Month: October 2014

2014 Fall Newsletter

See what Cascade Policy Institute has been up to in the Fall of 2014 in our latest newsletter.

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$15 Minimum Wage? More May Turn Out to Be Less

Last summer, Seattle passed an ordinance raising its minimum wage to $15 per hour. A Portland-area restaurant owner recently explained in The Oregonian how a $15-per-hour minimum wage here would spell lower total wages and less opportunity for his employees.

Lee Spectator wrote: “I start most of my new hires at minimum wage, then, based on their performance, give them a raise within their first 30 to 60 days. I give merit raises based on performance [and] annual performance reviews….With a $15 per hour minimum wage, that would go away. I would have no room to pay them any more, and they would have no incentive to work harder.”

With increased wage expenses also come higher taxes and workers-comp insurance. These would balloon to nearly 48 percent of Spectator’s total business expenses, he says.

So, what would be the likely result if Portland raised the minimum wage to $15 an hour? To start, fewer jobs will be available in small businesses that pay hourly. Fewer employers will want to hire low-skilled workers like teenagers, since they will need more productive and experienced workers to justify paying them a higher wage. Entry-level workers should have the chance to climb the ranks and achieve higher earnings as a consequence of their hard work, not to be stuck at one uniform pay grade or else have no job at all.

Kathryn Hickok is Publications Director and Director of the Children’s Scholarship Fund-Portland program at Cascade Policy Institute.

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Scaling Down: The Power of One

By Darla M. Romfo

Earlier this fall I had the pleasure of attending the awards ceremony for the Broad Prize for Urban Education. In the ensuing days, many bloggers and journalists weighed in with criticism, including one who pointed out that “although recent winners of the Broad Prize show positive results compared to many large urban districts, their scores are largely flat—or worse—over the past several years.”

I am sure this must be both disappointing and frustrating to Mr. and Mrs. Broad who made the fortune they are giving away by innovating, adapting, and always getting better. They wanted this prize to inspire the same kind of actions in public education.

Teddy Forstmann, who, along with John Walton, founded the Children’s Scholarship Fund (CSF) in 1998, was a man cut from the same cloth as Mr. Broad. Ted hoped the demand demonstrated when parents of 1.25 million children applied for 40,000 partial scholarships to escape their assigned public school would get the ball rolling and bring about substantial educational improvement for all children within the four-year window for those first scholarships. In Ted’s experience, demand for a better product and a bit of competition led to an improved product. Ted was certainly frustrated with the snail’s pace of it all.

And by now everyone who has ever uttered the words “education reform” is a little frustrated. More than a decade later, billions more in taxpayer dollars, in addition to the billions heaped on by private philanthropy, has been spent to achieve largely mediocre to poor overall results. There are pockets of hope, and we do have much better data. Now we know there is not only an achievement gap between minorities and whites, but also between all U.S. students and children in other countries.

It’s not clear that if we had full blown school choice, the end of teacher tenure, higher standards, or whatever flavor of education reform you favor, that every child would have the opportunity to reach their full potential. Certainly, one or some combination of those things would help many children; but we would still have kids who live in poverty and very unsettled home situations coming to school every day with needs that are beyond what can be addressed by education reform alone.

One thing I have both experienced through relationships with students I’ve met through CSF and observed in the lives of others is that 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. I know Ted and John both experienced this with children they helped directly apart from their education reform efforts. John once told me on a school visit in Omaha 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.

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. Anyone who is willing to give of themselves to another human being will bring about change in that person and themselves. Isn’t that the real reason we are all here anyway?

Darla M. Romfo is President and COO of Children’s Scholarship Fund, based in New York City. CSF has helped 139,000 low-income children nationwide attend the K-8 schools of their parents’ choice through privately funded scholarships worth $568 million. Cascade Policy Institute runs CSF’s Oregon partner program, Children’s Scholarship Fund-Portland.

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Shouldn’t the Terminally Ill Have the “Right to Try” to Save Their Lives?

By Matthew Hayes

Last Friday, Michigan approved Right to Try legislation with overwhelming bipartisan support. Colorado, Missouri, and Louisiana all passed similar measures this year, with Arizonans voting on the issue this November. What is Right to Try and why is it gaining steam?

Spearheaded by the Goldwater Institute, an Arizona-based public policy organization, Right to Try legislation allows terminally ill patients access to drugs, biotics, and implants that have completed basic FDA safety testing but are still awaiting further approval.

The FDA offers a similar program, known as Compassionate Use. Unfortunately, the process isn’t easy. Physicians typically face 100 hours of paperwork and research per applicant. The entire process can take several months, a luxury many terminally ill patients don’t have.

These costs are seen in the usage statistics. In 2011, fewer than 1200 patients received expanded access, while more than 1500 people died of cancer each day. Right to Try legislation removes many of these barriers, making the process easier and faster for patients. While it can’t be known how many lives these save, the number is undoubtedly greater than zero.

Since 1997, the Death with Dignity Act gives terminally ill Oregonians the right to end their lives. Bringing Right to Try to Oregon offers these citizens the chance to do more than just hasten death; it offers a chance to beat their illness.

If you have the right to die, shouldn’t you have the right to fight to live?

Matthew Hayes is a research associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Kitzhaber’s “Clean Fuels Program” Is a Hidden Gas Tax

By Jon Egge

Many politicians on the West Coast have fallen in love with untested policies and programs they say will help solve global warming. Many of these policies are mind-bogglingly complicated. What, after all, is a low carbon fuel standard (LCFS), or clean fuels program? And how exactly do programs like “cap and trade” work? And, perhaps most importantly, how do these policies impact you, the consumer?

Here’s the dirty little secret the politicians don’t want to talk about: All of these policies are going to make it more costly to produce gasoline and diesel. In fact, that’s the intended purpose of so-called “market-based” schemes to reduce greenhouse gas emissions. By making the energy we need and use every day more costly to produce, other energy supplies—like wind, solar, biofuels, and hydrogen fuel cells—will become more competitive. And where these programs have been implemented—such as in California—they are also conveniently generating billions of dollars in new revenue for the state to spend however it pleases. That’s why climate-change policies like cap and trade and LCFS are becoming Trojan horses for hidden taxes. These revenue programs provide limited environmental benefits but generate big political paydays.

California has adopted the nation’s only LCFS, a program energy experts say is infeasible. Forcing manufacturers of gasoline and diesel fuels to meet a standard that can’t currently be met puts the state’s entire fuel supply in a very precarious position.

Now, politicians in Oregon are considering a LCFS that, if implemented, will become a new hidden gasoline tax designed to increase the cost of fuel and decrease the bank accounts of everyday motorists and businesses who rely on transportation. Hidden tax schemes increasing the costs of fuel are also regressive revenue-generating policies that hurt poor and middle-income families the most. These families spend a much larger portion of their income on transportation and fuel than wealthy families do, and hidden gas taxes therefore take a much bigger bite of their budgets. Unlike their wealthier counterparts, working families simply can’t trade their vehicles for expensive hybrids and electric cars. And because these policies aren’t transparent, consumers often have no idea why their fuel costs are rising.

We all want to improve our environment and ensure cleaner air. But punishing motorists by increasing fuel costs through hidden taxes is not the way to do it. Governor John Kitzhaber has made it clear he plans to move forward with a LCFS—even without the support of the state’s elected legislators. Last session, our Legislature, after careful consideration, declined to extend authorization for the LCFS. Under the governor’s unilateral direction, the Department of Environmental Quality is now adopting rules to push the LCFS forward.

The governor and agency bureaucrats need to be reminded, once again, that when gasoline and diesel costs go up, families and small businesses suffer. It’s time to put a stop to the hidden gas tax that is masquerading as climate change policy.

Jon Egge is a plumbing service contractor in Clackamas and serves on the Oregon Advisory Council of the National Federation of Independent Business. He is a board member of Cascade Policy Institute. This article originally appeared in The Oregonian.

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More Tax Dollars for College ― Or Prepare Students to Succeed There?

Oregon voters are being asked this November to authorize spending more tax dollars to help some students afford an arguably unaffordable higher education. Measure 86 will create a permanent fund to subsidize certain students, which can be financed several ways including through state general obligation bonds. Any bonds issued under the so-called Oregon Opportunity Initiative will have to be paid off over 30 years, primarily by income tax payers, not by students. Only the earnings on bond proceeds and other funds will be available for subsidies.

There are several problems with this proposal:

First, Measure 86 does nothing to reduce the overall cost of higher education in Oregon. In fact, it actually could increase those costs as more taxpayer dollars flow into the system.

Second, even if the measure does help some students afford college, we don’t know if they will be prepared to succeed there, or if they will need costly and time-consuming remedial courses to learn what they should have learned in high school.

Our educational leaders in Salem anticipated the need to prepare students better for college years ago, and they took steps that they hoped would address the issue. In 2007 the state Board of Education adopted The Oregon Diploma, which was intended to ensure that students are prepared to enroll in postsecondary education without the need for remedial courses.

The Oregon Diploma “…requirements are designed to better prepare each student for success in college, work, and citizenship. To earn a diploma, students will need to successfully complete the credit requirements, demonstrate proficiency in the Essential Skills, and meet the personalized learning requirements…A phase-in schedule (2007 – 2014) has been created to allow students, families, schools and teachers to adequately prepare to meet these new requirements.”

Apparently assuming that The Oregon Diploma would get all students college-ready by 2014, Governor John Kitzhaber recommended, and the Legislature adopted in 2011, what has come to be known as Oregon’s 40-40-20 educational attainment goal. By 2025, this state policy aims for 40 percent of Oregonians to have a four-year baccalaureate degree or higher, 40 percent to have an associate’s degree or certificate in a skilled occupation, and the remaining 20 percent to have at least a “college and career-ready” high school diploma or its equivalent.

So, how are we doing in getting to that 40-40-20 goal by 2025? Three national reports issued over the last two months raise serious questions as to whether most Oregon high school graduates are coming anywhere close to being “college and career-ready.”

First we learned that only 30 percent of Oregon’s 2014 high school graduates are deemed “college ready” based on their American College Testing Organization (ACT) college admissions examinations in all four tested subjects of English, Reading, Math, and Science.

Then, a U.S. Chamber of Commerce report revealed that “Oregon is one of the very worst states when it comes to preparing students for college and the work force.” It noted that “Oregon ranks in the bottom 10 when it comes to getting students ready for college and careers.” We earned a grade of “D” in Academic Achievement and an “F” in Postsecondary and Workforce Readiness.

Finally, we found out that only 46 percent of Oregon public high school students who took the SAT college entrance tests scored high enough to demonstrate that they are prepared for college.

So, it looks like Oregon has struck out three times when it comes to meeting The Oregon Diploma goal of better preparing each student for “success in college, work, and citizenship” by 2014. We have eleven more years to see if the Governor’s 40-40-20 goal pans out, but it isn’t looking good so far.

Before we encourage more taxpayer spending on higher education through Measure 86, shouldn’t we find ways for our public school system to prepare most college-bound students to actually succeed there?

As I’ve noted before, that won’t take more money, because research shows that spending more money doesn’t lead to better educational outcomes; it just rewards the adults who get paid by the system. Instead, we should take the top-down control away from bureaucrats in Salem and give it to parents and students through a genuine system of school choice. Then watch our college readiness numbers climb. Otherwise, we’re just paying twice for remedial courses to teach college students what they should have learned in high school.

Removing the need for those remedial courses could help more students than Measure 86 ever would, and it should help Oregon taxpayers by reducing the cost and the time it takes to educate college students.

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

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Dissing Online Education

One can imagine that blacksmiths and buggy whip makers didn’t take kindly to the automobile revolution that started in the late 19th century. Those at risk of losing their horse-related jobs likely made the case for resisting the new, glitchy, and dangerous metal machines. We all know how that rivalry turned out.

Today, another revolution is beginning. Just as thousands of years of horse travel were largely replaced within a few decades, one wonders what the future of physical classroom education might be in the face of the online education revolution.

A Portland State University professor of educational leadership recently authored an op-ed making the case that “effective teaching practices such as class discussion, relational learning and other activities of the traditional classroom are hard to offer on a computer screen.” That might be true; face-to-face educational interactions may never go away, but soon they could be greatly supplemented or even overshadowed by online innovation.

The future is always daunting to those at risk of being displaced, but the future is coming and we will find ways to adapt to it and even improve upon it. Buggy whips may be a thing of the past, but there are still plenty of jobs for people who know how to make and care for our modern horseless carriages.

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The Elliott State Forest Should Be an Asset―Not a Liability―for Oregon Schools

By Jordan Lofthouse, Randy Simmons, and John A. Charles, Jr.

With Oregon’s schools constantly facing budget crises, why are our lawmakers missing out on the opportunity to give more money to our kids?

As part of the Common School Trust Lands, the Elliott State Forest has the constitutional obligation to generate money for Oregon’s schools. In the last few years, however, environmental interests have carefully manipulated the Endangered Species Act so that the Forest costs taxpayers money instead of providing funds for Oregon’s children.

Lately, harvest levels and revenues have been a fraction of their former levels. Despite potential to harvest 40 million board feet in 2013, actual harvest was only 4.5 million board feet. The expected timber harvest for 2014 is similar. This has resulted in a net deficit of $3 million that is covered by your tax dollars.

The Oregon State Land Board is searching for ways to balance the financial responsibilities of the forest with environmental factors hindering the Forest from providing revenue for schools.

Researchers at Utah-based Strata Policy have identified several options for monetizing the Elliott State Forest so it can meet its constitutional responsibility to Oregon’s children. Privatizing the Elliott State Forest is likely the most financially beneficial option. In a report for the Cascade Policy Institute, Eric Fruits of Economics International concluded that selling or leasing Forest assets could provide stable funding for Oregon schools at approximately $40 to $50 million annually.

A second option is a land exchange between the federal government and the state government. The federal government would receive control of the ESF in exchange for federally owned land that could be more easily monetized for Oregon schools. Other states such as Utah, Minnesota, and California have all successfully made land exchanges to increase revenue for schools.

A third but less likely option consists of renewing a Habitat Conservation Plan (HCP) with federal agencies. HCPs allow timber to be extracted while also protecting endangered species habitat. The former HCP expired several years ago, meaning that harvestable areas in the Elliott State Forest are severely limited. If state and federal agencies can negotiate a new HCP for the forest, timber harvest and revenue can increase while also protecting critical habitat. However, conflicts between state and federal agencies make HCP renewal a significant challenge.

As we consider ways of providing increased funding for education in Oregon, we should press the State Land Board to pursue options that will allow the ESF to fulfill its constitutional responsibilities. We can no longer allow environmental groups and federal regulations to dictate the failure of this trust at the expense of children’s education.


Jordan Lofthouse and Randy Simmons are scholars with Strata Policy, based in Utah. John A. Charles, Jr. is President and CEO of Cascade Policy Institute in Portland.

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Molalla Patriots

Join us as Kathryn Hickok will be presenting to the Molalla Patriots on the subject of Common Core.

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Washington County Public Affairs Forum

Watch Cascade’s own Steve Buckstein take on State Treasurer Ted Wheeler to debate this November’s ballot Measure 86, the Oregon Opportunity Initiative.

Click here to learn more.

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