Month: June 2018

U.S. Supreme Court Rules Today in Favor of Public Employee Worker Freedom

For Immediate Release

Media Contact:
Steve Buckstein

(503) 242-0900

Cascade Policy Institute stands with Mark Janus and with all Oregon public employees who want their rights to free speech and free association protected.

Portland, Ore. – The U.S. Supreme Court today restored First Amendment rights of free speech and free association for public employees in Oregon and nationwide. This is truly a victory for everyone who values the freedom of workers to associate with and financially support only those organizations with which they agree.

Ruling in favor of Illinois public employee Mark Janus in Janus v. American Federation of State, County, and Municipal Employees (AFSCME), the Court said he, and all other public employees nationwide, do indeed have Constitutional Rights that have been violated by the collection of so-called “fair share” or “agency” fees from their paychecks to pay for services the employees don’t want, or from unions whose political goals they oppose.

The Court has long allowed both public and private sector employees to opt out of union membership and the political portion of union dues, but it has allowed unions to collect fees for bargaining and representation purposes.

Now, Mark Janus has successfully argued that in the public sector, everything his union does is inherently political. Therefore, he should not be compelled to support that organization with his money.

The union compulsion the Court ended for public employees today brings to mind the well-known statement by Thomas Jefferson:

“To compel a man to furnish funds for the propagation of ideas he disbelieves and abhors is sinful and tyrannical.” 

Cascade Policy Institute stands with Mark Janus and with Oregon public employees, including public school teachers, who feel as he does that they want their rights to free speech and free association protected.

Nothing in the Janus decision prohibits unions from organizing and collecting voluntary dues from public employees. The ruling simply restores the First Amendment rights of public employees to say “no” to unions with which they don’t want to associate. Today is truly a day to celebrate the restoration of rights long denied a large group of citizens in Oregon and nationwide.

Founded in 1991, Cascade Policy Institute is Oregon’s premier policy research center. Cascade’s mission is to explore and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity.

For more information, visit cascadepolicy.org.

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Is Metro’s Affordable Housing Plan Really That Affordable?

By Rachel Dawson

The Metro City Council voted June 7 to place a housing bond measure of more than $600 million dollars on the ballot this fall. The regional government estimates the cost of new projects will be around $253,000 per unit. There is no cap on cost per unit, so project costs could be much greater, and have proven to be with past bonds.

However, it is possible to decrease the costs of these projects. Rob Justus, with Home First Development, has built a total of 431 public units for an average cost of $90,000 since 2011. He offered to build the city 1,000 homes at $85,000 per unit in 2015, but Portland officials rejected his proposal.

The city could build cheaper apartments by using less expensive materials and contracting with private developers to decrease labor costs. Placing a cap on how much is spent per unit would ensure that the city held itself accountable on project costs. Doing so would decrease the size of the bond and the burden it places on taxpayers.

There is a way to make housing affordable to both taxpayers and renters, and following the lead of private developers like Rob Justus is a way Portland can do just that.

Rachel Dawson is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Time to Stop the PERS Pac-Man from Eating Teachers’ Salaries and Taxpayers’ Pocketbooks

By Steve Buckstein

What do Pac-Man and public pensions have in common? An intriguing 2016 national study of pension debt and teacher salaries recently answered this question. Depending on what economic assumptions are made, it’s likely that unfunded public pension liabilities for all states and local governments exceeded $6 trillion in 2017. Based on the same assumptions, Oregon’s share of those liabilities likely approached $50 billion.

The study, The Pension Pac-Man: How Pension Debt Eats Away at Teacher Salaries, by Chad Aldeman of Bellweather Education Partners, concluded that unfunded public pension liabilities were eating away at teacher salaries in every state—just like the old arcade game Pac-Man. This happens because the school districts teachers work for have to pay an increasingly larger share of their budgets into retirement funds for teachers who are no longer teaching, at the expense of those currently in the classroom.

In effect, America’s public school teachers are being charged on average about $6,800 a year—money that could be boosting their paychecks—to preserve what are becoming increasingly inequitable public pension systems. The inequality stems from the shifting nature of state pension systems that compensate older (and currently retired) teachers at higher rates than they will younger ones.

So where do Oregon teachers stand? Compared to the national average of about $6,800 per teacher, Oregon basically has to charge our teachers $7,398 a year to cover our unfunded PERS liabilities. That’s more than in all but 14 other states.

One might conclude that Oregon teachers consequently have lower salaries than teachers around the country because of this large pension hit. Not true. The nation’s largest teachers union reported that the average Oregon teacher earned $61,862 a year in 2016-17, compared to the national average of $59,660. That put our teachers in thirteenth place for average teacher pay among the 50 states.

Then again, Oregon teachers might be expected to earn more because, again according to that recent union report, in 2017 Oregon had more revenue per student in its public school system than 30 other states. We had $14,827 per student in average daily attendance, compared to the national average of just $13,900.

So, even though Oregon teachers are being hurt by our large public pension debt, they still earn more than teachers nationwide, and even more relative to their Oregon neighbors who pay the taxes to fund those higher teacher salaries while earning less than the national average themselves. All-in-all, Oregonians compensate our public school teachers relatively well.

Even though the latest, so-called Tier 3 or OPSRP PERS system has a less generous defined-contribution element than Tier 1 PERS workers earned, taxpayers should not be on the hook for unknown, and unknowable, pension costs going forward. It’s unknowable costs like these that have led to the current, nearly $7,400 annual debt burden on our teachers, districts, and taxpayers.

If Oregon had no unfunded PERS liabilities, three things could happen. Teachers might argue they should see an average raise of almost $7,400 per year, while school districts might want to put that money toward other district expenses that benefit students. Taxpayers might expect to see their Oregon personal income tax bills reduced if the state managed its public pension funds responsibly.

But none of these outcomes will occur because Oregon hasn’t managed PERS responsibly. As long as this continues, the outcome will be what’s unfolding now: higher taxes and greater school district payments to fund pension liabilities that few saw coming—and that threaten to continue, like Pac-Man, to eat away at teacher salaries, school district budgets, and taxpayer pocketbooks.

To stop the PERS Pac-Man, our Governor and legislators need to get serious about PERS reform, specifically by ending the “defined-benefit” elements of PERS for all work done in the future, either by new employees or current ones. Instead, the legislature should move all public employees, including teachers, to 401(k)-style defined-contribution retirement plans, which are the only kind of plan available to most taxpayers. The costs to future teachers, schools, and taxpayers will only get worse if we don’t end the PERS Pac-Man once and for all.

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

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Stop Waiting for Superman—Be a Voice for Choice Instead

By Miranda Bonifield

Are we waiting for Superman? In 2010, a documentary by that name chronicled the struggles of five kids trying to get a quality education in the American public school system. Despite the $634 billion dollars Americans funnel into public education, these kids’ choices were between enrollment in an ill-fitting public school or winning the charter school lottery. Kids’ talents aren’t determined by their ZIP codes; and their educations shouldn’t be, either. Oregonians should take up Superman’s mantle ourselves and expand students’ horizons via school choice.

Education Savings Accounts, or ESAs, would put some of the funds that the state otherwise would spend to educate a student in a public school into accounts associated with the student’s family. The family could use the funds for approved educational expenses like tuition, tutors, online courses, and other services and materials. This would empower parents and give kids the freedom to thrive in the best educational program for them. Imagine kids with disabilities having more access to some of the best programs in the state, or gifted young artists with more access to the fine arts programs outside their home school district. ESA’s help make that happen. They could even save taxpayers thousands of dollars.

This year alone, 466,000 students were served by school choice programs in 29 states. Oregon should be among them. Stop waiting for Superman—he isn’t coming. Instead, be a voice for choice.

Miranda Bonifield is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

Click here for the PDF version:

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How the PERS Pac-Man Eats Teacher Salaries

By Steve Buckstein and Kathryn Hickok

What do Pac-Man and public pensions have in common? An intriguing 2016 national study of pension debt and teacher salaries recently answered this question. Depending on what economic assumptions are made, it’s likely that unfunded public pension liabilities for all states and local governments exceeded $6 trillion last year. Based on the same assumptions, Oregon’s share of those liabilities likely approached $50 billion.

The study, The Pension Pac-Man: How Pension Debt Eats Away at Teacher Salaries, by Chad Aldeman of Bellweather Education Partners, concluded that unfunded public pension liabilities are eating away at teacher salaries in every state—just like the arcade game. This happens because the school districts teachers work for have to pay an increasingly larger share of their budgets into retirement funds for teachers who are no longer teaching, at the expense of those currently in the classroom.

To stop the PERS Pac-Man from eating teacher salaries, Oregon’s Governor and state legislators need to get serious about PERS reform. They should end the “defined-benefit” elements of PERS for all work done in the future. Instead, public employees, including teachers, should move to 401(k)-style retirement plans. The costs to future teachers, schools, and taxpayers will only get worse if we don’t end the PERS Pac-Man once and for all.

Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization. Kathryn Hickok is Executive Vice President at Cascade.

Click here for the PDF version:

6-13-18-How_the_PERS_Pac-Man_Eats_Teacher_SalariesPDF

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Right to Try Goes National

By Steve Buckstein

Last week President Trump signed a national Right to Try law, allowing terminally ill patients the right to try drugs that have gone through part of the FDA testing process but are not yet approved.

In 2015 Cascade Policy Institute helped craft Oregon’s Right to Try law, but with two troubling restrictions. First, patients must be 18 years of age or older; and second, “in a physician’s reasonable medical judgment” patients will die within six months.

Neither of these restrictions is in the new federal law. One of the witnesses at the bill signing was Diego Morris of Arizona. Diagnosed with a deadly form of cancer when he was just 11 years old, Diego was denied a possible treatment because it was not approved in the U.S. It was, however, approved in other countries; so his family spent months in England where Diego was treated. Years later, he is still cancer-free.

Diego came to Oregon in 2015 to help us pass Oregon’s law. When someone asked him whether such laws offer false hope to desperate patients, this then-fourteen-year-old teenager answered: “There is no false hope, only hope.”

We hope that as legal issues are clarified, the new national law will “trump” Oregon’s law and offer all terminally ill Oregonians real hope for a better future.

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

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