SMI In the Springfield Business Journal

Posted on by David Stokes

The Springfield Business-Journal ran a nice article about my occupational licensing study and some reactions to it. I think it’s a great article, and I thank Jeremy for his interest in the subject.

Like any good journalist, the reporter got quotes from all sides of the debate. And, man, did he ever get some good quotes from the supporters of licensing (all emphasis below is added):

“The licensing process is a must,” said Detwiler, who along with fellow state-certified massage therapist Stephanie Lansdown run The Neuromuscular Clinic, which opened Nov. 15 in Springfield. “If you don’t know what you’re doing and say that you do, you could really do some harm to somebody.”

Clearly, this person has never tried to pick someone up at a bar.

“If we did the same work in San Diego, it would be a lot more expensive,” Detwiler said.

“I think it’s more about where you are. I don’t think the licensing would really have an effect on price.“

Believe it or not, we actually considered the issues of cost-of-living. The therapist is right that it matters, but wrong when he or she says that it explains the difference between Wichita and Springfield. The two cities have a very comparable cost-of-living, and Wichita’s is actually slightly higher. The main reason a massage session is $10 more in Springfield than Wichita is licensing, not costs of living.

I’ll finish with one quote that shows progress being made:

He added that the National Council of Architecture Review Boards has in recent years made it easier for architects licensed in one state to get licensed in others.

That is one way for the harmful effects of licensing to be reduced, and I applaud the architects for making it happen.

Blaming the Achievement Gap on Anything but the Schools

Posted on by Sarah Brodsky

The explanations that are being given to justify the black-white achievement gap in suburban school districts are disturbing:

When affluent districts show a similar achievement gap, the usual excuses given don’t seem to apply. Students in Clayton, Webster, Parkway, would all come from home environment not associated with poverty. Perhaps, it is a matter of “you can lead a horse to water, but you can’t make it drink.”

That’s a comment from “taxpayer” on today’s Post-Dispatch article about the achievement gap.

Any reasonable person would agree that skin color alone has no effect on a person’s desire to learn and succeed. If the gap persists even in affluent districts, you have to conclude that that there is some socioeconomic difference between the black and white students — perhaps because minority families are making sacrifices to move to the better districts — or that the schools are not educating everyone equally.

I’m amazed at how reluctant people are to criticize public schools, to the point where they resort to blatant racism rather than admit that public schools systematically produce worse outcomes for some students.

Very Important Study From East-West Gateway Council of Governments

Posted on by David Stokes

I urge everyone to read this study from the East-West Gateway Council of Governments about the ludicrous economic development policies that the St. Louis area has been pursuing during the past decades. The Post-Dispatch had a major article about it over the weekend. People at the Show-Me Institute, including me, have been raising issues like this for some time, but it is great to see EWG’s proof in the pudding. I will return to this issue after I have had time to read the entire study.

There Is a Market for Everything

Posted on by David Stokes

For most men, beer and sports go well with just about anything. That is the basic business plan of Knockouts barbershop in St. Joseph. Guys can go in, have a beer, get a haircut from an attractive young lady, and watch TV. Of course, the state can’t possibly allow something like this to go on without intervention of some type. So, now there is an investigation into whether or not Knockouts needs a liquor license — because, you know, God forbid the government not get its cut.

Mr. Schler, the acting state liquor and tobacco supervisor, said any salon requiring a purchase in order to obtain a complimentary drink is indirectly selling alcohol.

“You’re getting a haircut and alcohol all in one monetary consideration. It’s all a package,” he said. “You cannot get the drink without the money. So, it’s not actually free.”

I am pretty sure that at some point in the future, the government will try to license Super Bowl parties at your house. Because, you know, somebody has to pay for the television in the first place — so it’s not actually free. Speaking of guys who love beer and sports, thanks Combest for the link.

School District Spending on Drinks, Among Other Things

Posted on by Sarah Brodsky

I was intrigued when I saw this headline on Combest: “Lawmaker seeks to cut alcohol tab for school staffers.” Are education officials given some kind of allotment to spend on alcohol, which is being cut? No, but it turns out that at least one district has a problem with employees buying alcohol on the taxpayers’ dime:

The audit, available on the district Web site, flags $4,513 in confirmed alcoholic beverage purchases, including 14 pitchers of beer charged in one evening and as many as 46 alcoholic beverages split between two administrators on one other occasion.

And, in response, a state representative wants Missouri law to forbid the practice.

I’m sympathetic to this attempt to curb egregious spending, but I don’t think it will even make a ripple in the ocean of district wastefulness. The same audit revealed unwarranted purchases of items like sunglasses and flowers. We can’t write a separate law for each of these things: “No buying sunglasses … no buying this … no buying that …”

And if the state gives districts more incentive to conserve — for example, less money to begin with, or the threat of competition — there wouldn’t be a need for all those express prohibitions.

Talk to Me, Sarge

Posted on by David Stokes

The reactions have been swift to the decision by the incoming governor’s administration to halt a contract with Motorola that would have led to installation of a statewide emergency communications system allowing different public safety departments to talk to each other during emergencies. This is of great interest to me, because I actually did an extremely small amount of work on this project at the request of the Department of Public Safety. (So small, in fact, that I was unaware the contract with Motorola had been signed until I read on Combest that it had been canceled.)

If this halting of the contract is merely part of the new administration’s review of everything, than it is not a big deal. It is understandable that a new administration will want to take a look at pending projects, especially during tough financial times. But the fact that times are tough also makes it more important than ever to get the best deal, and when a well-known company like Motorola comes in with a bid that is significantly below the estimated cost, you don’t want to miss the opportunity to address an important need for a very reasonable price.

I am confident the governor’s administration will see the benefits of partnering with Motorola to give public safety officers the tools they need during emergencies.

P.S. — The work I did only involved gathering information about the involvement of public-private partnerships in emergency communications around the world, and forwarding it to the Department of Public Safety. It was a great deal of fun, and — just to be clear — the state did not pay us anything for the work. We don’t do contract work for anyone, or accept government money for anything.

No Experience? No Problem!

Posted on by Josh Smith

There’s an interesting post on the Freakonomics blog about the computer game SimCity and how it relates to a new web application from the Kansas Department of Transportation.

In SimCity, you play the role of the concerned and active government planner, taxing, zoning, and highway-building your citizens into a better tomorrow. When I was younger I found playing the game very stressful; it was tough to balance an attractive tax rate that will grow the population with satisfactory services, such as sufficient power plants, highways, railways, and appropriate balances of residential, commercial, and industrial zones.

A few years ago, I realized that the reason the game was not fun for me is that I don’t and can’t know what the people really want. I just do the best I can with the limited information I get from them. If they claim to want more industrial zones, the question becomes: “Do they demand industrial zones?” If they do, and it’s efficient to provide them, someone will start some heavy industry plants, hopefully where the people want, or he will be competed out of business by a superiorly located competitor. That’s what the market is all about: many competing actors, each with their own share of limited information, discovering they can reach remarkably efficient arrangements without a central organizing plan (or planner).

The T-Link Calculator is your chance to experience the confounding, hapless charade that is central planning. Try to make predictions about things as varied and likely-outside-your-expertise as “Will existing revenue sources grow slower or faster than they have historically?” and “Will KDOT’s non-construction expenditures grow faster or slower than they have historically?” I suppose someone has to make these tough decisions for all of us, and here’s your chance to be that planner.

I don’t mean to pick on Kansas in particular. Its funding calculator is actually a fun tool that performs the task it was perhaps meant to — namely, it shows the people of Kansas and elsewhere which sorts of decisions go into the roads they use every day. It is a relic of static thinking, however. Roads, like shoes, chicken dinners, and haircuts, are an example of something that can be well handled by private enterprise. Here’s some reading, if you’re interested.

The Reality of Tax Appropriation Via Bailout Sets In

Posted on by Ryan Davisson

Chrysler’s full-page thank you advertisement to American taxpayers has provoked an unintended reaction.

As for the price of the ad, which ran in USA Today and the Wall Street Journal (among others), Judson Berger with Foxnews.com found that “A full-page ad in The Wall Street Journal runs between $206,000 and $264,000, and a full-page ad in USA Today runs between $112,000 and $217,000.” So, there is little surprise that the advertisement has spurred some critical remarks.

On the same topic, Citigroup’s $400 million contract to name the newly built Mets stadium “Citi Field” came into question as Republicans Vincent Ignizio and James Oddo suggested the stadium’s name be modified to “Citi/Taxpayer Field” in order to pay homage to those who kept the company afloat.

The FDIC recently clarified that transparency concerning federal bailout money is a requirement rather than a suggestion. Three major companies in Missouri that received financial aid include: Blue Valley Bancorp (Kansas City), which received $21.75 million; Hawthorne Bancshares Inc. (Lee’s Summit), which accepted $30.26 million; and Enterprise Financial Services Corp. (Saint Louis), which accepted $35 million.

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