Texas Thinks Outside the Lane on Transportation Planning

Posted on by David Stokes

Texas is attempting to address its long-term transportation planning needs in a fairly radical way. "Radical" often has a negative connotation, but I mean it here in a good way — sort of like how our Founding Fathers were radicals, which they were. The New York Times Sunday edition had a major article on Texas and its proposed use of public-private partnerhips to build new highways during the next few decades.

From the article, here are the basics of the plan:

The plan envisions a 4,000-mile network of new toll roads, with car and truck lanes, rail lines, and pipeline and utilities zones, to bypass congested cities and speed freight to and from Mexico.

The reasons behind the new ideas are also pretty clear:

Critics abound, but experts say Texas is addressing a problem certain to worsen nationally in coming decades: the price of gasoline may be rising but revenue from gasoline taxes is not, and with the rise of more fuel-efficient vehicles, less money is being raised for highway projects, even as traffic grows.

So transportation planners are increasingly looking to the private sector to put up construction money for toll roads in return for revenue from motorists.

“We’re relying on 1993 income for 2008 output,” said Robert Harrison, deputy director of the Center for Transportation Research at the University of Texas in Austin. “It’s unsustainable.”

The obvious question here is whether Missouri should consider similar ideas. Please note that Texas may be thinking bigger than other states, but California, Virginia, Florida, and other states are embracing public-private partnerships for transportation projects, too. In my opinion, Missouri should give very strong consideration to these ideas — although on a smaller scale — for the near future, at least.

For one thing, Missouri is not growing nearly as fast as the states listed above, so our needs are not as great as Texas’. However, we do have major transportation needs that we may be best able to address through PPPs. The success of the only toll remaining in our state, at the Lake Ozark bridge, demonstrates the opportunities available in PPPs. (I should be clear that the Lake Ozark bridge was not built as a PPP, but as it’s a toll it is comparable.)

The Show-Me Institute, along with the Reason Foundation, will be releasing a major study on this topic around the end of this month. Much more to come from us on this issue then!

What Are They Teaching Kids (and Legislators) These Days?

Posted on by Dave Roland

It appears that some students over at the University of Missouri?Columbia still have a lot to learn.  Mizzou’s student newspaper, the Maneater, is reporting (article spotted via Combest) that the Missouri Students Association and the Associated Students of the University of Missouri, concerned by the high costs of college textbooks, are pushing the General Assembly for a "Textbook Transparency Act."  The bill apparently has a head of steam behind it, because 40 representatives have signed on as co-sponsors.

The bill has three elements: one good, and two that are outright ridiculous. The good point is that it would allow students to use excess financial aid toward the purchase of textbooks, which makes plenty of sense. But the bill would also require textbook publishers and bookstores to inform professors and students (respectively) about the books’ pricing, the history of textbook revisions, and whether the books are available in other formats, as well as requiring campus bookstores to offer textbooks and their supplementary materials as
separate items — even if they would normally be sold in a bundle.

These latter two provisions are senseless for at least three reasons. First, all of this information is already available to anyone with the inclination to look it up online. Second, they imply that professors should choose their texts with more concern for the cost of the books than for the quality and currency of the material — even price-conscious students should recognize that part of what distinguishes the value of a college course is the wisdom of a professor’s selection of reading material, not just her skill as a lecturer or instructor! And finally, these requirements would force the publishers and bookstores to take on additional costs in order to generate and communicate this information to "prospective purchasers." Any additional costs for the publishers will, of necessity, end up being passed on to student purchasers in the form of higher prices!

As the veteran of eight years of higher education, I can sympathize with students suffering from textbook sticker shock. But there are many solutions out there that would provide much better results for them as consumers. For example, instead of purchasing a textbook from the bookstore, look to an online bookseller such as Amazon.com or Half.com. While local bookstores can offer immediate ownership of the texts, online sellers can usually offer better prices because of the volume in which they deal, and it only takes a few days for the books to arrive. Even better, online vendors allow non-affiliated sellers to offer their own used and new books, usually at a substantially lower price than one could find through a corporation. Another trick for the cash-strapped student is to try to locate textbooks in either the university’s library or another local library.

The bottom line here is that the information that these students are trying to highlight is already available, readily and easily, to any student wishing to look for it — as are any number of lower-cost options for purchasing textbooks. The students will actually be harming their cause if they are able successfully to enlist the legislature to impose additional burdens on publishers and bookstores, because it will only drive up costs and, therefore, prices.  A far better use of these students’ time and energy would be to educate their fellow students about wiser ways of securing the books required for their classes.

Learning Languages

Posted on by Sarah Brodsky

Schoolhouse Talk links to a story in the Columbia Missourian about 6th-grade public school students learning Chinese. The kids learned Chinese names and greetings, and ate Chinese food as part of a 12-week program:

“Our goal is to promote understanding between China and the United States," Wiedmeyer said. "Language is an important part of it. Currently Chinese is not included. So we would like to make Chinese language a regular part of public school curriculum in Columbia.”

Most public schools stick to a few languages, which usually include French, Spanish, and German. Broadening course offerings to include Chinese is a great idea. However, nobody can learn a foreign language in three months. This program is probably so limited because it’s a new idea, and traditional public schools are notoriously cautious about innovation. Compare the 12-week Chinese program with the French curriculum at this Kansas City charter school, which starts immersion in kindergarten. Charter schools have more freedom than traditional public schools to experiment and specialize, so they can start language instruction earlier. And lest you think charters just focus on the same handful of languages that have always been taught in high school, take a look at this Chinese language charter school in Massachusetts, where 75 percent of the 1st-grade curriculum is taught in Chinese. Here’s another Chinese-immersion charter school, this one in Minnesota. Other charter schools teach Arabic, Japanese, and Greek.

Exposing kids to Chinese is a nice idea, but if they really want to gain fluency, it would be wise to start a charter school around the theme.

“Other People’s Money” – StL-Style

Posted on by Justin Hauke

On Wednesday, Macy’s Department Stores announced that it will cut 850 jobs and close its Midwest regional headquarters in St. Louis.

The Post-Dispatch opined on the subject in this morning’s paper. And while the editorial has some merit (a discussion of the need for a well-educated work force, public safety, etc.), it slips into xenocentric regional pride:

Whatever the reason, the loss of a corporate headquarters does hurt the region, and the hurt goes beyond the loss of jobs. There’s a loss of regional pride and bragging rights. Local development officials have a tougher job in recruiting new business for St. Louis. […]

Cities may score an occasional coup by luring a factory or headquarters from out of town. But most regional economic success is home-grown. It means spawning small companies and helping them grow into large ones.

No, no, no. Wrong. Cities shouldn’t promote “home-grown” industries for the sole purpose of familiarity and pride (I mean, look at Detroit). It’s the city’s responsibility to promote a healthy business environment, one that’s fair and competitive. We don’t live in a compartmentalized world of “regional economic success.” Think of the increases in standards of living during the past 50 years. How lucky are the citizens of St. Louis that they aren’t forced to rely solely on their own regional production? The mobility of capital and labor has made St. Louis a much more vibrant and economically healthy place than it ever was before. The increases in material wealth, broad home ownership, the availability of cheap food, clothing, and consumer electronics: Were those things obtained from erecting tall city walls to keep the rest of the world out? Or did the increase in competition from across the world bring prosperity to all?

What ever happened to the fur industry and river shipping? The railroad and meat packing? The buggy builders and the blacksmiths? Is St. Louis worse off because those jobs are now gone? What about the pride of those workers and the city’s roots?

Industries are born and industries die. Jobs are lost and jobs are created. That’s part of growth. The St. Louis region netted 25,000 new jobs last year, a 2 percent gain. Those jobs were created because capital was allocated to the areas where it was most productive, not because bureaucrats squandered it into industries slowly bleeding to death on taxpayer subsidies.

Do I sympathize with those who lost their jobs? Of course, we all should. But how lucky are they that they live in a world where competition ensures that their family’s next grocery bill will be only $100 instead of $400? They live in a world that encourages growth — a world which will offer them new jobs and opportunities.

In summary, I end with a quote from the classic 1991 film “Other People’s Money”:

“This company is dead. I didn’t kill it. Don’t blame me. It was dead when I got here. […] Let’s have the intelligence, let’s have the decency to sign the death certificate, collect the insurance, and invest in something with a future. ‘Ah, but we can’t,’ goes the prayer. ‘We can’t because we have responsibility, a responsibility to our employees, to our community. What will happen to them?’ I got two words for that: Who cares? Care about them? Why? They didn’t care about you. They sucked you dry. You have no responsibility to them. Take the money. Invest it somewhere else. Maybe, maybe you’ll get lucky and it’ll be used productively. And if it is, you’ll create new jobs and provide a service for the economy and, God forbid, even make a few bucks for yourselves.”

Here We Go Again

Posted on by Sarah Brodsky

Some people scoffed when I complained last year that encouraging schoolchildren to lobby will lead to a lot of frivolous legislation. So I wonder what they think about this:

In their quest to designate the ice cream cone as Missouri’s official desert [sic], a group of 19 St. Louis-area students made their case before a Senate committee Wednesday. […]

Besides the dairy association, the Missouri Restaurant Association, the Division of Tourism and the owner of several Cold Stone ice cream shops also spoke in favor of the measure.

Back in the days when kids’ bills were limited to animals, nobody in particular stood to benefit. After all, the box turtles didn’t care. Now that kids have broadened their efforts, real industries are looking to benefit. Some rent-seeking is an inevitable part of politics, but the restaurant and tourim associations should pay full-grown professionals to do their lobbying work.

Stokes Posts Bail

Posted on by David Stokes

More accurately, the title of this entry should read, "Stokes Posts Blog Post About Bail Bondsmen," but titles should be quick and to the point, so I’m told. There is an article today in the Columbia Daily Tribune (link via John Combest) about a controversial bail posting in Boone County, which follows up on a New York Times article about the entire bail-bond industry last week. Taken together, they provide a very interesting look at a unique industry — one that, to its eternal credit, has lent itself to many fine movies.

The controversy in the Boone County case involved several issues: The bonding agent lacked a license to work in Boone County (not a big deal, in my opinion); the bonding company itself did not have the assets to guarantee such a large bond (a very big deal, obviously); and the unusual structure through which the family of the accused agreed to pay the bonding company (I have no idea whether this is a big deal). To sum it up quickly, the court rejected the bond after the accused was released, and he was taken back into custody at a higher bond. Because the suspect is accused of a heinous crime — murder — I have no problem with the higher bond requirement.

The Times article focuses on the big scheme of things in the bonding world, and contains a number of quotes that could have been written by somebody at a free-market think tank. Here are a couple:

The system costs taxpayers nothing, [Professional Bail Agents of the United States spokesman Bill] Kreins said, and it is exceptionally effective at ensuring that defendants appear for court. […]

“Here’s what everybody forgets,” [bail bondsman Wayne Spath] said. “The taxpayers have to pay for these programs. Why should they pay for them? Why should they? When we can provide the same service for free.”

Sounds good to me. But this is the key question: Does the system work? From the article (emphasis added, for all quotations throughout this post):

According to the Justice Department and academic studies, the clients of commercial bail bond agencies are more likely to appear for court in the first place and more likely to be captured if they flee than those released under other forms of supervision.

Why does the system work?

That may be because bail bond companies have financial incentives and choose their clients carefully.

Wait a minute … are they saying that incentives work? There are, of course, critics of the industry:

“The bail bond system is rife with corruption,” said Joshua Marquis, the district attorney in Clatsop County, Ore. Since bond companies do not compete on price, they have every incentive to collude with lawyers, the police, jail
officials and even judges to make sure that bail is high and that
attractive clients are funneled to them.

Mr. Kreins, the industry spokesman, acknowledged scandals in Illinois, where “basically all the agents were in collusion with the judges,” and in Louisiana, where sheriffs were also in the mix.

The first part is a legitimate critique, if it’s true. While the amount of bail set should not be a matter of debate or competition, the fee percent charged by various bail bondsmen can certainly fluctuate, unless governments regulate that fee as part of the licensing requirements? If that is the reason agents don’t compete on price, it’s the regulation that should be gotten rid of — not the industry. As for the second critique of corruption in Illinois and Louisiana, those two states have corruption even in the kindergarten industry, along with everything else. Corruption in those two states (plus Rhode Island) is a problem with the entire system, not just one industry.

Since the critique comes from Oregon, what does the article say has happened since Oregon banned the bail bond industry?

Mr. Marquis, the Oregon prosecutor, said doing away with commercial bonds had affected the justice system in a negative way as well. “The fact of the matter is,” he said, “that in states like Oregon the failure-to-appear rate has skyrocketed.”

What does the rest of the world do (except for the Philippines, which uses our system, certainly a leftover from colonialism)? Please trust that the inserted sarcastic comments in brackets below are mine, and were not in the original article:

Some simply keep defendants in jail until trial [oh, that’s a much better solution for someone who is poor and genuinely innocent]. Others ask defendants to promise to turn up for trial [’cause a criminal would’nt lie]. Some make failure to appear a separate crime [I am sure someone facing 20 years is very worried about the addition of a failure-to-appear charge]. Some impose strict conditions on release, like reporting to the police frequently [I can’t see any possible way around that, like stopping at the police station while on your way to the bus station]. Some make defendants liable for a given sum should they fail to appear but do not collect it up front [see above comment on separate crime]. Others require a deposit in cash from the defendant, family members or friends, which is returned when the defendant appears. [Because taking money from a poor family is preferable to taking it from a for-profit business? What the hell?]

There are very good, historical reasons why our system evolved as it did. The Times article is outstanding, and it goes through those reasons. But it only hints at the fact that our bail system — like our overall criminal system — is much more favorable than the systems in the rest of the world toward people accused, but not yet convicted, of a crime. The rights to counsel, the presumption of innocence, the bail system itself, and many more aspects are all indicative of a system that favors the rights of the people, until those rights are abrogated by a conviction in court — not the other way around.

Plus, Charles Grodin was lying when he said he wasn’t able to fly. That part was funny.

Excellent Work from the Columbia Daily Tribune

Posted on by Dave Roland

I’m sorry to have missed this story over the weekend, but it’s definitely worth noting. Janese Heavin lifted the curtain on payrolls in the Columbia Public Schools, revealing part of the reason the district must deal with a $10.35 million deficit. This story has led to some lively comments on her Class Notes blog.

The district, which serves about 17,000 students, currently employs 246 secretaries, or one for every 69 students, and pays 18 administrators annual salaries of more than $100,000, including Superintendent Phyllis Chase’s whopping $200,340 salary (not including a $7,200 transportation allowance, insurance, retirement benefits, and a district cell phone). All told, 125 district employees make more than the maximum teacher salary of $66,478. In order for teachers to reach that maximum — which is roughly one-third of Superintendent Chase’s base salary — they must have at least three decades of experience, plus a doctorate (or its equivalent).

A quick look at DESE’s statistics shows that the Columbia School District spent $206.1 million last year. That’s the equivalent of $12,382.50 per student, one of the highest per-student expenditures in the state. I kind of doubt that these administrators’ gigantic salaries — or the plethora of secretaries — would add up to $10.35 million worth of waste, but it doesn’t seem like a huge stretch to imagine that the same folks willing to spend so extravagantly on these positions might have added to the deficit by splurging in a few other areas. Now the city’s taxpayers are being asked to shoulder the burden of a substantial tax increase so that the city can put even more money in the hands of those who have put the district in its dire financial straits.

I’d say that Ms. Heavin’s work certainly gives Columbia’s voters something to think about.

Election Week: The Perils of Frontloading

Posted on by Nicholas Loyal

This morning, it was all supposed to be over. Two candidates were promised to rise above the masses and act as standard-bearers going into the convention. The country was supposed to have spoken in a collective voice of approval, and the long trek of candidacy was to begin.

Turns out we’re right where we were yesterday, only it’s Missouri — so the weather’s different.

The frontloading of primaries by a number of states (including Missouri) to form a Super-Duper Tuesday backfired yesterday, as the collective need for half the country to stay relevant in the competition did nothing more than confirm the only fact that we already knew: this election isn’t going to be over until the first Tuesday in November.

In fact, Time has posted an interesting article that claims rather than keep states relevant, the frontloading of primaries onto a single, oppressively early date has actually taken them out of the decisionmaking process (emphasis added):

[A]ll the big states that rushed into the void to hold early primaries
may turn out to have spoken too soon. Instead of making themselves
kingmakers, their divided result has abdicated the power to the states
that waited their turn. The next major contests include Maryland and
Virginia, and then Ohio, Texas and Pennsylvania, followed by what could
be a slow and grueling crawl to the convention.

Ohio and Texas this year will go to the polls to select their candidates on March 4, making them — rather than the 25 states and territories that polled yesterday — the new drivers of this campaign season.

The ironic thing, though, is that these contests on March 4 are falling on almost exactly the same date that the Missouri caucuses fell (March 7 in 1996 and 2000) before the state switched to a primary system so Missouri voters would have more of a say on the national stage. Would Missouri voters have exerted their influence with a mightier hand if they hadn’t been swept up in frontloading fever?

Primaries shouldn’t all be on one day, they should be spread to allow candidates to legitimately campaign throughout the entire country, while allowing all states a chance to contribute their legitimate say. Frontloading alienates voters, lengthens the final stage of the campaign to levels of ridiculous length and expense, and forces candidates to present themselves in an unrealistic fashion in the quest for one day’s bounty of delegates. There has been much talk this week about Missouri’s status as a bellwether state. Let’s hope that state officials keep this status in mind when scheduling future contests so that the Show-Me spirit doesn’t get lost in the pack.

The Utility of Efficiency

Posted on by Eric D. Dixon

At the risk of beating a dead horse, for the record, I’d like to disagree with Justin’s disagreement with my "focus on aggregate utility as a value judgment." I think that Justin’s argument stemmed in part from my departure from Michael Pakko’s original article on smoking bans in Missouri. I didn’t intend to make it seem as though my blog entry was a summation of Pakko’s ideas — far from it. I merely used that article as a jumping-off point for a few further ideas. After the second paragraph, my own blog entry about smoking bans had nothing to do with Pakko’s excellent article.

My objection to Justin’s objection is that using aggregate utility — or "efficiency" — as a method of measuring a policy’s worth is not particularly controversial among economists. As the economist David Friedman pointed out, it’s an old solution to the problem of measuring a policy’s overall cost or benefit to the people it affects:

A little over a hundred years ago, an economist named Alfred Marshall proposed a solution to that problem. It is not a very good solution. It is merely, for many although not all purposes, better than any alternative that anyone has come up with since. The result is that economists, in both law schools and economics departments, continue to use Marshall’s solution, sometimes concealed behind later and (in my view) less satisfactory explanations and defenses.

Marshall’s argument starts by considering some change—the imposition or abolition of a tariff, a revision of the tax code, a shift in tort law from strict liability to negligence. The result of the change is to make some people better off and some worse off. In principle, one could measure the magnitude of the effects by asking each person affected how much he would, if necessary, pay to get the benefit (if the change made him better off) or prevent the loss (if it made him worse off). If the sum was positive, if total gains were larger than total losses, we would describe the change as an economic improvement; if it was negative, an economic worsening.

Several things are worth noticing about this way of evaluating changes. One is that we are accepting each person’s own judgement of the value to him of things that affect him. In measuring the effect of drug legalization on heroin addicts we ask not whether we think they are better off with legal access to heroin but whether they think they are—how much each addict would pay, if necessary, to have heroin made legal. A second is that we are comparing effects on different people using dollars as our common unit—not dollars actually paid out or received, but dollars as a common measure of value, a way of putting all costs and benefits on the same scale.

Continue reading “The Utility of Efficiency”

Support Us

The work of the Show-Me Institute would not be possible without the generous support of people who are inspired by the vision of liberty and free enterprise. We hope you will join our efforts and become a Show-Me Institute sponsor.

Donate
Man on Horse Charging