Author: Cascade Policy Institute

QuickPoint! – “They Left Out Radio!” – The Human Genius Behind Economic Growth

By Kathryn Hickok

Bull market? Bear market? Growth? Uncertainty? What does 2019 have in store?

Economies are described in numbers, percentages, and quarterly comparisons. But the picture is richer than dollar values of production and consumption. No economy exists without millions of unique people bringing to the marketplace their creativity, intelligence, initiative, and effort. The knowledge, skills, and experiences of people are the true wealth of a society.

President Reagan once remarked on the limitations of economic predictions that can’t measure human genius. He said:

“You know, back in the twenties I think they did a report for Herbert Hoover about what the future economy would be like. And they included all their projections on industries and restaurants and steel, everything. But you know what they left out? They left out radio! They left out the fantastic rise of the media, which transformed the commercial marketplace….

“And now they make their projections, and they leave out high tech….”*

Fostering economic growth requires a tax and regulatory climate that’s friendly to businesses and the people who start them. The Oregon legislature should remember this when it convenes in February.

 

* Peggy Noonan, What I Saw at the Revolution: A Political Life in the Reagan Era (New York: Random House, 1990), 146.

 

Kathryn Hickok is Executive Vice President at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Lessons in Education from Gandalf the Grey

By Miranda Bonifield

Cascade Policy Institute has supported parental choice in K-12 education since 1991. In fact, it’s the issue that convinced founder Steve Buckstein of the need for a free-market think tank in Oregon. But would you have imagined that Gandalf, fictional hero of J.R.R. Tolkien’s The Lord of the Rings, would be a voice for educational choice as well?

Yes, you read that right: Gandalf the Grey (delighter of hobbits, purveyor of fireworks, and instigator of disruptive adventures) would support school choice—giving parents the power to choose the educational setting that works best for their children. It’s all right if you need some tea to process that. I’m enjoying my second breakfast as I write this.

If you think Gandalf would never have any concern about education, consider the man who created the beloved character.

J.R.R. Tolkien was a celebrated philologist who studied and taught at Oxford. As a child, most of his initial education in languages, literature, botany, music, and art came from his widowed mother, whose creativity and passion for knowledge were passed on to her children. When her already meager allowance from her husband’s relatives was cut off upon her conversion to Catholicism, the Tolkien family moved to even harder circumstances and benefited from a local parish school. After his mother died, the young author persevered as a student.

Tolkien would later say, “True education is a kind of never-ending story—a matter of continual beginnings, of habitual fresh starts, of persistent newness.”

His character Gandalf regularly placed his faith in the character of everyday people, entrusting the most important task of Tolkien’s saga—the care and destruction of the One Ring—to an ordinary halfling. “Soft as butter as they can be,” the wizard said, “and yet sometimes as tough as old tree-roots.” Even comfortable, curmudgeonly Bilbo Baggins demonstrated how right he was—exchanging riddles to save his life from Gollum, rescuing his dwarven companions from giant spiders, and then risking the anger of the same friends to broker peace between gathering armies.

With such demonstrations of Bilbo’s merit, I think it’s safe to say Gandalf would trust ordinary people’s desire and ability to obtain a good education for their children.

Wisdom (and our favorite wizard) recognizes that life isn’t one-size-fits-all. One doesn’t reason with the evil possessing the king of Rohan—drive it out by whatever means necessary. One doesn’t send an impetuous, proud prince of Gondor into Mordor with a ring of unfathomable power. Instead, send an ordinary person whose heart is in the right place.

Likewise, parents don’t want to send their uniquely gifted child, who may have special needs, to a school that isn’t a good fit. Every parent wants to give their child the best education possible.

The most effective way to accomplish that is not by trying to force public schools to cover every eventuality and trapping students in schools that don’t meet their needs. Rather, we should return the power to parents by putting education funding in their hands to utilize resources that are already available for their children.

Last year, researchers at EdChoice combed through the highest-quality studies of school choice programs around the country. Did you know that 31 of the 33 studies on the competitive effects of school choice demonstrate a positive impact on public school test scores? Each of the three studies on the competitive effects of school choice programs found that participants in school choice programs graduate at a higher rate than their peers. School choice typically has a positive effect on racial and ethnic integration. Perhaps most importantly, parents who are able to take advantage of school choice are more satisfied with the quality of education their children receive and feel their children are safer at school.

It’s high time we brought some newness to Oregon’s education system. With good counsel from the wisest advisor of the Shire, I’m sure the excellent and commendable hobbits here in Oregon will agree: Each one of us should be a voice for school choice.

Miranda Bonifield is a Research Associate at Cascade Policy Institute, Oregon’s free-market public policy research organization. She is also the Program Assistant for the Children’s Scholarship Fund-Oregon, a Cascade program that provides K-8 scholarships to low-income Oregon children.

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Fake Leadership

By John A. Charles, Jr.

Governor Kate Brown’s proposed two-year general fund budget for 2019-21 requests $23.6 billion. That is an increase of 12.4% over the current level, which was the largest budget in Oregon history when it was adopted 18 months ago.

So far, few legislative leaders have questioned why the Governor needs so much money. At the Oregon Business Plan summit, held on December 3, most of the talk was about adopting new taxes and repealing the popular “kicker” law that rebates surplus funds to Oregon taxpayers. That’s not a good omen.

Most parents teach their children at a young age that they can’t always ask for more; sometimes you have to make do with what you have. That lesson has been lost on Oregon’s political leaders. No matter how much money we send to Salem, it’s never enough.

Before legislators vote to approve even one more tax, they should ask where the money will go, and why is it needed? And more importantly, if the current record-setting budget is not enough, what will change in the next two years to avoid another huge increase in 2020?

Any governor can demand more money; addressing the root causes of our problems takes real leadership. Gov. Brown has yet to figure that out.

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

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School Choice Improves Student Mental Health

By Miranda Bonifield

If you’ve done your homework on school choice, you know it’s been linked with improved student safety, improved quality of public schools, and academic performance. But another compelling virtue of school choice, recently published by Dr. Corey DeAngelis and Professor Angela Dills, is its association with improved mental health and decreased rates of suicide. Even when controlling for students’ family backgrounds, the paper continued to find a strong association between school choice and decreased rates of suicide.

This shouldn’t come as a surprise. When families are empowered to choose the best fit for their children, they are likely to favor schools with safe and nurturing environments that suit their child’s unique needs. The best answer to Oregon’s educational problems isn’t a longer school year or more access to preschool, even if those are potentially good things for some families. The answer is to expand Oregonian families’ choices through Education Savings Accounts, which would reserve a portion of state education funding for students’ families—making sure that money follows the educational needs of individual children, not the blanket dictates of administrators.

Every child should have the chance to receive a quality education. Oregon should make a change that’s good for our kids’ mental health and their long-term success.

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The Story Behind Thanksgiving That Every Elected Official Should Know

By Kathryn Hickok

The quintessential American holiday, Thanksgiving evolved from the Pilgrims’ celebrations to thank God for the harvests that saved Plymouth Colony. What most people didn’t learn in school is that nearly half the Mayflower Pilgrims died of starvation because many refused to work in the fields.

Plymouth Colony originally had a socialist economy. Land and crops were held in common. In the words of Governor William Bradford, “the young men who were most able objected to being forced to spend their time and strength working for other men’s wives and children without any recompense.” Collectivism incentivized colonists needlessly to rely on the efforts of others. Realizing this, Governor Bradford assigned each household its own plot of land. Families could keep what they produced or trade for things they needed. The result was a bountiful harvest in 1623.

Instituting private property and respecting the autonomy of the family unit caused Plymouth to survive. Collectivism and central planning produce scarcity. Private property, free markets, and personal responsibility lead to prosperity and plenty. A healthy economy, with strong and independent families, enables a community to help those who genuinely need assistance. All are important lessons for America today from William Bradford’s first Thanksgiving.

Kathryn Hickok is Executive Vice President at Cascade Policy Institute, Oregon’s free market public policy research organization.

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TriMet’s New Electric Buses Will Be Less Reliable, More Costly

By John A. Charles, Jr.

The TriMet board recently voted to replace the agency’s entire bus fleet with battery-electric buses by 2040. Since each electric bus is more than twice as expensive as a standard diesel bus, this decision will cost taxpayers more than $550 million in excess costs.

The electric premium might be worth it if there were significant benefits to switching fuels, but there aren’t. In fact, battery-powered buses are far less reliable than diesel or natural gas buses. According to a recent study by the Federal Transit Administration, battery electric buses in Seattle only traveled 2,771 miles on average between breakdowns; for diesel buses, it was 17,332.

Since moving passengers is TriMet’s primary job, this alone should have disqualified battery buses from consideration.

The primary motivation for TriMet seems to be reducing so-called “greenhouse gases,” but battery-powered buses offer no real air quality benefit. The buses must be charged from the utility grid, which is powered mostly by coal and natural gas. Even large wind farms are backed up every minute of the day by other sources such as gas and hydro dams. Using battery-electric buses simply changes where greenhouse gases are emitted, which is meaningless.

A better alternative would be renewable natural gas, derived from processing food waste or methane emissions from landfills. For this reason the Los Angeles County Metropolitan Transit Authority concluded in 2016 that it would switch its entire fleet to renewable natural gas buses because it would provide “approximately 39% greater reductions in GHG emissions at half the cost” when compared to electric buses.

Finally, TriMet has no way to pay for the electric bus conversion. The staff recommended buying the first 80 electric buses with combinations of federal grants and money from the new statewide employee tax, followed by a hoped-for legislative bailout sometime after 2022. That’s not a plan, it’s a fantasy.

TriMet has already been awarded ten battery electric buses through grants from the federal government. A more prudent option going forward would be to buy ten buses using other fuels—such as compressed natural gas and renewable natural gas—and then test them all head-to-head to measure reliability, emissions, noise, and passenger comfort.

This was a rash decision. The TriMet Board should admit that it made a mistake, and spend the next two years analyzing alternative fuels. If taxpayers are going to be forced to pay an extra half-billion dollars for new buses, there should at least be a good reason.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization. A version of this article appeared in The Portland Tribune on November 13, 2018.

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Survey Shows Florida Scholarship Parents Are Overwhelmingly Satisfied with Their Children’s Schools

By Kathryn Hickok

Florida’s Tax Credit Scholarship Program currently helps more than a hundred thousand of the state’s most disadvantaged students to get a better education through privately funded scholarships, making it the largest private school choice program in America. The program has been funded by voluntary corporate donations to nonprofit scholarship organizations. In return for these donations, companies receive dollar-for-dollar tax credits against their state income tax.

Last week, EdChoice released the largest-ever survey of the parents of Florida’s tax credit scholarship students, revealing these families’ educational priorities and experiences.

Analyzing the responses of more than fourteen thousand parents, EdChoice concluded:

  • “The vast majority of Florida scholarship parents expressed satisfaction with the tax-credit scholarship program.”
  • “Florida parents chose their children’s private schools because those schools offer what their public schools can’t/don’t.”
  • “Among respondents whose children were previously enrolled in a public district or charter school before using a scholarship to enroll in a private school, most parents reported engaging in a variety of education-related activities more often than before switching schools….”

Children have different talents, interests, and needs; and they learn in different ways. The landscape of educational options to meet students’ learning needs is more diverse today than ever. For more information about school choice in Oregon, visit schoolchoicefororegon.com.

Kathryn Hickok is Executive Vice President at Cascade Policy Institute, Oregon’s free market public policy research organization. She is also director of Cascade’s Children’s Scholarship Fund-Oregon program, which provides partial tuition scholarships to Oregon elementary students from lower-income families.

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Metro Should Let Transit Customers Drive Transportation Innovation

By Justus Armstrong

ABC’s Shark Tank may be coming to the Portland region—not in the form of a reality TV special, but as a taxpayer-funded project that positions the Metro regional government to act as a venture capital firm. Rather than investing in the success of growing businesses, however, the Sharks at Metro plan to fund temporary pilot projects that test new transportation technology.

Metro proposes that its Partnerships and Innovative Learning Opportunities in Transportation (PILOT) program—a component of the Emerging Technology Strategy—would help meet its “guided innovation” goals, but the shortsighted approach of this program ignores a vital question: Are risky technological investments the best use of taxpayer funding?

In a presentation at a Metro work session in July, Senior Technology Strategist Eliot Rose suggested the PILOT program would “guide innovation in transportation technology toward creating a more equitable and livable region.” Embedded in the presentation were numerous contradictions, beginning with the oxymoron of “guided innovation.” In Metro’s case, guided innovation more than likely means “hindered innovation,” with PILOT funding being a carrot-and-stick method of ensuring that emerging technologies take the direction technocrats deem appropriate, not the direction consumers are demanding.

By allocating government funding to the transportation projects of its choice, Metro risks preventing better ideas from emerging and hampering the innovation necessary for real progress to take place. As Metro strategist Rose noted, ridesharing, bikesharing, and other technologies PILOT wishes to foster have already been expanding in Portland. This technological progress has taken place with private investment, yet Rose still concludes that public money is needed for it to continue.

During the July work session, Metro staff claimed that the government “needs to intervene to bring technology to people and communities that the market doesn’t serve.” This assumption presents another contradiction: If an investment isn’t cost-effective for a private actor, what makes it a cost-effective investment to Metro? And how can successful projects be expected to continue without public funding, if the projects’ functions wouldn’t otherwise be demanded by the market?

Furthermore, Metro’s plan risks sinking taxpayer money into potentially unsuccessful projects. The $165,000 Forth-Hacienda project was presented by Metro as an example of a successful pilot project—not because the project itself was successful, but because its failure offered a great learning experience. The desire to better understand new technologies is not without merit, but the experimental nature of such pilot projects hardly makes them a good fit for taxpayer funding.

For all the project’s flaws, discussion about Metro’s Emerging Technology Strategy has included some promising aspects. For instance, during the work session, Metro Councilor Shirley Craddick brought up the idea of transitioning some of TriMet’s responsibilities to ridesharing networks. Considering more innovative modes for public transportation would be a step in the right direction and likely would improve cost-effectiveness, quality, and ridership of transit while meeting the needs of the populations Metro seeks to assist.

Perhaps a more effective Emerging Technology Strategy could focus solely on ways to improve existing public transportation through new technology, rather than interfering with private transportation markets through subsidies and attempts to shape private development. Instead of subsidizing companies with PILOT funding, Metro could offer open-ended transportation vouchers directly to transit users, especially transit-dependent and underserved populations.

Transit vouchers could be spent on a variety of transportation options, including TriMet and the newer technologies the PILOT program intends to target, such as rideshare, bikeshare, and electric vehicle and autonomous vehicle rentals. Putting the money directly into the hands of transit users could drive innovation through consumer sovereignty on the demand side, encouraging competition and making companies work to meet transit users’ needs instead of Metro’s project specifications.

With its PILOT program, Metro seeks to encourage innovation while managing risk; but any risk associated with developing new technologies should be borne by the companies driving the innovation, not by the public. If Metro moves forward with the PILOT program, it will only hinder its own goals. Instead of shaping existing markets in the private sector, Metro should focus on applying technological improvements to public transportation options.

Moreover, Metro should reform the regulatory framework and barriers to entry that may be preventing the emerging transportation technology market from functioning at its best. After all, the expansion of Uber and Lyft in Portland didn’t take place because Portland subsidized these companies. It happened because Portland stopped banning them. Metro councilors and staff can’t foresee the direction that new technologies will take, so they can’t know enough in advance to guide the direction of innovation or adequately manage its risks. The best they can do is get out of the way.

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

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Another Tax Increase from Kate Brown

By John A. Charles, Jr.

Governor Kate Brown’s top health care administrator is requesting that the legislature increase taxes on beer, wine, cider, cigarettes, cigars, and vaping pens. If approved, the taxes would result in $784 million in new revenue for the state over the next two years.

Health officials claim that this is a “public health” measure designed to reduce consumption of harmful products, but it’s really just a money grab. The state has an estimated shortfall of $800 million in Medicaid funding, and this proposal conveniently would raise almost that amount.

However, the proposed tax probably will not actually raise that much money because of a built-in contradiction: If consumption goes down, then tax revenue has to go down as well. Legislators cannot support it as both a public health measure and a revenue-raiser at the same time. For one goal to succeed, the other must fail.

It’s an open secret in Salem that the biggest “addiction” problem in the state is not tobacco or alcohol consumption; it’s the addiction that politicians have to taxation on smoking, drinking and gambling. They don’t want less of these activities; they actually want more.

Legislators are not our parents. Oregonians should be left alone so they can decide for themselves what products to use.

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

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Metro’s Bond Measure 26-199 Raises Taxes on Homeowners, Requires No Accountability for Money Spent

By Miranda Bonifield

Metro claims Measure 26-199 is designed to address affordable housing, but the 652.8 million dollar bond measure raises taxes for homeowners without ensuring that it will accomplish its goals.

Metro claims these bonds would fund up to 3,900 low-income housing units. However, the measure doesn’t require a minimum number of units: Metro could build a few units, spend the rest of the money on “services,” and fulfill the requirements of Measure 26-199. The text of the measure even says these bonds may be used for things like grocery or retail space without limitation. In other words, there’s no guarantee the measure will make even a small improvement to housing affordability.

There is no deadline ensuring Metro provides these units in a timely fashion. There is no requirement for Metro to change its practices if auditors find Metro is failing to accomplish its goals. 26-199 asks you to trust Metro’s intentions without any accountability to encourage success. Meanwhile, urban growth boundaries and endless red tape keep Oregon’s housing supply from meeting the needs of our growing population.

Any major project needs firm deadlines and specific goals to have any hope of success, but Metro’s measure provides neither.

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

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