Lots of people could save plenty of money, even if they take taxis everywhere. Above: São Paulo, a terrifyingly beautiful mega-metropolis. With too many cars.

I live in São Paulo, and I can afford a car. Why don’t I buy one? Because it doesn’t make any sense. Personally, I enjoy the rare luxury of being able to walk to work, so it would be wasted money.

But a fantastic new article and graphic tool shows that owning a car is a big waste of money for lots of people that do have to commute to work. And that isn’t just taking into account the obvious economic benefits to be had if they swapped in the wheels for public transport, walking, or biking. That’s not practical for everyone, anyways – the metro and bus system don’t get you everywhere easily.

No, what the numbers show is that many people can save lots of money even if they take taxis everywhere. Since taxis here are ubiquitous and excellent, that hardly seems like a less comfortable solution. But still, more and more cars, everywhere, every day.

In São Paulo, owning a car, like most everything, is expensive. If you add up gas, taxes, parking, insurance, maintenance costs, and what you are losing in the car’s depreciation each year (not the mention the sky-high cost of the vehicle in the first place), having your own is going to cost you more than taking taxis, unless you drive far, every day.

São Paulo is a beautiful and terrifying mega-metropolis, pulsating with energy and culture. I like it a lot. But I think most of us agree it would be a bit nicer with less cars.

So why do so many people keep buying so many of them?

I can venture two theories. The first is that people simply don’t know about this economic calculus. Since a lot of the car’s costs don’t immediately appear in the monthly installment plan presented at the dealership, a car may look like a good investment, even when it isn’t.

The second is psychological.

A car is status, it is personality, it is control. You power a big machine, you have your own music. All of this is freedom, and bliss.

At least, that is what the advertisers tell us. And if that didn’t work on lots of people, there would be no reason to have car commercials in the first place. If buying an automobile was an obvious utilitarian choice, those companies wouldn’t have huge marketing budgets. Sort of like you don’t see many flashy spots for rice or beans.

And, this being Brazil, there is an obvious class element, too. It makes foreigners’ heads spin to hear that some upper-class Brazilians never take the metro, even though it is so much faster and cleaner than counterparts in New York and London. If the train actually goes where you are going (and this is far from assured) the ride is a breeze.

But for a lot of people, including the rising middle classes, even the elegance of taxis is not enough. A car is a crucial status symbol. An expression of success. Even if purchasing one is the opposite of an investment.

So, those are the two reasons Paulistanos may be wasting so much money on cars, and choking the roads with them. Neither is a very good one.

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And if you have any Portuguese at all, click over to the full Folha article, with interactive graphic

In this profile I did for the Los Angeles Times, sources explain that his catastrophic losses this year were in part related to his, erm, shall we say, unique personality. Much about the way he behaves will shock English-speaking readers, and the way he promised investors more than he could deliver led the markets to punish him severely.

His losses were far worse than anything else going on in Brazil. It is him, and not the economy more generally, that really tanked. The current wisdom is that Brazil will probably re-balance to more modest but decent growth, and that Eike’s companies will probably do OK eventually.

The problem, however, is that he quite purposefully and forcefully made himself a symbol of Brazil’s success. And not just the long-term opportunities for natural resource extraction he represents. His getting REALLY RICH, RIGHT NOW became a goal in itself, and, the myth went, proof of Brazil’s worth. That never made much sense.

Continue reading “In Brazil, a billionaire’s reality check” at the Los Angeles Times

São Paulo will install 300 bicycle stations, each with 100 units available for rental. The scheme is similar to those in Paris, London, and Rio de Janeiro.

They will likely be free to use for the first hour or so, then incur charges after that. They’re sponsored by Brazilian bank Itaú.

It’s a bit of an understatement to say that São Paulo is not a bicycle friendly city. The streets are completely packed with cars, many of which appear just as happy to take out a cyclist as they are to slow down and go around them. Many who cycle to get around in London, Paris or New York would never think of trying it here.

But that could be changing. As the number of cars skyrockets, deciding to sit in traffic makes less and less sense.

There is still an outdated social status attached to driving a car here. But that has disappeared in much of the world, even in car-crazy California.

Ten years ago no one in Los Angeles used a bike to commute. Now it’s perfectly normal. Twenty years ago few in London were doing it either. Now the mayor of London bikes to work. It’s hard to imagine São Paulo mayor Gilberto Kassab doing the same.

But for the sake of the environment and urban harmony, let’s hope the rental scheme is a push in the right direction. Extremely powerful Itaú is behind it, and it has been a success in Southern Rio de Janeiro.

But it’s a different world over there. The Zona Sul Carioica is a flat beach community and people there go through life leisurely. That is not the case here.

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