The Royal is a Kansas City institution, one whose fall catalog of rodeos, barbeque, and livestock competitions herald the start of winter and the region’s holiday season. Thanks to tens of millions in sales tax revenue STAR Bonds, those traditions will soon move away from the Royal’s current digs in Kansas City, Missouri, to nearby Kansas City, Kansas. Kansas’s $80 million contribution to the project is about double what American Royal was publicly trying to get out of Kansas City, Missouri, officials just two years ago to keep the Royal in the city’s West Bottoms.

But did Kansas even have to “build it” with taxpayer money to entice the American Royal to move? The Royal’s brand is defined by its history in the Kansas City area—even Kansas City’s baseball team is named after the organization—so it’s safe to say that American Royal wasn’t going to move its operations to Texas or Florida.

But setting aside for now the important question of whether this is an appropriate role of government (it isn’t), Wyandotte County has been seeing significant economic growth that would have made it an attractive landing spot for the Royal anyway. More families are moving there today than were coming 10 years ago. In 2004, 1,871 tax filers—bringing more than $57.6 million dollars of income—moved to Wyandotte; fast-forward to 2014, and tax filers were pouring in 25% faster, bringing in around $74 million with them.

Wyandotte County was “building it”—a functioning economy that has, in contrast to its basket-case reputation, attracted investments from Google, Amazon and others in recent years—before Kansas’s $80 million incentive was ever put on the table.

But Wyandotte’s recent successes don’t justify Kansas’s decision to subsidize the American Royal move. Indeed, the state’s $80 million giveaway has all the hallmarks of bad policy and poor judgement from Kansas’s political class. The American Royal was already getting cheaper land and a prime location close to its support bases in Johnson County, Kansas, and Kansas City, Missouri. The tens of millions in taxpayer support is just the KC Strip on top of this gravy train sundae.

Kansas? Sure, it gets a talking point in the battle for the economic soul of the region, but it’s a point that is likely to be eclipsed by the next round of billion-dollar business-poaching that’s certain to come.

While the Royal’s decision could be seen as a slap in the face of its historical roots, Kansas City, Missouri isn’t exactly a victim in the matter, either. The city has a terrible track record of poaching Kansas businesses in precisely the same way and is an equally bad actor in the billion-dollar tax-incentive border war that has bedeviled the region, creating no strategic advantages on either side of the border.

To put it delicately, the bull manure is blowing onto taxpayers from both sides of State Line Road. It’s time to end this tax incentive rodeo and finally pursue a mature economic development policy—one that doesn’t force taxpayers to build the fields of their politicians’ dreams.

The post Creating a Field of Dreams for the American Royal appeared first on Show-Me Institute.

This is, for all intents and purposes, the deal that Judge Russell Clark offered to those who wanted to reform the Kansas City, Missouri, School District starting in the mid-1980s. He implemented policy recommendations by fiat. He raised the property taxes of the residents of the school district without allowing them to vote on it. He required the state to contribute hundreds of millions of dollars to fund new programming. What the plaintiffs in Missouri v. Jenkins, wanted, they got.

Well, except for one thing: a school district that met the needs of their children.

As Joshua Dunn points out in Complex Justice, an engrossing history of the court case, Judge Clark was hemmed in. Kansas City’s geographic peculiarities have it spread across two states, and families of means have always been able to move to the green, suburban pastures of Johnson County, Kansas. At the same time, the U.S. Supreme Court had handed down the Milliken decision, which forbade judges from requiring actions from suburban districts to alleviate segregation, essentially boxing in the district and those hoping to reform it.

So Judge Clark started cutting checks. Experts were called in, surveys were administered, and program after program popped up. Slavic studies? Can do. A model UN with simultaneous translation? Sounds great. An Olympic-quality swimming and diving facility? Whatever you think will make the school district work.

Kansas City in the early 1990s was the apogee of what Rick Hess and I describe in our new volume, Educational Entrepreneurship Today, as the “system” approach to school reform. It is marked by careful planning, alignment, and coordination, all driven by the wisdom of experts and implemented by clear-eyed technocrats—or at least that’s how it is supposed to work. Kansas City shows, even with a boatload of money and a judge who can implement programs with the stroke of a pen, just how hard it is to pull that off.

What were the results? When Judge Dean Whipple eventually dismissed the case, 20 years after it began and after Clark himself had retired, he summed it up well, writing, “Despite the expenditure of vast sums, the prolonged oversight of a federal court and its appointees, the efforts of multiple parties, and the passage of forty years since the end of official de jure segregation in Kansas City, Missouri, the KCMSD still struggles to provide an adequate education to its pupils.”

I grew up in Kansas City during this time, so it’s no surprise that I have a different view of how to improve the education system. Rather than looking for the grand solution or trying to impose “best practices” on every school and classroom, I favor a more decentralized approach marked by experimentation, trial and error, and smaller entrepreneurial organizations working to solve the problems that are right in front of them.

Fortunately for residents of Crown Town (sorry—we’re still basking in the glow of last year’s World Series win and will be for some time now), this more decentralized approach has been adopted to a large degree, and some seeds for future success have been planted. As the court case wound down, Kansas City opened its doors to charter schools.

Today, according to the National Alliance for Public Charter Schools, the Kansas City Missouri, School District has the 5th-highest percentage of its students in charter schools, at 41%. And it appears that the market share will only grow in the future.

It has not been all roses. Several charter schools have failed, and some have failed spectacularly. However, a loosely aligned network of schools is gradually emerging in Kansas City and meeting with success. Recently, the public policy research firm Mathematica released an evaluation of the Ewing Marion Kaufmann School that showed incredible gains from its students. French language immersion school Academie Lafayette has a waiting list over a hundred students long. The Crossroads Academy, a popular urban charter school that was bursting at the seams, is opening new campuses, and the Citizens of the World network is coming to Kansas City after a group of enterprising parents issued their own RFP to charter organizations to attract a school operator.

Is change happening fast enough? Of course not. Will all of these schools meet with success? Maybe not. But given the backdrop they are working against, they are beating the odds. What’s more, if one school fails, the damage can be contained. If a whole district falls into disarray, it can take a city down with it.

The lesson from Kansas City for the rest of the nation is one of humility. We often don’t know what we don’t know, and are overconfident that our one great idea is the silver bullet can turn things around if embraced by every teacher or every school. We think that we can impose our views and shape the behaviors of people by administrative diktat, even when the people we’re working with deeply disagree with us about the proper course of action. The world doesn’t work that way, and we must keep that in mind as we chart a path forward.

The post The Great Urban School District That Wasn’t, but May Be Soon appeared first on Show-Me Institute.

To their credit, Kansas City's streetcar aficionados rarely make the claim that streetcars are good transit. They aren't. They are woefully expensive for the service they offer, are inflexible, and are slow. Bus rapid transit such as the MAX on Troost is a much more effective method of moving people.

In Kansas City and elsewhere, the matter comes down to one of correlation versus causation. Streetcar proponents want desperately to claim that the streetcar causes economic development downtown. It doesn't. In fact, all sorts of literature in the United States and around the world fails to show that streetcars cause economic development. There might be a correlation, however, as economic development often occurs along streetcar routes. Why? Because cities such as Kansas City lard their streetcar routes with all sorts of taxpayer subsidies such as tax increment financing and property tax abatements that are much more likely to drive development. Economic development may occur along streetcar routes, but it is not caused by them.

In fact, a 2010 study sponsored by the Federal Transit Administration found that,

The literature regarding empirical measurement of actual changes in economic activity, such as changes in retail sales, visitors, or job growth, is almost nonexistent for streetcars.  

This finding undercuts the primary claim made by advocates of streetcars—that they spur economic development. The same report adds,

Given that federal funding for streetcars emphasizes economic development, along with many local policymakers’ objectives to stimulate economic development, the literature is particularly weak on impacts of streetcars on economic development, such as the attraction of jobs, retail sales, and tax revenue.

In Kansas City, officials have strung together a laughable list of projects supposedly caused by the streetcar. We've debunked them here and here and here. While there may be a correlation between development and the streetcar, it isn't plausible to claim that the streetcar caused the development.

Consider that in the 2013 and 2014 seasons up to May 22, 2014, when ground was broken on the Kansas City streetcar line, the Royals record was 109-99, for a winning percentage of .524. Since the streetcar tracks were laid, however, the Royals went 183-126, including two World Series appearances and one world championship. That's a winning percentage of .592. If I suggested that the relationship between the streetcar construction and Royals’ success was one of causation—the streetcar caused the Royals to win two pennants and the World Series—I'd be laughed out of the room.

Yet this is exactly the sort of specious argument streetcar proponents make when they point to downtown development. The progress of the streetcar and the Royals’ success may run in parallel, but there is no relationship between them or among their causes. Like the streetcar and many developments attributed to it, the relationship is illusory.

The post Streetcars and the Error of Confusing Correlation vs Causation appeared first on Show-Me Institute.

It's been said time and again that the Kansas City Royals have succeeded by playing small ball; focusing on base hits, keeping the runs coming. There is no dependence on big personalities, and hopes aren't pinned to a dramatic swing for the fences to win the game. The Royals charted their own course, built on their own strengths, and delivered a product no one else could.

Kansas City government—and Missouri government in general—could learn a lot from that. Instead, city leaders engage in the municipal me-tooism of convention hotels, streetcars and airports. We pin our hopes on big plays (Boeing tax credits, Power & Light District) and neglect the basics (deferred maintenance on neglected infrastructure, diverting funds from schools, libraries, sewers, public safety). As a result, the City of Fountains cannot afford to maintain its fountains. 

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Reviewing the literature on collective bargaining recently reminded me of this little bit of baseball history. The Missouri National Education Association (MNEA), one of Missouri’s teachers’ unions, published a pamphlet arguing that successful collective bargaining requires an “exclusive representative” who negotiates a contract on behalf of all employees, whether or not all employees want to join the union. I pointed out in a recent post that a teachers’ association need not represent all of the teachers in a school district in order to effectively represent its members. The Koufax-Drysdale holdout illustrates this point.

It would have been absurd for Koufax and Drysdale to force the rest of the team into their mini-union. More importantly, forcing everyone to accept representation from the same negotiator would be wrong. If another member of the Dodgers’ pitching staff would have refused representation from Koufax and Drysdale, it would have been his choice to make.

MNEA could learn a thing or two from the Koufax-Drysdale holdout. Rather than forcing every teacher in a school district to accept representation from their organization and negotiating a contract on behalf of all teachers, MNEA could seek to represent teachers in a members-only capacity. Members-only representation is where a union only represents its own members and neither forces nonmembers to pay fees nor forces them to accept a contract the union negotiates. Members-only agreements allow workers the freedom to choose whether or not to be represented by a union. They also give unions the freedom to withhold services from nonmembers.

The Koufax-Drysdale holdout is just one example suggesting that there are alternative ways for groups of employees to bargain with their employers. These alternatives can be as effective as exclusive representation—and they can be done in a way that fosters individual freedom.

The post What Teachers’ Unions Could Learn from Koufax and Drysdale appeared first on Show-Me Institute.

Plainly, it is more than the exercise of peaceful assembly and free speech. The protesters have had almost two months to express their complaints about corporate greed, income inequalities, and the whole notion that life isn’t nearly as fair as it ought to be. What more can they possibly say that they haven’t already said (however obtusely) a hundred times?

In the root sense of the word, to ‘occupy’ a place is to seize it from someone else. In just that sense, the Soviet Union ‘occupied’ Poland in September of 1939.

In the public theater going on in our cities today, the occupiers lay claim to the ground that they occupy — chanting “Whose Streets? Our Streets” and refusing to leave, regardless of city ordinances forbidding the pitching of tents in public places and regardless of the entreaties of elected officials asking them to leave.

According to their argument, the occupiers have reclaimed public space for the “99%” — meaning everyone outside the tiny group of people (the richest “1 percent”) who supposedly control almost all wealth and power. Of course, it is preposterous for the protesters to claim that they speak for 99% of the country — or, indeed, for anyone other than themselves.

Nevertheless, in cities across the country, mayors and other public officials have gone along with this fiction and bent over backwards in trying to accommodate the occupiers.

That was the case in my home city of Saint Louis, where 60 or so protesters were camped at Kiener Plaza, two blocks away from the city’s baseball stadium. At first, Saint Louis Mayor Francis Slay, a Democrat, went out of his way to welcome the “Occupy residents,” as he called them. He offered the occupiers a free permit to gather at the plaza and openly expressed his willingness to overlook the violation of various city ordinances.

Said the mayor in a blog post on Nov. 4:

During the weeks it has been camped here, Occupy St. Louis has had the opportunity to make its points heard during some very high profile events, including a presidential visit (on Oct. 5) and the World Series.

I emphatically disagree with those who say that allowing the encampment to remain during those events showed St. Louis in a bad light . . . Moving the Occupy residents simply to deny them a chance to tell their story to a large audience would have been wrong-headed and wrong-hearted.

But with the Christmas season drawing near (a big event at Kiener Plaza), the mayor wearied of the street theater. He announced that he would put an end to the occupation — promising only to give the group 24 hours’ notice before police would be called. In response, the Occupy St. Louis group accused the mayor of bending to the will of corporate leaders — the dreaded 1 percent. At a meeting with the mayor’s staff, occupiers expressed their outrage by showing up with money taped to their mouths.

The drama ended in the early morning hours of Nov. 12. That is when Saint Louis police arrested 27 remaining protesters and cleared the plaza of tents and signage.

If any moral may be drawn from the “big-hearted” mayor’s falling out with those he so recently lauded as having “important things to say about the direction of the country,” it is this: You can please professional agitators and self-proclaimed victims some of the time, but you will never be able to please them all of the time.

In truth, the protesters in Saint Louis and other cities have no claim to special treatment in the use of parks and other public places — apart from their willingness to flout the law.

The violation of city ordinances may sound like no big thing — against the immensity of the First Amendment guarantees of free assembly and free speech.

But no one ever denied free speech to the protesters. It is they who put the liberty of others in jeopardy. City ordinances that prohibit the pitching of tents in public places ensure that no one group can seize these places and deny or inhibit others in the use and enjoyment of the same space.

In other places around the country, city officials should follow the Saint Louis mayor’s example: They should strike the tents and stop coddling the occupiers.

Andrew Wilson is a resident fellow and senior writer at the Show-Me Institute, which promotes market solutions for Missouri Public Policy.

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I want to make it clear that I do not want to outlaw wine in Missouri. However, it troubles me that taxpayer money is subsidizing the wine industry. Specifically, the Missouri Department of Agriculture spends $1,828,859 (click on HB 6-Agriculture and scroll down to page 133) on something called the Missouri Wine and Grape Board.

According to the Department of Agriculture’s 2012 Budget Request Form (click on HB-6-Agriculture and scroll down to page 134), “The Wine and Grape Board stimulates growth of the grape and wine industry for the economic and social benefit of the citizens of Missouri.” Aspects of the board’s functions include using funds to “develop programs for growing, selling, and marketing of grapes and grape products grown in Missouri.” Indeed, the Missouri Wine and Grape Board does have marketing products, including brochures, videos, and radio advertisements. The Wine and Grape Board also funds the University of Missouri Institute for Continental Climate Viticulture & Enology in order to fund grape research programs.

So, in essence, the board serves somewhat like a chamber of commerce for the Missouri wine and grape industry. However, unlike a chamber of commerce, participation in this program is mandatory, with a charge of a 12-cent excise tax on every gallon of wine sold in the state. Also, in all my searches through the state budget, I have yet to encounter an official appropriation for a private chamber of commerce.

I have to ask, why can’t Stone Hill or Hermannhof promote themselves with their own money? Why can’t there be a private chamber of commerce that promotes the wine industry, or all the wineries of the state? I have no problem with private groups promoting wineries, but do I think the state should be promoting them? No.

Also, there is no evidence that this expenditure actually DOES have a positive impact on the state’s wine industry. In my search, I haven’t seen anything to suggest that the Missouri Wine and Grape Board has a discernible impact on the Missouri wine industry. Even the economic development report on the Missouri Wine and Grape Board website doesn’t really show the spending cause and effect; it just shows that in recent years, Missouri wineries are doing well. However, it doesn’t link the activities of the board to the wine industry’s success.

The key issue here is funding priorities. Why is the state funding this board, at least at its current level, when there are other places in the budget that may require that money? If the choice for appropriators is between potentially laying off teachers, firing firemen, or withholding funds from vital social services, shouldn’t every area of the state budget come under review for potential savings? Just my 2 cents.

The post Whining about Wine appeared first on Show-Me Institute.

If you visited the Cardinals’ official website today to buy tickets, you’ve probably seen this page:

Now for the good news: Tickets to the game are still available! The bad-ish news? It’s going to be expensive if you want into Busch Stadium tonight. The lowest price going on StubHub right now is $489, for standing room only.

The most expensive ticket for the game: more than $12,000. David Stokes, a Show-Me Institute policy analyst, wrote Wednesday about the effect of legalizing scalping on the cost of after-market ticket purchases. From the article he quotes:

The ante rises during the playoffs, when a box seat can fetch more than $1,000 and even the price of standing through a nine-inning ballgame can run as high as $300.

We are well beyond that point today. But simply put, secondary markets – whether on the street or online – usually do a fine job of reducing product inventories by matching willing sellers with willing buyers. Those that value a ticket literally as much as a house payment can buy one; those seeking to unload their ticket can sell it; and those making the market receive their own cut for the service they provide. Everybody wins.

(By the way, originally I was going to write that “thousands of tickets are still available,” but that’s rapidly becoming untrue. During the 20 or so minutes it took to write this post this afternoon, the available number of tickets dropped from approximately 2,100 to 1,800. Prices are high, but they’re obviously not too high.)

This all naturally flows into David’s other post on the World Series regarding parking prices. Websites like StubHub (which is, not surprisingly, owned by eBay) are great because the market is pretty clearly informing what sellers are charging. World Series tickets, while they may have some collectible value after the fact, are ultimately perishable: they’re used for a game, or they’re not. That’s why if you want to go to a regular-season game and don’t mind missing the first inning or two, you can get better deals, as scalpers try to avoid getting stuck with tickets when the music stops. That “wait and buy” opportunity will, for the most part, be non-existent tonight (I think) but the moral of the story is that people place different values on different products, services, and conveniences. Parking lots around the stadium wouldn’t raise their prices if they didn’t think those spaces were valuable to parking customers. World Series ticket prices are very similar in that regard.

In any case, enough economics. Here’s to you, Cards. May the rally squirrel be with you.

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“You made more money when it was illegal — it wasn’t even remotely close,” said Tony Green, a ticket broker for 20 years. “We knew all the cops, so they wouldn’t bust us.”

So, how did my 2007 prediction on ticket scalping work out? There may be no way of knowing if more people are paying above face value for their tickets to these playoffs, but I still think that is a reasonable belief. However, my predicted overall price decrease for major sporting events was apparently dead on (not that it was a difficult prediction).  

In case you have not watched it yet, please enjoy this video of the Show-Me Institute turning all of our interns loose in a ticket-scalping competition last summer.

The post World Series Ticket Scalping appeared first on Show-Me Institute.

Several of the speakers have since noted the growth in both the quantity and quality of young liberty activists over the last few decades. In his Washington Examiner column, Cato Institute Vice President Gene Healy recollects that when he founded a college libertarian group in the early 1990s, “we considered ourselves lucky when we could get a couple of dozen socially awkward malcontents together to grumble about the government.”

But economist Bryan Caplan probably summed it up best: “Twenty years ago, a pack of libertarian students would have been roughly as awkward and freakish as attendees at Comic-Con … or, say, me. Now I see hundreds of students who aren’t just smart, but smooth.”

My college experience was not nearly as benighted as Healy’s or Caplan’s. I helped lead a libertarian group at Washington University in Saint Louis from 2001 to 2005, and we were extremely active: holding weekly meetings, bringing speakers to campus (sometimes multiple times per semester), debating other student groups, helping to publish a biweekly conservative-libertarian student newspaper, etc. The group was a major force in campus political life, but we were still outnumbered and isolated. There were only a few other large and active libertarian college groups across the country (Loyola New Orleans, Hillsdale College, and George Mason University spring to mind), so we felt like the last of a dying breed, a remnant of brighter days.

At one point, we tried to launch a national libertarian student group, much like what SFL has become. When we started planning for a conference, we thought 100–200 student attendees would be phenomenal, but we never achieved that because there wasn’t a great deal of interest in the idea outside of those few groups. If someone told us that, less than 10 years later, there would be a pro-liberty student group hosting a convention with more than 500 attendees (and many others turned away because of a lack of space), we would have laughed in his face.

I don’t think it has ever felt this good to be wrong. (Maybe in 2006, when the Cardinals surprised even me by beating the Tigers and winning the World Series, but I’m pretty sure this is better.) Students and young people in general are listening to the message of freedom being articulated by talented writers, filmmakers, artists, etc. — and by groups like the Show-Me Institute. I get dispirited on an almost daily basis when I see the government grow and grow, seemingly without end, but I have seen real changes in people’s beliefs since I first started tilting at these government windmills. That’s no guarantee that things will change for the better, but it is something. It’s hope.

The post A New Hope appeared first on Show-Me Institute.

“To play for a million dollars, I’d rather stay with my private business and share more time with my family,” he said. “Thank God I’m well off financially and my money is well invested.”

Now, many people will look at this and see an example of an overpaid sports star, greedily seeking an ever larger pile of money, but I think it nicely illustrates two economic concepts: diminishing marginal utility and opportunity cost. Playing Major League Baseball is a major time commitment (162 regular season games per year, 81 of them on the road), and, according to his statement, his next-most-valued use of that time is spending time with his family in Colombia, so giving up family time was his opportunity cost to earn those huge salaries. However, Renteria has earned many millions of dollars over the years, and apparently he has invested it wisely, so each additional $1 million is worth far less to him than the first million he made. As his baseball salary dwindles, the amount of time he has left to spend with his family is also shrinking, so that good is becoming ever more valuable. Whereas $1 million was easily worth the opportunity cost for a childless and dramatically poorer Renteria in the early nineties, it’s simply not worth the effort now that he is financially comfortable with a family to tend to.

In a similar fashion, income taxes artificially encourage people with the means to opt out of the labor market to consume more leisure. There’s nothing wrong with that choice, but, as a consequence, society will be a little poorer without the wealth that this labor would have created. Consequently, we should minimize the distortionary effects of taxes by keeping them low and let markets signal what people need and want through prices.

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Apparently we no longer hold that honor. We’re now number two.

These statistics continue to amaze me, because I find it very difficult to believe that St. Louis is more dangerous than, say, Compton, CA; Camden, New Jersey; or Gary, IN (or really, for that matter, Kansas City). And the annual studies have been routinely criticized for their methodologies, which are grossly inconsistent and dependent upon idiosyncratic crime referencing systems used by municipalities. In short, I tend to agree with Michael Tonry, president of the American Society of Criminology, when he states:

[These rankings] do groundless harm to many communities. They also work against a key goal of our society, which is a better understanding of crime-related issues by both scientists and the public.”

Of course, I have been mugged and robbed in St. Louis, so who am I to really say differently?

Also of note, my hometown of Sugar Land, Texas, was ranked the fifth safest city in America.

Because apparently I like extremes.

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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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