Month: March 2015

Oregon Children Deserve the Right to Try

Oregon hopefully will join twelve states that have enacted Right to Try legislation, allowing terminally ill patients to try experimental drugs not yet approved by the FDA.

In several states, the face of Right to Try efforts was a child. Fourteen-year-old Diego Morris was honorary chairman of the Arizona campaign that saw 78 percent of voters approve Right to Try last November. Diagnosed with a deadly form of bone cancer when he was eleven, Diego and his family had to move to London for treatment with a drug approved there, but not in the United States. Now cancer free, Diego visited the Oregon Capitol in February to meet with legislators. When asked what he would say to opponents of Right to Try, Diego answered, “Wait until they find themselves in my situation, and then ask them.”

Five-year-old Jordan McLinn handed the pen to Indiana Governor Mike Pence when he signed that state’s Right to Try law last week. Jordan has Duchenne Muscular Dystrophy, a terminal illness that without experimental treatment may kill him before he turns 20.

No doubt some Oregon children could benefit from the Right to Try. House Bill 2300 would give adults that right, but not children under age 15. Those who favor Right to Try might let their state legislators know that faced with a terminal illness, children should have the same Right to Try as adults do.

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If the state loses $1.4 billion for schools and nobody notices, did it really happen?

The Oregon legislature is in the midst of its biennial quest for more public school funding. Advocates are so desperate for cash that they are even proposing that the state seize gift cards as “abandoned property” if some portion of the original value remains unused after three years.

While grabbing gift cards is certainly creative, it will not materially affect school funding. A much more lucrative source is available if we have the political will: selling the 93,000-acre Elliott State Forest (ESF) and placing the net receipts (likely to be $400 million or more) into the Common School Fund, where investments typically earn 8% or more annually.

In fact, the failure of the state to sell the Elliott 20 years ago when it was first proposed has already cost schools at least $1.4 billion in lost value. It’s a mystery as to why school advocates are willing to accept this.

The Elliott is located on the South Coast near Reedsport. By law, most of the timber must be managed to maximize revenue for the “common schools.” Unfortunately, over the past 20 years, timber harvesting on the ESF has plummeted due to environmental litigation. As a result, in 2013 the state actually lost $3 million on the Elliott, then lost more money in 2014. These losses drain money from public schools.

This disaster could have been avoided. In 1994, the state commissioned a study of ways to increase net revenues on the Elliott. The consultant reported that “selling the ESF would be the most effective way to maximize CSF revenues.”

The State Land Board (made up of the Governor, the Secretary of State, and the State Treasurer) considered selling the Elliott in 1996 but rejected the idea. That decision locked the state into a revenue death spiral on the forest.

The extent of that loss was quantified by the Oregon Department of State Lands (DSL) in a report published last November. The chart below summarizes the results:

Simulated Prior Elliott Sale versus Actual Elliott Management

 

Simulation Simulated endowment in 2014

Simulated distribution over time period

Estimated residual land value Total value over time period
(Actual) managed for timber since 1995 $1.4 billion $0.7 billion $0.4 billion $2.5 billion
Sale in 1995 and invested proceeds $2.5 billion $1.4 billion $0 $3.9 billion
Buyout in 2005 and invested proceeds $1.8 billion $0.8 billion $0 $2.6 billion

Source: Oregon Department of State Lands, November 2014

The failure to sell the ESF in 1995 cost schools $1.4 billion in lost value. That is a very large number, not only in absolute terms, but compared with public losses elsewhere that have resulted in resignations and political scandal.

For example, the U.S. Congress is investigating the disappearance of $305 million in federal funds spent on Cover Oregon. At the state level, the Oregon Department of Justice has just opened a civil and criminal investigation into the $11.8 million of energy tax credits issued for an array of solar panels installed by several state universities.

Yet the loss of $1.4 billion in school funding seems to be uninteresting to school advocates. No lawsuits have been filed, and no investigations are underway.

The legislature should insist that the Governor, the Secretary of State, and the Treasurer turn the Elliott from a liability into an asset, as required by law. Selling the entire forest is the best option for doing that.


John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Looking at ObamaCare, Five Years On

By Sally C. Pipes

ObamaCare turned five years old March 23. But don’t break out the cake and candles. There’s not much to celebrate. When he signed his signature piece of legislation into law, President Obama guaranteed lower health costs, universal coverage, and higher-quality care. Five years later, the health law has failed to fulfill those promises.

“In the Obama administration,” candidate Obama boasted in 2008, “we’ll lower premiums by up to $2,500 for a typical family in a year.”

A recent report by HealthPocket, an online insurance marketplace, has revealed that premiums for individual Americans skyrocketed after ObamaCare became law.

Drug costs have jumped, too, despite promises to the contrary from the Obama administration. The majority of health plans offered on the exchanges have shifted costs for expensive medications onto patients, according to a study by Avalere Health. In 2015, more than 40 percent of all “silver” exchange plans―the most commonly purchased―charged patients 30 percent or more for specialty drugs. Only 27 percent of silver plans did so last year. Part of the problem is that the health law has quashed market competition.

The president promised in 2013 that “this law means more choice, more competition, lower costs for millions of Americans.” But that hasn’t turned out to be true. According to the Heritage Foundation, the number of insurers selling to individual consumers in the exchanges this year is 21.5 percent less than the number that were on the market in 2013―the year before the law took effect.

The Government Accountability Office reports that insurers have left the market in droves. In 2013, 1,232 carriers offered insurance coverage in the individual market. By 2015, that number had shrunk to 310.

With competition in the exchanges on the decline, quality is going down, too―just like President Obama said in 2013: “Without competition, the price of insurance goes up, and the quality goes down.”

Consumers who purchase insurance on the law’s exchanges have fewer options than they had pre-ObamaCare. The consulting firm McKinsey & Co. noted that roughly two-thirds of the hospital networks available on the exchanges were either “narrow” or “ultra-narrow.” That means that these insurance plans have refused to partner with at least 30 percent of the area’s hospitals. Other plans exclude more than 70 percent.

Patients may also have fewer doctors to pick from. More than 60 percent of doctors plan to retire earlier than anticipated―by 2016 or sooner, according to Deloitte. The Physicians Foundation reported in the fall that nearly half of all doctors―especially those with more experience―considered ObamaCare’s reforms a failure.

While more Americans may have insurance thanks to ObamaCare, they may not be able to find a doctor to see them. That’s a recipe for waiting lists and de facto rationed care.

Finally, five years on, President Obama’s declaration that he would not sign a plan that “adds one dime to our deficits―either now or in the future” looks more ridiculous than ever. In 2010, the Congressional Budget Office anticipated ObamaCare’s decade-long cost was $940 billion. This year, the CBO more than doubled that price tag, with a new estimate of $2 trillion.

The U.S. Supreme Court will rule this June on King v. Burwell, a case that threatens to negate the law’s subsidies. If the court rules against the administration, ObamaCare would unravel.

Obama has been proven wrong about what his health law would accomplish. Quality hasn’t improved, and costs continue to grow. That’s ObamaCare’s five-year legacy.


Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by The Orange County Register.

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Oregon Seniors Deserve Truth in Medicare Reform

By Steve Buckstein and Patrick M. Gleason

If Congress doesn’t act by the end of this month, when payment cuts to Medicare providers are scheduled to hit, there will be a major health care crisis. Topping the to-do list is addressing urgent problems with Medicare, the most costly federal program and the largest driver of national debt. Failure to act would have harsh ramifications for seniors and caregivers in Oregon.

The first step is to address accounting gimmicks that hide Medicare’s true cost and its effect on federal debt in the years ahead. The program operates under a phony spending baseline that conceals its true cost.

How did this come about? In 1997, Congress instituted a new spending formula, the Sustainable Growth Rate (SGR). It would institute physician reimbursement rate cuts in order to ensure that Medicare spending did not exceed the rate of economic growth. Noble goal, except that’s not what happened.

In 2003, the first time Medicare cuts were scheduled to take place under SGR, lawmakers balked and delayed the scheduled reduction in physician payments. In the 11 years since, Congress has delayed these scheduled payment cuts a whopping 17 times. This maneuver is referred to as the “doc fix.”

The Congressional Budget Office is forced to operate under the assumption that Congress will comply with SGR, even though the last 11 years have shown that to be pure fantasy. CBO treats passage of a doc fix as a spending increase. But it’s not, in reality, because Congress always passes a temporary reprieve. The worst kept secret on Capitol Hill is that Congress will always, just in the nick of time, pass a doc fix to prevent these payment reductions.

Underscoring this fact, for the first time ever, even Medicare’s own actuaries admitted last year that scheduled SGR payment cuts never would occur. The solution is to end this game, start being honest with ourselves, pass a permanent doc fix, and move on to reforms necessary to ensure the nation’s fiscal health and Medicare’s sustainability.

For Oregon, failure to pass a permanent doc fix would reduce seniors’ access to care. Oregon has 16 practicing physicians per 1,000 Medicare beneficiaries, which is below the national average. If Congress does not act, the result will be a 24 percent across-the-board pay cut for caregivers treating Medicare patients. With 46 percent of Oregon’s physicians over the age of 50, the age at which surveys show many physicians begin to consider cutting back on patient care, scheduled provider cuts would only exacerbate Oregon’s problems with access to care.

A temporary doc fix breeds corruption and legislative chicanery, producing a gold mine for lobbyists and political fundraisers. Worse, the constant need to pass an emergency, temporary doc fix distracts from much-needed Medicare reforms. If Congress continues to ignore the unsustainable trajectory of Medicare spending, the result will be harm to seniors and a federal budget drowning in red ink.

Fixing what’s wrong with Medicare is the top health and budgetary issue facing the country. As former Congressional Budget Director Doug Holtz-Eakin warns, “By 2020, as Baby Boomers continue to age into Medicare at the rate of more than 10,000 a day, Medicare’s cumulative $6.2 trillion in cash flow deficits will constitute 35 percent of the nation’s total debt accumulation.”

It’s time for members of Congress to stop kicking this can down the road, institute truth in accounting by passing a permanent doc fix, roll up their collective sleeves, and get to work on the real reforms that will save Medicare and put the nation on a sound fiscal path.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization. Patrick Gleason is director of state affairs at Americans for Tax Reform in Washington, D.C. The Bend Bulletin newspaper op-ed version of this commentary was originally published on March 25, 2015 here: www.bendbulletin.com/opinion/3004859-151/letter-oregonians-deserve-medicare-reform.

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Human Achievement Hour 2015

This Saturday you’ll have the opportunity to vote with your light switches. Either turn your lights off from 8:30 pm to 9:30 pm local time to “show your commitment to climate change action now” or turn your lights on to celebrate “human progress and our advancements in various fields of industry, including technology, medical, energy, and more.”

Turning your lights off makes you part of Earth Hour, a project of the World Wide Fund for Nature (WWF). Turning them on makes you a part of Human Achievement Hour 2015, a project of the Competitive Enterprise Institute (CEI).

Since this isn’t a secret ballot, I’ll tell you that I’m voting for Human Achievement. As CEI notes, “Earth Hour does little to protect the environment” and “completely ignores how modern technology allows societies around the world to develop new and more sustainable practices that help humans be more eco-friendly and better conserve our natural resources.”

You don’t have to wait until Saturday to see what a large-scale expression of the “dark ages” versus human achievement looks like. Just check out any NASA nighttime photo of North and South Korea from space: “North Korea is almost completely dark compared to neighboring South Korea….The darkened land appears as if it were a patch of water joining the Yellow Sea to the Sea of Japan.”

North Koreans may simply be celebrating Earth Hour every hour of every day, but somehow I doubt it.

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Mandating Common Core, High-Stakes Testing Drives Oregon Further into the "Bureaucratic Trap of Good Intentions"

The Oregon Department of Education currently requires Oregon school districts to align instruction and assessments with the Common Core State Standards. A bill now before the state legislature, HB 2835, would end this requirement, possibly helping to end the latest chapter in nearly forty years of national education reform failures and what I call Oregon’s decline into our own “bigger is better” top-down education reform trap.

I saw this decline begin here in 1991 when the legislature overwhelmingly enacted the Education Act for the Twenty-First Century. It was full of new committees, new high school CIM and CAM tests (which were eventually abandoned), and a promise from the legislature that it would produce “the best educated citizens in the nation by the year 2000.” So, how did that work out?

In 1999 the legislature created the Quality Education Commission, which led to adoption of the Quality Education Model. The Model proposed entirely theoretical prototype elementary, middle, and high schools that, again theoretically and with enough funding, would get 90% of our kids to state standards.

When these last two big reforms didn’t work, Governor John Kitzhaber proposed and the legislature created the Oregon Education Investment Board (OEIB) in 2011 with the goal of unifying everything from early childhood through graduate school education. Of course, that goal can’t be accomplished without pushing power and control even farther away from the people who should matter most in education—parents, students, and teachers. This accelerated our decline into the “bigger is better” trap.

Why haven’t such revolutionary reform efforts in our K-12 education system achieved their goals? Because, according to the late John T. Wenders, Ph.D., they…

“…suck power upward and away from parents and students into top down, centralized and inflexible political arrangements, where unions and other special interests have more political clout. This causes accountability to decline and results in higher per pupil costs and lower educational results.”

I’m sure that now-former Governor Kitzhaber and the people he appointed to the OEIB are very smart. But no such group can hope to design a system that meets the needs of all Oregon children and their parents. Mandating Common Core State Standards and their accompanying high-stakes Smarter Balanced tests simply moves us even further down into the “bigger is better” education reform trap.

Yong Zhao, Ph.D. is the Presidential Chair and Director of the Institute for Global and Online Education in the University of Oregon’s College of Education. He gave an entertaining and provocative presentation to the Senate Education Committee on February 10, 2015 in which he set out some compelling reasons for us to reject both Common Core and high-stakes testing.

One of Dr. Zhao’s examples is very relevant when considering the benefits of passing HB 2835. He told the Committee that imposing any “common” educational requirements promotes conformity in our children, when we should be helping them foster their own creativity, diversity, and entrepreneurial inclinations.

He noted that when he was a child in his Chinese village, the Common Core was knowing how to ride a water buffalo. The most important and valued jobs in that time and place revolved around agriculture. He couldn’t drive a water buffalo very well, so as he put it, they encouraged him to leave and go to Oregon.

In a 1991 Wall Street Journal column, “Education by Committee in Oregon,” Cascade Policy Institute Academic Advisor, former public elementary school teacher, and assistant professor of education Richard Meinhard, Ph.D. explained why the “revolutionary” Oregon Education Act for the Twenty-First Century was no such thing:

“…[T]o be ‘revolutionary,’ educational change must be systemic. It must reform the system, not just add to it. Oregon’s educational reformers are unwittingly legitimizing the very system that needs reform. Well-meaning politicians have once again increased state control over education in order to mandate desirable goals. The Oregon plan provides the nation with an important lesson in reform: how easy it is to fall into the bureaucratic trap of good intentions.”

This 1991 critique could just as easily be said about the current “revolutionary” reforms of Common Core and Smarter Balanced high-stakes testing. It’s time to stop increasing state control over education and start moving accountability and control down toward parents, students, and teachers.

We can start crawling out of Oregon’s “bigger is better” trap by prohibiting the Department of Education from imposing any standardized curriculum and testing regime on school districts. This can start by approving HB 2835.

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TriMet’s Great Disappearing Act

During the 2003 session of the Oregon State Legislature, TriMet sought an increase in the regional payroll tax rate. In public testimony, TriMet General Manager Fred Hansen said, “TriMet’s proposed payroll tax increase will be used exclusively to provide new or enhanced transit service.”

The legislature approved TriMet’s request, and the payroll tax rate went up every January for ten straight years. By the end of 2014, TriMet had received $34.4 million in new payroll tax revenues attributable to rate increases. Yet during that same decade, the miles of transit service offered to patrons actually dropped by 14%, while the hours of service declined by 5%.

Like a magic show, TriMet tried to distract the audience by pointing to grand celebrations for the opening of the WES commuter rail line and the Green MAX line, both of which opened in 2009. But overall service levels were reduced five times in six years, the opposite of what was promised in 2003.

TriMet’s proposed budget for 2015-16 was released last week. It calls for “expanding service through the opening of the Portland-Milwaukie light rail line.” Once again, all the attention will be on new trains, while total service levels will still be far below the levels we had in 2003.

State legislators should be asking TriMet where all the money went. But sadly, no one in Salem cares about results.

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Is Your Five-Year-Old Ready for Full-Day Kindergarten?

The Oregon State Senate is considering a bill that would lower Oregon’s compulsory, full-time school age from seven to five. Senate Bill 321 was heard in the Education Committee on March 5.

Most children start at least a half-day Kindergarten as five-year-olds, but not every five-year-old is ready for full-time school. According to a recent report by the National Center for Education Statistics, about six percent of five-to-six-year-olds nationwide are not enrolled in school. These children may need a little more time to be ready for a formal classroom setting.

Children are unique, and maturing at different rates is normal. Temperament, emotional maturity, life experiences, and family situations also can affect a child’s classroom readiness. Parents are in a better position to determine a young child’s abilities than an arbitrary standard set by state law.

Some opponents of SB 321 point out that there would be no protections for children who are not ready for a traditional classroom at five years of age. Their parents currently have the option to let them grow up a little first. This bill removes parental discretion.

Forcing children to start school too early for them can have long-lasting consequences. They may view themselves as failures, think they don’t like school, or find themselves playing a demoralizing game of catch-up with their classroom peers.

Parents, rather than state legislators, should decide when their preschool-aged kids are ready for full-time school.

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Policy Picnic – March 18, 2015


Please join us for our monthly Policy Picnic led by Cascade board member & President of Turbo Leadership Systems Larry W. Dennis, Sr. & Cascade Publications Director Kathryn Hickok


Topic: 15 Leadership Principles and Ronald Reagan

Description:

Championing change is never easy. It requires vision, communication skills, and the courage to act as the fearful stand on the sidelines. By following Ronald Reagan’s example, you can change your world and inspire the next generation.

Please join Larry and Kathryn, author and co-author of the book, “15 Leadership Principles and Ronald Reagan”, as they discuss their book, Ronald Reagan and how you can become a better communicator and leader.

Copies of the book will be available for sale at the event.

Admission is free. Please feel free to bring your own lunch.
Coffee and cookies will be served. 
 
Sponsored by:
Dumas Law Group

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Should Compulsory Schooling Start at Age Five?

Every state in the union has what are known as compulsory school attendance laws. Oregon currently requires that virtually every child attend school from age seven to age 18. A bill before the State Senate, SB 321, would decrease the compulsory school age from seven down to five.

Before deciding whether this is a good idea, it may be time to reconsider why we compel parents to send their children to school at all. We might ask ourselves some hard questions, including:

  • How does compulsion further our interest in encouraging a passion for learning in our children?
  • In a free society, shouldn’t we be looking for ways to reduce compulsion, rather than to increase it?
  • If compelling seven-to-18-year-olds to attend school isn’t working very well, why compel five- and six-year-olds to attend also?”

Some of the written testimony from professional educators in favor of SB 321 assumes that the bill would reduce the “compulsory education” age. But we can’t really compel students to learn, so is the next best thing compelling them to sit in classroom seats?

Schooling may facilitate good education, but they are not always the same thing. As Harvard Professor Lant Pritchett says, “Good governments do schooling, but nearly all bad governments do it, too.” He is talking here about different national governments since his field is global development, but the thought applies to our state and local governments as well.

Pritchett goes on to say, “We know that if you impose a top-down educational system, often it breaks down—you get a bureaucracy that doesn’t work, and the outcomes get worse than if you allow local control.” If this is true in Oregon, then former Governor John Kitzhaber’s flawed Oregon Education Investment Board approach may be doing more harm than good.

More and more Oregon parents and teachers are standing up to oppose top-down approaches such as new high-stakes tests designed to measure how well public schools are teaching the controversial Common Core Standards.

The so-called Smarter-Balanced tests are on track to be given to students in grades three through eight and high school juniors to measure how well they’ve mastered reading, math, writing, listening, research, and thinking. Official estimates are that over 60 percent of students may fail the tests this spring.

Dr. Yong Zhao, Director of Global and Online Education at University of Oregon, is a critic of both high-stakes testing and the Common Core Standards themselves. He gave an entertaining 51-minute presentation to the Senate Education Committee on February 10.

While Dr. Zhao doesn’t have a formal position on whether Oregon’s compulsory school age should be lowered, he does make the points that we shouldn’t make kids ready for Kindergarten; we should make Kindergarten ready for kids, and creative kids aren’t Kindergarten-ready because they don’t conform. Lowering the compulsory school age to five may put more kids in Kindergarten seats, but it will do nothing to make Kindergarten ready to meet their individual needs.

Dr. Zhao’s presentation stood in stark contrast to that of Oregon “education czar” Nancy Golden who spoke before him at the hearing, and that of Deputy Superintendent of Public Instruction Rob Saxton who spoke after him. It should be noted that Golden and Saxton were handpicked by Governor Kitzhaber to help promote his top-down, birth-through-graduate school vision for education in Oregon.

Questioning the value of compulsory schooling is nothing new. Here is what a past president of the American Psychological Association, Knight Dunlap, said in his 1929 article, Is Compulsory Education Justified?:

“…education is a good thing for us, and so we wish to bestow its blessings on others. If they will not take it gladly, we will make them take it: for their own good…”

So, before we agree to reduce Oregon’s compulsory school age from seven down to five, let’s ask the hard questions about what our compulsory schooling system is really doing for, and to, the children it captures now.

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