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We used to make a big deal out of Casual Fridays at work.  But now that we're entering the dog days of summer, is anyone dressing up?

Mark Austin Thomas: Business analyst Mark Lacter, dare I ask what you're wearing?

Mark Lacter: This is radio for a reason, Mark!  And certainly, don't ask that question at the L.A. Daily Journal newspaper, which recently issued a memo that laid down the law on what's not considered appropriate attire.  As in, no jeans, no sneakers (except for messengers), no sandals or flip-flops, no halter tops, no spaghetti straps, no tee-shirts.  Also, no shorts, leggings, or exercise pants.  And, if you don't measure up, you may be sent home to change clothes - without pay for the time you've missed.  Now, to be fair, the Daily Journal is a legal newspaper, and law firms - along with the courts - remain kind of a bastion for traditional business attire.

Thomas: And that means jackets and ties for men...?

Lacter: ...and skirt suits and business dresses for women.  It's the same deal for many offices in New York and Chicago.  Matter of fact, dressing down is still not especially popular in many parts of the country, according to a new survey I came across.  More than half of the respondents say it suggests an employee doesn't have respect for the workplace.  In other words, not a team player.

Thomas: But L.A. has this huge creative community where jeans and tee-shirts are almost part of the uniform.

Lacter: Yeah, the only people wearing suits at these places are the high-level executives who are actually called "suits."  This has been true in Hollywood for years, but now you're seeing it with the growth of tech companies.  Imagine how confusing it must be for an attorney who wears the standard business uniform, and who has one of these companies as his client.  And, maybe that's the point - there is no single workplace culture, even within the companies themselves.

Thomas: Is being comfortable just not on the radar at these places?

Lacter: Well, not to pick on the Daily Journal, but so what if someone who is stuck in front of a computer all day wants to be a little more comfortable in jeans?  Will the world as we know it come to a halt?  You know, the workplace is far different than it was even 10 years ago.  People are doing their jobs in all sorts of ways, whether it's working from home, or as independent contractors.  And, this is really all about common sense - so, maybe it's time the stick-in the-muds realized as much.

Thomas: Attire aside, how is the workplace itself changing?

Lacter: Some of those downtown law firms have been cutting back, which means that they don't need as much space.  Not every attorney needs a giant office.  Same with the downtown accounting firms - when folks do go to work, the office may include a fancy kitchen, a ping pong table, workstations that double as treadmills, a place to do yoga or even to take a nap.

Thomas: All this is supposed to boost productivity...

Lacter: ...which it probably does, though you do have to wonder whether having a yoga room really enhances output, or is just a way of keeping employees from not taking a job somewhere else.  My favorite perk, and I say that facetiously, is the office kegerator, which not only seems like a dumb idea, but a great way for a company to get sued if somebody has one too many.

Thomas: Quickly Mark, any news in the dispute between CBS and Time Warner Cable?

Lacter: Not good news.  Time Warner Cable offered what it said were two possible solutions to the standoff, but CBS has came back and called it a sham.  Time Warner Cable subscribers have been without CBS programming since Friday, which is already going on longer than analysts had first expected.  The fight is over re-transmission fees - the amount of money that a programmer receives from a distributor- in this case, Time Warner Cable.  CBS apparently wants a big increase, and Time Warner Cable doesn't want to pay.

Mark Lacter is a contributing writer for Los Angeles Magazine and writes the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

Yesterday, we heard about the hyper-loop, a system that could get you from L.A. to San Francisco in about 30 minutes without losing your eyeballs.

Steve Julian: Business analyst Mark Lacter, that might come in handy given how crowded California's air corridor has become...

Mark Lacter: We'll talk about the hyper-loop in a moment, Steve, but yes, the L.A.-to-San Francisco air route is the busiest in the U.S., and it's already the most competitive.  We're talking about more than 50 flights a day, which - if you spread them out between six in the morning and 10:30 at night - there'd be one flight every 20 minutes.  But, Delta obviously thinks there's room for more because it's announced an hourly shuttle between the two cities.  That's another 14 daily flights beginning September 3.  The airline will be using a somewhat smaller jet, and it sounds as if the focus will be on the business traveler, with free newspapers, wine, and beer.

Julian: How much will it cost, do we know?

Lacter: As usual, it's a lot cheaper if you make an advance purchase, but if you're buying your tickets at the last minute - which is what a lot of business travelers do - roundtrip runs a hefty $430.  Actually, this Bay Area shuttle is just the latest effort by Delta to expand out of LAX, which is different from other major airports in that it doesn't have any one airline that dominates (United has a slight edge in market share over American, with Delta about three percentage points behind).  American also has been adding flights out of LAX.

Julian: Sounds like the airline business is improving...

Lacter: That's what happens when you pack planes to the absolute max, which is bad news for travelers being crammed into coach seats.  But it's good news for LAX, which continues to be the airport of choice among airlines looking to add service - matter of fact, domestic passenger traffic was up almost 8 percent in June compared with a year earlier.  Some of those gains might be at the expense of service elsewhere - most especially Ontario Airport, which has seen a big exodus among airlines and passengers.  Ontario city officials have been trying to regain control of the airport, which has been operated by the city of Los Angeles.

Julian: Back to the hyper-loop - is this kind of transport possible?

Lacter: Well, it's the brainchild of billionaire Elon Musk, and you never say never with this guy.  He started the electric car company Tesla and the private space company Space X.  The hyper-loop is a high-speed system of passenger pods that would travel on a cushion of air (think of air hockey table).  The pods would travel at more than 700 miles per hour, but they wouldn't result in sonic booms that severely restricted the Concorde aircraft.  Of course, anything that promises super-speed travel is bound to get people talking - and, from what the physics professors are saying, the Musk idea seems feasible.

Julian: How would its cost compare to the bullet train?

Lacter: He says a lot cheaper.  The price tag on the train is $70 billion at last check; Musk says he can do his for $6 billion.  But, the issue isn't so much the cost or even the technology, but the politics.  As a rule, governments do not think outside the box, and that's what a project like this is all about.  Already, you have bullet train supporters saying that the hyper-loop is impossible, but what they're really saying is we have a lot riding on the train, and we don't want this guy to mess it up.

Julian: But, how much demand is there for high-speed transport?

Lacter: You'd think there would be a lot, but when Boeing came up with a nifty idea for a souped-up plane that would shave almost an hour from L.A. to New York, the airlines said no because it would require more fuel - and that would mean raising fares.  Musk says his system would be a lot cheaper than traveling by plane, which could be a game changer in the attitudes about going places.  But, those attitudes won't change until the thing is actually built, and that can't realistically happen until attitudes change.  That's the ultimate problem.

Julian: Hence, why we're content to squeeze into coach.

Lacter: Yep.

Mark Lacter is a contributing writer for Los Angeles Magazine and writes the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

Businesses are cutting back on hours to avoid having to provide health care coverage under the new Affordable Care Act.

Steve Julian: Business analyst Mark Lacter, who's affected here?

Mark Lacter: Thirty hours a week is the magic number for workers to be considered full time under the new law.  If a business has 50 or more full-time employees, health care coverage has to be provided.  Except that a lot business owners say that the additional cost is going to be a financial killer, so instead, some of them have been cutting back hours to below that 30-hour threshold.  More than 200,000 Californians are at risk of losing hours from the health care law - that according to one study.

Julian: What kinds of businesses are doing this?

Lacter: Restaurant chains have received much of the attention, but the city of Long Beach, as an example, is going to reduce hours for a couple of hundred of its workers.  And, last week came word that the L.A.-based clothing chain Forever 21 will cut some of its full-time employees to a maximum 29-and-a-half hours a week, and classify them as part time.  That touched off an outcry on the Internet - people were saying that Forever 21 was being unfair and greedy - though the company says that only a small number of employees are affected, and that its decision has nothing to do with the Affordable Care Act.  There's really no way to know - Forever 21 is a private company, which means it's not obligated to disclose a whole lot.  What we do know is that those people will be losing their health care coverage.

Julian: And, the ultimate impact on businesses and workers?

Lacter: Steve, you're looking at several years before the picture becomes clear.  Here in California, workers not eligible for health care through their employer can get their own individual coverage, and if their income levels are not over a certain amount, they'd be eligible for Medicaid.  And, let's not forget many businesses already provide coverage for their employees.  So, lots of rhetoric - but, not many conclusions to draw from, which does make you wonder why so many business owners are unwilling to at least give this thing a chance.  Just doesn't seem to be much generosity of spirit for their workers, not to mention any recognition that if people can go to a doctor instead of an emergency room we'd probably all be better off.

Julian: Health care is far from the only controversy for Forever 21, true?

Lacter: In some ways, it's one of the biggest Southern California success stories.  Don Chang emigrated here in 1981 from Korea at the age of 18, opened his first store in Highland Park three years later (it was called Fashion 21), and he never looked back.  Today, revenues are approaching $4 billion.  But, the guy must have some pretty hefty legal bills because his company has been accused of all kinds of workplace violations.  The lawsuits alleged that workers preparing items for the Forever 21 stores didn't receive overtime, that they didn't get required work breaks, that they received substandard wages, and that they worked in dirty and unsafe conditions - sweatshop conditions, essentially.

Julian: Are most of their claims settled out of court?  You don't hear much about them.

Lacter: They are, which means there's usually a minimal amount of media coverage.  If a privately held company decides to keep quiet by not releasing financial results or other operational information, there's not likely to be much of a story - unlike what happens with a company like Apple, which is always under scrutiny.  Sometimes, plaintiffs will try to organize class-action suits, but that's extremely tough when you're dealing with low-wage workers who are often very reluctant to get involved because of their legal status.  And, let's not forget that Forever 21 - like any low-cost retailer - is simply catering to the demand for cheap, stylish clothes that are made as quickly as possible.

Julian: I guess you can't make that happen when wages and benefits are appreciably higher than your competition.

Lacter: The next time you walk into a Forever 21 store and wonder how prices can be so reasonable, that's how.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

When you look at fast growing private companies in the U.S., you need look no further than a small city next to Los Angeles International Airport.

Steve Julian: Business analyst Mark Lacter, tell us about the company that's based in El Segundo.

Mark Lacter: It's called Fuhu, Steve - that might ring a bell with some parents because Fuhu is the maker of the Nabi.  The Nabi is an Android tablet for kids, and it's a very cool device that mimics a lot of the capabilities of regular tablet, including the ability to play games and get onto the Web (with controls that parents are able to set up).  Last year, they sold 1.2 million Nabis, and that helped push the El Segundo company to the very top of Inc. magazine's list of fastest-growing businesses.  That's number one on a list of 5,000 companies, with a three-year growth rate of 42,148 percent.  Or, to put it another way, company revenue was $279,000 in 2009; it was almost $118 million in 2012.  Now, by the standards of an Apple or a Samsung, those are still not huge numbers -

Julian: - and maybe that explains why there's been relatively little media coverage of this company.

Lacter: It might also explain why local tech companies in general get short shrift.  Many of them are quite successful, but they're often on the small side, and they're also privately held as opposed to publicly-traded on a stock exchange.  That's one big difference from Silicon Valley, which has so many huge public corporations: Apple, Intel, HP.  L.A. County has only six Fortune 500 companies, and not a single one devoted solely to technology.  In Silicon Valley, there are 22 in the Fortune 500.

Julian: And yet, the L.A. economy has more than held its own without those large corporations.

Lacter: Matter of fact, the accounting firm PriceWaterhouse studied more than two dozen cities around the world to determine where it was easiest to do business (that's based on factors like access to labor), and what they found - somewhat surprisingly - was that L.A. ranked ahead of both San Francisco and Tokyo.  And, you can see evidence of that with the increase in venture capital money coming into all parts of L.A.  Now, it's important to keep an eye on all these up-and-coming companies because these businesses are helping generate higher-wage jobs.  And, for an area with a still-high unemployment rate - still over 10 percent in some places -- that's a big deal.

Julian: Speaking of companies, does anyone want to buy the L.A. Times?

Lacter: The answer is yes - most recently, the controlling owner of the Dodgers, Mark Walter, said he was interested in both the Times and the Chicago Tribune (though there's no way to know whether there are actual discussions taking place).  You also have several local groups, including one that involves billionaire Eli Broad, that have been interested to one degree or another.  But what was thought would be a fairly straightforward auction process has turned enormously complicated.  It's now to the point where the Tribune board has decided spin off the papers into a separate business, and that process will take until next year to complete and could preclude any sales for quite some time after that.

Julian: So, it's Limbo-land for the Times for who knows how long.

Lacter: Steve, it's not that Tribune really wants to keep the newspapers.  But, selling them off presents huge tax implications.  Also, there are assets that the potential buyers thought would be part of the package - assets that include real estate - that Tribune wants to hold onto.  So, what's left to sell are just the newspapers themselves, and frankly, they're among the least valuable properties.

Julian: Now, last week came word that the billionaire Koch brothers, who were believed to be interested in the Tribune properties, decided not to pursue a deal...

Lacter: ...that's right, they don't consider the Times or the other dailies to be economically viable.  You might recall a bit of an outcry over the prospect of having the Kochs, who are staunch conservatives, becoming the owners of these papers.  So, they're out of the picture.  But for the L.A. Times, it's really the worst of all worlds: no new owner and no vision for recasting the paper, at least in the near term.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

Now that we have a deal between Time Warner Cable and CBS, we can turn our Hollywood focus back on the movie industry.

Steve Julian: Business analyst Mark Lacter, would you agree it's been an up and down summer at the box office?

Mark Lacter: It's been a flaky summer for Hollywood, Steve.  On the plus side, ticket revenue was up more than 10 percent, and attendance increased around six-and-a-half percent compared with last year (this covers the first week of May through Labor Day weekend).  The problem is that the studios and their investors spent huge amounts of money to make a lot of these movies, and they had to compete in a very crowded market - 23 big-budget films came out this summer, which is way higher than normal, and some of them never had a chance.

Julian: Some examples?

Lacter: Probably the biggest clunker was "The Lone Ranger," which could end up losing close to $200 million for Disney.  Another big disappointment was "White House Down," which was distributed by Sony and brought in only $140 million, which for a big-budget action film is really bad.  Even a film like "Pacific Rim," which did well at the box office, might still end up in the red because the production and marketing costs were so high.

Julian: And summer, of course, is the time when studios want to bring out these monster releases -

Lacter: - right, what they call "tent poles" - and in that category, the biggest winner was Disney's "Iron Man," which took in $1.2 billion.  Also having a great summer was "Monsters University" from Pixar, with $700 million.  You also had "Despicable Me 2" and "Fast and Furious 6," which might not be our cup of tea (speak for yourself, it takes me back to my police car days!), but did very well for Universal.  Eight of the top 12 films this summer were sequels - and yet, sequels were no guarantee of success (a number of them really struggled).  And, some non-blockbuster films found considerable success: "Now You See Me" from Lionsgate only cost $75 million to make.

Julian: So, in some ways, Hollywood was its usual unpredictable self.

Lacter: That's right - and don't expect any big changes in strategy when it comes to big-budget films.  The prospect of having huge success with one of these blockbusters is just too great, but perhaps more important is the fact that many of these films are financed by multiple groups of investors, and so the risk is spread around.  It's not like the old days when a studio bankrolled the whole thing.

Julian: Though, sounds like it's bad news for the city of Los Angeles: the "Man of Steel" sequel is going to be shot in Michigan?

Lacter: Mayor Garcetti has actually declared a state of emergency because the city keeps losing business to other states that offer big tax incentives to films - what's known as runaway production.  The truth is that business has been lost over the years, but L.A. is hardly in any danger of losing its spot as the center of entertainment.  And, you can see that with the L.A. County Board of Supervisors signing off on Disney's plan for a TV and movie production facility near Santa Clarita that will add more than a half-million square feet of studio space.

Julian: And, Universal's expanding, too.

Lacter: Earlier this year, Universal was given the approval to build more production facilities, and Paramount is planning an expansion, as well.  Now, these are all very ambitious projects - not the sort of investments that would be made if these studios were looking elsewhere to make movies and TV shows.  And, of course, they mean jobs - actually, employment levels in the entertainment industry have remained fairly steady going back the last decade.

Julian: Are there states that are pulling back their incentives?

Lacter: Yes, the state of North Carolina, which has been especially aggressive in using tax incentives to draw in movies and television going back to the 80s, is phasing out the giveaways because legislators have decided that the economic benefits aren't worth the tax revenues being lost.  And, other states with tax incentive programs are pulling back as well - they're finding that the payback is very difficult to measure.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

Across the country, the sale of electric cars is sluggish.

Susanne Whatley: But business analyst Mark Lacter, that's not quite the case in California...

Mark Lacter: Well, comparatively speaking, Susanne.  L.A. and San Francisco alone made up 35 percent of the electric cars sold in the entire U.S. during the first half of the year - 35 percent!  Keep in mind that statewide just 9,700 electric cars were sold in that six-month period, which translates to a little over 1 percent of all car sales in California.  So, they're not exactly lining up around the block, even in a region that's known for its early adopters.  Of course, electric cars were always going to be a tough sell -

Whatley: I've been driving one for about half a year now... and I absolutely love it.  But they ARE expensive, and I'm sure that's a factor.

Lacter: - and that's even after a federal tax credit, but they also require drivers to learn about recharging the battery - sometimes in not-very-convenient places - and, from a design standpoint, most of them don't stand out (one of the automakers that's now out of business had been selling what was a basically plain vanilla Mitsubishi sedan).  Now, the one notable exception is the Tesla - so long as you have at least $90,000 to shell out, and are willing to wait a while to get your car delivered.  In affluent sections of L.A., this is truly the hot car - just 600 or so Teslas have been sold in Southern California during the first seven months of the year.  It's also received rave reviews from all the big automotive publications.

Whatley: And perhaps most surprising of all, Tesla has been making money…

Lacter: That's right, although the stock price is ridiculously overvalued at around $20 billion (that's one-third the market value of General Motors, even though Tesla cranks out all of 21,000 vehicles a year while GM sells almost 5 million).  People seem to love this car almost in spite of it being battery powered, which gets us back to the challenges in trying to sell these things.  Elon Musk, who founded the company (he's also behind SpaceX and he co-founded PayPal), has managed to win over customers because the car itself is so much fun to drive.  The other makers of electric cars - not so much.

Whatley: So, for the folks still on the fence... might it be better to wait until driverless cars become available?

Lacter: That's going to be quite a wait, although all the automakers are working on their versions of self-driving cars.  The Mercedes people just announced plans to launch in 2020 - the same year that Nissan wants to bring out its car - and Google, which has had self-driving cars tooling around California for several years, is looking at 2017.  So, what we're seeing is real, but the question is what sort of real it'll turn out to be.  Certainly, the possibilities are nothing short of revolutionary - you're looking at, potentially, faster commute times because cars will be able to travel closer to one other (reaction times would be faster than with a human behind the wheel); in addition, fewer accidents and injuries (also a function of reaction times).  But, how well the vehicles work once they get beyond the testing phase is anyone's guess.  California does allow self-driving prototypes car for testing purposes, but that's far different than full-scale authorization.

Whatley: What if something goes wrong?

Lacter: That's one of the big concerns - liability, but the real issue is public acceptance.  Already, surveys are finding reluctance to buying a driverless car, or even having them on the road.  That's not a huge surprise considering how novel the concept still is - and all it takes are a few mishaps to affirm the skeptics.  All of which points to a lengthy transition period - not unlike the early days of the passenger plane, when most folks couldn't imagine getting into a flying machine.  Eventually, they got used to them, but it took time.

Whatley: And finally, some thoughts on Cal Worthington?

Lacter: Certainly one of the great showmen in the annals of L.A. broadcasting - Cal Worthington wasn't the first auto dealer to discover the benefits of commercials, but he lasted longer than anyone else, selling more than a million cars (that according to his count), and grossing billions of dollars.  The Worthington ads are sometimes considered the first infomercials - that might be a stretch, but three factors really made it all come together: Southern California's appetite for the automobile, the ease by which Cal could deliver his schtick (remember when he was strapped to the wing of a biplane?), and the fact that there was so much available air time to sell in L.A.. Definitely a legend in his own time.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

When talk turns to the economy, it's clear that LA brings out the best and the worst.

Steve Julian: Business analyst Mark Lacter, where do you see the best of it here?

Mark Lacter: You see the best of the economy, Steve, with all kinds of startup activity - much of it tech-related - and you also see the large number of auto sales, the improved housing market, and the record number of people visiting Southern California - all indications of a growing economy.  But then, you have the other L.A. economy, with large numbers of families struggling to make ends meet, and seeing very little sign of recovery.  You know, the government has been releasing income data covering the last few years, and what you see is that the disparity between the richest 1 percent and the other 99 percent is at its widest point since the 1920s.  You especially see that kind of bifurcated economy in Southern California, which has some of the wealthiest people in the country, and also some of the poorest.

Julian: Now, the split between rich and poor has been happening for a good long time, hasn't it?

Lacter: Yes, but L.A. is in a special class because there are so many immigrants with limited job skills - in fact, a new study by the UCLA Anderson Forecast says it's a much higher percentage than immigrants living in Miami, San Francisco, and New York.  What's interesting is that 20 years ago the job skills among immigrants were significantly higher in L.A.  Limited job skills mean there's very little opportunity to move up the income ladder.  That factors into buying homes, sending your kids to college - really becoming part of the middle class.

Julian: I imagine that's particularly true for factory work…

Lacter: Yes, some of the same jobs that newly-arrived immigrants in previous generations would gravitate to.  Today, many of those jobs are gone, and they're being replaced by positions that require greater skill that's borne out of greater education.  And that, of course, is another problem: a sizable percentage of recently-arrived immigrants never finished high school, much less college, and that makes it even less likely that they'll be able to move up.

Julian: Related, or unrelated, to the recession?

Lacter: Actually, L.A. had serious income inequality in December of 2006, before the recession, when the county's unemployment rate was just 4.3 percent - a stunningly low rate when you consider that as of July, the jobless rate was almost 10 percent.  This points out that the division of haves and have-nots can happen even when the economy is doing well.

Julian: And it seems the last C-17 to be built for Air Force is a reminder of wage gap.

Lacter: That's right - it'll be up to foreign customers to keep the program in Long Beach alive.  Boeing currently has an order from India for 10 of the cargo planes, which will keep the line moving through the third quarter of next year.  Frankly, the only reason the C-17 has lasted this long is heavy political pressure by congressional lawmakers whose districts have an economic stake in the program.  At one time, as many as 16,000 people may have worked on the C-17 in Long Beach, but that number has fallen sharply over the years.

Julian: Still, this is the last airplane manufacturing plant in Southern California.

Lacter: And that, of course, speaks volumes about the state of the aerospace business, which had been one of the main economic drivers back in the days leading up to World War II.  Aerospace continued to be very important until the end of the Cold War, when you had a huge industry consolidation that resulted in the loss of tens of thousands of local jobs throughout the 1990s.  There's still quite a bit of aerospace activity locally that involves missiles, satellites, and electronics - both for the major defense contractors like Boeing and Northrop, and for smaller contractors and sub-subcontractors that still get a piece of the military pie.

Julian: But most of them require high skill levels…

Lacter: Yes, and that gets us back to the folks who are stuck in low-paying jobs with little prospect for moving up.  This is what the L.A. economy is all about, the good and the bad.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

Sign ups for the Affordable Care Act start in a week, and the program is leading to changes in the way employers handle health coverage.

Steve Julian: Business analyst Mark Lacter, what's the most noticeable adjustment?

Mark Lacter: Steve, once you get beyond the squabbling over efforts to defund the new law, what's happening is quite remarkable: businesses are finding new ways to administer and pay for coverage - and some would say it's long overdue.  One interesting example: the grocery chain Trader Joe's, which is based in Monrovia, employs over 20,000 people, and shells out millions of dollars a year in helping provide its people with health insurance.  Well, Trader Joe's has decided to end coverage for part-timers working fewer than 30 hours a week - under the new law businesses are not obligated to provide benefits to employees who work less than that amount.  However, the company is giving those people $500 to go towards the purchase of premiums at the new public exchanges.  And that, along with the tax credits available, could make the new arrangement cost about the same or even cheaper than the current health care package.

Julian: How did TJ's explain this to its employees?

Lacter: The company cited the example of an employee with one child who makes $18 an hour and works 25 hours a week.  Under the old system, she pays $166 a month for coverage; under the new system, she can get a nearly identical plan for $70 a month.  Now, there are cases in which workers will end up paying more - usually it involves having a family member who makes more money, but who doesn't have access to coverage (good example would be an independent contractor or freelancer).  By the way, other companies - including the drug store chain Walgreen's - are also moving part-timers to the public market, and offering some sort of a subsidy.

Julian: I imagine not all companies are being as conscientious...

Lacter: No.  We've seen a number of corporations cut worker hours and not offer a supplemental payment.  Steve, it's worth remembering that administering health insurance is something that businesses fell into quite by accident 60 years or so ago - premiums cost next to nothing at the time, and it was seen as way of attracting workers without having to jack up wages.  The arrangement became more attractive over the years because of certain tax benefits.  But, it's far from ideal - workers move from job to job more often than they used to, and not all businesses are capable of handling the extra costs, especially small businesses.

Julian: Doesn't L.A. have a higher percentage of uninsured than elsewhere?

Lacter: Considerably higher - the Census Bureau show that 21 percent did not have coverage in 2012, which is higher than the overall national number.  Now, there are a bunch of reasons for this: L.A. has a large percentage of households that simply can't afford health insurance or don't have access to government programs, among them undocumented immigrants.  You also have big numbers of people who are self-employed and don't get covered - we're talking about freelancers or consultants of some sort.

Julian: …Or, they work for small businesses whose owners either can't afford, or don't want to provide coverage…

Lacter: That's right - the new law only requires businesses with more than 50 full-time workers to offer health insurance, and a lot of small businesses don't meet that threshold.  The Census Bureau says that in the L.A. area, one in four people with jobs do not have health insurance - and, by the way, there's been a drop-off both in the percentage of businesses in California that offer coverage.

Julian: Sounds dire.  Who picks up the cost?

Lacter: Well, we all do in one way or another - and that, of course, is the problem.  What the Affordable Care Act offers is a start in getting some of the uninsured onto the rolls.  Clearly, it's an imperfect solution that will require all sorts of adjustments, and even though everyone and their uncle seems to have formed a definitive opinion about the new law, it's going to be years before there's any real sense of how it's going.  And, let's remember, signing up for these programs is not some political act.  It's just a way for people to get health insurance for themselves and their families.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

We've been reporting on the city of Los Angeles approving major developments without seismic studies attached.

Steve Julian: Business analyst Mark Lacter, why is this?

Mark Lacter: Steve, this is a real gotcha moment for the L.A. Planning Department, the City Council, and everyone else at City Hall who signed off on these projects.  The latest revelation, which was reported by the L.A. Times, shows that a planned 39-story residential tower in Century City is just 300 feet from the active Santa Monica fault.  And, we're only learning about this because the Metropolitan Transportation Authority did its own seismic testing near the site when it was looking for potential subway stops, and officials decided that it was too close to the fault.  This also comes after three large-scale projects in Hollywood were found to be located quite close to the active Hollywood fault.

Julian: The concern is that if any faults were to rupture, the foundation of a building could be split apart.

Lacter: Kind of an inconvenient truth both for the developers, who have millions of dollars riding on these projects, and for L.A. city officials who are betting on a future that will include many more high rises.  And, we should note that more than two-dozen high rises are either in the process of going up, or are at least on the drawing board.  In case you're wondering why there aren't regulations that monitor this sort of thing, the answer is that there are regulations.  California has a law that requires state geologists to map active earthquake faults, and then set zones on either side of the fault line.

Julian: Has the state done this?

Lacter: The state says it hasn't had the time nor the money to map areas within the city of L.A., though the faults have been known to be in the general vicinity of these projects - and so, you'd think the city would want them tested extensively.  Of course, that would mean more delays, which the developers wouldn't be happy with.

Julian: Of course, seismic studies are not always definitive.

Lacter: They're not - and it's possible that different geologists would come up with different findings.  But so far, most of the information seems to be coming from the developers, and you have to wonder whether it's a great idea to rely on folks who have a financial interest in a project to tell us what's safe and what isn't.  Probably not.

Julian: Your article in the new issue of Los Angeles Magazine raises a broader point about the city's business climate.

Lacter: Steve, for many years, L.A. has been branded as a terrible place to do business because of government interference, but that's largely a myth.  If anything, city officials have been too accommodating.  Frankly, the anti-business rap never made much sense when you consider the thousands of companies that start up here each year.  A study by the accounting firm PricewaterhouseCoopers ranks L.A. particularly high when it comes to ease of doing business, which runs counter to the conventional wisdom.

Julian: You're not saying it's truly easy, are you?

Lacter: Easy, no.  There certainly are plenty of reasons for business owners to pull out their hair.  And those hassles, along with an unemployment rate that remains quite high, has given developers and others the leverage to ask for various giveaways.  All they have to do is say that their projects will generate more jobs, and city officials tend to respond favorably - no matter how questionable those proposals might be.  And, by the way, job creation doesn't always determine economic growth, certainly not in the short term.

Julian: We all remember during the mayoral campaign, candidates were talking about how their policies would lead to lower unemployment...

Lacter: ...right, almost like they could pick up jobs at Ralphs.  Well, it doesn't work that way.  Thing is, the city of L.A. doesn't need to cut so many deals - the local economy is rich enough and broad enough to keep prospering.  Which is why city officials would be much better off laying off the incentives, and focusing on the basics - public safety, transportation, the parks, and libraries.  Do that right, and the business climate will take care of itself.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

The partial federal government shutdown is one week old, but economists are still saying that its impact in Southern California and elsewhere will be limited.

Susanne Whatley: Business analyst Mark Lacter, why is that?

Mark Lacter: If you look back on the history of these things, Susanne, you see that the disputes are resolved before too much damage gets done.  As for Southern California, I notice that KPCC's Alice Walton was asking around over the weekend about the shutdown, and most folks gave it a shrug.  The regional economy is just too diversified - and not especially tied to federal employment.  You have about 46,000 federal workers employed in L.A. County in one capacity or another - that's out of a workforce of nearly 5 million.  And, now it appears as if the federal employees who have been furloughed are going to receive their back wages whenever the shutdown finally ends.

Whatley: That still might make things dicey when it comes time to pay the monthly mortgage...

Lacter: ...but at least money will be available before most folks run into serious liquidity issues.  That's what the shutdown really comes down to - inconvenience rather than dislocation.  And, you see this with the various government services affected: the E-Verify website is down - that lets business owners know whether the people they're wanting to hire can work legally in the U.S., which obviously is important.  The Small Business Administration has stopped processing loan applications, and the Federal Housing Administration is reporting delays in its loan processing, which could mean a home buyer might not complete his or her paperwork all that quickly.

Whatley: But, what if this were to go on for months?

Lacter: Well, then it would create problems, but nobody really thinks that's going to happen.  The real issue, not just nationally and regionally - but globally - is the refusal by Congress to raise the debt ceiling.  The deadline is a week from Thursday, and - of course - there's been all sorts of debate about what this would mean for the economy.

Whatley: All right, so what would this mean for the economy?

Lacter: Well, no one knows exactly.  But, then again, no one knows exactly what would happen if you fell out of a airplane without a parachute.  I just wouldn't want to test it out.  And, of course, let's keep in mind that these are manufactured crises - not reflective of anything that's going on with the real economy.  It's certainly not reflective of anything that's going on in L.A., which saw a big jump in payroll jobs for 2012 - actually it was the sharpest increase since 2005, and nearly double the national rate (that's despite an unemployment rate that remains very high in certain parts of Los Angeles).

Whatley: What about some of the big locally based companies?

Lacter: Well, if your company is publicly traded, there's a good chance your shares took a dip these past few days.  Going back to September 18, the Dow has lost almost 700 points, which - percentage-wise - is not very much, but it is reflective of how uneasy Wall Street has become.  Public companies based in the L.A. area are taking it on the chin - Disney, Amgen, Mattel, DirecTV - their stock prices are all down going back to the middle of September.

Whatley: Even so, hasn't this been a good year for the stock market?

Lacter: It has - those local companies are up anywhere from 13 percent 30 percent year to date, and the Dow is up 14 percent year to date.  Of course, the stock price of a company doesn't always match the amount of money it makes, and this year, even before worries about the debt ceiling, the numbers haven't been as good as they should be at this stage of a recovery.  And, that's why there's particular concern about next week.  You do have to wonder whether a default could have ripple effects involving trade, consumer spending, the dollar - who knows what?  Now, it's still a pretty good bet that saner heads will prevail, although there are no guarantees - and again, if worse came to worse, do you really want to be jumping out of that plane?  Guess we'll find out.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

The state's online registration for Covered California has been up for a couple of weeks, and reaction has been mixed.

Steve Julian: Business analyst, Mark Lacter, what's your take on how well Californians are getting into the Affordable Care Act?

Mark Lacter: It's hard to get a good read, Steve, because it's hard to measure the success of what is really a new marketplace.  If you're basing it on the number of unique visitors coming to the Covered California website, well, then the program clearly has attracted lots of interest - they had almost a million visitors during the first week of eligibility.  But, maybe a better measure would be the number of people whose applications actually have been received by the insurance companies that are going to handle the claims.  If that's your measuring stick, then the numbers have been far smaller so far.  Now, it's worth pointing out that California - and particularly L.A. County - have a higher percentage of households without insurance than other parts of the nation, and so you'd expect there to be lots of interest.

Julian: So the question, then, is how many folks turn into actual policyholders paying actual premiums each month.

Lacter: The truth is nobody knows, which is why state officials want to sign up as many people as possible in the early going when the program is getting so much attention.  This is especially true for younger and healthier people who are needed to help offset the cost of caring for older and sicker people.

Julian: And, that's also why any computer glitch can be such a headache...

Lacter: That's right.  Covered California did run into problems in the early going, but everybody agrees that things are going much better than the federal website, which is the default site used by folks in states that don't have their own program to oversee the health care laws.  That federal site has been an utter disaster.  So, by comparison, California is ahead of the game.

Julian: It's a work in progress, even here.

Lacter: Very much so.  The California website still doesn't have a way for enrollees to find out which doctors and hospitals are included in each health plan.  And, that's a big deal because  insurance companies are limiting the options available as a way of keeping premiums low.  So, it's possible that the doctor you had been using for your individual insurance plan will not be on the list of doctors that can be used for one of the cheaper plans.  Of course, for someone who doesn't have any health coverage, none of that is likely to matter.

Julian: And then, there's the continued threat of a U.S. default...

Lacter: You know, Steve, this is like watching the beginning of a bad traffic accident in slow motion - and we're all pretty helpless to do anything about it.  And, so are the financial markets, which are moving back and forth not based on what's going on with the economy or with any industry, but on the latest press conference out of Washington.  One thing we do know is that if the nation does go into quote-unquote default - and we're not even sure what that might mean - but if Wall Street and somehow declares this a major crisis, it's going to be bad.

Julian: Who gets hit?

Lacter: It'll impact anyone who has a retirement account, any business wanting to borrow money, and potentially it's going to impact the budgeting of the state.  You know, one of the things we were reminded of during the Great Recession was how reliant California has been on higher-income individuals who make a lot of their money through the stock market and other investments.  So, when those folks do well - as they have been over the last year - the state coffers will do well.  And when they don't, as was the case in 2008 and 2009, the state takes a huge hit because there's not enough tax dollars coming in.  Gov. Brown and others have tried to lessen the reliance on those top tiers - so far without success.

Julian: And the state's budget situation is so much better than it was a year or two ago.

Lacter: That's the real pity.  And, even if the House and Senate reach a temporary agreement on the debt ceiling, it's just a matter of weeks or months before another deadline crops up - and more uncertainty for the financial markets.  I guess Chick Hearn would have called this nervous time.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

The contamination of Foster Farms chickens has provided insight into food regulation.

Steve Julian: Business analyst Mark Lacter, had we been paying attention before this happened?

Mark Lacter: You know, Steve, we often have an out of sight, out of mind attitude when it comes to food safety, and - as we're seeing with this episode - the government has a way of enabling that attitude.  What stands out, first of all, is that people started getting sick from salmonella-contaminated chicken back in March, and yet, it wasn't until the past few weeks that news stories began appearing about the seriousness of the problems.

Julian: At last check, more than 400 people have been infected, with most of them in California...

Lacter: Right, and Foster Farms, which is based in Merced County, controls two-thirds of the poultry market along the West Coast.  No fatalities so far, but many of the people who became sick had to be hospitalized - and that leads to still more concerns that the salmonella strains were resistant to antibiotics.  Now, why it took this long for consumers to be made aware that there was a problem tells you something about the way the federal government regulates poultry plants.  It was only last Friday, after the company had seen a 25 percent drop in sales, when the president of Foster Farms decided to go public.  He said he was embarrassed by the outbreak, and promised to change the company's processing facilities so that salmonella can be better identified.

Julian: Where was the US government in this?

Lacter: Apparently, the Department of Agriculture only requires testing for levels of salmonella at the time of slaughter - not later on, after the poultry is cut into parts.  Foster Farms now says it will do retesting at that later stage.  What's also interesting is that Foster Farms was not asked to recall any of its products because the chicken is considered safe as long as it's handled properly and then cooked to the right temperature, which is at least 165 degrees.  That's why some supermarkets have kept carrying the brand.

Julian: Can the government even order a recall?

Lacter: Not in a case like this - and that's because of a court case in the 1990s involving a Texas meat producer that federal inspectors were ready to shut down due to a salmonella outbreak involving ground beef.  The company sued the government, arguing that salmonella is naturally occurring, and therefore, not an adulterant subject to government regulation.  And the courts agreed.  Foster Farms has been using much the same argument.

Julian: Why isn't there more public outrage over this?

Lacter: Well, again, we go back to out of sight, out of mind.  Slaughterhouses are not exactly fun places, and they're usually not well covered by the news media until something bad happens, like the Foster Farms situation.

Julian: Chino comes to mind - a story we covered.

Lacter: That's when an animal rights group used a hidden camera to record inhumane treatment of cattle at a meat processing plant.  That company was forced into bankruptcy.  Another reason coverage is spotty is because it's not always easy to trace someone's illness to a contaminated piece of meat or chicken.  And, that leads to lots of misinformation.  The broader issue is figuring out a way to monitor these facilities without the process becoming cost prohibitive.  The Agriculture Department has been pushing a pilot program that would allow plants to speed up processing lines, and replace government inspectors with employees from the poultry companies themselves.

Julian: The idea being?

Lacter: The idea being to establish safeguards that can prevent problems before they get out of hand.  But, this is pretty controversial stuff, and advocacy groups representing poultry workers say that processing lines need to be slowed down, not speeded up.  So, you have this ongoing back and forth involving industry, government, consumer groups, and labor organizations.  And unfortunately, most of us tend to move on after one of these outbreaks gets cleared up.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

It's late October, which means  more and more stores are decorating for Christmas. 

Steve Julian:  Business analyst Mark Lacter, whatever happened to "better late than never?" 

Mark Lacter: Steve, retailers never want to sell late because it often means having to reduce the price. They're looking to start out as soon as possible - these last three months represent their biggest payday of the year. And here in California people do seem to be buying stuff - consumer spending has been up for 14 consecutive quarters, going back to the spring of 2009, and taxable sales are up almost 5 percent from the peak levels before the recession. Another good sign is Chapman University's index of consumer sentiment, which is at its highest level since the beginning of the recession in late 2007. All these indicators explain why the state economy is generally outpacing the rest of the nation.

Julian: There has to be a "but" in here someplace…

 Lacter: The "but" is that only 60 percent of the jobs lost during the downturn have been recovered, and the unemployment rate in many parts of the state, including L.A. County, is still at or above 10 percent, which isn't what you'd call a healthy economy. And that's why holiday shopping this year could end up being sort of hit and miss. Folks who have well-paying jobs and a bunch of their money in the stock market - and Southern California has its share of both - those folks will probably be spending good amounts. 

Julian: Are there geographic tell-tale signs?

Lacter: The closer to the coast you go, the more spending there's likely to be. But it's a different story if you're feeling vulnerable about your job or in the amount of savings you have in the bank. So you have retailers once again coming up with ways of reaching as many budget-conscious folks as possible, as early as possible. The most obvious move is opening their stores on Thanksgiving night - Macy's is the latest of the chains to get a head start on Black Friday (Target, Kohl's, Walmart and J.C. Penney will also be open). Another strategy is matching your prices with the prices on Amazon and other online retailers - also, retailers will use mobile apps and arrange in-store pickup of online purchases. All told, expect holiday sales to run 3 percent ahead of last year, with the L.A. area likely to be a bit higher. Decent, but not great.

 Julian: What's the message to consumers now: buy or not buy?

 Lacter: Well, we'll start with the good news - gasoline prices are at their lowest level since the beginning of the year, with an average gallon of regular in the L.A. area running $3.75, according to the Auto Club. And barring any refinery fires or international catastrophes, the numbers might keep falling into November and December, which could incentivize consumers to buy a little more at the shopping malls. Here's some more good news - the L.A. area has seen a huge drop in the number of homeowners who are underwater, which happens when the value of a property is less than the amount that's owed on the property. This of course was a big problem during the recession, but over the last year the median home values have gone up between 20 percent and 30 percent. 

 Julian: And if your equity is positive instead of negative, you'll probably feel more confident about spending. 

 Lacter: That's right. But there are also deterrents to spending - as has been reported, a few hundred thousand Californians lose their individual health care policies by the end of the year because their plans don't meet the requirements of the Affordable Care Act. Policyholders will be stuck in many cases with a premium increase, possibly a big increase. Now it's possible that in the long run these folks will be better off with a more inclusive plan that results in lower out-of-pocket expenses. But it'a hard to ignore the sticker shock of having to shell out, say, $250 a month instead of $100.

 Julian: There goes the holiday list...

 Lacter: For those folks, yes. And even though L.A. consumers do a good job of separating their feelings about Washington with their desire to spend, the economy is bound to slow down a little. So Steve, just don't count on that $9,000 fur vest I was going to get you for Christmas. Sorry about that…

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

Police say TSA agent Gerardo Hernandez was shot and killed last Friday at the base of the escalators of LAX Terminal 3, and not at the checkpoint gates.  Paul Ciancia is accused of killing Hernandez and wounding several others.  Ciancia remains hospitalized in critical condition.

Steve Julian: Business analyst Mark Lacter, how did the airlines respond to shooting and its aftermath?

Mark Lacter: Generally pretty well, Steve, considering that the airport was effectively closed for several hours on Friday, and most of Terminal 3 was out of commission until Saturday afternoon.  You know, there's always this precarious balance in operating airlines and airports, even in the best of circumstances.  Just so many flights coming in and going out, and so many thousands people using the facility at any given time - and it really doesn't take much to upset the balance.  So, when you have something horrific take place and you see all those travelers stranded outside the terminals, the ripple effects are enormous - not just at LAX but all over the country.

Julian: More than a thousand flights were either canceled or delayed on Friday.

Lacter: And, there was a further complication because the airlines flying out of Terminal 3 are not the legacy carriers like United, American, and Delta that have all kinds of resources, but smaller operations with less flexibility.  It's not like there's an empty aircraft just sitting in a hangar waiting to take passengers wherever they want to go.  Actually, the airlines have gotten better at arranging re-bookings when there's a snowstorm or some other emergency that gives them advance warning.  But obviously, there was no advance warning last Friday, so the carriers needed to improvise in handling passengers whose flights were cancelled.

Julian: What did they do?

Lacter: One step was waiving the fees normally charged to re-book flights (and that's gotten to be a pretty penny).  Another was waiving the difference in the price of the original ticket and the re-booked ticket.  But, the policies varied according to the airline, and we heard about travelers not receiving hotel or food vouchers, or having to buy a brand new ticket on another airline if they wanted to avoid the wait - and that can be expensive.  Which raises another issue: planes tend to be completely full these days because airlines have been cutting back on the number of flights.  And that can be a problem if you're taking a route that doesn't have too many flights in the first place.  So, it gets really complicated.

Julian: Why do you think we haven't we heard more horror stories from passengers?

Lacter: Well, look at the cities that the airlines in Terminal 3 fly to - New York, San Francisco, Seattle, Dallas.  They're all served by several other carriers.  L.A. to New York, in particular, is one of the busiest routes in the world, which means that it's also one of the most competitive.  So, even if your flight was cancelled, there's a good chance you'd be able to find space by Saturday (which is normally a slower day for air travel).  This is a big reason, in general, why people like LAX.

Julian: Why don't other local airports handle more of the load?

Lacter: You might remember a few years ago local officials were promoting something called "regionalization" - the idea was that as LAX maxed out on the number of passengers it was allowed to handle each year, then other airports would make up the difference - places like Ontario, Bob Hope in Burbank, and John Wayne in Orange County.

Julian: Right, and they talked about easing traffic congestion by spreading around the flights.

Lacter: Well, regionalization never happened because, first of all, passenger levels at L.A. International didn't come close to maxing out.  But, more importantly, because the airlines decided that using LAX was more efficient for everything from handling baggage to arranging international connections.  So, through the first nine months of the year, passenger traffic at LAX is up 4.2 percent from a year earlier, while at Ontario traffic was down 9.3 percent.  And, we've seen that John Wayne, Bob Hope, and Long Beach are all struggling.  Of course, the challenge at a busy place like LAX is making it as safe as possible, and that will no doubt become a priority in the weeks ahead.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.

Yesterday may have been a holiday on paper, but if you were navigating LA's major freeways, there was no sign people had the day off.

Steve Julian: Business analyst Mark Lacter, is this more evidence that Southern California traffic getting worse?

Mark Lacter: Steve, L.A. continues to be the most clogged-up city in the U.S. - according to something called the TomTom Traffic Index - with commuters caught up in delays, on average, 35 percent of the time.  Or, to put it another way, L.A. commuters are in congestion up to 40 minutes of each hour they're driving.  The worst time of the week to commute is Thursday night; that's when there's congestion more than 80 percent of the time.  Monday morning commutes are the lightest.

Julian: After L.A., where should you not live if congestion bugs you?

Lacter: The next worst cities in the U.S. are San Francisco, Honolulu, Seattle, and San Jose.  Now, the Census Bureau comes up with its own commuting surveys, and if you compare the most recent numbers with those back in 2000, you'll see that things aren't all that different.  Matter of fact, the percentage of commuters driving alone to work actually increased a little over the last decade to 72 percent, while the percentage of those carpooling has declined.

Julian: What about public transit?

Lacter: Well, the numbers are up slightly from 2000, but only to 7.3 percent of all commuters.  So, even assuming that the number inches up in the next couple of years when the Expo Line extends into Santa Monica, it's still a smallish piece of the pie.  And, since many of the other public transit projects being planned are decades away from being completed, those numbers might not change much.  One other thing, Steve: less than 1 percent of all L.A. commuters bike to work, which would throw cold water on the idea that biking in L.A. is becoming a popular way of getting to the office.

Julian: People just prefer commuting by car…

Lacter: It remains the most convenient way of getting around - despite the congestion.  New car sales are up 14 percent through the first nine months of the year in Southern California.  Add to that are generally affordable gas prices (they've been especially low in the last few weeks).  In other parts of the world, congestion is considered a good thing because it means that the economy is doing well.  Which explains that while L.A. is the most congested city in the U.S., it doesn't rank among the 10 around the world.  On that front, Moscow is tops, followed by Istanbul, and Rio de Janeiro.

Julian: What about driverless cars?

Lacter: Well, these vehicles hold the most promise for reducing accidents, lowering travel times, and improving fuel economy - and you don't have to give up your car.  Actually, a lot of the technology is already in place - that includes stuff like radar-based cruise control, and devices that keep you at a safe distance from the car in front of you.  The trick, of course, is taking these individual capabilities and integrating them into an entirely driverless car.  Several car companies say they could be ready to start selling by 2020, with Google saying that its car could be ready even sooner.

Julian: Is that realistic?

Lacter: Who knows?  But even if the dates can be met - and that's a big if, considering how complex these systems are - legislatures will have to determine, among other things, whether vehicles can be fully autonomous (meaning that you can curl up and take a nap while the computer is driving by itself).  Or, whether they will only be semi-autonomous, which would be like an airline crew using automatic pilot, but always prepared to take over the controls.

Julian: Is that a liability issue?

Lacter: Yes - if something does go wrong, who will get the blame?  The owner of the vehicle?  The carmaker?  The suppliers of the car companies?  These questions might take years to get resolved in the courts - and even then, it could be years before the percentage of these vehicles on the road is large enough to truly have an impact.  But, considering that most commuters aren't willing to give up their cars, this would seem to be the most exciting, most desirable idea.  One day.

Mark Lacter writes for Los Angeles Magazine and pens the business blog at LA Observed.com.

This content is from Southern California Public Radio. View the original story at SCPR.org.