Ohh, The Audacity…

To the surprise of nobody who has been alive in St. Louis County for the past two years, Novus Development and its president, Jonathan Browne, are having trouble with another project.  The Post-Dispatch has a short article on his plans in Rock Hill with a wonderful little nugget:

"Browne said he met with residents to determine why they hadn’t signed contracts to sell their properties and learned they wanted more money."

How dare they!!!  In America of all places!  Who do these people think they are trying to get the most money possible for their investment?  So what does the very sinkable Mr. Browne do?  Negotiate further?  Counteroffer?  Reason with them?  Of course not.  This is 2007, so his first choice is:

"Novus President Jonathan Browne had said his company needed an additional $7 million in tax incentives."

Go to the city and demand more money from taxpayers!  Wisely, the Rock Hill Board of Alderman has rejected this shameless demand.  Now bids are again being considered to redevelop the northwest corner of Rock Hill aka McKnight and Manchester.  Whatever the new plan is, I hope the incredibly succesfull restaurant stays.  As for other possible tenants, I can think of one company that would be absolutely perfect there.      

You Can’t Make a Silk Purse from a Sow’s Earmarks

Claire McCaskill, Missouri’s freshman senator, has been keeping her campaign promise to fight congressional earmarks, the budget process by which lawmakers funnel federal funds into pet projects back home:

Claire McCaskill campaigned against congressional earmarks last year when she ran for the Senate.

Talk about counterintuitive politics: Passing up the chance to funnel millions into your state for roads, buildings and other projects — and claim the political bragging rights — is a rare thing on Capitol Hill.

But it turns out she meant it.

Since January, the freshman Democrat from Missouri has received about 200 pleas for money from all over the state and turned down every one of them.

She thinks that using earmarks — whereby members of Congress anonymously tuck appropriations into bills without going through public hearings — is simply not the way to govern: “I honestly believe we can find a way to make serious investments without this secret, behind-closed-door process.”

It can be easy for people who applaud fiscal responsibility to lose sight of principle when it comes to the  pork projects they benefit from personally. When federal coffers are tapped for state or local spending, we don’t see the immediate cost. It’s not our money, we may tell ourselves — not most of it, anyway — so this form of government largesse seems like free cash.

But the money comes from taxpayers all the same, and when every state receives some form of funding from congressional earmarks, we all consistently pay for the frivolous spending of others. The pork windfalls we receive from earmarks are a drop in the bucket compared to what we actually pay.

Economist David D. Friedman provided an ingenious illustration for how congressional earmarks work in his book The Machinery of Freedom:

Special interest politics is a simple game. A hundred people sit in a circle, each with his pocket full of pennies. A politician walks around the outside of the circle, taking a penny from each person. No one minds; who cares about a penny? When he has gotten all the way around the circle, the politician throws fifty cents down in front of one person, who is overjoyed at the unexpected windfall. The process is repeated, ending with a different person. After a hundred rounds everyone is a hundred cents poorer, fifty cents richer, and happy.

We should congratulate McCaskill for sticking to her principles in her fight against congressional earmarks. Some Missourians might feel the pinch as their favored federal pork projects dry up, but this is a cost worth bearing to try to bring systemic reform to the appropriations process. The Springfield News-Leader agrees:

So prepare yourselves, Missourians. If McCaskill won’t participate in the traditional earmark process, that might mean the state takes a short-term financial hit. We think that will be worth it if the end game is real reform that involves Congress learning how to control its own spending.

Quality Jobs, Questionable TIFS, and Cameras, Cameras, Cameras

Over at the Columbia Daily Tribune they have a depressing article about the corruption of a bill to expand the otherwise top-notch "Quality jobs" program blogged about here back in February. The bill was initially intended to expand the program by increasing the available funds. Unfortunately, a host of other pet projects, TIF proposals, and other fun political handouts were added, creating another bloated piece of political hackery likely to have a difficult time making it through the legislature.

Particularly troublesome are the TIF provisions. This alleged tool for economic growth has been used quite often in STL, most notably in the construction of the new Busch Stadium and the promised Ballpark Village development. This means of spurring growth in struggling parts of the city has been touted as the most important tool cities have for this purpose. However, the policy is not without its critics, and one particular study about the practice in Chicago has called into question the cost-effectiveness of the measure.

I would argue that the best means for a city to spur growth lies not in its ability to hand out tax abatements to specific developers, but rather in its ability to provide an overall fertile business climate. Providing good infrastructure, secure property rights, and strong returns on investment (i.e. lowering the costs of doing business for everyone) encourages balanced and fair competition, whereas TIF projects only serve to spur the further erosion of the barrier between public officials and private interests by encouraging the latter to cozy up to the former in hopes of securing the TIF privelege.

There are two things MO legislators need to do: first, they need to untangle the "Quality Jobs" legislation from everything else, and make sure this program is as strong and effective as it can possibly be. Second, they need to seriously think about the real costs and benefits of TIF spending as relates to MO, the political convenience of such projects aside (I’m not holding my breath on that last point).

On an otherwise unrelated note, big props to my colleague Mr. Stokes on his post regarding gov’t surveillance, particularly those cameras atop every intersection. I’m pretty sure the standard of justice is "innocent until proven guilty." Putting cameras at every intersection undermines this principle and replaces it with the Orwellian maxim that we’re all guilty, and that justice is only a matter of who gets caught. Big Brother is watching…

How Free Are We? Part 2

On April 6, I wrote about the creeping state control of our lives in the name of safety.  I was pleased with efforts to repeal the motorcycle helmet law and oppostion to a primary seat belt law allowing cops to ticket people for not wearing a seat belt without some other cause for the pullover.  Anyway, I now stand to fight (in my own web way) again.  The State Senate has unfortunately passed a primary seat belt law, giving officers another way to fine us for not living our lives as the state tells us to.  Well, not mine really, as I am pretty good about wearing my seat belt, but the larger issue is what is important here.  I now hope the state House of Representatives can continue to fight this off. 

In similarly upsetting news, the City of St. Louis is now operating red-light cameras at a few intersections.  I am amazed these things are allowed from a constitutional perspective, but I assume that issue has been settled already.  I know several county municipalities have installed them as well, so thankfully local government can now surveill us as we merely drive the streets.  While I normally oppose running red lights, I have major issues with turning law-enforcement authority over to for-profit enterprises.  And if I, as someone whose main role at a think tank is researching and advocating government privatization and consolidation, think that, then I have to imagine others out there share that view.  Its like if Timothy Leary told you to avoid drugs because they’re dangerous or if Matty Alou told young hitters to take more pitches.  Red Light cameras are not about safety for government – they are about collecting revenue using safety as a cheap excuse that too many people but into.      

More Competition for Doctors

A bill to allow rural patients to be treated by physician assistants awaits the governor’s signature:

The bill allows physician assistants, or PAs, to treat patients unsupervised 34 percent of the time as long as their supervising doctor is on site 66 percent of the time.[..]

Without guidelines this year, the Board of Healing Arts would have required PAs to work with the supervising physician 100 percent of the time, effective in August. That would have been the most restrictive law in the country, PA advocates said.

Where did they get the 34-66 ratio from? Is that much safer or more protective of public welfare than 40-60 or 50-50?

As with the midwives, the opponents of the legislation are not outraged patients, but associations of medical doctors that don’t want competition. If rural residents don’t want to be treated by anyone but MDs, they can spend extra time and money for that. Allowing people to be treated by PAs gives them more options without forcing anyone to give up other kinds of medical care.

Good Sense in Jefferson City

Jefferson City officials have, at least in one, minor way, exhibited good economics, good tax policy and good common sense in their recent decision to remove tax credits for one Columbia company.  The tax credits were authorized in 1990 to encourage recycling, but as often happens with good ideas over time, the cost of recycling has gotten comparatively less expensive and the incentive is no longer needed, if indeed it ever really was.  So the legislators have now done that rarest of things – they have killed a silly, wasteful, unnecessary government program.  Sen. Luann Ridgeway gets a very bloggy shout out for summing up good policy theory when she said: "Tax credits should be designed to achieve broad policy goals, not to help one company." She is increasingly convinced that tax credits amount to "boutique legislation that’s written for the few at the expense of the many.’"

Refreshing and encouraging to hear. 

 

Disappointing Reporting in the Post

I didn’t care for the St. Louis Post-Dispatch‘s article on eminent domain activist Jim Roos. I have to admit I take the article personally because I’ve known Roos for two years and have found him to be one of the hardest-working advocates for the rights of ordinary people I’ve ever met.

The story is a “he said, she said” story in which city officials’ trumped-up allegations against Roos are reported alongside Roos’s responses. Since most readers don’t know any of the parties and aren’t going to do research for themselves, this gives the (erroneous, in my view) impression that there must be something shady about Roos or the Post wouldn’t have published such a critical article. Here’s an example:
 

Roos’ properties have drawn complaints for graffiti and trash buildup. This year alone, city inspectors cited Roos’ properties for several infractions, including broken or missing window panes, a collapsed fence, a collapsed porch, a partly collapsed wall and improper display of address numbers.

Even the “End Eminent Domain Abuse” mural, which can be seen heading north where Gravois Avenue becomes Tucker Boulevard, has been cited. Last month, the Department of Public Safety issued Roos a notice for having an “illegal sign” and ordered it removed.

Other than the mural, Roos says that the buildings cited by the city had the violations before he purchased them. Roos says his rental units are “decent,” though not glamorous.

“It’s ordinary housing,” Roos said. “But durable, safe.”

Is Roos is telling the truth that his citations are only for buildings he’s recently purchased? I’m willing to bet he is (which would be an effective rebuttal to Roddy’s insinuation that he’s a slumlord) but the reporter didn’t check, something I expect he could have done fairly easily. Instead, he just repeated Roddy’s allegations and left the reader with the impression that Roos is probably up to something shady.

The story also glosses over why Roos is running housing in slums in the first place. Like most cities, Saint Louis has a shortage of affordable housing. Low income people have difficulty finding housing that’s “durable, safe”—and affordable. Roos provides such housing. And having seen both his office and his home, I can say with confidence he’s not getting rich in the process.

So what does the city do to help out?
 

A city-backed commission, led by the Missouri Botanical Garden, used eminent domain to acquire nearly two dozen buildings Roos owned or managed in the McRee Town neighborhood.

That’s when Roos said he first became a “victim.” To hear him tell it, McRee Town, left alone, would have been the next Soulard.

Not so, says veteran Alderman Joe Roddy.

“It was a neighborhood in a free fall,” said Roddy, who cited the area’s high crime rate.

Today, the neighborhood is home to a suburban-style subdivision — Botanical Heights, with homes listing for more than $300,000 — which Roddy points to as evidence that eminent domain can work.

That sounds lovely except for one little detail: poor people can’t afford $300,000 homes. The city has “solved” the problem of poverty in McRee town by forcing the poor to move to a different neighborhood. I’m sure that counts as “progress” for Mr. Roddy, because now they’re probably out of his ward and no longer his problem. But it’s not progress for the city as a whole. In fact it’s the opposite of progress, because what affordable housing remains will be more expensive and more crowded than ever.

Trains, market gains and monopolies…

Yesterday, my colleague, Sarah Brodsky, posted on the report on Missourinet about MoDOT’s desire to improve Amtrak’s performance in order to increase ridership. We discussed Amtrak around the office for about 1/2 hour, which is one of the great parts about working at a think-tank like the Show-Me Institute. I come at this issue from the perspective of someone who loves riding trains.  My dad loves trains, and he passed that on to me.  I have taken several overnight train trips in my life, including trains to Seattle via Glacier National Park and a three-week jaunt around the east coast via Amtrak after college. So it infuritates me that every time I make a point to ride Amtrak something goes wrong. I took it to Chicago last summer for a bachelor party and the train was two hours late leaving St. Louis. I have taken the Missouri Mule to Jefferson City or Kansas City a couple of times and the delays while freight trains pass are exasperating. As simple as it may seem, I really believe that if Amtrak would just operate more efficiently more people would give it a chance. Perhaps Sarah is right that eliminating the subsidies would force Amtrak to shape up. Eliminating the subsidy to a de facto monopoly would more likely just cause Amtrak to close in Missouri, and I think Missouri benefits from Amtrak, if only for the drunks it takes off the highways after Hermann Octoberfest.

We have been trying to determine the extent of Amtrak’s monopoly. It is a monopoly in reality, but not necessarily legally codified as such. By that I mean Bill Gates could go insane and tomorrow put $20 billion into a new passenger railroad across America, in a way that he could not just go ahead and decide to start selling nuclear power to Missourians. The new railroad would be heavily regulated, no doubt, but private business can operate passenger rail service. The problem is doing it on a large scale profitably, which is quite likely impossible. I hope Missouri keeps at least the subsidy to have Amtrak operate at the current schedle, while insisting that those service levels improve. If a better operating agreement can ‘t be reached with the railroads that own the lines Amtrak operates on giving preference to whichever train was first scheduled as opposed to the freight line every time, than I don’t have much hope for the Missouri Mule.

With train tickets now generally costing signigicantly less than the gas to drive between comparible cities, not to mention to ability to drink beer while on a train, or the zany hijinks, there is an opening for better service to bring in more custmers.  How about that for a crazy idea?  That plus adding a train connection from St. Louis to New Orleans.  That bus ride to Carbondale to catch the train just is not going to cut it.

Welcome Eric Dixon

I’m pleased to announce that the Show-Me Institute has a new editor. Eric Dixon joins us from Idaho, where he worked at the Idaho Press-Tribune, as well as doing freelance work for the Cascade Policy Institute, Oregon’s free-market think tank. He’s got a degree in journalism from Brigham Young University, and he’s got nearly a decade of experience with a variety of public policy organizations, including the Cato Institute, US Term Limits, and Liberty magazine.

As the Show-Me Institute’s editor, Eric will be in charge of maintaining the high quality of all of the Show-Me Institute’s publications, including our website and blog, our Policy Studies, and Show-Me Quarterly. He’ll also be writing op-eds and contributing to the weblog.

Where am I going? I’ll be doing technology policy research from home in Saint Louis as an adjunct scholar at the Cato Institute. I’ll also be helping out part time at the Show-Me Institute for the next few months to make sure the transition to the new editor goes smoothly. I’m also working on a study on eminent domain abuse in Missouri, which I hope to finish in the not-too-distant future. If you’d like to read more of my tech policy work, please check out my contributions to Cato’s blog and the Technology Liberation Front.

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