As a writer, there are moments when someone else articulates an idea so well that rewriting it in my own words would be unnecessary. A recent op-ed in The Hill did exactly that, clearly laying out the energy challenges facing the United States:

The U.S. electricity sector is a slow-moving maze of regulations, shaped by decade-long transmission approvals, time-intensive interconnection studies for new generators and large new customers, and overlapping layers of state, regional and federal bureaucracy. . . . The regulatory thicket surrounding the electricity industry was tolerable when the pace of change was slow. However, with the rise of AI and renewed growth from manufacturing and electrification, we can no longer endure a sclerotic grid.

In addition to reforming our rigid, reluctant-to-adapt grid, there are questions about whether average ratepayers should be on the hook for increased electricity demand being driven by a few large customers.

In the midst of all of these concerns, there is a U.S. Senate bill that could help fix the problem: S.3585 – DATA Act of 2026. The bill was recently referred to the Senate Committee on Energy and Natural Resources.

I have written about consumer-regulated electricity (CRE) for Missouri, which would reduce the number of state-level regulations that off-grid CRE utilities (CREUs) would face. (You can click here if you’re interested in what a CRE policy might look like in practice.) However, even if it were allowed in Missouri, there would still be many federal-level regulations that would diminish the benefits of the new practice.

That is where the DATA Act becomes so vital. The act would exempt certain new CREUs from specific federal regulations that apply to the broader grid. If our state and federal governments approve CRE, there would be a pathway for large electricity users like data centers and aluminum plants to more quickly generate their own electricity without impacting the rates of average Missourians. That would be a win for all of us.

All of this suggests that the DATA Act of 2026 is something to watch in Washington, D.C. But Missouri should not wait until the federal government makes its move. We should be proactive and allow CREs in our state, creating a pathway to address modern energy challenges that would become even more viable if federal reforms under the DATA Act follow.

The post Keep an Eye on the DATA Act in Washington, D.C. appeared first on Show-Me Institute.

The piece featured a quote from the mayor bemoaning the passage of Amendment 4 in Missouri, which required the city to up its spending on the police from 20% to 25%. The author begins with a quote from the mayor:

“The current system doesn’t work. We need more accountability, not less . . . We need more innovations in policing, not less.” Lucas explained that he doesn’t believe an increase in funding for the KCPD will be useful in countering rising violent crime.

This is interesting because in his latest budget, Mayor Lucas was eager for the Kansas City Police Department to significantly increase salaries for existing officers as well as new hires. Why would he want that if he didn’t think it would be useful?

The Pitch, perhaps to back up the mayor’s reaction to Amendment 4, offers the following:

A body of evidence shows that increasing police funding has no major impact on reducing local crime rates. One of the tropes used during the campaign for Amendment 4 was the need to fund the KCPD while skewing the increase in homicide rates in Kansas City to present the Lucas administration and the Kansas City Council as far-left partisans who care not for the safety of their constituents.

The first link (“body”) is to a page of Human Rights Watch. It doesn’t expressly conclude that police funding doesn’t reduce crime. Instead, it provides a two-stage yet still heavily qualified claim:

Studies show that investing in health care, housing, universal basic income, child care, universal pre-K, and public safety programs outside the criminal legal system infrastructure would reduce poverty and inequality, and research suggests, is likely to improve community safety. [emphasis added]

All of that may be true. But plenty—in fact most—people living in poverty and suffering inequality do not commit crime. Policing is about getting criminals off the street and deterring crime. And we know that the most common victims of crime are exactly those same poor people.

The second two links (“evidence shows” and “Increasing police funding has no major impact”) are about a single study of the 20 largest cities in Canada. Those may be compelling. But I suspect the dynamics of crime and policing between the United States and our neighbor to the north are sufficiently different to be unhelpful for Kansas City.

The last link (“reducing local crime rates”) has nothing to do with the relationship between crime and police funding. The article merely makes the argument that many places accused of defunding the police have actually increased police funding.

Instead, consider the conclusion of a 2018 study conducted by Princeton University, titled, “More COPS, Less Crime.” The author examined the impact that federal COPS funding (Community Oriented Policing Services) had on crime and concluded, without qualification, “one officer-year was added for every $95,000 spent by the federal government and that the social benefit associated with the ensuing crime reduction [was] on the order of $350,000.”

Another paper published by the National Bureau of Economic Research in 2020 concludes, without qualification, “Each additional police officer abates approximately 0.1 homicides.”

Issues surrounding crime and law enforcement are not easily settled. They are made even more complicated by partisan politics. I suspect Mayor Lucas knows better than what he claimed, and The Pitch should be a little more thorough with its facts and research.

The post The Pitch’s Half-hearted Crime Research appeared first on Show-Me Institute.

First, policymakers here should understand what the future of nuclear power looks like. Even though Georgia just saw the completion of Vogtle Units 3 & 4 (which cost around $30 billion and over a decade to build), Vogtle may well be the swan song for traditional nuclear power plants. It simply is not feasible to construct such an immense project, and this points to the direction nuclear is going—toward advanced and small modular reactors, which I discuss in another post.

Even on a smaller scale, nuclear construction is still immensely costly, and utilities and private entities alike take on a huge financial risk largely due to the regulatory barriers. In Missouri, while we wait for needed federal reform, we should do what we can at the state level to reduce the risks involved with investment in nuclear power.

Does this mean we should hand out subsidies and tax credits like candy? No. But we need to signal our openness to nuclear expansion. Fortunately, our state already has some history with nuclear. The plant in Callaway has been reliably operating in our state since 1984. We also have a nationally known nuclear engineering school; in 2021, Missouri University of Science and Technology awarded the 11th most nuclear engineering degrees in the country. We have the potential to attract more nuclear developers to our state and should be partnering with them.

Seeking out private nuclear developers, forming a nuclear advisory board (which would focus solely on legislative and policy changes/opportunities to address nuclear workforce and education barriers, storage and waste practices, and coordination with federal agencies), and passing pro-nuclear legislation could all help bring more nuclear energy to Missouri. In a future post, I will discuss how Missouri could also lure developers by creating nuclear infrastructure through acquiring early-site permits on brownfield sites or failed construction projects.

In Tennessee, the Tennessee Valley Authority is partnering with GE Hitachi Nuclear Energy (USA), Ontario Power Generation (Canada), and Synthos Green Energy (Poland) to jointly invest $400 million into developing up to four small modular reactors. Advanced nuclear reactors are a new technology, and the fact they are reliable, versatile, clean, and powerful is drawing global interest. Missouri should be similarly proactive in looking for potential partners

Missouri should also improve the regulatory environment so that it does not discourage investment in nuclear power. State utilities cannot raise rates to help pay for construction projects in progress; they must wait until the development is fully operational and used in service. But power plants do not arise out of thin air; they are necessary infrastructure that benefit anyone who uses the energy they produce. My colleague David Stokes has discussed how this law was made by the anti-nuclear lobby in the 1970s to kill nuclear construction in the state—and it has succeeded thus far. Last session, Missouri, through HB 225, wisely sought to allow utilities to file with the Federal Energy Regulatory Commission (prior to the beginning of construction) in order to raise rates to pay (if needed) for small modular reactor projects only. If the newly requested rates are not “just and reasonable,” the commission can renegotiate or deny the proposed increase. This bill flew through the house but failed to gain traction in the Senate (where just about everything died). I understand the concerns with paying for a project that may never come to fruition, and I think adding a refund measure (if the project is cancelled) could help ease the concerns of ratepayers. A refund measure would also give utilities an additional incentive to finish what they started, which would further signal resolve to develop these reactors.

The emergence of small, modular nuclear reactors presents Missouri with a familiar choice: take the initiative or sit on the sidelines. Option B, which seems to be a traditional favorite among policymakers here, would be a costly error.

The post Can Missouri Be a Leader in a Nuclear Energy Resurgence? appeared first on Show-Me Institute.

The study, published by ASU’s Center for the Study of Economic Liberty, ranks St. Louis 31 out of 115 cities in North America in regulatory competitiveness. That ranking doesn’t seem half bad, but 31 out of the 66 U.S. cities included in the study isn’t great. Among American cities, St. Louis is just middling.

The table below shows how St. Louis fares in the various categories. St. Louis ranks 12 overall in “Paying Taxes,” but sales taxes are not included in the scoring. Anyone who’s shopped in the city knows how steep the city’s sales taxes are; St. Louis’s ranking would likely be lower if they were included. In addition, “resolving insolvency” is a ranking where all American cities are tied for first place, so not much should be made of that stat in this context.

In two critically important categories, St. Louis is less than impressive, ranking 60 in “Starting a Business” and 47 in “Employing Workers.” These scores incorporate regulatory costs to business owners, including compliance fees for mandatory procedures and wage regulations like overtime requirements and probationary periods. As our low rankings indicate, starting and staffing a business is a costly and onerous process in St. Louis—and that’s not the inviting economic environment that we want.

Policymakers must recognize that all business regulations carry costs for business owners, and St. Louis’s costs are too high. 46 other major U.S. cities have found less costly ways to meet their public policy objectives for employing workers. And St. Louis was outranked by cities in the U.S., Canada, and Mexico when it came to ease of starting a business!

All this suggests that St. Louis has a lot of room for improvement when it comes to business regulations. Policy changes like lowering licensing requirements, taxes, or procedural costs are just a few things that may get St. Louis a better ranking. Without reform, St. Louis will continue to be mired in mediocrity.

The post St. Louis Ranks Poorly in Ease of Doing Business Study appeared first on Show-Me Institute.

First, it’s worth recalling that in 2018 the National Bureau of Economic Research (NBER) demonstrated how tax rates affect innovation. Looking at state-level taxation dating back to the early twentieth century, the NBER concluded, “A one percentage point higher tax rate at the individual level decreases the likelihood of having a patent in the next 3 years by 0.63 percentage points.” Specifically, they found that, “higher personal and corporate income taxes negatively affect the quantity, quality, and location of inventive activity at the macro and micro levels.” This should not surprise anyone; resources that might be put toward innovation can’t be used for that purpose if they are spent paying taxes.

The new study from Arizona State University, titled “Doing Business: North America“ looked at 115 cities in the United States, Canada, and Mexico and rated them in six different categories. Those were “starting a business,” “employing workers,” “getting electricity,” “registering property,” “paying taxes,” and “resolving insolvency.” (All U.S. cities tied for first place regarding insolvency.)

While St. Louis ranked 31st overall out of the 115 cities in Canada, the United States, and Mexico (no other Missouri cities were included in the study; Chicago scored 45th overall), the areas where it scored less impressively—starting a business and employing workers—feature significantly in attracting entrepreneurs and innovation.

St. Louis scored 60th on “starting a business” (46th among U.S. cities). This ranking resulted from a “study of laws, regulations, and publicly available information on business entry,” along with consideration of the time and cost of complying with applicable regulations.

Regarding “employing workers,” St. Louis ranked 47th both for the whole sample and among the 66 U.S. cities examined. This ranking was more involved and is described on page 177 of the report, but it reflects the cost of wages and wage regulations such as probationary periods, overtime requirements, and sick leave.

Policymakers can debate the value of local and state mandates and regulations associated with starting a maintaining a business, but all should acknowledge that each one imposes a cost on the employer. Forty-six other U.S. cities have formulated less costly ways to meet their public policy objectives when it comes to employing workers. And St. Louis was outranked by cities in in all three countries examined when it came to ease of starting a business!

All this suggests that when working toward the important goal of taking advantage of St. Louis’ “innovation districts” in the agri-tech, biomedical and technology fields, city government could do a lot more to help entrepreneurs take advantage of what the city may already offer.

The post St. Louis Ranked in the Middle in Ease-of-Doing-Business Study appeared first on Show-Me Institute.

Berner goes on to offer examples from the United Kingdom, Belgium, the Netherlands, Canada, and many other countries that support a broad variety of schools. In a pluralistic system, students or their parents are allowed to choose the type of school that their child will attend. The school may be religious, it may have a specific pedagogical practice, or may have various other defining features, but it will still receive public funds.

Berner suggests that the key to a pluralistic education system is that there must be some form of accountability for all schools, even private ones.

While I may not completely agree with Berner on the extent to which the government should regulate private schools, her paper offers an excellent overview of what educational pluralism is, the perceived obstacles to pluralism in the United States, and an overview of compelling educational research.

To learn more, give her paper a read or check out her recent op-ed on the matter here.

The post What Is Educational Pluralism? appeared first on Show-Me Institute.

Well, my friend, if you are, I have to admit: You had a couple of modest “wins” in 2018. Here in Missouri, free-market thinking took it on the chin in two ballot initiatives. On Aug. 7, by an overwhelming majority, Missourians voted to kill a right-to-work law passed by the Missouri Legislature in 2017. Then on Nov. 6, Missouri voters passed another ballot initiative boosting the state’s minimum wage from today’s $7.85 to $12 by 2023.

Compared with other news, however, those victories by deep-pocketed trade union groups and their co-dependent, big-government allies were small beer. The year’s big story was the striking success at the national level of free-market policies in driving faster growth and widely shared prosperity for all groups of people. For two years, the federal government has been lifting the burden of regulations and taxes on businesses and consumers alike. The dynamism of American capitalism has done the rest.

Recent GDP growth has been close to 4 percent – or about double the rate sustained over the eight years of the prior administration. Suddenly, there are more job openings than people seeking work. That, in turn, has led to higher pay for people at all income levels.

On Oct 2, Amazon CEO Jeff Bezos announced that he was raising his company’s internal minimum wage for warehouse and other unskilled workers to $15 an hour. This led to mutual back-slapping between Bernie Sanders and Bezos. The self-declared socialist complimented the world’s richest man on “doing the right thing,” and Bezos responded with self-congratulations, saying he hoped that other companies would follow his lead.

But guess what? He wasn’t leading. The U.S. Labor Department recently reported that wages for nonsupervisory warehouse employees had risen 4.6 percent from a year earlier, to $17.87 an hour. That’s almost $3 an hour more than the wage set by Amazon’s act of supposed enlightenment. Faced with the demands of an expanding economy and a tight labor market, companies did what they had to do – they raised wages to poach workers or keep the ones they have. So it wasn’t Mr. Bezos who deserved the compliment, but the unimpeded operation of the free market.

If you look around the country and the world, you see people everywhere who are fed up with the cluelessness of wealthy and long-established political elites who continue to pursue highly questionable policy objectives regardless of the cost in higher taxes, reduced paychecks, and lost economic growth. We are witnessing what the Wall Street Journal calls a “Global Carbon Tax Revolt,” with ordinary people rising up in protest against fuel-tax hikes and costly climate-change initiatives aimed at boosting unreliable renewable power. That has happened with the violent “Yellow Vest” protests in Paris and many rural areas that have rocked the presidency of France’s Emmanuel Macron. Other hot spots in the same revolt by taxpayers opposed to sacrificing growth on the altar of environmental piety include Germany and Canada, along with the states of Arizona, California, and Washington.

In sum, 2018 was a bad year for government-failure deniers. It was a much better year for those who believe in the unrivaled power of free markets to create and spread wealth and to promote greater individual freedom, responsibility, and creativity. But 2018 wasn’t all roses either, with rising fears of a global trade war sparked by retaliatory tariffs.

Tariffs are another tax – a tax on commerce. Of course, the more you tax something, the less you get of it. Missouri is a soybean basket to the world. Our state can ill afford a major disruption in world commerce. Neither can the nation. Looking ahead to 2019, let us hope that the substantial economic gains made in 2018 are not jeopardized or lost through the folly of managed (or mismanaged) trade policy.

The post 2018: A Bad Year for Government-failure Deniers appeared first on Show-Me Institute.

Well, my friend, if you are, I have to admit: You had a couple of modest “wins” in 2018. Here in Missouri, free-market thinking took it on the chin in two ballot initiatives. On Aug. 7, by an overwhelming majority, Missourians voted to kill a right-to-work law passed by the Missouri Legislature in 2017. Then on Nov. 6, Missouri voters passed another ballot initiative boosting the state’s minimum wage from today’s $7.85 to $12 by 2023.

Compared with other news, however, those victories by deep-pocketed trade union groups and their co-dependent, big-government allies were small beer. The year’s big story was the striking success at the national level of free-market policies in driving faster growth and widely shared prosperity for all groups of people. For two years, the federal government has been lifting the burden of regulations and taxes on businesses and consumers alike. The dynamism of American capitalism has done the rest.

Recent GDP growth has been close to 4 percent – or about double the rate sustained over the eight years of the prior administration. Suddenly, there are more job openings than people seeking work. That, in turn, has led to higher pay for people at all income levels.

On Oct 2, Amazon CEO Jeff Bezos announced that he was raising his company’s internal minimum wage for warehouse and other unskilled workers to $15 an hour. This led to mutual back-slapping between Bernie Sanders and Bezos. The self-declared socialist complimented the world’s richest man on “doing the right thing,” and Bezos responded with self-congratulations, saying he hoped that other companies would follow his lead.

But guess what? He wasn’t leading. The U.S. Labor Department recently reported that wages for nonsupervisory warehouse employees had risen 4.6 percent from a year earlier, to $17.87 an hour. That’s almost $3 an hour more than the wage set by Amazon’s act of supposed enlightenment. Faced with the demands of an expanding economy and a tight labor market, companies did what they had to do – they raised wages to poach workers or keep the ones they have. So it wasn’t Mr. Bezos who deserved the compliment, but the unimpeded operation of the free market.

If you look around the country and the world, you see people everywhere who are fed up with the cluelessness of wealthy and long-established political elites who continue to pursue highly questionable policy objectives regardless of the cost in higher taxes, reduced paychecks, and lost economic growth. We are witnessing what the Wall Street Journal calls a “Global Carbon Tax Revolt,” with ordinary people rising up in protest against fuel-tax hikes and costly climate-change initiatives aimed at boosting unreliable renewable power. That has happened with the violent “Yellow Vest” protests in Paris and many rural areas that have rocked the presidency of France’s Emmanuel Macron. Other hot spots in the same revolt by taxpayers opposed to sacrificing growth on the altar of environmental piety include Germany and Canada, along with the states of Arizona, California, and Washington.

In sum, 2018 was a bad year for government-failure deniers. It was a much better year for those who believe in the unrivaled power of free markets to create and spread wealth and to promote greater individual freedom, responsibility, and creativity. But 2018 wasn’t all roses either, with rising fears of a global trade war sparked by retaliatory tariffs.

Tariffs are another tax – a tax on commerce. Of course, the more you tax something, the less you get of it. Missouri is a soybean basket to the world. Our state can ill afford a major disruption in world commerce. Neither can the nation. Looking ahead to 2019, let us hope that the substantial economic gains made in 2018 are not jeopardized or lost through the folly of managed (or mismanaged) trade policy.

The post 2018: A Bad Year for Government-failure Deniers appeared first on Show-Me Institute.

Privatizing Lambert could be a win–win–win proposition for St. Louis. The city could get an infusion of cash; private firms could get the opportunity to pursue profits; and the traveling public could get an improved and more efficient airport. But skeptics point out that a limited number of airports have gone through the APPP, implying that privatization is rarely successful, if not unrealistic.

So, is privatization realistic? Why hasn’t it taken off in the US?

The answers: “Absolutely” and “It’s complicated,” respectively.

Privatization is becoming more common abroad. As of 2016, 41% of European airports were partially or fully privatized, and the Canadian National Airport System (comprising Canada’s 26 largest airports) has been successfully operated by the private sector for decades. According to Airports Council International, the private, market-based approach in Europe has led to “significant volumes of investment in necessary infrastructure, higher service quality levels, and a commercial acumen which allows airport operators to diversify revenue streams and minimize the costs that users have to pay” (p. 1). Privatization has also led to greater competition, which has “pushed airports of all sizes to fight for route development and traffic growth, to become leaner and more efficient… and to find the optimal means of financing investments “(ibid). In short, privatization works; in fact, it works really well.

But European and Canadian airports weren’t privatized through the APPP, which might be why privatization has been faster and smoother abroad. While the APPP is promising, it can take years to finish the application process, and time is money. For perspective, Henry County Airglades Airport had its preliminary application approved in 2010 and has yet to receive final approval from the Federal Aviation Administration (FAA).

The APPP also imposes restrictions that can make crafting a privatization deal challenging. For instance, a 65% majority of airlines need to approve a lease agreement for privatization to go forward. And if the city wants to use proceeds from the agreement on projects outside the airport, it’ll require that same 65% approval. Moreover, private operators must assume any public debt held for the airport unless the FAA waives the responsibility. On top of all this, the passenger facility charge (PFC) airports levy on travelers is capped at $4.50 by Congress, which limits revenue for private operators. (Read this recent Congressional report on the APPP for a more detailed account of the program and its challenges.)

The question isn’t “Should we privatize?” but “How should we privatize?” The FAA has discussed the benefits of privatization and increased competition for decades, and the APPP gives St. Louis a chance to capitalize on those benefits. And while few airports have been privatized through the APPP (note that most simply withdrew their applications), policymakers can work to craft a deal that works for all involved: the city, the airport, airlines, and the traveling public. Look for more soon on what a privatization deal could include to offer the best outcomes for all parties.

The post Putting the APPP in Perspective appeared first on Show-Me Institute.

Bombardier, the Canadian transportation company, said on Wednesday that it would lay off about 7,000 employees over the next two years, as it struggles to find buyers for a new series of planes that for the first time put it in direct competition with the aviation giants Boeing and Airbus….

While the Air Canada sale provided important help for the CSeries, sales of the aircraft remain below levels that analysts generally view as assuring the project’s success. Including the 45 planes for Air Canada, Bombardier now has 288 firm orders.

Making money in business is never a certainty, and yet time and again state and local officials seem to think they have a special insight for picking moneymakers when they don’t. Whether you’re talking about developing a hotel, a stadium, an airport, or something else, the incentives of politicans often diverge greatly from the long-term interests of the communities they’re supposed to represent. It’s fun to cut the ribbon at a groundbreaking and get your picture taken with a hard hat on, but who ends up with the bearing the burden when an incentivized business goes belly-up? Taxpayers, that’s who.

Fortunately, it wasn’t Missouri’s taxpayers who paid the price when Bombardier’s incentive-addled business plans crash-landed, and state officials should learn from having dodged that bullet. Rather than riskily cutting deals with a select few, policymakers should invest in every family and business in the state by simply lowering everyone’s taxes. 

The post Bombardier’s Troubles Continue As Company Lays Off 7000 appeared first on Show-Me Institute.

Which brings us to 2015: Bombardier, back in Canada, now needs a bailout.

The post Missouri Dodges A Bullet: Bombardier Seeks Billion Dollar Rescue in Canada appeared first on Show-Me Institute.

At its peak Corinthian Colleges had over 100 colleges throughout the United States and Canada, including Everest College campuses in Earth City, Kansas City, and Springfield. Last month Corinthian Colleges, Inc., a large for-profit post-secondary education company, announced it would cease operations in all remaining U.S. locations effective April 27, 2015. The closure of Corinthian has left 16,000 students in quite the predicament. Many have taken on burdensome student loans, and now their school is closed.

In response, the Department of Education (DOE) announced a plan to wipe the debt slate clean for all students that attended these schools, a move that potentially could cost taxpayers $3.6 billion. Secretary of Education Arne Duncan defended the plan saying, “You’d have to be made of stone not to feel for these students.”

While I agree wholeheartedly that it is more than a minor inconvenience to have your school close, this is the wrong course of action. Indeed, this plan is wrongheaded and will simply encourage more of the behavior that created this crisis in the first place.

First, there is no need to forgive loans for courses students have already completed. They did not spend their time at Corinthian schools in vain. These students are still eligible to transfer their credits to other schools and continue their educations. Countless universities have made it clear that they want to help and are willing to open their arms to students who take the initiative to transfer credits and continue their pathway toward a better life. Long Beach City College President Eloy Oakley summed it up perfectly back in April: “They have options and no matter what, at the end of the day, we want them to finish their education, stay in the community and become economic assets to the community.”

Unfortunately, one of the catches of the DOE’s plan is that closed-school debt relief is only available to students who have not transferred their credits to another university. This bailout encourages students to throw away the years they have dedicated to attaining a degree and bettering themselves.

Second, this is potentially the largest debt relief program the government has ever offered students, and it sets a bad precedent. Taxpayers should not be held accountable for the billions of dollars students borrow in full knowledge of the consequences. Most of these students never would have attended a Corinthian College if it were not for the government’s subsidization of college loans. This bailout essentially means students bear no risk when making college selections; they can easily obtain college loans, and the government will forgive them if things go badly.

The students of the now-defunct Corinthian Colleges certainly got a raw deal, but that is no reason to enact measures that will encourage the same type of behavior in the future.

The post Corinthian College Crisis appeared first on Show-Me Institute.

First, it is noteworthy that the stated purpose of the advisory committee is seemingly small ball. Their email soliciting participation asks only,

What’s it going to take for Kansas City Public Schools (KCPS) to regain full accreditation? What’s it going to take for your school to regain/sustain full accreditation? How can we retain and attract students?

In other words, “What do we have to do to provide the minimal state-required level of service?” We’re also suspect that they are looking toward parents and the community for ideas when there is an entire industry of specialists who have researched, written, and talked about what to do to improve schools. We at the Show-Me Institute have our own suggestions, and they aim at rebuilding world-class education in Kansas City. All our ideas have a common theme: Move power away from centralized school districts and toward students and parents.

For his 2003 book Making Schools Work, UCLA Professor and Author William G. Ouchi studied more than 200 schools in six cities and found that a school’s educational success may be most directly affected by how it is managed. The way to increase successful management, he argues, is to give schools more control over their own budget.

While schools may boast large budgets, Ouchi’s research uncovered that very little of it is controlled by the principal or the school itself. In one anecdote, he relates that a Los Angeles principal said her school had a budget of $21 million but added, “It doesn’t really matter because I only control $32,000.” Ouchi’s further research indicated that in New York, Los Angeles, and Chicago the local schools only controlled 6.1 percent, 6.7 percent, and 19.1 percent of the budget, respectively.

In school districts that have seen tremendous improvements in their urban school performances, such as Seattle, Houston, and Edmonton, Canada, the percentage of the budget controlled by the local schools was 91.7, 79.3, and 58.6, respectively. This should be no surprise. Administrators, teachers, and parents at the school are best able to identify and address the specific needs of their students.

Here in Kansas City, better school management means moving the power of the purse away from the top-down centralized control at 12th and McGee streets and out to the principals at Paseo, Lincoln Prep, and elsewhere. Ouchi offers this warning to parents:

Control goes with the money. If your superintendent smiles, invites your group into his office, and tells you that he agrees with you and that he’s going to roll out a new school-based decision-making program that includes parent involvement—smile sweetly and ask him who will control the school’s budget. Don’t let him off the hook. Don’t let him think that you can be so easily fooled.

Remember, the author was chief of staff to Los Angeles Mayor Richard Riordan. He has academic credentials, but he has weathered political fights as well. And the Kansas City district appears to be doing exactly what he describes: They smile, invite people to discuss the district, but surrender none of the control that is necessary for success.

The post An Idea for Kansas City Schools: Give Principals Power appeared first on Show-Me Institute.

I am optimistic about the future of K–12 education, because certain schools and education innovators have proven that what researchers and education administrators thought was impossible is, in fact, not.

For example, the Knowledge Is Power Program (KIPP) charter schools have been especially effective in reducing, if not eliminating, the achievement gap:

Students in at least half the KIPP schools Mathematica studied gained the equivalent of 1.2 years in mathematics and 0.9 years in reading three years after enrolling. The results effectively cut the racial achievement gap in half.

Another example of what is possible are the incredible gains made in Harlem, N.Y., by educational advocate Geoffrey Canada. He chose to attempt to “change the odds” of low income children in central Harlem — an area the New York Times reported had a poverty rate of more than 60 percent, and where three quarters of students were scoring below grade level on state aptitude tests. Today, we know Canada’s education nonprofit as the Harlem Children’s Zone (HCZ).

HCZ reports that 90 percent of its high school seniors were accepted into college this past year, and that those students received more than $6 million in scholarships and grants. HCZ also reports that of the four-year-olds that entered one of its programs, nearly one in five were initially achieving educational scores so low that they were classified as “delayed.” By the end of one year in the HCZ program, none of those students were delayed, and the percentage of students in that class that were classified as “advanced” had doubled, to more than 40 percent.

Canada was featured extensively in Waiting for “Superman.” Besides showing the struggles of students, the documentary’s broader message is about the big failures of traditional public education — including rapidly increasing education costs with no change in student academic achievement, the extreme difficulty of firing an incompetent teacher, and the seemingly endless bureaucracy that impedes educational innovation. The documentary’s strength is that it juxtaposes the flat-lining of student academic achievement in traditional public schools with what education innovators, like Canada, have been able to accomplish.

After watching the movie, the panelists took questions from audience members. About halfway through, Chris Guinther, the president of the Missouri National Education Association (the state’s largest teacher union), stood up to rail against the movie. I could write a series of blog posts responding to the statements she made — but space is limited, and you, reader, can only take so much.

I was most disturbed by Guinther’s objection to Canada’s success, because he had, according to her, made money by running the school. Now, after some brief research, I can’t find any indication that Canada has made outsized profits from HCZ, especially because the organization is a nonprofit. However, for the sake of argument, I’ll grant Guinther’s claim that the man who turned around student achievement in one of the most dangerous places in Harlem made a lot of money doing so.

I would be ecstatic if Canada were one of the most wealthy people in the United States. He has unarguably helped some of this country’s neediest children — in an area with extremely high foster care rates — gain an appreciation and mastery of education. I am more excited about Canada potentially reaping financial rewards for his risk taking and success than I am for almost anyone else. Why would money invalidate the success of the HCZ program? If the only criticism of Canada and his work encouraging low-performing Harlem children to succeed academically is that he might be making more than the average teacher, then that’s really no criticism at all.

In fact, I wish there were more potential for great rewards for people who work hard and take risks to vastly improve K–12 education. That might encourage more people to work to solve some of the shortcomings we are seeing in U.S. schools.

The real scandal is that, although educational innovators can make great strides and perhaps be begrudged for their relative financial success, teachers who fail their students can be nearly impossible to fire. For example, New York City’s school system has managed to fire only three teachers during the past two years. Or, as Waiting for “Superman” director David Guggenheim illustrated, in Illinois, only one in every 2,500 teachers lose their credentials, while the disbarment rate for Illinois lawyers is roughly one out of 100. Florida has difficulties firing bad teachers, too. Missouri, at least, appears to have a slightly higher rate — about 2 percent.

The post I Would Be Thrilled if Geoffrey Canada Were the Richest Man in the United States appeared first on Show-Me Institute.

The controversy surrounding this act raises two questions. First, how can we create more reliable sources for medical supplies that are difficult to produce? Both economic theory and our own history of imports and exports make it obvious that tariffs and bans on trade disproportionately harm the country that refuses to trade with others. Domestic production of medical isotopes would require massive government subsidies in order to upgrade nuclear reactors, such as the one owned by the University of Missouri for research purposes. Cutting off outside supplies of the isotopes, which is the intended purpose of the act, would drastically reduce efficiency in the production of medical isotopes and decrease the welfare of patients who need regular treatments with them. Although other countries are capable of making this product at present, and we are not, supporters of the act suggest that closing our doors to our current suppliers of medical isotopes would result in a more reliable supply.

The second question raised by the Isotope Production Act is more emotionally charged. What if terrorists get hold of the HEU and use it to construct bombs? Often, when fear is highlighted in a policy issue, it is used to distract voters from facts. Whether dealing with phone calls, airport security, or ingredients that could potentially be used to create weapons, it is important not to become so carried away by suspicion that we sabotage ourselves in other ways. Cancer and terrorism are both scary, but isotope technology can do something about cancer. Restricting it so severely, on the other hand, won’t put a dent in the many readily available materials that can be used to hurt people. The real market for medicines is too important to allow paranoia to dictate supply and demand.

The post Tumors, Tariffs, and Terrorism appeared first on Show-Me Institute.

First, some of the data relies on physician and patient surveys. Individuals in different countries have different expectations for their health care systems, an important factor that the study’s authors admit might have affected the ratings:

Patients’ and physicians’ assessments might be affected by their experiences and expectations, which could differ by country and culture.

One of the categories I find most objectionable is “long, healthy, and productive lives,” which has a rather ambiguous meaning. The authors used three indicators to determine what constituted a “long, healthy and productive life.” (Table data excerpted from the study):

Exhibit 8. Long, Healthy, and Productive Lives Measures

These three indicators do not fully capture “productive” or “healthy” lives. There are more relevant measures of productivity and quality of life, such as statistics about morbidity, the amount of time spent ill, or disability-adjusted life years (DALYs), which account for degree of sickness as well as length of life. These are sometimes difficult to calculate, but they are standard measures used by the World Health Organization (WHO) and far more relevant for a category about “healthy” and “productive” lives.

The indicators used do not capture the fact that someone waiting 18.3 weeks for surgery in Canada may also be losing four months of work productivity, as well as spending a long time with an impaired quality of life. The United States ranked first in wait times for specialists and nonemergency surgeries. When one includes those factors, a different story emerges from the data.

For the indicator “Health life expectancy at age 60” the United States ranks sixth, but a closer look at the raw percentages shows a very small range from first to last; whether these differences are even statistically significant was not addressed in the study. Nor does the category capture that Americans work longer — both in their work week and in their lifespan — than the other countries listed, which could explain the slight difference in the raw percentages. American work ethic is a cultural issue, not an implication of the health care system.

Also, infant mortality is a contentious indicator for the success of a health care system. Different countries use different measurements to calculate the statistic. The United States strictly follows WHO guidelines by counting all babies that have shown any sign of life, whereas Germany, for instance, only counts babies that weigh at least one pound at birth. Other countries do not count births earlier than 26 weeks. This disparity in measures of reporting artificially skews the rates, without factoring in cultural differences, like teen births, that also contribute to higher infant mortality.

In developed countries, a large portion of the increase in life expectancy is not attributable to the health care system. During the past century, the average life expectancy in the United States has increased by 30 years; modern medicine can only account for five of those years, while public health measures account for the other 25. Attributing small changes in mortality to medical care is very tricky. Lifestyles can affect health outcomes as much — if not more — than health care. The obesity rates in the United States are much higher than the other countries listed. Holding health care systems equal, that one factor would lead the United States to have lower health outcomes. Again, this is a cultural issue, and not an indication that a universal system would improve U.S. results.

A conclusion some may reach after reading the study is that universal health care is the solution to perceived disparity; this seems to be the conclusion the authors hoped to make. In fact, the study actually suggests that the new federal health care legislation will improve U.S. outcomes:

Newly enacted health reform legislation in the U.S. will start to address these problems by extending coverage to those without and helping to close gaps in coverage—leading to improved disease management, care coordination, and better outcomes over time.

Incentives need to be realigned, but that has more to do with the disconnect between patient and physician — the health care wedge, explained in the Show-Me Institute study “Prognosis for National Health Insurance: A Missouri Perspective.”

The Commonwealth Fund study admits that none of the other nations considered have “ideal” health care systems, and makes some questionable comparisons in order to “prove” that universal health care is the best way to solve problems in health care. Show-Me Institute staff and scholars have discussed better solutions for health care reform in blog entries, op-eds, and policy studies.

The Commonwealth Fund study notes that the largest problem in the U.S. system is affordability of health care; the study thus concludes that universal health care is the solution, rather than making health care more affordable. The Congressional Budget Office has calculated that the recent legislation, lauded in this study, will actually increase the cost of health care. The Commonwealth Fund study suggests a solution that will bring the exact opposite of the problem it anticipated: Health care will become too expensive for some people.

Just because a few countries are getting (questionably) better results by some carefully selected measures under universal health care systems does not negate the fact that market-based solutions are a better solution for Missouri and the whole United States.

The post Questionable Comparisons, Questionable Conclusions appeared first on Show-Me Institute.

It is not exactly groundbreaking research for me to state that teams and players pay substantial income taxes in various forms. Here are the most recent payrolls and league ranking for the five Missouri teams:

1. Rams, $62,384,821 (32)
2. Chiefs, $83,187,156 (31)
3. Cardinals, $93,540,751 (12)
4. Royals, $71,405,210 (21)
5. Blues, $46,485,000 (22)

As far as I know, the location in which a team plays its regular season home games is the primary determinate for which taxes must be paid. So, the city of St. Louis, which hosts the home games of all three St. Louis teams, gets $1,518,079 per year in earnings and payroll taxes just from the Cardinals, Rams, and Blues players. Kansas City gets $772,962 from Chiefs and Royals players. (This post originally mistakenly said that the KC stadiums were outside of Kansas City proper. Thanks to David Nicklaus of the Post-Dispatch for sending me a correction, and for reading our blog!) Of course, when you account for team employees and the profit tax levied on each organization, the earnings tax receipts grow even larger.

Missouri receives an estimated $10,710,088 each year from applying the 6-percent income tax rate to athletes from each of its five sports teams. (With deductions, etc., this figure would be a little lower.) Missouri, like many other states, enforces its income taxes on visiting athletes, too. However, just as players from visiting teams must pay the income and earnings taxes, all the players get credit for taxes paid to other cities and states. The result is that the total taxes paid are just moved around between jurisdictions, as our former editor Tim Lee first pointed out when writing about the “jock tax” in 2005:

But Missouri athletes who pay other states’ jock taxes are able to subtract those tax payments from their Missouri tax bills. When you subtract the revenue lost from other states’ jock taxes, the result is practically a wash. If all 20 states repealed their jock taxes simultaneously, states would get virtually the same revenue with a lot less administrative overhead.

Two lists help us determine whether players pay more or less taxes: states without an income tax, and cities with an earnings tax. The Cardinals players don’t appear to do so well here. They pay both a state income tax and city earnings tax at home, and regularly travel to Pittsburgh, Cincinnati, New York, and Philadelphia. Only when they travel to play the Astros — and, less frequently, the Marlins — do they really get a pay raise. The Royals also pay the local earnings tax when they travel to Detroit, Cleveland, or New York. Both the Cardinals and Royals pay the other city’s e-tax each year when they travel across I-70 for the annual “rivalry” series.

The Blues pay a local tax on their frequent visits to Detroit or Columbus, but get a nice tax vacation when they head to Nashville. Of course, Canadian taxation becomes a issue for any hockey player, and for the Royals to a lesser extent.

The NFL schedule rotates from year to year more than other leagues, but the Rams players have to like getting to play one guaranteed road game in Seattle each year, because Washington has no state income tax and Seattle has no earnings tax. The Chiefs and Rams play this year in the regular season, so both teams will be paying the host city’s e-tax then, as well. (The two football teams usually play in the pre-season for the much-coveted “Governor’s Cup” but I don’t think athlete’s salaries are based on pre-season games so no earnings tax would be collected in that case.) If you are looking to avoid taxes, the AFC south is where you want to play — aside from the smallish earnings tax in Indianapolis, of course. The Chiefs have to pay high California state taxes for at least two games per year. (Disclaimer: All team opponent and schedule info listed here has been pulled from my own memory, with a little help from ESPN.com.) Of course, other factors such as where an athlete keeps his primary residence, the agressiveness of his accountant, etc., will all play a factor here. A player who lives full time in Missouri is going to pay Missouri income tax on salary earned, but not taxed, playing in Texas, while someone who lives in another state might not. I am a policy analyst, not a CPA.

What does all of this prove? Nothing really, yet. This post is less debatable than future posts in the series might be, because in these cases the teams and players are treated just like other businesses, and the taxes paid are substantial. That does not mean I think they should be substantial, just pointing out that the applicable tax policies show no favoritism. Also, it is simultaneously difficult to say that the athletes and teams are not paying enough in taxes when around 100 individual players generate more than $1.5 million per year to the city of St. Louis alone, and it is almost as hard to seriously complain about the taxes paid by modern professional athletes, who earn enormous salaries to play a game for a living. (Am I jealous? Absolutely!)

Future posts in this series will deal with areas in which teams are not treated like other businesses, for better or worse.

The post Taxes and Sports: The Earnings Tax (Part One in a Series) appeared first on Show-Me Institute.

I believe the main reason for this disparity is that foreign languages are treated by our public education system as less important than math, science and English. In contrast, E.U. governments expect their citizens to become fluent in at least two languages plus their native tongue.

Another panelist laments the fact that “unlike Europe, the U.S. has no coherent strategy for making our society bilingual.”

I suspect European countries’ policies are a reflection of their citizens’ interest in languages, rather than the cause. Europeans have ample reason to study languages; they all live within a short distance of other countries where different languages are spoken. As Norman Matloff notes in his response to the Room for Debate question, Americans who live close to the border with Mexico show more enthusiasm for learning Spanish than do their fellow citizens to the north.

Could it be that although proximity to foreign language speakers can spark people’s interest, policies are what really make them use other languages? If that’s the case, I’d be hard pressed to explain what happened in Ontario, Canada, where a ceremony was conducted in English a few weeks ago. That was despite French’s status as an official language of Canada, and despite the French-language public school boards and community colleges that are established throughout the province. When a language isn’t useful to people, policymakers who promote it are wasting their time.

The United States shouldn’t order everyone to learn languages, but the education system should give opportunities to become bilingual to people who are interested. Magnet schools and charter schools are good environments for language specialization, as are the optional language-immersion programs offered by some traditional districts. (Examples in Missouri are Academie Lafayette, the St. Louis Language Immersion Schools, and the Kansas City School District’s Foreign Language Academy.) Parents who want their children to have a lot of foreign language exposure can enroll them in these schools.

If Chinese language education is to continue growing, more people must be free to choose schools that teach it. Policymakers who are worried about American students learning English only ought to try to make it easier to open new language-immersion choice schools.

The post “No Coherent Strategy” for Teaching Foreign Languages appeared first on Show-Me Institute.

Missouri’s oral health is among the worst in the nation. The Centers for Disease Control ranked the state 47th in terms of the percentage of the population that visited a dentist last year, and 50 of Missouri’s 114 counties have a shortage of dental professionals. In response to this public health crisis, the Missouri Department of Health and Senior Services (DHSS) released its 2009 statewide oral health plan, which addressed the difficulty of recruiting dentists to rural areas. Although the plan points out that enabling improved oral hygiene and regular visits to a dental practitioner would narrow the disparity, it fails to address an underlying cause of Missouri’s dental predicament: the professional licensing law, and its restrictive definition of who can provide dental care in Missouri.

Alaska had a similar dental problem in its tribal areas, which had the worst rates of oral health in the country. Alaskan dental therapists — trained to do most basic dental work, like drilling and cleaning, but not oral surgery — became a much-needed solution to the problem. The American Dental Association (ADA) sued the Alaskan Native Tribal Health Consortium (ANTHC) as a result, and the two groups ultimately reached an agreement that limited the program’s scope. The ADA argued that dental therapists cannot adequately provide health care. However, a 2008 pilot study of the Alaskan program, funded by Texas A&M University, did not find any significant differences between the quality of care provided by dental therapists and dentists.

Other groups have argued that there are too many dentists already, and that opening the market to paraprofessionals is unnecessary. If dentists are so accessible, though, why are Missouri’s oral health outcomes so much lower than other states? Cost and access are both issues; even those who can conveniently reach a dentist may deem dental services to be too expensive when money is tight. Dental therapists, because they require less training, are able to provide comparable care for a wide range of dental services, at a more affordable rate. Those who need more than basic drilling and cleaning can be referred to a professional dentist. Dental therapists would not replace dentists; already, dental hygienists provide the majority of basic dental care before patients see a dentist. Also, in the same way that some people prefer to see a general practitioner rather than a nurse practitioner, some will always prefer a professional dentist to a paraprofessional. Dental therapists merely provide a less expensive alternative for those who cannot afford a professional dental checkup.

Dental therapists have been successful in England, Canada, and Australia at providing quality dental care. In Australia, dental therapists are proving their worth beyond the provision of basic oral care. A recent study found that nearly 94.6 percent of restorations performed by dental therapists were successful, and that patients were satisfied. Another study demonstrated that dental therapists can improve children’s oral health, especially in areas without proper coverage. Throughout the United States, new legislation is capitalizing on the international success of dental therapists; in the spring of 2009, Minnesota passed a bill creating a bachelor’s degree program in dental therapy.

Opening the market to dental therapists provides more than just quality, affordable health care. It also provides jobs, especially in depressed rural economies that have trouble attracting professional dentists on a permanent basis. A change in the law would benefit both those newly employed therapists and their patients, who would have significantly better access to dental care. This is an important contributing factor to general human welfare, because improving oral health helps to improve overall health. Recent studies have indicated that gum disease is correlated with increased risk — and is potentially a contributing factor — for other health problems, like heart disease.

Dental therapists provide an economical way to combat tooth decay, and public health officials have already suggested plans to implement training programs in the United States. The only obstacle to their introduction in Missouri — and to subsequent improvement in the oral health of Missourians — is the regulatory barrier of Missouri’s professional licensing law.

Caitlin Hartsell is a public health graduate student at Washington University and an intern for the Show-Me Institute.

The post Filling the Cavities in Missouri’s Dental Care appeared first on Show-Me Institute.

First, it is more than likely that the money spent by filmmakers via tax credits would have been spent anyway in the market, by private individuals. If a hotel hadn’t rented a room to a member of the film production crew, they could have rented it to somebody else. If the restaurant hadn’t seated the producers at a table, they could have given the table to another party. I think that it is fallacious to assume that, had it not been for the tax credits, these Missouri resources would have been unemployed.

McCarty writes:

Harbin also misses the fact that the movie industry is nontraditional.

Saying that something is a fact does not make it a fact. The only thing that makes an industry like filmmaking “nontraditional” is the fact that the government has intervened to such an extent that it has distorted the market. Health care is another industry that is often described as nontraditional, but as I have described previously on this blog, health care is subject to the same market mechanisms as any other industry.

McCarty also writes:

Lastly, Harbin mentions that it may be better for Missouri to leave the filmmaking to other film states “like California.” She may not know this, but California found itself weakened between 1998 and 2000. Between those years, the U.S. lost $10 billion worth of film productions to Canada, which passed film tax incentives. Southern California alone lost about 35,000 jobs due to the shift to Canada.

It makes economic sense that California would produce fewer films because it had to compete with states and other countries. Filmmakers like Jason Reitman are smart businesspeople, and they will go wherever they can get the best deal. I disagree that this refutes my statement that Missouri shouldn’t feel that it has to compete with other states for filmmaking, however.

Michigan has pursued the filmmaking industry particularly aggressively, and its state legislature is already discussing repealing the program. Missouri would be smart to specialize in producing according to its comparative advantage (i.e., in products that aren’t filmmaking), and then realize gains from trade with those states. Missourians will still be able to enjoy the benefits of the product (i.e., film), and at a much lower cost (i.e., the price an admission ticket at a movie theater vs. the price of subsidizing the production).

As another advantage of producing according to its competitive advantage, Missouri would have an opportunity to differentiate itself. Instead of producing the same products and services as other states do, Missouri could produce the goods and services that are uniquely Missourian.

Furthermore, McCarty did not dispute my argument that targeted tax credits hurt businesses in non-favored industries. By providing special advantages to a select industry, targeted tax credits force everyone else in the market to compete at a disadvantage. In a previous blog post on Show-Me Daily, Dave Roland explains this better than I do:

True economic development happens best when governments allow businesses to compete on a field that offers no special advantages to any of the players. The government does a grave disservice to its citizens when it assumes the responsibility for picking winners and losers in the market, rather than letting businesses succeed or fail on their own merit.

Another argument of mine that McCarty does not address is the one relating to the supreme opportunity cost associated with film tax credits. What else can Missouri do with this money? What is so special about the film industry, in contrast to other industries? Why doesn’t Missouri target hog farmers or economic research analysts or education or infrastructure?

Maybe in a couple of years, each state in the union will offer tax credits that are targeted to filmmakers, thereby negating the artificial comparative advantage that currently exists in states like Missouri. I can only hope.

The post A Rebuttal to Ray McCarty’s Rebuttal appeared first on Show-Me Institute.