Guess who pays for credit card incentive plan?

You do silly.

When credit card companies give you "cash back", or "points" or "air miles", it isn't really a gift. You've already paid in the form of higher prices at the till. Reward programs work when you use your card more frequently. Frequent use of the card forces the retailer to pay more fees to the credit card company. The direct results are higher prices which conceal the credit card fees you are paying indirectly and feeling good about with your piddly "cash back". It feels like a reward but all you are really doing is contributing to consumer price inflation and making credit card companies more money.

If you don't believe me you can believe Target, one of the largest department stores in the US. Target tells the Bloomberg newswire that credit-card interchange fees are the retailer's second-highest expense, exceeded only by payroll. The fees can sometimes exceed 3% of the purchase price.

09:35 PM

Suburbs without cars

I put this concept to an urban planner I know in Victoria a couple of years ago and she said it was impossible, that I was an unrealistic dreamer, and that there were no practically workable solutions.

Punchline? Now available in Germany. From the NY Times article:

Street parking, driveways and home garages are generally forbidden in this experimental new district on the outskirts of Freiburg, near the French and Swiss borders. Vauban’s streets are completely “car-free” — except the main thoroughfare, where the tram to downtown Freiburg runs, and a few streets on one edge of the community. Car ownership is allowed, but there are only two places to park — large garages at the edge of the development, where a car-owner buys a space, for $40,000, along with a home.

As a result, 70 percent of Vauban’s families do not own cars, and 57 percent sold a car to move here. “When I had a car I was always tense. I’m much happier this way,” said Heidrun Walter, a media trainer and mother of two, as she walked verdant streets where the swish of bicycles and the chatter of wandering children drown out the occasional distant motor.

Vauban, completed in 2006, is an example of a growing trend in Europe, the United States and elsewhere to separate suburban life from auto use, as a component of a movement called “smart planning.” [...] The town is long and relatively narrow, so that the tram into Freiburg is an easy walk from every home. Stores, restaurants, banks and schools are more interspersed among homes than they are in a typical suburb. Most residents, like Ms. Walter, have carts that they haul behind bicycles for shopping trips or children’s play dates.

For trips to stores like IKEA or the ski slopes, families buy cars together or use communal cars rented out by Vauban’s car-sharing club.

09:21 PM