Centene Corp. Hears A Can’t

Posted on by David Stokes

Huge news in Clayton yesterday as an Appeals Court rejected Clayton’s, and Centene Corporation’s, bid to acquire three properties on Forsyth by eminent domain for Centene’s large and controversial expansion and retail project.  I am less radical on the issue of eminent domain than others here at SMI, so you can look forward to posts with additional analysis and more gloating from others, but there is no doubt that the area in question is absolutely NOT blighted by any normal understanding of the word. 

The appellate court concluded, however,  that a study by a planning firm, PGAV, suggesting the area was blighted was insufficient evidence for city aldermen to make the blighting determination.

I know this area very well, and the buildings in question are very nice, productive properties.  To reach this determination the three judges really just had to go for a walk along Forsyth.  The buildings in question are just not as productive as some would like them to be.  That, however, does not forfeit their rights as property owners.  I truly hope that a negotiated compromise, in a traditional business (i.e. pay for for the land), not legal, manner is reached and this project goes forward, as it will be great for Clayton. 

In fairness to Clayton, they are not doing anything that has not already been done numerous times by neighboring cities like Richmond Heights, Brentwood and Maplewood.  Clayton is just doing it (or trying to do it) after the Kelo decision when people are much more aware of the abuses of eminent domain.  Clayton is also oppoosed by people much more powerful, and wealthier, than people who have lost the eminent domain battles in other parts of St. Louis County.  You may have caught that one of the property owners fighting the development is a ‘Danforth.’  I am guessing that most people don’t remember the names of the people in Evans Place, hell, I can’t even Google Evans Place and it wasn’t torn down until the 90’s.

What I just wrote is not a defense of the project as much as looking at both sides, which is always positive even when one side is pretty clearly in the right.  It is a good thing that judges, and hopefully politicians, start to define ‘blight’ much more stringently.  Clayton is not blighted, but I still hope the project moves forward without the use of eminent domain.   

Be a Show-Me Institute Intern!

Posted on by Timothy B. Lee

We’ve just released the application for our fall internship program. If you’re a college student, I hope you’ll apply. If you’re not a college student, I hope you’ll pass the application on to someone who is.

In a lot of organizations, the interns are treated like slave labor. They’re chained to a photocopier, and they get little or no contact with the real decision-makers in the organization. The Show-Me Institute is different. Our interns spend the vast majority of their time doing research and writing. Our current intern, Steve Bernstetter, had no less than three op-eds in the Saint Louis Business Journal this semester, as well as the opportunity to do an in-depth research project. Because there are fewer than a dozen people in the office, our interns get the opportunity to work closely with almost everyone on staff. That means you get an in-depth understanding of how a think tank works, including editing and publishing, event planning, and travel around the state.

More information and the application form is available in PDF form here. Please help us spread the word!

A Good Idea for KC

Posted on by David Stokes

Kansas City-area officials are considering building a new jail to serve to prison needs of the area, not just one individual city.  This is an excellent idea that would serve KC well.  Jails are one area where regionalism, cooperation and privatizsation have been used succesfully in the St. Louia-area.  The Buzz Westfall Justice Center was built by St. Louis County, after a succesfull bond vote, in the mid-1990’s.  While it is owned and operated by St. Louis County, the 91 municipalities in the County use it to house their prisoners, too.  Space has also been rented out to other entities – the City housed inmates there during the recent construction the City’s own, new jail a few years ago.  While the jail itself is operated by the County, parts of its work have been privatized after competitive bidding, primarily the pharmacy department used to serve the (legal) drug needs of the prisoners.

The City of St. Louis has long used its City Workhouse to house prisoners from other cities and counties.  This medium security facility has for a long time served the public safety needs of the City, other municipalities and counties, and made money for the City of St. Louis at the same time.  If Kansas City goes ahead with a regional jail, am I sure they will find it to be a great decision for the KC area.  It will both improve public safety and save money in the long run.  Not much to complain about there…   

Slap Happy Days Are Here Again…

Posted on by David Stokes

It is every elected officials’ favorite question: What to do with a budget surplus?  The Post-Dispatch has a good article on the choices facing Missouri legislators now, and what officials from other states in the fortunate situation of a surplus have chosen to do.  A budget surplus is truly an economic gift that keeps on giving, as a tax cut done because of the surplus expands the economy beyond what the pre-cut economy produced.  A tax cut in response to a surplus, combined with budget discipline in general, can lead to a revolving cycle of healthy economic growth leading to budget surplusses allowing for tax cuts leading to even greater economic growth and continued surplusses.  That is in the theoretical world – in the real world elected officials too often use the surplusses to fund new government programs which must be funded in future years no matter what the economic situation or future needs, resulting in more government programs continuing to hover over and around the economy. 

I like Utah’s answer to the surplus – cut a little bit off every tax rate.

  "Utah reduced its income tax, sales tax and business taxes."

Hawaii is condidering new programs for the state’s homeless – as if the homeless in Hawaii don’t already have it better than the rest of us.  It’s Hawaii, for Christsakes!  Virginia has paid for one-time transportation projects with its surplus, with some help from public-private partnerships.  Missouri could certainly learn from that example.

Oregon and Nebraska are socking money away in rainy day and reserve funds.

Booo!  Where is the fun in that?  Do things really change so much in Nebraska that they need money in a rainy day fund?  In case of emergency, it’s not like that have to get legislation through both houses of the legislature like every other state. 

Missouri’s plans are fine – cutting taxes is good, but I would prefer a small, general cut for everyone to the large, targeted cut for senior citizens that looks likely.  The franchise tax refuction is an excellent idea and will benefit Missouri’s economy.  Maybe with a franchise tax cut we can finally get some outrageously overpriced coffeehouses to open here.  Putting some money ($200 million now counts as ‘some money’) away for the future is ok, at small levels rainy day funds make sense – but I think the people of Missouri could do more with that money than the state could or will.            

 

New Website

Posted on by Timothy B. Lee

Regular visitors to our website might notice that it looks a little different today. That’s because we’ve upgraded to a new and better content management system that will allow us to put more content on our site more easily, and with better organization. If you notice any problems with the site, please shoot and email to [email protected] and let us know about them!

We’ve also belated posted the Winter issue of Show-Me Quarterly, which went out to our sponsors last month. Click here to read about our recent studies on the income and earnings taxes, our various events on education policy, and a profile of the late, great, Milton Friedman.

Eye Exams for Everyone

Posted on by Sarah Brodsky

The state of Missouri may soon require comprehensive eye exams for all students entering kindergarten or first grade:

Parents without insurance will be responsible for the $100 to $165 vision exam.

Children on Medicaid will be covered by the state, and families that can’t afford it can apply for help from civic groups like the Lion’s Club or tap into $99,000 that will be available annually from the Blindness Education, Screening and Treatment Program Fund, Sen. Delbert Scott said.

But school nurses estimate one year’s worth of exams for the 70,000 Missouri children entering kindergarten in the fall will cost the state and private donors $2.4 million to $7 million. (Medicaid reimburses doctors about $43 for a comprehensive eye exam.)

The article includes some horror stories of children who were diagnosed as learning disabled because of vision problems that school nurses couldn’t detect during standard in-school exams.

Overidentification of learning disabilities is a problem. However, as the school nurses quoted in the article point out, requiring full eye exams for everyone is a costly solution. It would be much cheaper to require full eye exams only for students who are suspected to have learning disabilities. An even better idea would be to publicize the information about private donors who help parents pay for exams, without mandating these comprehensive exams for anyone. Parents can decide which level of exam their kids need.

MOHELA Money II: Biotech Boogaloo

Posted on by Steven Bernstetter

Looks like Gov. Blunt and friends will get their MOHELA money after all. At this juncture, pointing out just how ridiculous this bill is has become something akin to beating a dead horse. Except this horse won’t die, and instead just keeps mutating into something, well, less horse-like and more closely resembling the gross piece of political waste it truly is. So let the beating continue.

For a good synopsis of how it all went down, go here. Basically, those politicians who opposed the bill, on whatever grounds, had their projects stripped and the funds redistributed to more politically friendly districts. No political soup for you, conscientious objectors! However, the most egregious example of wasted political capital lies in the still unfavorable appraisal of pro-life groups who so effectively derailed the original plan to drive Missouri’s budding biotech industry. Blunt and Co. claim the bill’s passage as a success, but as the Springfield News-Leader so accurately surmises:

What the state’s universities still need is a commitment from lawmakers that funding levels — including for much needed construction projects — will match the important role our institutions of higher education play in being a driving economic engine in Missouri. What our colleges and universities need is a commitment that Democrats and Republicans from all corners of the state recognize their incredible value. The passage of SB 389 didn’t accomplish that goal. Victory is still out of reach.

Indeed. Missouri has so much potential to be a future leader inthe life sciences, its almost unfathomable that the state’s leaders could be so ineffective as catalysts in realizing that potential. As a recent editorial in the STL P-D proclaimed:

It’s difficult to think of another state in a better position to lead research into bio-energy and agricultural defense. We have some of the nation’s leading research institutions — the Danforth Center, Washington University, St. Louis University and the University of Missouri-Columbia. We have agricultural powerhouses like Monsanto and energy companies like Peabody Coal. And, of course, we sit astride the most productive farmland the world has ever known.

It’s not too late for legislators to set aside money that only could be used if the federal research grants are awarded to Missouri companies and universities.

The question is whether they want to invest in the future, or run from it.

At this stage of the game, "run from it" seems to be the preferred strategy. But where exactly are we running to? Straight into the arms of whatever is most politically expedient, apparently. That means pet projects for the legislators willing to play "follow the leader" with Gov. Blunt, elmination of the most universally beneficial provisions at the behest of special interests, and the perpetual disappointment of those sincerely trying to help Missouri before they help themselves.

How to Spur Budding Industries

Posted on by Timothy B. Lee

I have to disagree a bit with Steve’s assertion that doling out state money will “drive Missouri’s budding biotech industry.” I don’t know if Missouri’s biotech industry is budding, or if it will thrive in the future. But I rather doubt that a few million dollars of state largesse is going to make the difference. If biotech is economically viable in the Saint Louis area, no subsidies are necessary. And if it’s not economically viable, subsidies aren’t likely to make it so.

No doubt spending more on life sciences will lead to some beneficial science being done, and it may very well lead to important breakthroughs. But by itself, spending more money on biotech research isn’t likely to make the broader Saint Louis area a biotech hub. Carnegie Mellon is one of the best computer science schools in the country, but Pittsburgh isn’t known as a hotbed for tech startups. Nor are subsidies from the state of Pennsylvania likely to make it a hot technology area.

If government wants to make Saint Louis the home of the biotech industry, the best way to do that is to make it hospitable to industry in general: cut taxes and red tape, provide good infrastructure, and then get out of the way. That might spur the growth of the biotech industry here in Saint Louis. But it might also spur the growth of all sorts of other industries as well. After all, the whole reason we have a market economy rather than running our economy using Soviet five-year plans is that government officials don’t know what’s needed and where the economy is headed. If they can’t run the economy as a whole, why should we expect they’d be any better at picking what Saint Louis’s next hot industry is going to be?

The reason, I suspect, is that when you cut taxes and thereby spur the creation of a lot of small businesses, you don’t necessarily get to attend a big ribbon-cutting ceremony and take credit for it on the evening news. So even if tax cuts and deregulation are better for the state’s economy than “targeted” economic programs, they’re not as good for the career of the politician in question. So instead, politicians focus on high-profile projects that make good photo-ops, regardless of whether they’re good policy or not.

NYT on Saint Louis

Posted on by Sarah Brodsky

The New York Times publishes a not-entirely fair article about what a bad place St. Louis has become to live in:

In the past few months, the public schools were stripped of accreditation and taken over by the state; the city was designated the most dangerous in the country in a national crime survey; and 15 police officers and supervisors were disciplined for giving World Series tickets seized from scalpers to friends and family.

It goes on to discuss the storms and power outages we’ve experienced in the past year, and it quotes a city planner and some professors.

I complained as much as anyone (okay, maybe a lot more) when my neighborhood repeatedly lost power. But we don’t have it so bad as places like New Orleans. And Saint Louis’ remaining problems seem to be man-made. What struck me about this article was how little attention it paid to possible solutions.

Changing the tax structure in Saint Louis could do a lot to reverse the trend of flight to the suburbs. School choice and other reforms have the potential to improve the city schools and turn Saint Louis into an attractive place to raise a family. Reforms focused on the economy and education would probably go a long way in reducing crime, too. Unfortunately I don’t have a specific policy proposal to prevent unethical use of confiscated tickets.

In addition, the article left out many positive things about Saint Louis, like Ted Drewes, the zoo and the Gateway Orchestra’s free classical music concerts. There’s more to life here than urban crises.

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