Month: September 2015

Scaling Down: The Power of One

Is it truly possibly for one person to make a positive difference in education in America? Darla Romfo has a good answer to this question. She is president of the Children’s Scholarship Fund, which has helped more than 145,000 low-income children nationwide to attend private grade schools. She wrote:

“[Children’s Scholarship Fund founder] John [Walton] once told me…that giving the scholarships and meeting the kids and their parents grounded the whole effort of trying to reform the larger system. He knew no matter what happened with those efforts, he was having a direct impact on the lives of kids today….

“[A] caring adult who really invests in an authentic relationship with a child will bring enormous benefits to the child, to say nothing of the rewards to the adult….

“We can’t stop trying to get education right in America, but maybe we will get further faster if every adult who can gets involved in the life of a child who has a couple of strikes against them. Whether it is through a mentoring program, a scholarship program, a school-based program, or some other means, it could make the ultimate difference in a child’s life, and you don’t have to be up to speed on the latest education reform idea to do it and make it work.”

For more information about how you can help the Children’s Scholarship Fund make a difference today, visit scholarshipfund.org.

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Transit Policy: Kryptonite for Business Leaders

By John A. Charles, Jr.

During September, the Portland regional transit monopoly, TriMet, voted to raise the payroll tax rate by 1/10th of a percent, beginning January 2016. The rate increase will be phased in over a ten-year period, as required by the state legislature.

Politically, the only reason TriMet was able to do this was that none of the major business associations objected. The question is, “why?”

A number of issues should have raised red flags for business representatives. First, the payroll tax pays for more than half the cost of all transit operations. That ratio seems far out of balance. The primary beneficiaries of transit are transit riders, yet they only pay about 24% of operations cost. It would seem far more equitable to insist that passenger fares pay for at least 50% of the operational cost.

Second, there is no reason for businesses to pay more if TriMet is unwilling to impose discipline on the expenditure side. The transit district has failed miserably to do this for decades. TriMet has approved so many lucrative labor contracts that the total cost of benefits now routinely exceeds the cost of wages. In FY 2014, the ratio was $1.49 in benefits for every $1.00 in wages; in FY 2015, it was $1.19. It’s hard to imagine any private sector company paying that much in total benefits.

And third, TriMet has repeatedly broken promises about how it would spend new payroll tax money. In 2003, when the Legislature approved an earlier tax rate increase, TriMet promised that every penny of new tax revenue would be used for “new service.” Yet over the subsequent decade of tax rate increases – 2004-2014 – TriMet’s total annual operational revenue increased by 80%, while miles of actual transit service declined by nearly 14%, as shown below: 

TriMet Financial Resource Trends

 (000s) 

  2004 2006 2008 2010 2012 2014 % change
Passenger fares $ 55,665 $ 68,464 $ 80,818 $ 93,729 $ 102,240 $ 114,618 +106%
Tax revenue $ 155,705 $ 192,450 $ 215,133 $ 208,933 $ 248,384 $ 275,357 +77%
Total op. resources $ 290,513 $ 342,274 $ 404,481 $ 433,609 $ 488,360 $ 522,155 +80%

  

Annual Fixed Route Revenue Service Trends 

  2004 2006 2008 2010 2012 2014 % chng.
Hours of service 1,698,492 1,653,180 1,712,724 1,682,180 1,561,242 1,608,090 -5.3%
Miles of  service 27,548,927 26,830,124 26,448,873 25,781,480 23,625,960 23,763,420 -13.7%

TriMet claims that service actually increased during this period because several new rail lines were built, and rail cars are bigger than buses. But that is a fallacy. Most transit vehicles are under-utilized most of the time, so seating “capacity” is rarely important.

When bus service was cut throughout the 525-square mile district by 14% over the past decade, the thousands of riders who were inconvenienced were not made better off just because a few new trains were operating in narrow corridors somewhere else. They were made worse off, and may have stopped riding transit altogether as a result.

In fact, transit has lost market share over the past 17 years despite (or because of) the rail building boom. According to the Annual Community Surveys conducted by the Portland Auditor, the transit share of commute travel was 12% in 1997, when TriMet had only one light rail line. By 2014, it had dropped to 11%.

 

Travel Mode Share for Weekday Commuting

Portland citywide, 1997-2014 

Mode 1997 2000 2004 2008 2010 2011 2012 2013 2014
               

 

 
SOV 71% 69% 72% 65% 62% 63% 61% 64% 63%
Carpool 9% 9% 8% 8% 7% 6% 6% 6% 6%
Transit 12% 14% 13% 15% 12% 12% 12% 10% 11%
Bike 3% 3% 4% 8% 7% 7% 7% 7% 8%
Walk 5% 5% 3% 4% 6% 6% 7% 7% 8%
Other n/a n/a n/a n/a 7% 6% 6% 6% 6%

             Source: Portland Auditor

Transit policy tends to make otherwise rational business leaders do silly things. Instead of defending themselves and demanding that public transit districts operate more efficiently, they feel obliged to “take one (more) for the team.” But this simply enables the dysfunctional behavior by transit districts to continue.

The fact is, public sector monopolies and their unionized employees will take every dollar available for themselves as long as someone keeps putting new dollars on the table.


John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization. This article originally appeared in the September 2015 edition of the newsletter, “Oregon Transformation: Ideas for Growth and Change.”

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TeachersPayTeachers Creates Learning Entrepreneurs

The debate over the sharing economy often revolves around the well-known players such as the room rental company Airbnb and the ridesharing company Uber. These firms have harnessed the liberating power of technology to unleash billions of dollars of so-called dead capital, while turning millions of people around the world into entrepreneurs, serving their fellow man and making a profit at the same time.

As the sharing revolution evolves and matures, it promises not only to improve the lives of countless individuals, but it may also help to revolutionize a critical part of our lives that for too long has been dominated by status quo lobbies such as teachers unions and the governments they influence—education.

Education is critical to human progress, but for too long it has largely been provided outside the market framework that makes everything better in our world.

Now, thanks to a small company called Teacher Synergy, Inc., and its online marketplace TeachersPayTeachers.com, educators are beginning to directly benefit from a free market in their intellectual property (IP). On the site they can buy and sell their own original lesson plans and related educational resources that up until now have benefitted their own students, but nobody else’s.

In the words of Jason Bedrick, a policy analyst at the Cato Institute’s Center for Educational Freedom:

“Words like ‘market’ and ‘competition’ or—worst of all—‘profit are considered dirty words in some circles, particularly in education. Perhaps that’s why some people prefer the more anodyne (if less accurate) term ‘sharing economy to describe how online platforms and apps are enabling people to monetize resources they own by connecting them directly with potential buyers.”

TeachersPayTeachers recognizes that not all teachers are the same. Some teachers are better than others at creating lesson plans that engage students and help them learn. So, for example, a teacher who is great at teaching math may not be so great at teaching geography. Why not let the good math teacher profit by selling his or her lesson plans to other teachers while she, perhaps, buys geography lesson plans from teachers who excel in that discipline?

Since its founding in 2006 by a New York City public school teacher, TeachersPayTeachers has allowed more than 10,000 teachers to earn $175 million from its 3.4 million active teacher members. Some teachers have earned over $100,000 selling lesson plans for just a few dollars apiece to thousands of their colleagues all over the nation, and even in other countries.

So, if teachers buying and selling lesson plans can benefit both teachers and students, who could be opposed? Well, just like existing taxicab monopolies opposed ride sharing firms like Uber for obvious reasons, those who currently control public school districts might feel threatened by teachers acting more like entrepreneurs and realizing the benefits of markets and capitalism.

Some districts claim that any intellectual property created by their teachers belongs to the district, even if created on the teachers’ own time. TeachersPayTeachers addresses this issue and concludes that teachers often do own their own IP in lesson plans. Even the nation’s largest teachers union, the National Education Association, has stated that “staff should own the copyright to the materials they create for use in the classroom.”

Jason Bedrick concludes that “[t]eachers tend to be less enthusiastic about market-based reforms to education, but perhaps some experience with the ‘sharing economy’ will show them how the best teachers stand to benefit greatly from Uber-ized education.”

While the best teachers will benefit greatly from Uber-ized education, other teachers can benefit also, and many students will benefit as their teachers have access to better teaching tools. Big picture, Uber-ized education can help create a diverse marketplace of educational options that will turn not only teachers, but students, into capitalist entrepreneurs. It can’t happen too soon.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Mysteries of Tilikum Crossing

Portland’s newest bridge over the Willamette River, Tilikum Crossing, has a few puzzling design features. Apparently, a barrier down the middle of the bridge means that a stalled light rail train or bus would shut down transportation until it was removed, because no vehicle could go around it.

If the bridge is only open to trains, buses, cyclists, and pedestrians, what useful purpose does the barrier serve? (Other than potential MAX and TriMet bus line rush hour chaos, that is.)

And that’s not all….

Syndicated radio host Lars Larson interviewed Cascade’s John Charles on Monday. Click on the Listen link to hear John reveal his observations from Portland’s South Waterfront during Tilikum Crossing’s opening week.

You might be surprised by what he saw bicyclists doing on SW Moody Avenue.

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The Minimum Wage Conversation Never Ends

Oregon and some other states mandate that their minimum wage increase every year with the Consumer Price Index. Based on that formula, last Wednesday it was announced that Oregon’s minimum wage, the second highest in the country at $9.25 an hour, will stay unchanged in 2016.

That same evening during the Republican presidential debate, one candidate called for both a higher national minimum wage and for indexing it to inflation. He argued that this would mean “we never have to have this conversation again in the history of America.”

Well, if Oregon is any example, that’s not exactly true. Oregon began indexing its minimum wage in 2002. Yet, earlier this year, there were no fewer than twelve legislative bills introduced to raise the rate to as high as $15 per hour. Activists promised that if the legislature didn’t act, they would put a measure on the 2016 General Election ballot.

So clearly, putting minimum wage increases on autopilot won’t take this conversation off the table. Until legislators and voters understand that income cannot be generated by state mandate, minimum wage increases will continue to hurt the very workers they’re meant to help: the young, the less educated, and the less skilled. They are the ones who often can’t produce enough value for employers at higher wage rates to justify gaining or keeping a job.

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Policy Picnic – October 28, 2015


Please join us for our monthly Policy Picnic led by Cascade President and CEO John A. Charles, Jr.


Topic: Portland-Milwaukie Light Rail: Comparing Promises with Reality 

Description: TriMet’s newest MAX line opened on September 12. At $210 million per mile, this was the most expensive light rail line in Portland history. Now that it’s open, is it making the traveling public better off?

In this seminar, we revisit the Utopian predictions made by transit planners in 2008, and measure those against the early performance of the line.

There is no charge for this event, but reservations are required as space is limited.  To reserve your free tickets, click here.

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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Freedom: Will Its Defenders Triumph?


It’s time for Freedom Seminar 2015!

Freedom: Will Its Defenders Triumph?


Join lovers of liberty from around the state for this special annual event featuring noted speakers

James Bovard and Dan Alban

 

James Bovard is the author of ten books, including Public Policy Hooligan, Attention Deficit Democracy, and Lost Rights: The Destruction of American Liberty. He has written for the New York Times, Wall Street Journal, Washington Post, and many other publications. He is a member of the USA Today Board of Contributors, a contributing editor for American Conservative magazine and The Freeman, and a regular contributor to the Future of Freedom’s Freedom Daily.

The Wall Street Journal called Bovard “the roving inspector general of the modern state,” the New York Times tagged him “an anti-czar Czar,” and Washington Post columnist George Will called him a “one-man truth squad.”

His writings have been publicly denounced by the chief of the FBI, the chief of the TSA, the Secretary of Labor, the Secretary of Agriculture, the Secretary of Housing and Urban Development, the Postmaster General, the Sierra Club, the American Civil Liberties Union, and the Washington Post, among others.

 

Dan-AlbanDan Alban serves as an attorney with the Institute for Justice. He litigates cutting-edge constitutional cases protecting free speech, property rights, economic liberty and other individual liberties in both federal and state courts.

Before joining IJ, Dan practiced employment law in the Tysons Corner office of Littler Mendelson P.C., with a focus on employment litigation in both federal courts and Virginia state court.   Prior to that, he served as a law clerk for Chief Judge Royce C. Lamberth on the United States District Court for the District of Columbia.  Dan started his legal career in private practice at Wiley Rein LLP in Washington, DC, working primarily in telecommunications litigation and mass media regulatory law.

Dan received his law degree cum laude from Harvard Law School in 2006, where he was an Executive Editor of the Harvard Journal of Law & Public Policy.  From 2000 to 2003, Dan worked at the Institute for Humane Studies in Arlington, Virginia.  In 2000, Dan earned his undergraduate degree in Political Rhetoric from Berry College in Rome, Georgia.  Dan originally hails from Nampa, Idaho.

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Tilikum Crossing: More Punishment for Motorists

The new bridge over the Willamette River, TriMet’s Tilikum Crossing, opened for business on Saturday. With beautiful weather and parties at every stop of the Orange MAX line, a good time was had by the thousands of sightseers.

Unfortunately, now that we’ve returned to gray skies and normal weekday travel, it’s clear that the bridge created both winners and losers. The big winners are light rail passengers and bicyclists. The scenic bikeway has already proven immensely popular with local cyclists, who are crossing at a rate 10 times higher than the rate previously observed on the nearby Ross Island Bridge.

The big losers are motorists. The Tilikum Crossing is closed to autos and trucks. In addition, the new traffic signal at the west end of the bridge creates a major bottleneck on SW Moody Avenue, the busiest road within the district.

At both morning and afternoon peak-periods, Moody Avenue traffic is shut down 60% of the time in order to accommodate light rail, the streetcar, and buses leaving or entering the bridge. This gums up all north-south travel, including most of the same bike riders cruising over from east Portland, who must cross Moody Avenue as they exit the bridge.

Moody Avenue motorists have no choice but to wait through red lights that sometime exceed three minutes; but pedestrians and cyclists are rebelling by the hundreds. After losing patience, they simply cross the rail tracks illegally.

In most normal cities, a new bridge makes everyone better off. But in Portland, a bridge simply becomes one more weapon in the political war on mobility.

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Event Video – Ending the Public Employee Union Stranglehold on State Politics

The Executive Club and Cascade Policy Institute were pleased to welcome David Nott, president of Reason Foundation, at the Executive Club’s September 2, 2015 dinner event. Introduction by Cascade founder Steve Buckstein.

David Nott is president of Reason Foundation, a non-profit think tank advancing free minds and free markets. The foundation also publishes the award-winning and critically acclaimed national magazine, Reason. Reason Foundation hosts the annual Reason Media Awards featuring the Bastiat Prize. David created Reason.tv and the Drew Carey Project to produce and distribute internet video journalism, whose home page has reached over 200 million hits since its launch as well as the Reason.com news, which receives over 3 million hits a month. He is executive producer of the Reason Foundation 2013 film, “America’s Longest War: A Film About Drug Prohibition.”

David is an engineer by training. He received his Bachelor of Arts and Sciences with Distinction, in economics and engineering, from Stanford University. He has three children and resides in El Segundo.

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A Visitor's Guide to an Alien Planet: Washington, D.C.

The Executive Club and Cascade Policy Institute are pleased to welcome political journalist John Fund, at the Executive Club’s October 7th dinner event.

John Fund

John Fund has reported from Washington for 30 years. He believes it is best understood as an “alien planet,” where the conventional laws of economics, common sense, propriety, and good taste are frequently suspended. He will give us a tour of Washington from as insider’s eye, including a keen look at the current presidential field.

Formerly a Wall Street Journal editorial board member, John Fund is currently the national-affairs columnist for National Review Online and a senior editor at The American Spectator. He has been a guest speaker for Cascade Policy Institute and the Executive Club in the past, and it is a delight to have him back in Portland.

Date: Wednesday, October 7, 2015

Time: Buffet dinner begins at 6:30pm. The regular program starts at 7:00 pm.

Location: Portland Airport Shilo Inn, 11707 NE Airport Way, Portland, OR 97220

This event is free to attend. If you would like to purchase the dinner buffet, you are welcome to do so for $20 at the door.

Reservations for this joint Executive Club/Cascade event are appreciated but not required. We hope to see you on October 7!

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