Main | February 2006 »

January 31, 2006

Iowa Beer Tax Goes Flat

A Des Moines Register Political Columnist stated his case on January 11th for no increase in the state beer tax.

“Gov. Tom Vilsack proposed Tuesday [January 11, 2006] a 53 percent increase in the beer tax. The idea lacks fizz and gets in the way of more important things he's trying to do,” wrote David Yepsen.

”The Democratic governor asked lawmakers to increase the tax from 19 cents per gallon to 29 cents per gallon, raising an additional $7.4 million for the state treasury. While that's only about 6 cents a six-pack, the reaction from both Democratic and Republican lawmakers went down like a warm Lite beer.”

Yepsen continued, “Vilsack's idea is poor tax policy because it would help make Iowa's tax uncompetitive with other states.”

“A beer-tax increase raises only $7 million —- a pittance in the state's overall $5.3 billion general-fund budget — and is never going to be approved by this Legislature. It just isn't worth the political hangover.”

The entire article can be found at:

http://http://desmoinesregister.com/apps/pbcs.dll/article?AID=/20060111/OPINION01/60110025/1035/OPINION

Head for the Hills

Global warming is coming !!! I

New York Editorial Against Cigarette Tax Hike

According to The Record “if Gov. Pataki has his way, it will become very, very bad for your wallet” to purchase cigarettes in the state of New York.

“Among the many revenue raisers he [Pataki] addressed in his budget plan this month was a proposed $1 hike in the tax per package of cigarettes. That would raise the price to about $6 a pack, half of which would go to state taxes. It would also make New York number one in yet another taxation area…..we believe this proposed hike is unfair and, in the long run, could prove self-defeating and costly to the state down the road.”

The Editorial goes on to say, “Even more people will cross state borders to buy cigarettes, shop on Indian reservations, or even, despite its illegality, buy cigarettes on the Internet. That means no revenue for the state.”

To see the full Editorial click here.

Union Market Share Continues Slide

Newly released Bureau of Labor Statistics data shows that the share of the nation's employees who are union members has declined again, continuing a trend that started nearly 50 years ago. In 2005, 7.78 percent of private sector employees were union members, down from 7.92 percent in 2004. The private sector union market share peaked at near 40 percent in the late 1950s.

Oregon Land Use Due for Review

Faced with some of the highest unemployment rates in the nation in recent years, one of the nation's worst housing affordablity trends and with nearly all Portland area inward domestic migration locating outside the urban growth boundary (particularly in the neighboring state of Washington), Oregon will undertake a review of its land use policies.

Already, voters have indicated their aversion to higher density development in neighborhoods, while the state's voters overwhelmingly approved a measure that would roll back land use planning regulations in some cases. The law is currently under review by the Oregon Supreme Court. Less than a year after the anti-densification referendum, Portland's Metro, the regional land use agency, was forced to expand the urban growth boundary to beyond what had been planned for 2040.

January 30, 2006

Suburbs Cause Bird Flu? More Trouble for the Suburbs Cause Obesity Yarn

There has been a flurry of studies purporting to demonstrate a causal relationship between suburban life styles and obesity. An Atlanta study, by Lawrence Frank and a University of British Columbia (UBC) team managed to make the connection, and saw no reason to even ask participants about their eating habits (I know that it is risky to suggest a relationship between eating and weight, but I am courageous). My op-ed (Urban Sprawl does not Make People Fat), distributed by the Heartland Institute to a number of newspapers, including the New Hampshire Union-Leader took the Frank team to task for what I considered to be an incomplete and highly deficient study.

But the beat goes on. Now, Frank and company have completed a copy-cat study with similar deficiencies in Seattle. Moreover, further studies are planned, but “fill-in-the-blank” press releases should make the public relations effort relatively easy (there was a time that academic studies didn't require public relations strategies).

Meanwhile, there are media reports today that obesity may be caused by a virus. That should be a matter of concern for the UBC team. If, for the sake of discussion we accept the dubious proposition that suburbanites weigh more, perhaps the problem is suburban based viruses, rather than land use patterns.

The problem could be even more far reaching. Frank et al could add to the literature by a thorough review of the potential connection between the suburbs and bird flu.

Unions Just Too Good!

At least, that's how the New York Times is attempting to explain why union membership is falling or stagnant across the country:

In the United States, unions may have done their job only too well. Last year, according to the latest report from the Bureau of Labor Statistics, private-sector workers who were members of unions typically made 23.1 percent more per week than their nonunion colleagues, up from a 22.4 percent premium in 2004.

I'm not sure what economicuniverse the reporter is operating in here, where apparently, if unions price their members out of the market, this is a measure of sucess. Its no wonder their numbers, relative to the overall workforce, are nearly a third of what they were in the '70s

I think the more obvious interpretation of the trend is, while unions may have done a superior job at securing the immediate interests of their members, they did not do so well with the long-term interests. An interesting thought-project might be what unions would look like if they had focused on long-term interests. What "good" could have been done?

Media: Parnell Quoted in the Montgomery Advertiser

Heartland's Vice President for External Affairs, Sean Parnell, was quoted in a recent article on hospitals that increase what they charge for procedures in response to govrnments' failure to fully reimburse Medicare and Medicaid expenses. Read it online here.

Canada: Kyoto Reality Check from New PM

New Canadian Prime Minister Stephen Harper is preparing the electorate for a bit of reality on Canada's prospects for meeting its Kyoto CO2 reduction goals. Noting that Canada trails the United States, which has no commitment to abide by the Kyoto protocols, Harper has expressed the view that its too bad the better part of a decade was wasted pretending that Canada would meet its commitments.

January 28, 2006

Choice Series: George Clowes, The Heartland Institute


On January 19, Clowes kicked off the new monthly Educational Choice Speaker Series with a talk titled, “Competition as an Effective Education Reform: What Works and What’s Ahead.” The luncheon event, held in the Michigan Room of the Metropolitan Club in the Sears Tower, was organized by the Illinois School Choice Initiative.

Clowes noted that while competition among providers of goods and services is an accepted feature in most sectors of the U.S. economy, there is little competition among providers of K-12 education, a sector with annual revenues in excess of $500 billion. However, recognizing other education reform efforts have yielded scant success at high cost, an increasing number of states have taken steps to begin the process of deregulating their K-12 education delivery systems to permit the creation of new types of schools--such as voucher, charter, and contract schools--and to help defray the cost of private schools with tax credit programs.

Research has consistently shown competition for students and education dollars produces beneficial effects, not only in terms of improved student achievement and parental involvement at choice schools, but also in prompting improvements in public schools that lose students to the new competitors. Competition also has the advantage of being a self-sustaining reform.

Despite the positive effects of competition, particularly in markedly improved high school graduation rates at lower cost, teacher union opposition to the deregulation of K-12 education remains fierce and unrelenting. The opposition that is most troubling, said Clowes, is in the courts, where judges, like those on the Florida Supreme Court, deconstruct the accepted meaning of constitutional texts and discern novel new interpretations that prohibit competition to public schools.


January 25, 2006

2005 Warmest Year on Record?

USA Today, along with just about every other newpaper in the country, is reporting that news that 2005 is the warmest year on record in over a century. Funny ... I didn't mind so much.

January 20, 2006

Media Spotlight: Eat Paint, Get Rich

The Heartland Institute made a bang yesterday with an op-ed in the Wall-Street Journal by Maureen Martin. It's posted online here.

January 18, 2006

Laptops: The Next Big Thing in School Reform?

Not that we've haven't heard this suggested before, but Illinois' Lt. Governor, Pat Quinn, is apparently trying to make it a reality. He wants to give every 7th grader in the state a laptop. Let's set aside for the moment the obvious point that laptops do not necessarily equal better education.. The logistics of this would appear to be a nightmare, especially at such a large scale. Just a few thoughts:

Just a few examples of what I’m thinking:

Who bears replacement cost for damaged units? It is unlikely to be the parents, which therefore skews the incentives and guarantees outrageous insurance costs. Right?

By the time a second grader gets to twelfth grader he or she will have owned the unit for five years ... long enough for it to have gone obsolete. So there will be pressure to replace the computers more often and without incentives in place “more often” will undoubtedly become “too often”.

Presumably, the laptops will require tons of software, a different program for each class (maybe two for some). Add to this constant unit turnover of machines and you have a software compatibility nightmare.

Then, of course, there is tech support. Ten years from now, the tech-to-student ratio would probably rival teacher-student ratio if not beat it. The EdTech union might be the next great powerhouse union, convincing school boards everywhere, that if they just buy more technology and hire more support staff their kids will be brilliant.

For sure, these logistics can be worked out. But to expect an organization that has yet to figure out the logistics of teaching kids how to read to be the ones to do it; well, that’s just a bit too much of a stretch for me.

January 17, 2006

Game Theory and Public Policy

If it seems to you that there’s been a lot of talking but nothing really happening. In Washington on energy policy, tax reform, social security reform and immigration legislation, you’re right. Nothing has been happening. Even though there’s been months and, in some cases, years of talking about what to do, our elected legislators can’t seem to muster whatever it takes to do it.

Such action is interesting because regardless of your social or economic status, whether you’re a suburbanite or a city dweller, young or old, black, white or hispanic, you have a great deal at stake in the ultimate resolution of these issues and in the content of any legislation adopted. But therein may lie part of the explanation for the impasse. There is so much at stake. So many to be pleased and so many to be potentially displeased, that our politicians choose to do nothing. Or, in some cases, choose to come up with such a bland compromise that the final piece of legislation contributes little or nothing to the solving of the initial economic or social problem which the legislation was originally designed to address.

Such an attitude reflects what “game theorists” call trying “to play the positive-sum game.” Game Theory is the view that human interactions at any given time may be categorized, more or less, into three types of games: positive-sum games; zero-sum games; and negative-sum games.

The positive-sum game is where winners outnumber losers, or better yet, where everyone wins! This is the kind of situation which all politicians understandably like. Everybody is relatively happy. But you ask, is that situation ever possible. Or more to the point, has that situation ever endured in our nation’s history? The answer to both questions is yes.

The positive-sum game dominated the political decision-making climate for the 25 to 30 years following World War II. Everybody was winning a little so it was much easier to make decisions that had long term consequences and broad impacts. As a consequence it was the time when the interstate highway legislation was passed; suburbia created, a homebuilding industry begun and homeownership made the essential part of the American dream. It was also the time when farmers got supports and G.I’s got educational and economic benefits when they returned from active military duty.

However, the advent of the 70’s with it’s energy shortages, environmental crises (both real and imagined) double-digit inflation and unemployment rates made the positive-sum game harder to play. For the last 25-30 years— continuing through today, we’ve been playing at best the zero-sum game. That’s the situation where for every winner there is a loser. So passing legislation providing school choice---particularly the brand that provides vouchers to parents that they can use to move their child from an ineffective, failing public school into a private school of their choice can be viewed as a zero-sum game by the legislators. There are clear winners. They are the low-income, often disadvantaged minorities, for whom vouchers are their only hope for escape from a public educational system that is failing them daily.

The losers, or those perceived as losers, are the teachers unions and the trade unions whose self-interest is perceived to be bound up with the continuance of the status quo. This is not a situation that elected officials like. You have as many unhappy people as you have happy: and the unhappy vote too.

But the zero-sum game is not likely to vanish soon. In fact, some political analysts believe that what we are really facing today is the negative-sum game. This is where you have not just a loser for every winner, but more losers than winners, or at least the losers losing more than the winners win. That kind of situation really makes politicians uncomfortable.

And that brings us to what may be the ultimate reason why we do not and will not see any significant direction changing legislation in education, social security, taxes and energy etc. It forces the legislators to make choices as to who gets and who gives. That sounds like a negative-sum game when they really want to play positive-sum games. They have other dreams too.





Nuclear Demonstration

Ever wondered how nuclear power works. How about a demo from How Stuff Works?

January 13, 2006

Deficit Creep

The White House announced yesterday that the federal deficit will creep above $400 billion in 2006, despite the President's promises to reign in spending.

Wal-Mart Forced to Pay Health Insurance Costs

Maryland has passed a law requiring companies with more than 10,000 employees to spend 8 percent of their payroll on Health Insurance.

Merit Pay in Houston

Houston officially becomes the largest school district in the country to pass a merit pay plan for its teachers. From the Austin-American Statesman:

By a 9-0 vote, the Houston school board approved a plan that offers teachers up to $3,000 in extra pay if their students show improvement on state and national tests. The program could grow to up to $10,000 in merit pay.
...
In the first section, teachers get bonuses if their schools are rated acceptable or higher based on scores from the Texas Assessment of Knowledge and Skills, the state's standardized test. In addition, their students need to show improvement in the top half of scores when compared to students in 40 other similar schools throughout the state in order to get the extra pay.

The second section deals with improvement by students on the Stanford Achievement Test, which compares student performance with nationwide norms, and its Spanish-language equivalent, Aprenda. Teachers who instruct children in the core subjects on these two tests are eligible for larger bonuses than teachers and other employees who don't instruct the core subjects.

In the third section, only teachers in the core TAKS subjects of reading and math would be eligible for bonuses, which they would receive if students show yearly progress compared with students in similar classrooms throughout the district.


January 12, 2006

Sierra Club on TV!

Coming Soon.

UN's "Scientific " Authority

Hasn't anyone figured out that the UN is a political body, not a scientific one. Why is it that domestic US government statistics are treated with skepticism (as they probably should be) but UN statistic are not. This time it's USA Today:

The Earth's average temperature rose roughly 1 degree in the 20th century and could rise 10 more degrees by 2100, according to an international group of scientists convened by the United Nations.
There should be a qualification included in this article that some have raised questions about the UN/IPCC methodolgy and that one scientist even quit accusing the IPCC of misrepresenting data.

January 10, 2006

Media Mention : Government Executive Magazine

One of Heartland's Senior Fellows was recently mentioned in Government Executive on the challenges "pay-for-performance" poses to good medical practice:

Dr. Richard O. Dolinar, a clinical endocrinologist in Phoenix, will not be among the volunteers. Pay for performance would have serious consequences for doctors and patients, he says. As a senior fellow for health care policy at the Heartland Institute, a Chicago-based think tank, Dolinar is no fan of Medicare's current system, which he says is based on price controls and central planning. But he's worried that pay for performance would result in doctors playing hot potato with particularly risky patients. A case "that's going to wreck my statistic - I'm going to ship this patient downstream," is how Dolinar predicts doctors would react. In fact, a study published in the July 25, 1996, New England Journal of Medicine found a majority of Pennsylvania cardiologists who were graded annually in a public report card became less willing to operate on severely ill patients.