they're looking at food and drink establishments tomorrow night, tomorrow evening at 4.30. So they're taking that up. And then in their spare time, they're working on rental registration. And that's kind of a big deal that they're working on with Rob Mora and his staff. So those are the things that they're doing. All right, thank you. Report of chair. I have no report tonight, given the hour. Chris, any report of staff? I don't think I have any further reports. Okay. All right, the time is 10.17. I guess we can adjourn. We gotta figure out how to do this faster. This is just brutal. I think we have too many agenda items. That's my feeling like two big ones would be good, not three. Yeah. You've done a great job of trying to manage all of it. I appreciate it. I hate to push you guys to be faster, but I know how long it takes to repeat something verbally.


Our next speaker is Dr. Thomas DiLorenzo. He will be lecturing to us this afternoon on the topic of competition, monopoly, and antitrust. John? Kim? Thanks, Mark. I thought I'd put a few readings here. If you want to introduce yourself to the Austrian way of thinking about competition and monopoly, these are some readings that I've recommended these on the advanced reading too, some of them. The Hayek article, The Meaning of Competition, is on the web on misis.org, you can find it. And of course, as is Murray Rothbard's Man economy and state. Chapter 10 is the chapter of monopoly. So that's worth reading. And then a real classic book in the Austrian economics is Dominic Larmontano's book, Antitrust and Monopoly, Anatomy of a Policy Failure. There's also a shorter version of it that is online, the shorter version is online, the bigger version is sold by the Independent Institute. And it's just a great book if you really want to learn something about at least the American experience in the history of antitrust, that's the one to read. And then Israel Kursner, of course, is a big name in the whole area of competition, entrepreneurship. And so his book, Competition and Entrepreneurship, is a classic. And I ran out of room, there's an article that I published 100 years ago with Jack High in a journal called Economic Inquiry. And I'm gonna talk a little bit about that article today, but it's also, I think, a good quick summary of the importance and significance of how the Austrian view of competition differs from the so-called mainstream view of competition. Okay, so that's just some tips on reading for now. And so you'd think economists of all the things they would have, they would know what competition is about. So you would think that's one thing, but not really. Not really. And I'm gonna put something else up here, there's sort of a difference. Fuzzy there. This is just my definition of the Austrian view of competition. Competition is a dynamic rivalrous process of discovery and entrepreneurship. And of course, there's no key word, they're all equally important. Dynamic means ongoing and evolutionary, never ending. You can never end competition. For example, government had legal monopolies on cable television for years. Most cities in America, where companies were given legal franchises to be a monopoly, but satellite technology broke that up. The postal express statutes in the US make it illegal for you to send a letter in competition with the post office, but who needs the post office with email? And so competition is never ending and evolutionary. It's rivalrous, of course. The whole purpose of competition is to win the customers over to you at the expense of your competitor, in most cases. And it's a process. It's a process of discovery, discovering what? What's discovering what consumers want on the part of a business? It's discovering how to go about producing those things. What input combinations are best? Will a merger be good or bad for your bottom line? And all the other types of business practices that are engaged in, these are all things that have to be discovered in the marketplace, but they're also all things that are just assumed to be known by the standard model. And so in Hayek's famous article on competition, one of the things he says is that all the elements of competition are assumed away by the competitive model, the so-called perfect competition model, which is really not a model of competition at all, as we'll see. And so real competition in the real world involves product innovation and differentiation, price cutting, advertising, mergers, and all these other free market activities. These are all things that have been condemned to some degree by the mainstream of the economics profession over the years as possibly monopolizing and in need of correction by government regulation.  Okay, so it's very different definitions. Of course the, and this way of thinking of competition by the Austrians was pretty much the way anyone who studied economics thought of competition from the time of Adam Smith and even before the time of Adam Smith. You know, he wrote his famous book, The Wealth of Nations in 1776. It was first published until about the 1920s in the United States. Okay, and as an example of how that went is one of my articles that I'm gonna mention a little more later is called The Myth of Natural Monopoly. And it was in the Review of Austrian Economics in 1996. Part of it, I quote what some of the American economists said in the late 19th century about the first federal antitrust law, the first federal anti-monopoly law. It's called the Sherman Antitrust Act. It was named after Senator John Sherman of Ohio, who was the brother of General William Tecumseh Sherman, the famous Civil War General. It was very popular down here in Alabama, by the way. What's that? Especially in Atlanta, Georgia, yes, nearby. But at the time, at the time the first federal antitrust law was passed. And this is a subject of this article in mind with Jack High from Economic Inquiry that I put on earlier, that the economics profession was unanimously opposed to the whole idea of antitrust regulation as a matter of principle. They thought it would be inherently incompatible with competition. And at that time, there were only really a few dozen people who had careers as economists in America, as academic economists who wrote anything in articles or books or magazine articles on the whole subject. So we were literally able to survey the entire population of economists at the time and see what they were writing about this new antitrust law. We didn't take a random sample. We got everybody. And I'll give you some idea of what was being said. The co-founder of the American Economic Association was a man named Richard T. Ely. And he was quite a statist. He wanted to nationalize the public utilities and things like that. But here's what he said about the merger way that had been occurring, corporate mergers. He said, he wrote that large scale production is a thing which by no means necessarily signifies monopolized production. His co-founder of the American Economic Association was John Bates-Clark. His name is up here somewhere. I forget where John Bates-Clark is, but he's behind me. Is it over here? There he is right there. And he who was very instrumental in the development of a marginal productivity theory, John Bates-Clark. He said, the notion that industrial combinations would destroy competition should not be accepted. Really the sort of the founder of the Chicago School in economics was a man named Herbert Davenport. He was also sort of a fellow traveler of the Austrians. He said that only a few firms in an industry with our economies of scale, it does not require the elimination of competition. So they recognized that competition really had little or nothing to do with how many firms there are in an industry because they believe competition was dynamic and ongoing. It wasn't determined by the number of firms. Davenport went on to say that without large scale production, the world would revert to a more primitive state of well-being and would virtually renounce the inestimable benefits of the best utilization of capital. And so that's the way economists thought about such things as mergers and market structure. That is the number of firms competing within industry at the turn of the 20th century in America and elsewhere in the world for that matter. Because they all looked at competition, essentially like the Austrians did, the Austrian definition of competition. And then there was a change. There was a change in the theory of competition. And you've heard something about this when the economics profession decided that it would be a good idea to try to ape the field of physics, to try to look more scientific. And because the hard sciences as they're called were gaining more and more notoriety in the late 19th, early 20th century for all sorts of reasons. And the economists were sort of jealous of this, envious of this. And so they adopted sort of the mathematical method as a way of explaining economic behavior or so they thought. And this way of looking at competition, the way competition had been studied since before the time of Adam Smith did not really lend itself that much to mathematical modeling. Human behavior is not always linear and twice differentiable and all that.  We're gonna model things. It's not necessarily consistent with human behavior. And this reminds me of a, there's certain things that stick in your mind about your education. When I was in graduate school, there was a well-known mathematical economist. His last name was Ng, N-G. And he had a model of the hamburger market and a mathematical model. So as most graduate students in those days did, we had to sit in these rock-hard chairs and watch this guy put a zillion equations on the blackboard for about 45 minutes. And then one of my professors, Gordon Tullock, said, but this is nothing at all like the hamburger, the real hamburger market. And Professor Ung's answer was, well, I don't care. I care about my model. I don't care about the hamburger market. And that was an important lesson to me because it taught me what mainstream economics was all about in those days. It's all about playing games with math. It wasn't about understanding how the economic world works. And that is also, it was at the same semester that I was taking microeconomics using human action as a textbook and human action and Friedman's Price Theory as if I had two textbooks. And so that made a big impression on me of what the economics profession was all about at the time. And so what happened about in the 1920s in order to make the study of competition more amenable to mathematical modeling, you know, these various, there are other types of assumptions that have been added over the years. But rather than looking at competition as an ongoing process, the model was developed as more or less as an end state, as an equilibrium condition. And these are the assumptions that if you've ever taken principles of microe or any microe, you know, these are sort of basic assumptions beyond the competitive model, as it's called or the perfect competition model, that was developed in pretty much by the 1920s and 30s. Homogeneous products and prices, many firms, perfect information, costless entry and exit. And originally, these assumptions, you know, the standard account is that, you know, the assumptions can be totally unrealistic but what counts is can the model explain and predict? So it doesn't matter if the assumptions are unrealistic, the story goes, this is the famous, you know, Milton Friedman's famous essays on positive economics, which lays this all out, which by the way, is a normative statement. There's no hypothesis testing in his essays in positive economics, but which I always saw was kind of funny, but that's the standard approach. It doesn't matter. But what has happened in the study of competition though, is that economists, lawyers and policy makers have taken these assumptions over the years, not in every instance, but in many, many instances, as actual descriptions of desirable competition. So that if products are not homogeneous, there's something suspicious. There might be monopoly power afoot. If prices differ, there's something suspicious. It's not perfect. If the number of firms declines, maybe we need to get the antitrust division of the Justice Department to look into this, perfect information, one of the silliest variants of the perfect information assumption got Joe Stiglitz, a Nobel Prize a few years ago, asymmetric information, but ask yourself this, who has more information about manufacturing the automobile that you are driving right now, you or the company that built the automobile? Who knows more about how to get a cow standing out in the field and turn it into a nicely packaged piece of filet mignon in the grocery store? You or the farmers and the grocery store owners? And on and on and on, the whole economic world works under capitalism because of asymmetric information, different information in the minds of different people, or different interpretations of the same information. There's a big literature in economics that says this is market failure. This is a failure of the marketplace if we don't all have equal information. It's sort of egalitarianism gone insane to assume that markets need regulation and correcting by government unless there's perfectly equal information in the minds of everybody. That's essentially what Joseph Stiglitz won the Nobel Prize for. And of course, if there is a real asymmetric information problem, it's with government. For example, whenever we get into a war, it's always the executive branch bureaucrats who do all the negotiating and with other governments that get us into wars. You and I as citizens have nothing to do about it and we know nothing about it. And that's true of most of what government does, isn't it? It's called rational ignorance in the public choice literature. So if there is a problem with asymmetric information or unequal information, I think the big problem is that the government knows a lot more than we do about what it is up to and we really don't have much incentive to acquire that information really. We're rationally ignorant. But so these are the assumptions. These are the assumptions. So what I wanna do next is just talk a little bit about the consequences of changing the benchmark of competition from dynamic rivalrous process of entrepreneurship and discovery to these assumptions. What have been the consequences of that? And of course, if you look at the homogeneous product assumption, one of the things that economists have done over the years is there have been various critiques of product differentiation as potentially monopolizing. The most famous critiques were in the 1930s of two famous books written on monopolistic competition. One was by Edward Chamberlain, monopolistic competition. And there were several books written pretty much said the same thing. And what these books said is that, well, if you look at the marketplace, yeah, you could have car tires. See how it sounds like a homogeneous product, tires for your car.  And any difference like this of product differentiation means that pretty much everything in the marketplace is actually a monopoly. Even if you had a hundred people selling car tires in a metropolitan area, the fact that each set of tires is slightly different than the others means that they're all monopolies. So monopolistic competition meant the competition part is you could have many firms selling tires, but if they're differentiated, that's monopoly. So monopolistic competition became sort of like jumbo shrimp or military intelligence or oxymoron. Joan Robinson is the other author of these famous books. Do we have a boo there? Somebody from England, I assume, who knows about Joan Robinson. Now, when she died, my good friend, Jim Bennett, said, thank God she died before they gave her the Nobel Prize, but she couldn't do that. Joan Robinson. And so what came of this is I'm not gonna put the monopolistic competition model on the blackboard, but the standard monopoly model in neoclassical economics. There's a demand curve, a marginal revenue curve, marginal cost, let's say it's a constant cost industry. Here's a monopoly price, and here's a monopoly quantity. And the standard model says, well, if there was competition, this marginal cost curve would be the supply curve, and this would be the amount of supply, QC, and this would be the price, PC. And so the thinking of a lot of economists for a lot of years was that, well, if somebody invents a new product or differentiates an existing product, and they create literally a monopoly defined as the single seller of something. That's what the standard neoclassical definition of monopoly has been, a single seller of a product. Well then, what happens is if you innovate and create a new product, you create a monopoly, and so this is the quantity of output, QM. But if you compare that to a situation where, say, 100 people had the same ID in their head at the exact same time, the quantity would be QC. It would be the perfectly competitive level of output. Therefore, product innovation creates monopoly power, which is in need of regulating by the government. And so the British government years ago, when they were under the sway of Robinson and Chamberlain, tried to homogenize the housing stock in cities in England, for example. In the United States, there's those of us who study antitrust regulation, know there's a famous antitrust case, a federal government antitrust law case that is known as the cereals case, as in breakfast cereal. And this was in the late 1970s and early 1980s when the Federal Trade Commission sued general mills, general foods, and Kellogg's, three companies for monopolizing the dry cereal industry because they had a 70% market share among these three companies of dry cereal. And they hired an economist named Friedrich Scherer to be their expert witness, the government did. And Scherer came up with a brand new theory of monopoly called the theory of shared monopoly. They claimed that these three companies were sharing a monopoly and the tactic they were using was brand proliferation. It was probably also brand proliferation too, but brand with a D, it probably was. It's a brand proliferation. And so if the government pays an economist enough, they'll say anything, apparently, and Friedrich Scherer did. And so they spent years in court arguing over is Kellogg's and general mills and general foods a monopoly, but what happened in the end, the cereal companies won the lawsuit. They defeated the government. They didn't force them to break up or anything like that. But when you win a lawsuit against the government in any trust, you don't really win because it cost you millions of dollars in legal fees and thousands of hours of time that people had to divert to fighting the government as opposed to producing better products for your customers and making money and being a business person, rather. And so you'd never really win. But in the end, what happened was there's a famous quote by the judge in a case that I could paraphrase it. He said something like, I don't like dry cereal. I eat bacon and eggs in the morning. And the point he was making is that they defined the market too narrowly. There are a lot of substitutes for dry cereal so that even if they had some sort of monopoly power and raised the price of dry cereal, people could easily have bagels or oatmeal or bacon and egg, other breakfast foods are readily available as far as that goes. And of course, what's to stop other companies from underpricing them? They didn't even accuse them of having a single monopoly. They only had 70%. They didn't have 100% of the market. And so what happened was these three companies were among the first to be successful at mass marketing healthier dry cereal, granola and things like that. Whereas prior to that, it was all sugar-covered corn flakes and things like that. And it really cut on in the 70s.  And no one was stopping their competition from doing the same, from investing many millions of dollars in R&D and marketing research and putting out these new products. And so as a reward for taking all this risk and spending all this money, developing all these new products that consumers loved, they were punished by the government with an antitrust lawsuit. And a lot of times these lawsuits are instigated by the competition who know that they're phony and they know that it's a bunch of baloney, but they also know that it'll tie up the competition in court for years and divert their attention away from the fundamental business and then force them to deal with the government bureaucrats instead of dealing with their customers. And so that's, it was a bit of a success for the competitors of these three companies. And but the theory of perfect competition was at the bottom of this. This is how Frederick Scherer was able to be the expert witness. He was a Harvard professor at the time and he invented this theory of shared monopoly. And but it was basically based on this. And this type of thinking that came out of this assumption is an example of what is called the Nirvana fallacy. The Nirvana fallacy in economics. I think the phrase was coined by the economist Harold Demsets, who used to teach at UCLA. And there was an article he published in the Journal of Law and Economics around 1970. It was 69 or 70. It was called Information and Efficiency, another viewpoint, Harold Demsets. And the Nirvana fallacy is basically what welfare economics is all about. You pick some sort of situation that is totally utopian and unattainable, like perfectly competitive equilibrium here in a world where everyone has perfect information and everyone knows everything. If one person invents a new product that people like, everyone knows that invention. It's assumed to have perfect information of everybody, not just one person. And then you compare that utopian unachievable ideal to the real world, right here, which comes up short. And then you say, aha, the market fails, okay?  So, you know, I used to call it aha enomics because they would, because all these mathematical models in welfare economics basically do this. They spin a tale about what competitive equilibrium would like in this never, never land of perfect information, free entry and exit, blah, blah, blah.  But government does, government does. Okay, they don't apply the same, they never apply the same criterion, Pareto optimality to government. I can recall being at a conference once where this was being discussed. And a friend of mine, Dwight Lee, asked one of these hotshot welfare economics theorists from Yale, or the guy from Yale actually asked the question, well, what criterion do you think should be used for to analyze government behavior? And Dwight Lee said the same criterion, Pareto optimality. You know, why would you use a different criterion in economics? And so if you use the same criterion, then of course government would be infinitely more failing than the marketplace. And the guy from Yale didn't like that. He didn't change his ways at all as far as that goes, but that was the right answer. And so yeah, if you compare the real world, like someone invents a product that people like to the situation where 100 people had the invention at the same time, yeah, the real world falls short. But the real comparison is the real world of the output level QM to this output level, zero. When you innovate a product, you increase the production of something. You increase consumer welfare. You increase consumer surplus as they call it because you're going from zero to something. But the sort of dishonest way, I think that the new classical economics goes about it is to compare something to the unachievable utopian ideal of nirvana out there. And so the market always comes up short when you do that. And so, you know, on contrast, the Austrian way of looking at this is that product differentiation has always been looked at as a competitive tool. That's how you compete, you innovate, you experiment. You try to find out what people want. You don't always do the right thing. You waste a lot of money.  Some of it catches on and some of it doesn't. And then you can always go and find the $1 box of cereal. That's the junk no one wants.  Just one guy, yeah. He does look kind of sickly back there. But the most unhealthy stuff. But this, I don't know if you can see these numbers, but what this is, I guess people on the front can maybe see some of these numbers. What this is, this is from an annual report of the Federal Reserve Bank of Dallas, 1998. And done by an economist named Michael Cox, who's a very good economist. And there was an article about a phenomenon called mass customization. The integration of computer technology and mass production of cars and just everything. And a big point of this report, this article, is that the integration of computers with manufacturing has totally changed manufacturing. In the old days, Henry Ford became one of the wealthiest men in the world by saying such things about his Model T automobile that you can get any color you want as long as it's black. And so it was economical to mass produce the same thing over and over and over again because you could achieve economies of scale, very low cost per unit. And that would make it profitable to produce cars very cheaply so that anybody who had a job could afford a car. And that's how Henry Ford became very, very, very wealthy. This has all changed with the integration of computers and manufacturing. You don't need to mass produce.  And then when you're done with that, you go to the financing part. And if you want to finance the car with a loan, you apply for a car loan online. And the whole thing will take maybe 10 or 15 minutes. And then in a week, they'll deliver the car to the nearest car dealer to your house. Even if you do it from Auburn and you live in Seattle, you can tell them deliver this car to the car dealer nearest my zip code in Seattle. And then you can do that. So they can tailor make the car just for you and thanks to the integration of manufacturing computers. And what this is, is I did a survey of the proliferation of products that have come about as a result of this. And it's all real mundane stuff. Soft drinks, 26 brands in 1980, 252 brands in 1998, even bottled water, 12 to 125 brands, coffee, 11 to 384 beer. In the bad old days, when I was a college student, there were only a couple dozen types of beers. Now, this is probably more like 1800 today, other than it was 187 in 1998, but anybody can make a beer. I ran into a former student of mine in Baltimore at a restaurant and he's graduated. I asked him, what are you doing now? And I was expecting to know where he's working or something and he says, I'm making beer in my bathtub. He was very excited. He was going to a beer making class and he's making beer in his bathtub. So anybody can make beer. How many of you have had dogfish head beer? I used to have a condo in Rehoboth, Delaware where dogfish had started. And it was just a dinky little restaurant about the size of Mama Goldberg's there. And these two guys just made beer in the back. And now it's, you go anywhere in America, there's dogfish head beer out there. So it's a, and this is pretty easy. Shampoos and conditioners, fragrance, everything that you look at and they have another table, book titles even, proliferated software titles. There was zero in the early 70s and it's probably 250 million today. It's 250,000 in the late 90s. And so what these numbers illustrate is that in the sort of the competitive world, product differentiation does exactly the opposite of what the perfect competition theorists originally said was the effect of this sort of thing. Just the opposite, okay. Homogeneous prices, the other assumption, the big assumption there. There's no reason to believe firms will all charge the same price. There are different intensities of demand in different markets. The kind of mischief that this has created is for example, it is true that with regard to antitrust regulation, if you keep your price the same for a long period of time, you may be sued under the antitrust laws for price fixing. If there are numerous competitors and the price in a market stays stable for a long time, you might be suspected of conspiring to fix prices and you could be sued for price fixing. If you raise your price, of course, it could be monopoly, if you're raising your price, monopoly power, so you could be sued under the antitrust laws for raising your price. If you cut your price, you can be accused of predatory pricing. There's a scheme afoot of pricing everybody out of the market and then once they disappear, you're gonna charge 10 times higher than what you're charging now. And so no matter what you do with your price, keep it the same, you raise it, you cut it, you can be sued under the antitrust laws for violating some aspect of the antitrust laws. And so this assumption that competition means homogeneous prices has led to that. And if you read Dominic Armatano's book that I put up earlier, he analyzes from an Austrian perspective, this book was published in the early 80s, but up to that point, it was the 55 biggest federal antitrust cases in history up to that point. And he analyzes the economics of it from an Austrian perspective. And in every single case, he concludes, the companies that were sued were either increasing output, cutting their prices, innovating and creating new products or some combination of those three things. And for that, they were sued and tortured for years by the government out there. The many firms assumption has probably been the most mischievous. I read you those statements from the 19th century economists. They didn't care, they were, see the late 19th century in America was a period of price deflation. From 1865 to around the turn of the century, there was price deflation. And so these economists were looking at all the technological developments in steel manufacturing and cement manufacturing and all these various industries. And they were seeing a large scale production, they were seeing mergers. And at the same time, they were seeing prices falling for years and years as a result. And it was all good. There were new products that did not exist before. They were cheaper than before. They saw no problem with that. But the new theory, you see, the markets did not change in the 1930s. The definition of competition by economists changed. So all of a sudden the exact same markets were condemned as monopolistic in the 1930s. And some of them blamed for the Great Depression even though the markets had not changed. It was the economic theory of markets, the prevailing theory that changed. And so this has led to endless problems too because the earlier economists were right. The main cause of, the main effect rather, the main effect of all these mergers in the late 19th century was to create economies of scale, lower costs of production, and lower prices. They were fueling the lower prices. Everyone knew that. Okay, so if you invoke the government to break up these companies, break up these firms, what are you gonna do? So this, you know, to draw a picture, a familiar picture to most everybody, if you look at the relationship between output and cost, the long run average cost, the long run average cost is falling because of larger scale production. Here's where you have 1,000 customers. And here's where you have 100,000 lower costs per unit. But if two companies merge to create this situation of larger production, 100,000, which enables them to drop the cost, say the cost up here is $100 per unit, whatever they're producing, and down here it's $10. And that is a result of a merger. Well, you know, other companies will wanna compete by doing the same. Other companies will compete, they'll see, well, these two companies merge, they got economies of scale. It costs them $10 to make this thing. It costs us $100 to make this thing. We better do something fast or we're out of business. And so this was one reason for merger waves. It's competition to achieve economies of scale. But the market failure economists, they're very good at coming up with words and language that is very loaded, very loaded terms and very biased. They call this the domino theory of mergers. The domino effect is sort of fearful. Everything is gonna collapse, dominoes. But this is what was motivating a lot of the merger waves is competition to reduce cost. But if the prevailing theory says fewer firms is a bad thing and the government comes in and breaks up this merger and forces it back to here, you're back up to, it costs $100 to produce this thing again because the market is not big enough. One of the famous chapters in the wealth of nations by Adam Smith was called the division of labor is limited by the extent of the market. And he meant that he didn't use the word economy to scale, but lower cost production was caused by the division of labor, the benefits of specialization in the division of labor. And what does he mean when he said limited by the extent of the market? Well, if you could only sell in England, your market is limited. But if you could also sell in America and all the rest of Europe, you have a much bigger market. And therefore you have a much bigger division of labor and specialization and you're able to produce at a much lower cost. That's one of the fundamental principles of economics which was abandoned by the perfect competition model when it said many firms is a requirement for competition. And so when the government comes in and breaks these firms up, it's bad for consumers because it causes higher costs and ultimately higher prices. That's been the whole history of it. And some of the judges and politicians have been quite ludicrous in their pronouncements on this. This theory, the theory of perfect competition led to the thinking in a field of industrialization that it became known as the structure, conduct, performance paradigm. Structure, conduct, performance paradigm where competition, the degree of competition is determined by market structure, how many firms are competing. And the market structure determined conduct, pricing conduct primarily. And then performance, well that has to do with how much is produced? Is it increasing or decreasing output? And of course, if it's a monopoly, it's set to decrease output and reduce consumer welfare. And so this is what was used in antitrust from the 1930s until about the 1980s when economic critiques of this really were influential and caused the antitrust regulators to back off a lot. They resuscitated their power with the Microsoft antitrust case in the 90s but for a while they did back off. But as an example of some of the nonsense, there's a, I'll mention one famous antitrust case when the government sued Alcoa, the aluminum company of America in the 1930s for supposedly monopolizing the aluminum business which they never did in terms of being a single seller. The judge at the time, the judge who ruled in a case, this is the perfect name for a judge. It was Judge Learned Hand. Learned, L-E-A-R-N-E-D, Learned Hand. If you wanna become good at law school and be a judge, change your name to something like that. It sounds, you might be on the Supreme Court someday. Learned Hand. And so when he condemned Alcoa for monopolizing the market, which it never did, it just had a good market share. Okay, here's what he said was bad. He said he condemned it for its, and I'm quoting, superior skill foresight and industry. That's a bad thing. I said, this is how they got a big market share, superior skill foresight and industry. And why was this bad? It was exclusionary. It excluded companies that did not have superior skill foresight and industry, okay? And what did that lead to? Fewer firms in the industry. Fewer firms in the industry. He condemned Alcoa for advertising his business. And it was so good at advertising and stimulating sales with advertising that it quote, efficiently supplied a demand that had evolved. So it let people know about its product and what it cost. And it was pricing below the competition. And so people who bought aluminum to manufacture things bought a lot of stuff from Alcoa. It was cheap compared to the competition. So they efficiently supplied a demand that had evolved because of their advertising. And then he also said, another bad thing they did was, Alcoa had correctly anticipated increases in consumer demand and then doubled and redoubled its capacity to fill the demand. How criminal can you get? And then they, he also said, they embraced every new opportunity with a great organization, manned with elite business personnel. That's a direct quote. And for that, and therefore I find you guilty of monopolizing the aluminum industry in America and under the antitrust laws, if you're found guilty in a case like this, the first thing they do is try to assess the damages that were done to competitors and consumers and then they triple them. It's called treble damages. So if they decide that while there's a billion dollars in damage done to competitors and the losers of the industry and consumers somehow, then you pay a $3 billion fine involved in that. And there's also prison sentences involved in some antitrust, some antitrust. And so that's the kind of thing that was the consequence, but there had to be an intellectual background behind this and the intellectual background is the change in the theory of competition and this belief that many firms is necessary for competition. It was the whole heart of that statement. Another book that I would recommend if you're really into this or some of you students want to get into it, write a paper, a big name in the 1970s and 80s was Yale Brozen and his big fat book is called Concentration, Mergers and Public Policy. And what this does, it's a survey book, surveys, literature that came about beginning in the late 1960s through the 1980s that challenged this view. And another book, I won't write it down, it's called Industrial Organization, The New Learning. And it's edited by a man named Fred Weston. And it's similar to Brozen's book. And these two books are surveys of the literature that, and the phrase the new learning is ironic because what these books did is these were sort of Chicago school economists who were pretty good at econometrics who took the old learning, the old idea, the old Austrian idea of competition is dynamic and ongoing and took a look at all these industries that were being accused of being monopolized, accused by the government of being monopolized and they showed that there weren't being monopolized, there was no monopoly there. The way you become big in business is to just be better than the competition at serving the customers. That's how you become big in business. It's not some sort of conspiracy theory involved here. But it's, and so if you want to follow up in this literature, those are two books I would recommend. I don't really have time to talk about this kind of research now. One of the things Brozen did in one of his early articles, for example, is he took a sample of industries that were accused of being monopolistic because the perfect competition view is a static view. It looks at markets at a point in time. And so they will take a look at an industry at one point in time, one year, and they will see that there's maybe a 70% market share by three companies, okay, three companies like Kellogg's General Mills and General Foods. But what Brozen did in one of his earlier articles is he got the same industries and looked at what kind of market share there was over about a 30 year period. And so yeah, if you look at one year in 1966 and his example, there'll be one industry that has a 70% market share by three companies, but he found that within 10 years, that was totally different. That the most profitable companies all tended to descend toward the median and the less profitable companies ascended up toward the median so that manufacturing in the US was actually very fluid, very competitive and there's a lot of mobility there. But if you take a snapshot view at a point in time, by definition, somebody, at any one point in time, somebody is the reigning Super Bowl champ.  That doesn't mean they will forever be the Super Bowl champ, the same in business. At any one time, somebody's gotta be the best. You know, Microsoft eclipsed IBM at one point. You know, in fact, one of the things I do and when I teach this in classes is Google the words picture of Microsoft's founders. Some of you have laptops, you could do it right now. I'm not gonna use a laptop here, but and there's a picture of Bill Gates and his band of married men and women who founded Microsoft and they look like hippie geeks. They look like teenage hippie geeks and especially Gates. He looks like he's about 12 in the picture and it's on the web. And I tell the students, these are the people who eclipsed IBM, one of the biggest corporations, if not the biggest corporation in the world at the time is this dozen young kids, they look 10 years old, some of them in the picture with big heads and big brains, they eclipsed IBM. And so, but if you look at IBM profitability in 1970, you would think, wow, 90% of the computer market is monopoly and the government did sue IBM for monopolizing the market for 13 years. They're involved in court from 1970 to 1983. They were involved in endless litigation with the government over monopolizing the computer industry. In the meantime, Microsoft has created and totally takes market share by the truckloads away from IBM. And finally in 1983, the judge died, the judge in the case died.  And they gave up. Because to resume the case, to make the new judge credible, he would have had to have gone up to speed with 13 years of litigation. And how long would that take? And in the meantime, Microsoft was just kicking their butt with selling personal computers because the famous story is the biggest, maybe the biggest blunder in the history of the computer industry, IBM executive said, who wants a personal computer? No one wants a personal computer. And they did that for years. They were selling mainframes. That was their business, the big mainframes. When I was in college, the computer, I took computer science back when the dinosaurs still roam the earth. You can still see footprints down by the lake of the dinosaur. And I used a mainframe computer. It was like about half the size of this room. And it was just a step up from the stone tablet era when you use data, like economic research, you had to type all the data points in on cards, on cardboard cards, and then put them into a card reader that read them into this gigantic thing. And that's what you did. And that's what IBM's business was. And so that was just a step up from the stone age back there. Also on mergers, I don't know if Peter Klein talked about this, but he's quite the expert on something called the Market for Corporate Control. And one of the motivation for mergers is that that create fewer firms in the industry or in terms of corporate takeovers is that if a firm is being mismanaged and is less profitable than it could be, that creates a profit opportunity for entrepreneurs who think they can take over a controlling interest in the firm and fire the existing management and do things differently and increase the profits. And of course, they will profit tremendously because the way they have to do this is one method is a proxy battle where you can buy, you can purchase, if you can purchase enough shares, you can control the board of directors of a corporation. And the board of directors can then fire the existing management and put new management in and change the way the company is run if you think it can be more profitable or by running that different, being run that different way. And it doesn't always work out that way, but that's the theory, that's the thinking. And so when you see a lot of corporate takeovers, this is what's happening. That's something, there's a whole industry of people who are takeover specialists who specialize in nothing but trying to find takeover targets. And as a result, the stockholders of the acquired firms almost always benefit because if your stock is selling at $20 a share, somebody comes up and says, I will give you $30 today, that's pretty tempting. That's a pretty tempting, pretty good return on your money. And so they buy up the shares. And of course, if they buy it up at 30, they have to do something with that company that will make the stock price go up above 30 or else they're gonna lose money. And there have been a lot of fabulously successful examples of this. And so it's basically competition for managers is what the market for corporate control is. It's managerial labor market competition. Or at least it's a forum of managerial labor market competition. And there was an old PBS special that I showed in my classes some years ago. I have to dig it up. It's PBS probably still has it. It was they had some of these famous corporate takeover raiders like a guy named T. Boone Pickens. That's a good name for a corporate raider. Corporate takeover, T. Boone Pickens, a Texas oil man. Also on one side of the table, they had people like Pickens who I met once when I was at Washington University in St. Louis. He actually funded a conference on corporate takeovers and he was there. And then on this side, they had the corporate executives whose companies had been subjected to takeovers.  And they had a moderator who asked one of the CEOs, what would you do if Mr. Pickens here calls you up and says that your company is in play. We're waging a proxy fight. We're buying up shares. And if we get enough, we're gonna kick you out of your job. What would you do? And the corporate executive said, well, I would call a meeting of the board of directors and we would figure out everything we could do to shut down our unprofitable plants and increase our product line and increase our profits and so forth. So he gave a big long list of reasons or ways in which they would increase profits so that we could go to our shareholders and say, you don't need Mr. Pickens. We will make more money for you ourselves. And what question does that beg? Yeah, why wasn't he already doing that? That's the whole point of corporate takeovers because human beings are inclined to favor the easy life more than working your butt off day in and day out. And so unless you have the pressures of competition, you might not do that. You might not do these things that could make more money for the owners of your company, but it's the pressure of a takeover or the threat of a takeover that makes them do these things. And so there were a lot of takeovers in the 80s in America that were allowed to go through and that was generally good for the economy. But then a lot of state governments reacted by imposing laws that made takeovers more difficult in various ways. There wasn't a federal anti-takeover law, but several dozen states made it much more difficult to take over because the corporate executives for some company located in, say Atlanta, would be in like this with a state legislature and they would get the legislature to pass essentially protectionist legislation that would protect them personally from competition from other companies or takeovers. There's a famous story also in the, among those of us who study these things of Columbia Business School. They hired a takeover specialist from Wall Street to teach a course in takeovers and he came in there and he told the students, this was an MBA course, that if you can find a legitimate takeover target, I'll give you $100,000 to a student and they fired him. It was too unsavory to have students making money. So the money is supposed to come from the students to the university, not to the students. That's where the money is supposed to flow. And so anyway. So that's on also some of the final comments running out of time here on the whole issue of output restriction. You know, the standard model argues that there's a problem when corporate business restricts output. Let's see what happened to my monopoly model. There it is. From the competitive ideal. And Murray Rothbard, I would recommend reading Murray Rothbard's chapter on this. How many of you are here fans of cage fighting? These are cage fighting. It's sort of taken over boxing. And in my day, I was a Muhammad Ali fan. So I watched boxing as far as fighting goes. How often do these guys fight the cage fighters? Anybody know? Every couple of months. Well, they're obviously restricting output, aren't they? Why don't they fight every night like Brad Pitt did in that movie? Fight club, fight club. Was it fight club? Is that the name of it? Bare knuckles, they weren't sissies. They didn't put gloves on. They fought every night. They're obviously restricting output, aren't they? And so, you know, when you think about it, you know, we all restrict output. I don't lecture 20 hours a day. You know, I'm restricting output. You know, what do you do for a job?  You don't work 20 hours a day. I don't think, some of you seem to stay out of the bars almost 20 hours a day, but I don't know about working. And an example of the absurdity of thinking that output restriction is necessarily a bad thing. Well, one important point, by the way, that Rothbard made was that, well, even if an industry or a business did decide to reduce output for whatever reason, they don't want to work as hard. The owners of the business don't want to work as hard. What's wrong with that? It's their business. It's their property. They can do what it wants. Well, that means that the resources they would have used, workers, capital, materials, will be reallocated somewhere else. You know, the restricted use of resources by them to produce their product will be reallocated somewhere else. So there will be an expansion of output somewhere else whenever any one industry restricts output so that on net, you can't say there's been an output restriction in the whole economy just in one industry. So that's an important point to make. And if you think of the absurdity of this, the one actual case that I, example that I often give in my talks on this is, I was at a conference where there was a person from the Federal Trade Commission bragging about all the good things they were doing. And one of the brags was that they were investigating Detroit auto dealers who in the winter time were all closing down at five o'clock in the evening. So if you were in downtown Detroit in the middle of the winter and it's snowing and it's 10 degrees Fahrenheit, it would be impossible to buy a new car. And so he was explaining to this crowd of several hundred people in Washington, D.C. that they suspected this was a conspiracy to restrict output and thereby drive up the price of cars in Detroit. And I asked them the obvious question, does this mean that forced labor is a requirement for economic efficiency? Because what else are you doing if the government says you must stay open till 9 p.m.? It's forced labor, it's servitude, you're forcing them to work four more hours a day when they have voluntarily chosen, no, I don't wanna work four hours a day. And so it really is kind of absurd when you look at this way or look at it as, why don't they force the cage fighters to fight every night? Now, they're restricting their output as far as that goes. Let's see, what should I pick in the two minutes that I have left to talk about? Oh, the perfect information assumption, I didn't really mention that, other than if there was perfect information, it would make advertising unnecessary, wouldn't it? Who needs to advertise if everyone knows everything? And so that has been an additional source of mischief and that a lot of advertising has been attacked as unnecessary for economic efficiency for many, many years. And basically the final thing I'll say is that the real source of monopoly has always been understood for centuries as government. In fact, until the antitrust laws came along line in America, most of what happened with regard to the subject of monopoly in the law was based on British common law, which looked at monopoly as a government grant of monopoly. That was always the case. That was the case in Adam Smith's day. It was the case all through the 19th century and it's still the case. You can't have a monopoly in a meaningful sense in a free market because there's too much competition, especially in today's world where there's, with globalization being so prominent, somebody from anywhere can crop up and compete with you. But I'd recommend my own article, The Myth of Natural Monopoly, that's on the web, where I show that at the time, the so-called natural monopolies were monopolized by government, phone company, the water utilities, the electric utilities. There was vigorous competition everywhere. And some companies did try to form cartels, but what typically what happens is they find that it's futile. They can't form a cartel. There's always cheating. And so they run to the government and get the government to enforce the cartel arranger. The way in which, where I live in Maryland, Baltimore Gas and Electric became monopolized. I quote this in my paper that they tried to form a cartel. There's several companies that were operating and then finally it didn't work. So they went to the state legislature and made this deal. We will give you $15,000 and 15% of all profits if in return you give us a monopoly in electricity. And the politicians said, okay, good deal. So it was basically a share the loot deal between the state legislature and this one company. And that happened all across America in electricity, natural gas, water supply, cable TV, telephone and so forth. And there's nothing natural or free market about any of these. It was all they're all put into place by government regulation. Mark here says, time's up, time's up for what? Okay, for my monopoly, okay, my monopoly, my monopoly. Okay, I guess so.


Hi and welcome to the session. I am Shashi and I am going to help you with the following question. Question says solve the following linear programming problem graphically and show that the minimum of set occurs at more than two points. We are given that we have to maximize z is equal to minus x plus 2y subject to the constraints x is greater than equal to 3, x plus y is greater than equal to 5, x plus 2y is greater than equal to 6, y is greater than equal to 0. Let us now start with the solution. Now we have to maximize z is equal to minus x plus 2y subject to the constraints x is greater than equal to 3, x plus y is greater than equal to 5, x plus 2y is greater than equal to 6, y is greater than equal to 0. Now for drawing the graph and finding the feasible region subject to given constraints first of all we shall draw the line representing the equation x is equal to 3 corresponding to the inequality x is greater than equal to 3. Now we know x is equal to 3 is a line parallel to y axis also x is equal to 3 passes through the point 3 0. So this is a line x is equal to 3. Now we shall draw a line representing the equation x plus y is equal to 5 corresponding to the inequality x plus y is greater than equal to 5. Now we find that the points 0, 5 and point 5, 0 lie on the line x plus y is equal to 5. So the graph of the line can be drawn by plotting the points 0, 5 and 5, 0 and then joining them. Now this line represents x plus y is equal to 5. Now we shall consider the half plane satisfying x plus y is greater than 5 that is the half plane which does not contain origin. How clearly we can see line corresponding to the inequality x plus 2y greater than equal to 6 is x plus 2y is equal to 6. So we shall draw the line representing the equation x plus 2y is equal to 6 on the same graph by plotting the points 0, 3 and 6, 0 which satisfy the equation x plus 2y is equal to 6. Now we will plot the points 0, 3 and 6, 0 and join them to get the line x plus 2y is equal to 6. Now this line represents x plus 2y is equal to 6. This line divides the plane into two half planes. We will consider the half plane satisfying x plus 2y is greater than 6 that is the half plane not containing 0, 0 or we can say the half plane not containing origin. Now next inequality given to us is y is greater than equal to 0. Now this inequality implies that the graph lies above x axis only. Now this shaded portion in the graph satisfies all the given constraints. This shaded region is the feasible region. We know the common region determined by all the constraints including the non-negative constraints. x is greater than equal to 0, y is greater than equal to 0 of a linear programming problem is called the feasible region. Now in this given problem this is the feasible region. Now clearly we know that the feasible region is unbounded from above and it extends to infinity. The corner points of the feasible region on the lower side are 3, 2, 4, 1 and 6, 0. Now let us calculate the value of objective function z is equal to minus x plus 2y at these three corner points at corner point 3, 2 value of z is equal to 1. We know minus 1 multiplied by 3 plus 2 multiplied by 2 is equal to 1. At corner point 4, 1 value of z is equal to minus 2. We know minus 1 multiplied by 4 plus 2 multiplied by 1 is equal to minus 2. Now at corner point 6, 0 value of z is equal to minus 6, minus 1 multiplied by 6 plus 2 multiplied by 0 is equal to minus 6. Now clearly we can see maximum value of z is equal to 1 which occurs at the corner point 3, 2. But we can locate a point say 6, 6 which belongs to the feasible region and value of z at this point is 6. Now we can write but we can locate a point say 6, 6 which belongs to feasible region and value of z at this point 6, 6 is z is equal to minus 1 multiplied by 6 plus 2 multiplied by 6 which is further equal to 6 only. Now we know 6 is greater than 1 or we can say value of z at point 6, 6 is greater than the maximum value of z at a corner point of the feasible region. Now we know if the feasible region is unbounded and m is the maximum value of the objective function at any point of the corner points and a value greater than m belongs to the feasible region then the objective function has no maximum value. Now here 1 is the maximum value of the given function at corner point 3, 2. Also 6 is a value greater than maximum value and it belongs to feasible region. So there is no maximum value of z. So our required answer is z has no maximum value. This completes the session hope you understood the solution take care and keep smiling.


I think there's a bunch of things that I would pat myself on the back for, as should you all.  Because you might not be aware of them because we don't talk about them, we don't mark them at the time, we don't celebrate them, but you've all done quitting before now. You've all done quitted version, former versions of yourself, brilliant, powerful and painful quittings, quitting ideas and belief systems have been huge quittings for me, quitting on my definition, of words like failure and winning on success.