Lonely Conservatives on Campus
In case you missed David Brooks' essay in the New York Times on the plight of conservative students, you can find it here. (I was going to blog on this later, and kept a link to it open, but a computer seizure hit. Lesson: blog now--even if it's a draft--and revise later).
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A New Think Tank
Well, it's not exactly new, but centrists.org caught my eye from this chart, on the gap between the unemployment rate as determined by surveys of companies and as interviews of households. (The link comes courtsey of the Instapundit.) I'm somewhat familiar with the work of Jeff Lemieux (one of the staffers), so the site may be worth a bookmark.
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Illinois Gov: Pharmaceutical Companies Violate Antitrust Law
Gov. Rod Blagojevich has asked for an investigation into four pharmaceutical companies on the grounds that they are violating anti-trust laws.

The reasoning? As the Sun-Times puts it, these companies " limit supplies sent to Canadian wholesalers and pharmacies, which in turn sell their goods to Americans."

As well they should. The Canadian companies receive their goods under the terms of a contract, which presumably include provisions prohibiting the sale of these drugs across the border. To protect the terms of the contract, the drug companies ought to limit the supplies they ship up north.

Perhaps the governor is under heat for the poor record of the state in paying its medicaid bills to pharmacists. This latest tack--Blagojevich has taken other measures to promote drug importation--is yet another reminder of why putting states in charge of medicine is a bad idea.
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Support for Vouchers Weakening
Wisconsin appears unlikely to expand the Milwaukee Parental Choice Program. The teachers union-backed governor is likely to veto any expansion. In an odd twist of political semantics, Republicans are the pro-choice party, and it can be said that Democrats are anti-choice. Even Polly Williams, the "mother of choice," is against most current proposals under consideration.
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De Nile is a State of Mind
Of course, Governor Pawlenty's proposal to bring a pilot program of merit pay to Minnesota schools is bringing out the usual protests: (all teachers) should be paid more (regardless of performance), class sizes should be smaller (in effect, another pay raise for all teachers, regardless of performance), and so on.
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SUV-Haters Win One
Businesses get to take a deduction from income taxes the cost of certain items of capital equipment--such as vehicles. After Congress raised the limit for small businesses from $25,000 to $100,000, a number of business owners noticed that this provision would allow them to buy not a used sedan, but a brand new SUV.

Well, the SUV-haters couldn't stand for anything that might aid in the purchase of Those Fearsome Machines, including a tax credit for what would otherwise be a legitimate business expense. And now they've succeeded in stripping SUVs (new and late model ones, at least) from the list of what qualifies as a business expense in legislation making its way through the U.S. Senate. Sorry, Mr. Drywall Independent Contractor, you're just going to have to strap that sheetrock to the top of your eco-friendly mini-car, I suppose.
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New Charter Schools for Detroit Finally Dead
Philanthropist Bob Thompson has pulled his offer of $200 million off the table. The money would have gone to build 15 new charter schools in the city of Detroit. Unfortunately for him, the governor, legislature, and mayor of Detroit could not come to an agreement.

There is plenty of fingerpointing to go around, and perhaps the blame should be parcelled out to several people. But I lay the greatest responsibility on the teachers union, which protested vigorously against the proposal, and (especially) Kenneth Burnley, chief executive officer of Detroit Public Schools, who made his support conditional on DPS holding the charter, and thus overseeing the new schools. As if a system with a record of failure could be trusted with a new set of schools.

If Thompson wants to spend that money on education, I'm sure that someone in Michigan could find a good K-12 scholarship program to give that money to.
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Eminent Domain for ... Diversity
Thanks a recent "60 Minutes" expose, abuses of eminent domain have been getting more attention this week. Now, the Goldwater Institute comments on a recent court case that pitted a family-owned auto repair shop against the city of Mesa, Arizona. The Arizona Court of Appeals ruled against the city, finding that "“Article 2, Section 17 of the Arizona Constitution prevents the City from taking the Baileys’ property for this redevelopment project because the ultimate use of the property is not a ‘public use.’”

The institute's press release on the case, Bailey v. Myers, notes that despite the court ruling, governments in the state still have significant leeway. "Under the 1997 statute, an area can be targeted for redevelopment if, among other reasons, it is deemed by a municipality to have a predominance of 'defective or inadequate street layout,' insufficient 'diversity of ownership,' or 'improper or obsolete subdivision planning.'"

Diversity of ownership? Does that mean taking from a Mexican-owned business to make way for a Cambodian-owned business?

Obsolete subdivision planning? Perhaps a city, then can bring about a wholesale reconstruction of a neighborhood, and justify it on the basis of it having lots that are too small, or too large?

I used to live in a very pleasant city, a suburb west of Chicago. Within a mile, I could walk to two train stations, a library, the city hall, a theater, a Starbucks, several banks, a few doctors and dentists, and multiple family-orestaurantsaunts. My house, though, was obsolete by today's standards: old (from 1951), 3 bedrooms (few), 2-baths (small and without a walk-in closet), 1,500 square feet (small, when many houses start at 2,000 feet), a basement (only partially finished), and a segmented layout with no "great room" (which I don't care for anyway) flowing from kitchen to living room.

How do I know that my house was obsolete? Because a slightly smaller house just up the street was going through the "teardown" process just as I was moving out of state to new opportunities. Now, I didn't like the sight of smallish ranch houses like mine being taken down and replace by faux mansions on tiny lots of one-quarter acre. But at least these were voluntary transactions. How soon will it before houses such as those--perfectly serviceable, and in a desirable location--be torn down by government fiat in the name of removing obsolescence? It's a stretch, granted. Or is it?

OK, so I'm late to the game--"Urban renewal" was an abuse of eminent domain a long time ago. But the more I read about it, the more appalling it becomes.
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Super Teachers, Super Pay
Minnesota's governor, Tim Pawlenty, announces a merit pay proposal (of sorts) for government school teachers. It would include

• Teachers in selected schools could be paid up to $100,000 a year, based on performance
• These teachers could come from non-traditional career paths [meaning, I hope, they don't have to submit to the mind-numbing certification process]
• A plan to grade schools of education [fine, but abolishing them altogether may be better]
• Give schools more authority over teacher assignments

Minnesota has been an unlikely place of innovation in government school policy, so the prospects for this proposal can't be dismissed out of hand. However, I find it unlikely that the industrial-union style of labor/management relations in government schools will go away anytime soon. Expect fierce resistance.

UPDATE: Here's a link to the Star-Tribune (registration required) article on the subject.
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Wisconsin May Boost Voucher Program ... or Not
The Wisconsin House of Representatives has voted to expand the Milwaukee Parental Choice Program, which provides low-income parents with vouchers to pay for tuition at private or other public schools. They would lift a cap that limits the number of students who can participate, loosen the income requirements, and expand the eligible schools to those in the county, not just the city.

Ultimate passage is uncertain at best, though; the governor won election with the substantial of the state's teachers union.

The debate in the Assembly has shown (once again) the fundamental gap between two schools of thought on how to reform education: the standards-based, and the parents-based. Rep. Marlin Schneider (D-Wisconsin Rapids), a critic of expanding the program said that he opposes allowing parents to use tax money send children to schools "that are not accountable to anybody."

When public money is used, yes, there should be accountability. But Schneider's ignoring the fact that the schools of choice are already accountable: if parents think a school is doing a poor job, they can take the child--and the money that follows the child--out of the school. The threat of losing several thousand dollars a year in tuition strikes me as a better form of ensuring accountability than relying on the rules of a government school establishment that has a record of mismanagement, arrogance, and irrelevance.
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Take a Hike!
Every year on Labor Day, 30,000 cars cross the Mackinac Bridge that connects the two peninsulas of Michigan. And every year on Labor Day, half of the bridge is closed to autos, so that 60,000 people can make the 5-mile trip by foot. Now, the bridge administrator (the bridge is run by a separate corporation) suggests changing the date of the bridge walk to some other day, to alleviate traffic congestion.

Even though I am a Michigan native, I've somehow never made the trip down this magnificent structure. I am hoping to someday, though. Perhaps it would be more feasible if the trip isn't scheduled on what is probably the highest day for auto traffic as well.
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In Detroit, the Doctor is Out
In 1983, there were at least 50 ob/gyn physicians in private practice in Detroit. In 1993, there were 20. Today, there's 62-year old Alex Pickens. That's it. One, for a city of roughly a million people.

In the last five years, Detroit has lost 60 percent of its primary care physicians, and those who have stayed in the city have shifted from private practice to being corporate employees, working HMOs or hospitals (some of whom are owned by HMOs).

So what's happened? The Free Press comes to this conclusion: doctors have gone " to the suburbs, where more patients pay, or to a hospital staff, where someone else handles billing."
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21st Century Health Care Coverage for ... the 21st Century
Coming on the heels of yet another report that the number of uninsured has gone up, Ron Bailey argues that we need to move beyond the current system of health insurance, which depends on employer-paid (or at least sponsored) coverage.

Bailey quotes the Galen Institute's Greg Scandlen, "Considering that 2.7 million jobs have been lost recently, why would anyone be surprised that 2.4 million more people are without health insurance?"

Businesses currently receive a $140 billion tax break for paying for health insurance for employees--while people who buy insurance on their own get a tax break of: $0. (This is slowly starting to change, for a few.) According to two economists cited by Bailey, "A modest tax credit paying 50 percent of the premium would reduce the number of uninsured workers and family members with low incomes by as much as 52 percent."

An employer-based system, as problematic as that is (think of your employer's HR department rummaging through your medical records), it worked reasonably well when people worked for one company until retirement. That doesn't happen as often anymore, but the regulatory and tax environment operate as if nothing has changed.
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Unsafe Imports?
The FDA reports that shipments of foreign drugs to the U.S. "often contain dangerous unapproved or counterfeit drugs that pose potentially serious safety problems.
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Michigan to Buy Price Controls
The State of Michigan is looking at importing price controls ... err, price-controlled drugs, from Canada.
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Pre-Paid Tuition Programs Sinking in Red Ink
About 20 states offer pre-paid tuition plans, or variants thereof. The idea is that if you give your state X dollars today, the state will guarantee that tuition for Johnny will be covered Y years from now.

There's just one little problem with this arrangement: it shifts the risks from families (who would otherwise save money in their own mutual funds) to taxpayers as a whole. And with faster-than-expected increases in tuition, many state programs are in financial jeopardy.

It's funny, but by getting into this game, state governments have going against the trend of the financial industry for the last decade. Retirement plans are shifting from defined benefit (you can expect a certain benefit at retirement, courtesy of your employer) to defined contribution (the company and employee make an X percent contribution of pay into an account, which is then managed throughout the employee's lifetime). There is even talk of health insurance plans going the same way, with companies giving employees a bundle of money and then saying "You go find your own health plan."

A "defined contribution" plan in college planning would be for a family to set aside a certain amount of money every month during the child's youth. Instead, state's have encouraged families to use a defined benefit plan for college planning, and turn to the state as the administrator of the plan. Now states--and taxpayers--are at risk.
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Money Flows To the States
A new study on campaign finance shows that "The two major political parties are funneling increasing amounts of money through state political parties to circumvent new federal campaign finance laws."

Not exactly a surprise. Taking the money out of politics is like .... Oh well, I'm not very good at metaphors. Let's just say it isn't going to happen. Money will stop going into politics once politics doesn't matter, when it doesn't affect people's economic condition or liberties. So those who wish to halt the amount of money devoted to politics ought to work to reduce the effect that the results of politics--tax systems and regulations--have on our lives.
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Should We Buy More Government?
I'm looking over an August 2002 budget document (PDF) from the Minnesota Department of Finance to get an idea of what the state budget has been like over the years. From 1982 through the 2002, spending growth in the general fund has risen, on average, 6.4 percent per year. Some of that is due to inflation--though inflation has been under 4 percent per year since at least 1993, and the rest, through an increasing population (roughly 1.2 percent per year). Add an inflation rate of 3.5 percent, and we have a "natural" increase of 4.7 percent a year. The leftover of 1.7 percent per year, is the result of deliberate policy choices.

Now, it's true enough, personal incomes have grown during that time (5.6 percent per year since 1992), meaning people can "afford" more government. But it's not enough to say that personal incomes have grown--even if they have kept pace with government spending increases.

Why? Because the percentage of one's income going to any given product or service ought to go DOWN as income goes up. If, as a teenager, you had a car and had to make car payments, those payments were a substantial part of your income. If you are now established in a career, payments on a comparable car would be less of a drain on your income.

But say that you went from a 10 year old Chevy as a teenager to a brand-spankin-new SUV today. Then, perhaps, the burden of the car part of your budget would be the same, because you've upgraded what you have bought. Was that upgrade necessary? Maybe it wasn't; maybe it was. Who am I to say?

We have a similar situation with state government spending--Minnesotans have gotten wealthier, but instead of replacing that Chevy with another of its kind, we've gone out after Lincoln Navigators and Hummers. "Mission creep" is fine when a person freely spends of his own money. But in this case, what is the public good (and thus meriting tax money) has been upsold as well, beyond what is good.
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Health Care Spending: Why is More Bad?
I've been reading various articles about the rising cost of health insurance--double-digit increases in premiums, and so forth.

Now, there is much that is wrong with our health care system: it involves too many third parties, health insurance as we know it isn't really health insurance, out-of-control judgments send malpractice insurance rates sky-high, and so forth.

But contrary to what you may read, increased spending on health care is not necessarily a problem. Health care is, after all, a good thing. And when you have more money, you spend more of it on good things. American houses cost a lot more than they used to--but they also have more space and more features, in keeping with appetites for more and better. And one's health is even more important than housing, so if medical science knows how to increase the level of comfort during our lives, and we have the wherewithal to purchase that increased well-being, what's the problem?

Yes, there are many changes that should be made, and much spending on health care is wasted. But the overall level of spending on health is not a problem. It's the sign that we continue to have a wealthy society.
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Strike? Yer Out!
Minnesota state government workers are set to strike over health care benefits; 80 percent of voters of one union and 66 percent of voters of another have authorized a strike.

As a former government worker (at the federal level) and a taxpayer, I have little sympathy for the would-be strikers. Employees will still be getting step increases.

Union leaders complain that rising health care costs will offset the expected raises. Well, welcome to the real world, folks.

The state's employment boss says that every extra $1 million in compensation (either salary or benefits) beyond what is already budgeted would require 17 layoffs. That's over $58,000 compensation per position--pretty decent, especially with so many people out of work as it is.

Currently, employees pay $0 a year for single coverage (the national average is $508) and $708 a year (the national average is $2,412). They've gotten quite a deal so far. If they don't like the future, well, there's always the private sector.
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Take Me Out to the Ball Game
The Chicago Cubs have long wanted to increase the number of games they play at night. But they need the permission of the Chicago city council to do so.

Now that the Cubs are in the playoffs, tickets to Wrigley field are a hot item, going on the street for $300 to $1,500 each.

Guess who's going to be getting playoff tickets at the $35 face value? You guessed it. Members of the Chicago city council.

Understandably, some Cubs fans are upset.

(Note: I'm not a Cubs fan, or even much of a baseball fan.)
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Chicago-Milwaukee Rail?
Milwaukee-area officials have agreed to spend $91.5 million in federal funds to study ways to extend Metra service from Kenosha to Milwaukee. (For information on Chicagoland's passenger rail system, click here.) Mass transit usually doesn't live up to its promise. Population density in America is seldom high enough to justify its cost. For a review of mass transit in general, see The Public Purpose.
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Uninsurance Rises in Michigan
According to the Center for Urban Studies, at Wayne State University, the number of Michiganders without health insurance rose 1.3 percent in 2002, or 110,000.

The Detroit Free Press article covering the story quotes an official with the Center, who blames the rise on a decline in unionized manufacturing jobs. Perhaps. But the story is incomplete. Is the 1.3 percent rise more or less than the change in previous years? I don't know. Why did manufacturing jobs decline in number? Perhaps it has something to with the very heavy presence of unions in southeast Michigan. Auto manufacturing has been increasingly turning to open shops--in the south, and in other countries--for decades now.

Longing for a mythical past of union-and-company provided security is a losing game. It's time for public policy to adjust, and provide ways for people to have affordable insurance (not overly expensive prepaid medical care) on their own or in voluntary organizations, rather than through an employment system that is fading in relative importance.
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Telemarketers May Win
Telemarketers are accused of being aggressive and pushy, but Shawn Macomber thinks that Congress was too pushy for its own good lately. In his brief article, the American Spectator intern points out that many states (37, in fact) had their own "do not call" acts in place--laws that were working reasonably well. But a national law has raised the ire of the noisemakers, who have challenged the law in federal court, and have thus far won, twice. The latest victory was especially troublesome, as it affirms a constitutional right to pester people over the phone--a right that was in the shadows until recently. In other words, the legal standing of telemarketers is more firm than ever before.
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Administrivia: Archives Updated
Check out the archives listing; it's now current. I know that search engines are useful, but I wish more blogs would provide an annotated index.
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WGN-AM Program Host Joins Blogroll
You may notice a new entry in the blogroll today: Milt's files. That would be for Milt Rosenberg, evening (9-11 pm, CT) host for WGN-AM. His program, Extention 720 program is a showcase for what talk radio can be, but seldom is: smart, wide-ranging, and challenging without throwing bombs or ranting and raving. Tune your dial to 720 AM, or have a listen by the net.
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Government Takes Business from One, Gives to Another
I didn't see this, but I've been told that "60 Minutes" did a profile of eminent domain abuse last night. Read a transcript here. If you're unfamiliar with eminent domain, be prepared: it can be appalling.

Here's a small sample:

Jim Saleet worked in the pharmaceutical industry, paid off his house and then retired. Now, he and his wife plan to spend the rest of their days there, and pass their house on to their children.

But Lakewood's mayor, Madeleine Cain, has other plans. She wants to tear down the Saleets' home, plus 55 homes around it, along with four apartment buildings and more than a dozen businesses.

Why? So that private developers can build high-priced condos, and a high-end shopping mall, and thus raise Lakewood's property tax base.

Eminent domain, which should be used sparingly, is designed for developing such things as roads and courthouses. Instead, it's being used to take property from one private party to give to another private party, who is often lavished with tax credits in the process.

The Institute for Justice is, by the way, a great champion of property owners who face this kind of abuse of government power.

(Interesting note: as I put this post through Blogger's spell-check, it suggested "lawsuits" for "Lakewood's".)
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Canadian Policy embarrasses U.S. on Drug Price Controls?
The editorial board of the Des Moines Register says that Americans who get cheaper prices for drugs by purchasing from the land up north are "Sponging Off Canada." Sounds like a spoof of reality to me. David Hogberg has the news.
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Do You Know How Much Your Health Insurance Premiums Are?
The Kaiser Family foundation has a new edition of their annual report on employer-sponsored health benefits. Here's a link (PDF) to the summary.

The survey finds that the average premium per employee for single coverage is $3,383 per year; for family coverage, it is $9,068. For single coverage, employees pay $508 a year (15 percent of the total), with employers paying $2,875 (85 percent). For family coverage, employees pay $2,412 a year (27 percent of the cost), with employers paying $6,656 (73 percent).

But since insurance premiums are but one form of compensation, one can argue that the total "employer" and "employee" contributions are as good as cash when discussing worker pay. In my book, $9,000 a year is a lot to pay for insurance; it's enough, in fact, to make me wonder if the money is being wisely spent.

By contrast, I took a trip over to ehealthinsurance.com and plugged in some numbers for a hypothetical family: husband (age 42), wife (40), daughter (15) and son (12), living in Chicago.

The plan with the highest annual premium: a BlueCross plan with $20 office visits, $0 deductibles, and no coinsurance. Premium? $15,075.

Too rich? How about a PPO that comes up midway through the list of plans offered through this website. It's got a $0 deductible, but a coinsurance of 20 percent, and the price for an office visit goes up to $30. Premium: $9,144 per year.

Wow. Ok, let's try something else. Go cheaper. Another BlueCross plan. Of course, you have to put up a substantial deductible--$5,000 per year, though the coinsurance remains at 20 percent. You pay all for all office visits up to the deductible, then 20 percent after that. Premium: $3,684 per year.

That's roughly 55 percent of what an employer pays for insurance each year, and 40 percent of employer/employee payments, or a savings of 60 percent, or $5,384.

Now, do you think it's possible to come ahead with this plan, or something like it? Certainly. But it requires changing your thinking about the role of health insurance.

In reality, most most health policies mix insurance--seeking protection from the unpredictable--with an expensive, pre-paid purchase arrangement.

As is the case with auto insurance, you can get a less expensive health insurance policy if you accept a higher deductible--that is, rely on it for catastrophic events (for autos: a crash; for health: major unexpected surgery) and not for routine ones (for autos: oil changes and new tires; for health: bouts of the flu).

Will a catastrophic-only health insurance policy make sense? Won't a $5,000 deductible be just too much for most people to deal with? Before saying yes, consider the following.

Most people won't incur massive medical expenses each year, so say that the employer and employee team up for this lower-cost plan. Take half of the cost savings, or $2,692 (5,384 divided by 2), and put it in an employee raise (since the money being spent was on compensation, already). Take the other half and put it in a tax-free account (a medical savings account) and let that grow tax free. That's an incentive to be a wise healthcare consumer. As a bonus, within two years, there will be enough money stored up to pay off the deductible if it maxes out--something that won't happen every year, or even every two years.

An even better approach, of course, is to get the employer out of the equation, and take the cash. We don't have "car maintenance organizations," and depend on employers to provide auto insurance; why should people depend on them for something even more valuable?
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Flint Senator Calls for Charter Schools
Charter schools aren't the ultimate solution to what ails public education, but as a step away from the government-run-geographic-monopoly model, they do introduce some measure of school choice.

Democratic politicians, by and large, have been leading the charge against enhanced school choice (charters, tuition tax credits, vouchers), which is why it's always encouraging to see one or two break with the solidarity of status-quo teacher unions.

In Michigan, a controversy has been brewing over a philanthropist plan to build 15 charter schools in Detroit. Sen. Robert Emerson, a member of the Michigan senate from Flint (the city otherwise known as "the industrial sinkhole of Michigan") has said of the man who wants to build the schools: "Tell him we'd love to have some in Flint."
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A Few Sports Frivolities
First, the Detroit Tigers are proudly Number 2--that is, they possess only the second-worst team single-season record for a team since 1900. "Could be worse," but only barely. As a native of Michigan who went to a few games at the old Tiger Stadium, I'm glad to see that it didn't happen. Still, the Mackinac Center had some fun publishing a piece describing a subsidies-to-victory ratio.

By comparing the cost of various tax subsidies with the number of victories a team has, Michael LaFaive found a way to describe how it cost taxpayers for each victory. Naturally, the more often a team loses, the more each victory costs. In recent years, the number was slightly over $103,000 per win (2000 SF Giants) to $4.3 million per win (1999 Seattle Mariners).

Second, as if to demonstrate the foolishness of sending good taxpayer money after bad (sports teams of any sort), the Chicago Bears have their home opener tonight at a just-renovated stadium. Soldier Field cost $365 million to fix up. As if to chide the taxpayers for their fiscal folly, the Bears have started the year in which they have an expensive new play palace with ... an 0-2 record. Tonight, they will play a team (Green Bay Packers) that has won 14 of the last 16 contests between the two clubs, suggesting that the team will be 0-3, and the very first contest in the taxpayer-funded renovation will end in a loss for the home team. But even a victory would be expensive.

Finally, summer is officially over, and I can't wait for Winter. Now that I live close enough to some ski hills, the season is noteworthy for something other than short, cold days and long, colder nights. I bought a new pair of skis the other day, and eagerly anticipate making some tracks.

As far as I know, there were no taxpayer subsidies involved in the development of my favorite ski areas. Though in this day when government planners get involved in nearly everything, I could be wrong.
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