Ready, Fire, Aim!

Posted on by David Stokes

Hits and misses from around Missouri newspapers, blogs, and elsewhere today:

  • Education Week has a story on how the increased enrollment in charter schools across the country has hurt enrollment at Catholic schools. We have certainly seen this in St. Louis, with the controversial decision to close several city parishes and schools in recent years. I think this is one of the things that just happens. As parents get a less expensive (free), quality option for their children’s educations, many low-income people are going to take that. Change is often good, but nobody said it was always easy.
  • The Arch City Chronicle is reporting about a bill that would take away the driver’s licenses of teenagers not in school. While I certainly understand the use of incentives to keep kids in school, and none is more powerful than a driver’s license, I would recommend to you Eric Dixon’s post the other day on unintended consequences. A fairly obvious unintended consequence of this bill would be to limit the employment opportunities for teenagers who have left school. It would be limited to jobs along public transit routes, which don’t require a car. Now, that may be a decent number of jobs, but further limiting opportunities for people who are already limiting their own opportunities might not be such a good thing.
  • Missourinet has a story on the Missouri House of Representatives moving to restore the deductibility of property taxes for outstate taxpayers who work in Missouri. This is an excellent, and unanimous, move by the House, and if it passes overall it will head off retaliatory moves by other states. This is very important to me, because I commute here to work from Singapore.
  • Finally, in a contender for stupidest idea of the year, the Post-Dispatch is reporting that Illinois is considering lowering its voting age to 17. However, an even worse idea is contained within the article:

Alex Koroknay-Palicz, executive director of the D.C.-based National Youth Rights Association, said his group is pushing for the voting age to be 16 across the country.

"(They’re) informed, active and intelligent, and they deserve a voice in our democracy just as much as everyone else," he said.

Koroknay-Palicz said 16- and 17-year-olds are typically more stable than an 18-year-old. Eighteen-year-olds have more on their plate — starting college, getting a job or moving away from home, he said.

"The trouble is, though, that when you give people the right to vote at 18, it’s actually a bad time to start voting because you’re going off to college or getting on with your life," Koroknay-Palicz said.

Seriously, is this a joke? Is there really a National Youth Rights Association? How are they funded? Do they get an allowance from other lobbying groups? As for being informed, active, and intelligent, when I was 16 I was none of the three, and I now work at a think tank!

If you don’t have a voice in how your own house is run, you don’t need a voice in how the country is run. This guy’s statements remind me of the end of Wild In The Streets, after the 20-year-old dictator insults a kid, and the 10-year old looks in the camera and says, "We’re gonna kill everyone over 12." (And yes, I deserve enormous praise for not only being able to reference this camp classic, but to paraphrase it from memory despite only seeing it once about 15 years ago.)

Alex’s statements just get more absurd. His arguments that 18 is a bad time to start voting could just as easily serve as a reason to take voting rights away from senior citizens. Switch "…starting college, getting a job, or moving away from home," to "retiring, collecting social security, and moving into an assisted care facility," and wham!, it now makes the point that there is too much change in your 70s for you to vote. Just unbelievable.

A Car for Me? No, a Car for We

Posted on by Nicholas Loyal

In an effort to help lower emissions and reduce the congestion associated with the Highway 40 shutdown, both downtown St. Louis and Washington University recently signed on to a new car-sharing program by Clayton’s own Enterprise Rent-a-Car. The program, dubbed WeCar, allows subscribers (for a small hourly fee) to briefly rent hybrid Enterprise vehicles to use for errands throughout the downtown area.

Although I was skeptical of this program at first (most likely because of the fact that I’ve never seen two of the Wash U. vehicles leave their spaces in front of Mallinckrodt Center), further thought has led me to believe that the prevailing joy of this Post-Dispatch piece might not be misguided after all.

WeCar represents the efforts of a private company using its resources to correct a social and economic problem. Enterprise, noting that the Highway 40 shutdown would create monumental traffic congestion in the St. Louis area, is offering a fair and convenient service to St. Louis residents that will make their lives easier. In turn, the company itself earns revenue from the rental fees for the vehicles.

The best part about this, though, is that it is a market correction to a civic problem. A car sharing service may not lower congestion all that much, but it certainly costs taxpayers less than the costs associated with expansion of, say, St. Louis’ Metrolink light-rail system.

I know sometimes David Stokes and I don’t agree on things in this forum, but this whole privatization thing might not be that bad of an idea after all.

Some Senators Should Stop the Stupid Stimulus

Posted on by David Stokes

Ahh, alliteration, the simple pleasure of a poetic mind. This post really doesn’t have anything to do with the Senate — that just fit nicely in the title. I have been looking for an opportunity to connect the proposed federal stimulus plan with a Missouri story and blog on it, and the Kansas City Star has given me the opening today. The Star has an article on the problems that the federal stimulus plan will cause Missouri and Kansas. The headline, though — which is also quite alliterative — made it sound like the stimulus plan would hurt the people of the states. But as I read the article, it became clear that the focus of it is on hurting state government budgets, which I care far less about. Nonetheless, I have my opening …

There are numerous reasons why the stimulus plan is unnecessary and improper, and it’s easy to find excellent criticisms of it on the web. I think my favorite line comes from one of the writers in the second link:

“Forget the ‘stimulus’ label, this is merely additional deficit spending,” wrote Dartmouth College economics professor Andrew Samwick, on his blog.

Then there is the fairly obvious disconnect between the fact that Americans don’t save enough money, with the government’s encouragement to spend this $600 giveaway as fast as you can. How about the idea that, since the government never truly knows until a few months after the fact when our economy is in or out of a recession, we could well be on our way out of the recession by the time these checks hit — making it even more of a worthless giveaway?

My primary objection, though, is with the principle that it is the government’s job to manage our economy and to take care of people going through troubles. The government often worsens economic problems when it jumps in. (With some exceptions — and I don’t mean the Federal Reserve here, I mean the government.) I recommend "The Forgotten Man," by Amity Shlaes, for a great discussion of this subject. For all the new programs and taxes and spending, the New Deal did not get us out of the Depression. I would think most people should know that by now, but alas …

As for the article in the Star, though, I think I found the only good thing the stimulus package might do. Since the depreciation schedules would shorten for businesses, state governments might lose significant income, according to the article. If this happens (emphasis added):

“It becomes all about priorities,” Icet said. “After increased funding for K-12 education and Medicaid, you’ve got a few options, but they are very, very limited. So a lot of new programs you simply might not fund.”

So the stimulus plan might prevent the funding of new state government programs? I take back everything I said. Sounds great to me!

Campaign Finance Regulations Eviscerate Free Speech

Posted on by Eric D. Dixon

I can’t let Nick’s post in favor of campaign finance reform pass without rebuttal. It can be easy to miss the connection between free speech and direct contributions to campaign efforts, so it’s understandable that many people don’t think of it as a free speech issue. That aside, the Bipartisan Campaign Reform Act (BCRA, aka McCain-Feingold) was one of the most blatantly unconstitutional pieces of legislation ever to pass the initial scrutiny of all three branches of government. State-based efforts to regulate campaign funding aren’t as wide-ranging, but are still almost universally terrible ideas.

Nick assures us that "The goal of campaign finance reform isn’t to destroy the 1st Amendment," which is undoubtedly true, but beside the point — destruction of the First Amendment is not the goal, it’s a side effect. Even though killing free speech isn’t the overt purpose of campaign finance reform, we can’t judge legislation solely on what it intends. The need to ferret out unintended consequences is one of the most important lessons of economics.

But really, the most obvious restrictions aren’t even unintended. The BCRA explicitly banned broadcast ads mentioning the name of a federal candidate from appearing within 60 days of a general election, or 30 days of a primary. This notwithstanding the fact that the importance of unrestricted political speech is a primary reason we have the First Amendment in the first place. And, as Jonathan Rauch pointed out, "Educating voters influences them, which is the whole point. ‘Electioneering’ is not distinguishable from other forms of political speech, even in principle."

The real driving force of the campaign finance reform movement has been politicians who want to be protected from competition. Make no mistake, campaign finance reform doesn’t level the playing field; it stacks the deck even further in favor of incumbents by restricting ordinary people from speaking out against those in power — those who already have plenty of exposure in the public eye on their own terms. Ryan Sager of the New York Sun has it exactly right: "Money has never been the issue. Cleansing our speech of impure thoughts about politicians is the real agenda."

Fans of campaign finance reform inevitably respond that "money isn’t speech," or that nobody is prevented from speaking, it’s just that groups are prevented from buying airtime. Semantic issues aside, I don’t know of anybody who ever claimed that money is speech. Money buys many things, and one of them is access to an audience. I’ve said it before, and I’ll say it again: Without the freedom to pursue such an audience, the freedom to speak is practically worthless. How much regulation will it take before advocates of campaign finance reform come to their senses and realize that the laws they favor promote real, actual government-mandated censorship? How about a law banning personal conversations that mention a political candidate within 60 days of an election? Maybe not: "You’re still free to speak. You can stand inside a locked closet and shout about whatever you want, to your heart’s content. Relax — the First Amendment is just fine."

For those who still think something needs to be done to "fix" political speech, there are solutions available that don’t happen to tear parts of the Constitution to shreds. Roger Pilon, director of the Cato Institute’s Center for Constitutional Studies, provides a guide for real reform (emphasis added):

[F]or some time now we have heard a chorus of calls in Congress and in the nation for campaign finance "reforms" that would almost certainly compromise political speech and hence the First Amendment. At a general level, I join that chorus, for there is something fundamentally wrong with the way political campaigns in America today are financed. But the reforms I would advocate would take us in a very different direction than that charted by most others in the chorus. Indeed, many of the problems that most reformers see in our present arrangements are the products of earlier reforms. Thus, if we are serious about addressing those problems we should look first to those earlier reforms. Far from needing further restrictions on political speech, we need fewer. Deregulation not only would be consistent with the Constitution but would solve the problems regulation brought into being. Here, as in so many other areas, the Founders had the better of it when they set us on a course of freedom rather than regulation. […]

There is a measure, however, that will withstand judicial scrutiny, the aptly-named "Doolittle bill," introduced in the 105th Congress as H.R. 965, the "Citizen Legislature and Political Freedom Act," sponsored by Rep. John Doolittle and co-sponsored by 70 other members of the House. In essence, that bill would remove the campaign contribution limits now in place and require instead that candidates and parties promptly report their financial transactions to the Federal Election Commission for disclosure to the public. The bill would, in short, deregulate the process and open it up to the public. Its simplicity is its virtue.

I’ve already spent much more time on this blog entry than I should have, so I’ll stop here for now, and let my colleague David Stokes tell everybody tomorrow why public funding of elections is one of the worst ideas under the sun.

Bit by Bit

Posted on by Nicholas Loyal

The Post-Dispatch ran an article this morning about a pair of bills recently introduced in the General Assembly that would seek to drastically change Missouri’s policies on political contributions for state contests. The first, introduced by Senate Majority Leader Charlie Shields (R–St. Joseph) seeks to eliminate the contribution limits established by Missouri voters after a 1994 petition. The second, brought by Sen. Jeff Smith (D–St. Louis) takes a more populist view by instead promoting a system of public funding revolving around a number of small donations.

Shield’s bill is the latest in a decade-long back-and-forth debate between supporters and opponents of campaign finance limits that has already seen a U.S. Supreme Court decision (that helped pave the way for a certain piece of federal legislation that I’m rather fond of), and a Missouri Supreme Court decision. Removing limits, supporters claim, will actually increase transparency by eliminating the need for wealthy donors to shuffle money through PACs. This argument, though, has been echoed for years. Much more exciting, in this author’s opinion, is Sen. Smith’s idea:

"[Smith] wants to ‘draw a contrast’ between special interest-funded campaigns
and his model, where candidates would get public funding if they
garnered a certain number of $5 donations."

The goal of campaign finance reform isn’t to destroy the 1st Amendment (although this may be disputed by some of my colleagues). Instead, limits exist in order to ensure that the voices of a few with extraordinary means don’t drown out the words of others who can’t (financially) shout as loud. Smith’s bill hopes to correct this disparity by giving those who have proven their support through small donations the public financing they need to compete with candidates receiving the backing of a few massive donors. Although public financing has often been disputed for its ineffectiveness in campaigns, I think the populist nature of Smith’s bill does more to promote the idea of free speech than the removal of any limits ever could.

It’s a good idea. It’s a shame even he doesn’t think it will pass.

Beyond Ivory-Tower Dome: Two Men Enter, One Man Leaves

Posted on by Justin Hauke

I agree with Dave’s post about the lunacy of the "Textbook Transparency Act." There are obviously additional options out there for the savvy consumer. And I think student groups should focus on educating students about those options, rather than turning to the government.

But one thing I think Dave overlooks is that the college textbook market encourages collusion between the university and professors. For example, call me a cynic, but I’m inclined to believe that many professors choose textbooks based on the book’s associated royalties, rather than perceived academic quality (in economics parlance, it’s a principle/agent problem; see, I can use $2 words, too). I can’t count the number of times that my “required textbooks” have been authored, coauthored, edited, or refereed by the professor teaching the course. Either that, or the author is the professor’s dissertation advisor, faculty co-member, or otherwise within six degrees of separation from Kevin Bacon.

In fact, the one piece of the bill Dave supported was the part I was most wary about — financial aid for textbooks. That’s like ringing the dinner bell, in my opinion. You mean professors can rack up royalties by passing the bill through financial aid and onto the taxpayers subsidizing higher education? Even the Marxists would enjoy that kind of profit-seeking.

I should also mention the fact that college bookstores only sell the most recent editions of required textbooks. These editions are generally identical to previous editions, but sell at a premium (and, of course, the secondary market doesn’t include royalties … I wonder why colleges only sell new editions …). I actually think including a revision history would be a good idea, from a consumer-information perspective. You’d then know whether the premium price for the most recent edition was worth the cost. Of course, requiring this disclosure would also drive up textbook costs, so it’s kind of a silly provision (and it probably should be handled by the student groups anyway … or just go online, people, geez …).

Anyway, I agree that the bill is a little misguided. But I would not consider the college textbook market to be a true competitive market, either. Kind of like OPEC, but with actual pricing power.

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.

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