Conservatives now offering "one of the worst ideas in education:" former U.S. Secretary of Education.
"DUMB liberal ideas in education are a dime a dozen," says Rod Paige, "and during my time as superintendent of Houston's schools and as the United States secretary of education I battled against all sorts of progressivist lunacy, from whole-language reading to fuzzy math to lifetime teacher tenure. Today, however, one of the worst ideas in education is coming from conservatives: the so-called 65 percent solution."

As an alternative, Paige recommends the 100 percent solution, about which I will have more to say in the next month or so--with any luck, in a major newspaper in the Midwest.

The mad professor of economics has a couple of thoughts on the 65-percent plan.

Labels: Education

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Your and My Happy Days.
Do we still live in a world of Happy Days?

Public and corporate policy regarding retirement income and health insurance is based on the assumption that people would live in a nuclear family with one breadwinner and one bread baker. The single provider of income would, in turn, work at the same company throughout his working life.

As you know, that’s not exactly what the American society and economy look like today. Last week, the Bureau of Labor Statistics released the latest findings (PDF) of an ongoing project called the National Longitudinal Survey of Youth 1979. (Click here for one newspaper's summary of the findings.)

The study is a survey which tracks the same 10,000 or so Americans over time. The survey found that the average person in this group held 10.5 jobs between the ages of 18 and 40.While people tend to change jobs less frequently as they age, this group had on average two jobs during the age range of 36 to 40—one job every two years! (For what it’s worth, the survey focuses on employers, which means that an initial job, a lateral reassignment and a promotion all count as one job. This means that the survey may actually underestimate job hopping.)

Defined contribution plans, such as 401k(s), are more in tune with this new reality. The old version of Social Security, which worked best when Detroit’s Big 3 defined the world automotive industry, is obsolescent, and should be supplemented (for those who wish) with a 401(k) style plan that involves privately owned accounts.

In our health care approach, many people who lose their job lose their health insurance coverage. Whatever its merits in years past, it’s simply a stupid approach today. There are two alternative ways forward: government-run health care (socialized medicine) and individually-owned insurance.

Corporate policies can and do change, though the old approaches are still propped up by federal laws such as the tax code. Public policies, since they are driven by interest group politics, are slower to change. But as time marches on, we will find that they were designed for a world that, bit by bit, doesn’t exist anymore.

Labels: Health care

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There's a Political Interest Group for Everything.
The people who sell skis and snowboards and run ski areas are "working with" the "Congressional Ski & Snowboard Caucus" to get President Bush to declare January as "National Ski and Snowboard Month." (permalink)

Is TOD DOA?
Transit-oriented development is one of those things that just sounds like it makes a lot of sense: take cars off the road, revitalize blighted or depressed areas, eliminate congestion (at least for some people) and provide some “quaint” as well. But the Independence Institute has its doubts.

Here’s Kathleen Calogne on "The Truth about Transit Oriented Development."

RTD [the regional transit authority in Denver] is preparing to spend billions of dollars of taxpayers' money building rail transit. The problem it faces now is how to get people onto trains when most people live miles from rail lines. Its solution: Jam people into high-density housing around each rail transit station. RTD calls this "transit oriented development," or TOD.

Berkeley, California TOD proponent Dena Belzer claims rail transit in other cities has spurred billions of dollars worth of developments. She adds that many people are eager to live in high-density, mixed-use developments where they can walk downstairs to a coffee shop or grocery store instead of having to get in a car and drive.
First of all, the billions of dollars of development supposedly inspired by rail transit is simply a lie. To make this claim, rail supporters have included every downtown skyscraper and taxpayer-subsidized sports stadium that happened to be built near any rail line. They have even counted downtown parking garages: if rail transit works so well, why the need for new garages downtown?

Second, while some people prefer to live in a beehive of activity, they are definitely the minority. A poll conducted by National Family Opinion found that 82 percent of Americans say they aspire to live in a single-family home in the suburbs, and only 18 percent want to live in cities close to work, shopping and transit. Certainly, people do not move to Colorado's wide-open spaces so they can live in Brooklyn-style neighborhoods.

Unfortunately for TOD enthusiasts like Belzer, the real-world experience with transit-oriented development in Portland, the San Francisco Bay Area and other cities is that TODs only work when they are subsidized and designed around the automobile, not transit.

When Portland, Oregon built its first light-rail line, it zoned every neighborhood along the line for high-density transit-oriented development. Not a single one was built for ten years and then the city started offering millions of dollars in tax breaks and subsidies. Even with the subsidies, only a few of the TODs are fully occupied, and many have high vacancy rates. Some have absolutely no businesses in the supposedly mixed-use developments. What makes some work and others fail? In a word, parking.

TODs are only marketable if they have plenty of parking for both businesses and residents. In other words, they are really automobile-oriented high-density developments, not transit-oriented at all. In fact, surveys of people living in Porland's TOD's show most drive to work.

Denver and its suburbs are already handing out subsidies to TODs near existing and proposed rail lines. The subsidy of choice in Colorado is known as "tax-increment financing" or TIF.

TIF uses most or all of the property taxes on a new development, and sometimes part of the sales taxes on retail sales, to cover much of the cost of building the development. That means that schools, police, fire protection and other services used by those developments must be paid for out of someone else's property taxes -- like yours. Typically, cities sell bonds, spend the money on the development and use future property taxes to repay the bonds.

To understand how much TIF subsidizes these developments, imagine being able to use your property taxes over the next 15 to 30 years for home improvements or to pay off your mortgage. This is enough to persuade developers to build high-density housing even though they know the vast majority of Coloradans prefer to live in single-family homes.

No politician would ask you to vote for higher taxes to subsidize people who shop at Whole Foods. Instead, they divert property taxes from city services to subsidize these lifestyles, and when schools run short of money, they ask you to raise taxes to keep them open. Portland has diverted so many property taxes from schools to transit-oriented TIF that its mayor recently proposed a city income tax to make up the shortfall.

Rail advocates purport that we must have expensive and heavily subsidized rail transit to attract transit riders. Then they say we need subsidized TODs to get more people to live along rail lines to get a few people out of cars. What we end up with is more congestion, higher taxes and declining urban services.

Labels: Transportation

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A Clash of Civilizations.
Should the north woods be preserved as a playground for suburbanites? Or should rural dwellers be able to develop the economy as they see fit?

USA Today tells the story of Two Maines.

USAT says that there are two states of Maine: "One, mostly northern, inland, rural and conservative, is symbolized by the moose; the other, largely southern, coastal, suburban and liberal, is symbolized by the lobster. Most important, the first is declining while the second is booming."

If some folks in southern Maine have their way, the economy in northern main could continue to decline.

"Some people, such as Roxanne Quimby, co-founder of Burt's Bees skin care products, want to make the North Woods a nature preserve and restrict logging, hunting, trapping and snowmobiling Â? the very activities that local people consider their birthright. One proposal, unlikely to be realized soon, would create a national park larger than Yellowstone and Yosemite combined. Meanwhile, conservationists are buying land and banning hunting and other activities."

Say what you will about the aesthetic value of wilderness, but imposing restrictions on the use of thousands of acres of land is no way of promoting economic growth. In fact, inhibiting economic growth seems to be the goal of some southern Mainers. Too often, the vision of what northern Maine should be like is based on the invalid use of extrapolation, and of faulty assumptions about personal behavior:

"We like to think we'll drive north and see this vast, untouched wilderness. We don't want to think we'll see house lots. This is the soul and spirit of Maine."

[Green Party legislator] Eder says the constituents' feelings are connected to the development sweeping the southern coast: 'They see it in their backyard, and imagine it across the state.'

But he admits that many southerners talk about seeing the North Woods only 'when they get around to it' and says he has not made the four-hour drive himself lately. That underscores the northerners' point: Southerners throw around their political and economic muscle without fully considering its effect on the far-off north." (permalink)

Public Pensions: A Problem for Taxpayers, Not Employees.
Standard and Poors reports that the average large-city pension fund is weaker now than it was six years ago.

From the Wall Street Journal

Some of the nation's largest cities are falling further behind in funding their employees' pension plans, according to Standard & Poor's. The credit-rating firm looked at 20 large U.S. cities and found that most faced rising shortfalls in their employee plans, thanks to a combination of sizeable stock-market losses early in the decade, enhanced benefit packages to employees and longer life spans.

Over the survey term from 2000 to 2005 (some cities only had data through 2004), the average level of pension funding in the 20 cities fell to 84% from 99.8%.

As the Journal points out, the biggest threat is to taxpayers, not retirees and current city workers. Public employees will get their money; the public may have to pay more to make up for shortfalls. "Enhanced benefits packages," as the Journal puts it, are in some cases supercharged benefits that exceed what is commonly available in the private sector. To paraphrase the old country music song, they get the goldmine, and the public gets the shaft.

BusinessWeek looked at the problem just over a year ago.

Labels: Public employee pensions

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Some Bad Ideas Won't Die Just Yet.
Milwaukee and Chicago have the only two big-city school districts that have a residency requirement for teachers.

The Wisconsin Policy Research Institute recently explained (PDF) Why It's Bad for Schools and Why It Isn't Going Away.

Why won't it go away? Here's one reason: the teachers union's power increases if its membership lives within the district.

Labels: Education

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This is Not Encouraging
Three diverse groups -- the Brookings Institution, the Concord Coalition, and the Heritage Foundation -- brought together a focus group to explore attitudes toward the federal budget. The results were not encouraging, at least according to this report in the New York Times.

Three focus groups of varying life experiences was briefed on the situation of the federal budget regarding tax receipts, spending, and entitlements. (In a word: depressing). They were then asked where government should go from here.

Here's what the firm conducting the research, Viewpoint Learning, found:


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- The participants didn’t hate taxes nearly as much as many Republicans think.

- They seemed to treasure Social Security and Medicare in their current forms, but were more open to change than many Democrats think.

- None of the participants pushed for less defense spending, even if the war in Iraq were to wind down.

- Nobody could agree on a single government program that ought to be cut or eliminated altogether.

The good news was that people here appeared less polarized and more open to sharing burdens than do their elected leaders in Washington. The bad news was that the Philadelphia group thought the best solutions were to tax other people (smokers, drinkers, S.U.V. buyers, the rich) or to somehow "spend smarter."

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Criticize the NYT or the use of focus groups, but I suspect this is not far off from being representative of the public at large. (permalink)

Schools for Students ... or Student for Schools?
Should traditional public school districts be required to let charter school students participate in extra-curricular activities?

The Saint Paul Pioneer-Press recounts the story of a 16-year old boy who wasn't doing well in his school district. He enrolled in a charter school, and has performed well since then.

Since the charter school does not have a football team, Randall Brekke asked to try out for the team of the district high school.

They said no. The logic is appalling: "District 196 Superintendent John Currie said students should view the activities as part of the whole school experience and not drop in only for one or two."

In other words, take it or leave it, regardless of whether the academic program--allegedly the reason for a school to exist--fits the needs of the student. We're going to claim all of you, regardless of the fact that customization is the order of the day.

The system must prevail.

Labels: Charter schools, Education

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