Unintended Consequences: When Well-Meaning Policies Backfire

F.A. Hayek famously wrote, “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” This truth is evident in public policy, where laws and regulations often produce results far different from their intended goals.

Take Missouri’s 2018 decision to remove the 174-day minimum school year requirement. The goal was to give school districts greater flexibility in structuring their academic calendars. It worked. By 2023, nearly one third of Missouri districts had adopted four-day school weeks. The policy also had an unintended consequence—students now spend significantly less time in school.

While schools are still required to meet the minimum 1,044-hour requirement, Institute research shows that the average Missouri student is going to school 17 to 29 fewer hours per year than before. Over the course of an entire K–12 education, this equates to losing nearly a quarter of a school year.

This phenomenon is not unique to education policy. Unintended consequences abound in economic and social policies.

  • Raising the Minimum Wage: The intention is to help low-income workers earn a living wage. In practice, however, higher labor costs often lead businesses to cut jobs, reduce hours, or replace workers with automation—hurting the very people the policy was meant to help.
  • Housing and Zoning Regulations: Efforts to control urban development often result in reduced housing supply, making homes and apartments more expensive. In places with strict zoning laws, such as California and New York, these regulations have contributed to skyrocketing housing costs and homelessness crises.
  • Corporate Tax Increases: Policymakers impose higher taxes on corporations to generate more government revenue, but companies respond by moving operations overseas, reducing investment, or passing costs onto consumers.

Public policies are often crafted with the best intentions, yet they reshape human behavior in unpredictable ways. When policymakers overlook economic incentives and fail to anticipate secondary effects, the result is often worse than the problem they set out to fix.

As Missouri’s school calendar experiment shows, flexibility in education policy may be valuable, but policymakers must exercise caution. Legislators should weigh not just the direct outcomes of a policy but also the unintended consequences that ripple through society.

Missouri’s Rural Schools Can Benefit from Open Enrollment

Many believe that rural districts and students can’t benefit from open enrollment, but the reality is quite the opposite. Rural students often have few school options, and open enrollment can provide them with greater access to educational opportunities—particularly as the four-day school week expands. In states with open enrollment, rural districts have gained students, with many seeing it as a way to sustain their budgets. In Missouri, over 80% of rural high schools are within a 20-mile drive of at least one other high school, making open enrollment a viable option for many families. Instead of focusing on preventing student loss, rural districts can use open enrollment to attract students and strengthen their schools. 

Learn more about the need for Missouri to adopt strong open enrollment policies here.

The Salad Days in Sugar Creek

The Kansas City suburb of Sugar Creek is considering selling off its water system to Missouri American Water. The proposal is on the April 8 ballot.

Sugar Creek doesn’t operate its own water utility, which makes this proposal a little different from other privatization proposals. Sugar Creek buys water from the Independence municipal utility (which should also be privatized along with the Independence electric utility, but that’s another story).

Privatization, however, is still a very good idea for the residents of Sugar Creek. The main problem with public utilities is that customers are also voters, and politicians are hesitant to raise rates on their voters. This leads to an underinvestment in the system. As the City of St. Louis said in 2024 when it finally increased water rates:

Major I-64 Water Main Break Highlights Need for Long Overdue, Much-Needed Investment in City’s Water System

This was the city’s own water system it was talking about! Cheap rates have harmful consequences down the line.

Beyond that problem, studies have demonstrated that private utilities are generally more efficient than municipal utilities. In 2000, economist B. Delworth Gardner of Brigham Young University determined that private water utilities in Utah charged lower rates for water than comparable public utilities despite the large advantages in taxation and regulation that government utilities have. A recent comparison of public and private electric utilities in Florida concluded that private utilities outperformed public utilities in nine of 14 categories.

Missouri American Water is offering $5 million for the system and has promised to invest $8 million in upgrades over five years. The equipment would also go onto the tax rolls, expanding the property tax base for Sugar Creek. Most importantly, it would put water services in Sugar Creek in the hands of a more efficient private operator, which is closely regulated by the Missouri public service commission. The idea that Missouri American Water could use its monopoly power to keep raising rates is incorrect.

This policy change would be a very good move for the people of Sugar Creek.

Open Enrollment: Erasing Seven Myths in Missouri

The adoption of open enrollment in Missouri, which would allow any student to register at any public school in the state regardless of their residential district assignment, would be a significant change in our state’s public education landscape. Putting families in charge of where their children attend school would upend the status quo and require adjustments to everything from funding mechanisms to the transportation logistics. But just because it’s never been done in Missouri doesn’t mean that we would be leaping headlong into uncharted territory. Twenty-four states already have open-enrollment policies in place, so we know a lot about what to expect. Many of the fears and concerns being voiced by opponents of open enrollment in Missouri simply don’t reflect what we’ve seen in other states. This report addresses seven of the most common myths surrounding open enrollment.

Click here to read the full report.

Listen to a podcast featuring the authors of the report:

The Role of Culture and Character in Education with Jason Bedrick

James Shuls, senior fellow of education policy at the Show-Me Institute and head of the K-12 education reform branch of the Institute for Governance and Civics at Florida State University, and Jason Bedrick, research fellow in the Center for Education Policy at The Heritage Foundation, discuss the Phoenix Declaration. They explore the importance of cultural transmission, the distinction between education and indoctrination, and the necessity of grounding education in truth and goodness. The discussion emphasizes the role of schools in character formation and the importance of engagement in public education.

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Produced by Show-Me Opportunity

Can We Handle the Truth . . . of Our Cities’ Financial Status?

The “Financial State of the Cities 2025” report by Truth in Accounting provides a comprehensive analysis of the fiscal health of America’s 75 largest municipalities. Alarmingly, it reveals that 54 of these cities lack the necessary funds to meet their financial obligations.​

Kansas City and St. Louis are notably highlighted for their fiscal challenges. Kansas City is ranked 57th, while St. Louis is positioned at 59th. Both cities have been assigned “D” grades, indicating significant financial distress. This distress is quantified through the “Taxpayer Burden” metric, representing the amount each taxpayer would need to contribute to settle all municipal debts. In Kansas City, this burden amounts to $8,800 per taxpayer, whereas in St. Louis, it escalates to $9,800. ​

A primary factor contributing to these burdens is the underfunded pension liabilities in both cities. Unfunded pensions place taxpayers and city services at risk, leading to increased debt and financial instability. ​

The implications of such financial distress are profound. Residents may face reduced public services, increased taxes, or both, as cities strive to balance their budgets. Moreover, fiscal instability can deter business investments, stymie economic growth, and erode public trust in local governance.​ This is in addition to both cities’ struggles providing public safety.

Addressing these challenges necessitates a multifaceted approach. Cities must prioritize fiscal responsibility, ensure transparent accounting practices, and engage in proactive financial planning. Fostering economic development can help alleviate fiscal pressure, but it must be real development, not the sort we have seen for decades that merely transfers tax dollars to corporate cronies.

There is an urgent need for comprehensive fiscal reforms in both of Missouri’s largest cities. Without prompt and effective action, residents will bear the brunt of past financial mismanagement for years to come.

Missouri Pension System Pushes Out Another Great Educator

Sometimes the headline says it all. And sometimes a headline leaves us scratching our heads. Take, for example, this headline from the Maryville Forum: “Principal to retire in Missouri, teach in Iowa.” That’s a head-scratcher. Is the principal retiring if he is still working, just doing it in another state? Why would someone retire and then move across state lines to continue working?

Of course, the answer is obvious if you know anything about how educator pensions work in Missouri.

Missouri’s teacher pension system creates strong incentives for educators to retire as soon as they hit their pension’s peak benefit. This doesn’t mean they’re ready to stop working; it just means that staying on the job in Missouri would financially penalize them compared to retiring and working elsewhere. This system is problematic because it pushes experienced teachers, principals, and superintendents out of Missouri’s schools when they still have a great deal to offer.

When Missouri educators retire early, they take with them years of expertise and leadership. Instead of keeping our best and most experienced educators in Missouri classrooms, our pension system encourages them to leave for neighboring states. This harms our schools and weakens the overall quality of education available to Missouri students.

To fix this, we need pension reform. We should develop a retirement system that rewards long-term service without forcing educators into an artificial retirement timeline. Instead of a system that penalizes continued work, we should create one that allows educators to gradually phase into retirement, perhaps by working part-time or taking on mentorship roles while still accruing meaningful benefits.

Other states, such as Washington, have reformed their pension systems to better retain educators. Missouri should do the same. We cannot afford to keep losing our best teachers and leaders simply because our pension system makes it financially advantageous for them to retire and work elsewhere.

It’s time to change the incentives. Let’s keep our educators in Missouri, where they belong.

Ending Educational Redlining with Tim DeRoche

Susan Pendergrass speaks with Tim DeRoche from Available to All about the importance of open enrollment in public schools, particularly in Missouri, where strict residential assignment policies limit access to quality education. They discuss the issue of educational redlining, the impact of district boundaries, and the need for policy changes to ensure equitable access for all families. DeRoche highlights transportation challenges, funding models, and successful open enrollment policies in other states that Missouri could learn from.

Read Tim’s full report “Show-Me the Way Out: Overcoming Educational Redlining and Strict Residency Restrictions in Missouri’s Public Schools”.

Learn more about Available to All

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Download Episode Transcript

00:00 Introduction
03:11 The Case for Open Enrollment
06:02 Missouri’s Unique Challenges
09:07 The Impact of District Lines
12:13 Educational Redlining and Its Consequences
15:03 Resistance to Change in Missouri
17:58 Comparative Analysis with Other States
20:51 Transportation and Accessibility Issues
24:03 Funding Models and Their Implications
27:08 The Future of Education in Missouri

Produced by Show-Me Opportunity

Concerns about Kansas City Animal Control Operations

There is a lot of controversy regarding animal control operations in Kansas City. Animal control in Kansas City has gone back and forth between public and private operations, and it could be changing again soon.

Animal control services are one of the prime municipal services ripe for privatization, either with for-profit veterinarians or (more commonly) non-profit animal welfare groups. For example, many of the cities on the Kansas side of the state line have contracted with Great Plains SPCA for shelter operations.

Kansas City has gone through a series of privatization efforts for both its animal shelter and animal control operations, as have many other cities and counties. Kansas City first outsourced its animal shelter to a private vet in 2009. The private operator saved taxpayers $175,000 and improved adoption rates at the same time. However, complaints regarding alleged animal abuse caused the city to terminate the contract in 2011 and briefly go back to city operation. Next, Kansas City turned over its animal shelter to KC Pet Project in 2012, and that privatization effort led to tax savings of $40,000 and a significant reduction in euthanasia for the animals. Later, in 2019, when Kansas City contracted with the same non-profit for animal control operations (e.g., capturing stray animals), city employees opposed it on familiar grounds:

City workers and the American Federation of State, County and Municipal Employees Local 500 worry about the loss of jobs and pensions if the city of Kansas City, Missouri, follows through with its plan to privatize the Animal Control Division.

Recently the operations of the shelter have been questioned due to a dispute between the non-profits that operate it. It seems the city will be retaking control of the shelter. Animal control operations are also apparently coming back under city control. Admittedly, one can see how capturing potentially dangerous animals is more of a police-like assignment than running adoptions from a shelter. I am not sure most volunteers are going to be enthusiastic about dealing with a wild, rabid pit bull.

Complaints about animal abuse, poor conditions, and more in animal shelters are common. As I said in a previous blog post, jails are hard places to operate, whether they are for people or animals. I suspect there is a core group of animal rights “volunteers” that are going to file complaints about any shelter that isn’t entirely a “no-kill” shelter. It doesn’t seem to matter if the shelter is operated by the government or by a non-profit.

The other part of this debate is that government employees are never going to stop fighting to bring back jobs and assignments that were contracted out. We have seen efforts to retake government control with Kansas City trash operations and University City ambulance services, to give just two examples. I don’t automatically believe the “complaints” filed against private providers in these situations. As a resident of University City, I can assure you that bringing the ambulance operations back under city (and fireman’s union) control was an orchestrated political plan.

Is this the case with the animal shelter and control operations in Kansas City? I don’t know. For the sake of the animals, I hope it works out for the best.

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