Last spring, story after story appeared in newspapers around the state, reporting that school leaders anticipated layoffs of 3000-5000 teachers due to reductions in the education spending. As reported in page one of today's Seattle Times, "districts retained more teachers' jobs than they thought they could."
Cuts to I-728 spending have required school districts to think more carefully how to spend their ample resources, in 2008-9 at $10,274 per pupil. But districts have weathered this minor squall to spending quite well, as the state received nearly one billion dollars from the federal government. This allowed the state to increase overall education spending by 2.8%. Basic ed spending increased by 16%.
The Seattle Times also reports that districts are reassigning certificated teachers on staff to the classroom. And librarians are being reassigned to the classroom. Reallocating resources to the classroom should be the highest priority of district officials, but a better system would allow school principals and their building leadership team the power to make these critical decisions.
Today there is evidence that the First Lady could never meet the standard set by those looking for force lifestyle changes in an effort to reduce carbon emissions. The Washington Post reports:
Let's say you're preparing dinner and you realize with dismay that you don't have any certified organic Tuscan kale. What to do?
Here's how Michelle Obama handled this very predicament Thursday afternoon:
The Secret Service and the D.C. police brought in three dozen vehicles and shut down H Street, Vermont Avenue, two lanes of I Street and an entrance to the McPherson Square Metro station. They swept the area, in front of the Department of Veterans Affairs, with bomb-sniffing dogs and installed magnetometers in the middle of the street, put up barricades to keep pedestrians out, and took positions with binoculars atop trucks. Though the produce stand was only a block or so from the White House, the first lady hopped into her armored limousine and pulled into the market amid the wail of sirens.
Perhaps traveling one block for organic food is allowed but traveling six blocks to work, in a hybrid, is not. It certainly doesn't reduce carbon emissions, however.
According to this article in the Oregonian, costs are forcing officials to look for cuts in replacing the I-5 bridge across the Columbia River.
The preferred option costs around $4 billion and includes light rail. The light rail piece has a cost estimate of over $1 billion. So light rail represents about 25 percent of the total costs.
According to the Regional Transportation Council, the
bridge carries about 3,300 transit trips per day, so only 2.4
percent of all trips that cross the bridge are on public transit.
This means local officials want to spend over $1 billion more to serve 2.4 percent of total bridge crossings.
officials estimate transit demand
across the bridge would increase with light rail, because riders will
not experience congestion like bus riders do today. As a result, CRC
projects light rail would boost transit crossings to about 20,000 trips
per day by 2030.
Generally, the Federal
Transit Administration presumes there is no modal preference for trains
over buses when travel time, comfort level, and other factors are the
same. So there is likely some validity to the CRC logic that congestion
is somehow suppressing transit demand across the bridge. However, a 500
percent increase in transit demand is an unrealistic estimate of light
rail’s influence on attracting new passengers.
assuming their ridership estimate is correct and accounting for population and growth in
bridge crossings over the next 20 years, light rail’s mode share would
still only rise to about 9.8 percent of daily crossings.
what light-rail advocates claim, deliberately increasing costs by 25
percent to serve between 2.4 percent and 9.8 percent of all bridge
crossings establishes a very large gap between public costs and public
Washington transportation taxes should be used more efficiently and tied to congestion relief rather than to appease Portland politicians.
According to this article in today's Seattle Times, Seattle mayoral candidate, Mike McGinn proposes to expand light rail in the city. He does not have any cost estimates but suggests a Transportation Benefit District (TBD) could be implemented to pay for it.
Under state law, at TBD could implement up to a $100 car tab fee on every vehicle registered in the district, subject to voter approval.
According to the Department of Licensing, there are about 454,000 vehicles eligible for a car tab fee in Seattle. If voters approved the full $100 per registered vehicle, the estimated annual revenue would be about $45 million per year.
Without knowing any specifics on how or where the system would be placed, its virtually impossible to know whethe!
r a TBD could fund such a project. Sound Transit's system is roughly about $350 million per mile, making it one the more expensive systems in the country.
Hypothetically, if the project were to cost $1 billion, it would take an annual revenue stream of $45 million about 22 years to pay.
While feasible, convincing voters, even in Seattle, to triple their car tabs would be difficult; given it would be within three years of Sound Transit's 1/2 cent sales tax increase, King County's sales tax hike for buses, and the city's street repair property-tax increase. Not to mention the negative impact removing the Viaduct and replacing existing streets with rail would have on mobility, congestion and productivity.
The Columbian has a story today arguing that Washington could be a leader in the production of solar panels if only the government would subsidize the production. Here is the letter I sent in response:
Your story on Washington’s potential as a hub for solar panel production contains an interesting admission. One supporter notes that Washington isn’t keeping up because “it doesn't have the same cash incentives that Oregon does.” In other words, without government subsidies, solar production doesn’t pencil out.
This logic could be applied to other industries as well. While Washington is a leader in coffee sales, we are forced to buy the beans elsewhere, contributing to our trade deficit and costing American jobs. The only thing preventing us from producing coffee beans here is a government subsidy allowing us to build massive greenhouses that emulate the tropical climate. Think of the jobs we would create. Of course, we’d have to tax families and existing businesses to pay for this and that may kill jobs elsewhere. But that is the price of leadership.
Funding might also be better spent elsewhere to reduce carbon emissions or fund education. But that is the price of leadership.
The simple truth is that government-subsidized approaches are bad for prosperity, bad for jobs and bad for the environment. Washington should take care not to fall for such politically popular but job-killing environmental fads.
More than 150 years ago, Alexis de Tocqueville identified the very trend at work here. In Democracy in America, he noted people agree that:
...as a general principle the public authority ought not to interfere in private concerns but by an exception to that rule each of them craves for its assistance in the particular concern on which he is engaged and seeks to draw upon the influence of the government for his own benefit though he would restrict it on all other occasions. If a large number of men apply this particular exception to a great variety of different purposes the sphere of the central power extends insensibly in all directions although each of them wishes it to be circumscribed. Thus a democratic government increases its power simply by the fact of its permanence. Time is on its side every incident befriends it the passions of individuals unconsciously promote it and it may be asserted that the older a democratic community is the more centralized will its government become.
The solar industry isn't the first example of this trend, but it is the latest to ask the government to give it special treatment and contribute to the trend of government expansion.
According to the state's top economist, Dr. Arun Raha:
As stated in the economic review, the recession is almost certainly over, although risks remain
Commercial real estate, regional banks, and consumer spending pose the major threats to the recovery
Washington will recover faster than the nation thanks to the global recovery underway that will help our exports
The economy is very close to where we had predicted in June, and the outlook now is mildly more optimistic than both the June and September preliminary forecasts
Revenue collections lag the economic recovery, and are lower than the last forecast
Won’t feel like a recovery until at least the middle of 2010
We risk a double dip recession if consumer spending doesn’t improve
In response to this news, Governor Gregoire said in a press release:
“Although we believe the recession has bottomed out, it will take some time for revenues to recover. I am preparing a supplemental budget request that accounts for the revenue shortfall we have experience since May.”
“The budget I signed in May was built on tough decisions that I made together with the Legislature. The shortfalls in the last two forecasts necessitate more spending cuts, as do the lawsuits that have restricted our ability to implement reductions.”
Victor Moore, Director of the Office of Financial Management, noted:
"Given the reductions we have seen this year, further cuts will be necessary to keep the budget in balance. We have reached a point where we have to !
consider eliminating discretionary programs in our supplemental budget.”
The focus on spending reductions versus tax increases is commendable. Earlier this year when the Legislature was considering tax increases, state and national economists warned that such action would further damage Washington’s economy and hamper economic recovery.
In November the people of Washington will vote on
Initiative 1033. The measure is sponsored by Tim Eyman and would create
a new revenue limit for the state, counties and cities with the goal of
annually reducing property taxes. Eyman calls Initiative 1033 the
“Lower Property Tax Act of 2009.” Initiative 1033 is the latest in a
series of initiatives considered by voters which seek to control the
growth of state government, though it is the first to include local
governments under its requirements, and it is the first to focus
primarily on providing ongoing tax rebates to property owners.
According to the state’s Office of Financial Management, passage of
Initiative 1033 would result in approximately $5.9 billion in state
property tax rebates and $2.8 billion in local property tax rebates
going to citizens by 2015. At the same time state and local revenue
available for spending increases would grow each year by an amount
based on population growth plus inflation. Eyman argues that Initiative
1033 attempts to close loopholes created by the legislature to an
earlier voter approved initiative, Initiative 601. Enacted by voters in
1993, Initiative 601 sought to improve on the shortcomings of
Initiative 62 adopted in 1979.
"This summer, in response to the changing sports media landscape, I
wanted to create a “media pool” for the Mavs. I wanted to assemble a
group of unpaid interns that would acquire video, write game reports,
track unique stats, do interviews, interact with fans, and then compile
all of this incremental media and provide it free to any and every
outlet we could think of."
But apparently his efforts would run afoul of U.S. Department of Labor law, which states in part: "A common but frequently unreported labor violation is the use of unpaid interns in violation of minimum wage and possibly overtime laws. The scenario is fairly typical: a company offers an opportunity to 'break into the business' in exchange for the intern working for free."
According to Cuban, the Department also stipulates that:
"In order to qualify as an unpaid internship, the requirement is simple: no work can be performed that is of any benefit at all to the company. That is, you can not deliver mail, sort files, file papers, organize a person's calendar, conduct market research, write reports, watch television shows and report on them, read scripts, schedule interviews, or any other job that assists the employer in any way in running their business."
This is absolutely absurd. Why would anyone want to bring on an unpaid intern if that intern could provide no help to the business? And why would that same intern even want to participate in an unpaid internship if they are unable to gain valuable experience that will help them in the future?
It is commonplace to think of people only as workers or laborers. But in reality they are human capital. And people best serve thems!
elves when they invest in their own capital formation -- most !
often today this means education or experience in a trade. Why? Because more often than not, the more experience one has, the more in demand they become and the more they contribute to the market and the more they are likely to become prosperous.
Young people may have years of traditional education under their belts but are very unlikely to have experience similar to another person who has spent years in their industry. Experience is invaluable. Gaining experience for a young worker is paramount to their upward mobility. Inexperienced workers who are wise will seek out experience at just about any cost. That cost is often free labor. They do this not because they want to be taken advantage of, as backers of living wages may say, but because they have their eyes set on the longer term benefits.
Thomas Sowell, in his book Applied Economics, tells the story of a young man who applied for a job in a sales store in upstate New York. The young man had no experience whatsoever and was competing against twenty other experience candidates. The store owner told the young man that he would receive no pay for three months as a cost for teaching him the business. After starting work, the young man was so inept that he was relegated to sweeping the floors. Soon he became a paid employee and a salesman based on the experience he learned while doing menial tasks.
Eventually, the young man, F.W. Woolworth, began his own chain of retail shops; even making his former employer, the one who paid him nothing for three months of work, a partner in his business.
When it comes to reducing carbon emissions, or addressing any environmental challenge, there is often a fight between efforts to force lifestyle changes and promote technology. Invariably, technology proves far better at reducing environmental impact and improving the use of scarce resources than forced lifestyle modification.
The fight between these two approaches is exemplified by two recent events.
McGinn's most triumphant moment of the night may have come with a question about transit. The moderator asked candidates to talk about streetcars and buses, and also to say when each last rode a Metro bus. Mallahan recalled riding a bus over the summer from a Ballard bar to his home in Wallingford, but "I drive my Prius to work in Factoria," he said. Now that he's on leave, he admitted: 'I drive my Prius six blocks from my house over to Eastlake Avenue," where his campaign office located. McGinn has made a big deal throughout the campaign about being a bike commuter. He took the bus yesterday.
The Democrats decided not to endorse either candidate. It is hard to say what role this moment played in the decision, but when driving a Prius is considered disqualifying, it is emblematic of the commitment to lifestyle modification that drives the left's approach to reducing carbon emissions. That approach is also the centerpiece of the state's approach to climate change, driving spending on transit, light rail and imposing numerous new regulations.
On the other hand is a recent speech from Robert Shapiro, an economic adviser to President Clinton, Al Gore and John Kerry. Speaking to the National Economists Club in Washington D.C., (you can listen to the speech here), Shapiro makes the argument for putting technology at the center of our approach to reducing carbon emissions.
In his speech, he notes:
There is one clear and clean intersection between climate, energy independence and economic growth, and the innovation process lies the heart of it. ... If a critical issue for climate is innovation – as it is more generally for long-term growth and productivity gains – then the conditions which affect the pace of innovation become much more important.
He goes on to argue that protection of intellectual property rights is critical to this trend.
Shapiro also offers a strong defense of globalization and the critical role it plays in developing new technologies that are a critical part of improving energy efficiency.
We can figure out things that before we never had the techniques or the person-power to tackle. And part of it is globalization, which gives almost any organization access to the entire global pool of human capital. Globalization also has helped drive very rapid economic development across a number of large developing nations. As the number of middle-class people in the world has rapidly expanded, the market for many innovations has expanded with it – something perhaps most obvious in health care. And as that potential market has expanded, so has the R&D to develop new products, processes, materials, and ways of financing and marketing, and new ways of organizing and running a firm, to meet that demand. With those increases in R&D – which also probably have been accelerated by the global trend towards deregulation, which the current crisis may well reverse – we should expect to see increases in innovations based on R&D.
The choice between an approach that emphasizes regulation designed to force lifestyle modification and one that emphasizes creativity and innovation is the key decision governing our efforts to reduce carbon emissions and use scarce resources wisely.
The choice should be simple: technology not only honors personal freedom and choice that are central to a free society, but improves overall well being and has been consistently more effective at reducing environmental impact.
Senator Tom Harkin (D-Iowa) thrust himself center stage this week when he vowed to dig deeper into persistent rumors that excessive and prolonged cell phone usage could be linked to brain tumors and other cancerous reactions -- this despite various world health organizations such as the American Cancer Society, World Health Organization and the National Cancer Institute all saying there is no connection.
There is a growing consensus that "green" building standards, like those Washington adopted in 2005, don't live up to their promise. Many of the reasons cited echo the data and flaws we've highlighted in the past.
One problem, they note, is that "the certification relies on energy models to predict how much energy a planned building will use, but council officials and many experts agree that such models are inexact." This has been a particular problem in Washington state where the Seattle City Hall and numerous schools were projected to save energy, but ended up increasing energy use. Our research has shown that in virtually every school district, green schools use more energy per square foot than recently-built schools that don't meet the arbitrary standard.
One reason, as we've noted, is that these buildings use large windows in an effort to increase natural lighting. Those windows, however, see large energy losses in the Winter and large energy gains in the Summer, making it difficult to keep a room at a consistent temperature. One person in the NY Times article noted:
But Mr. Siegal, 59, a customs service broker, said his three-bedroom apartment has floor-to-ceiling glass windows that offer great views but also strong drafts. “If there’s a lot of glass, is that going to be efficient?” he asked.
The same problems were found by the San Francisco Chronicle.
In an article titled "Green buildings standard seen as flawed," the Chronicle notes that "many buildings certified as green under a broadly accepted national standard for energy savings are not performing as well as predicted." As a result, San Francisco is looking to change the rules.
Worse, it is widely acknowledged that these regulations increase the cost of buildings -- funding that could go to helping teach school children or on projects that actually help the environment.
The best solution is to let districts find the best way to design buildings that save energy. The fact that districts were building schools that are more efficient than the schools built following the new regulation shows that local districts have the incentives and knowledge to build good schools. That knowledge consistently outperforms the cookie-cutter approach now mandated by law.
Politicians and activists who support these standards often argue that they are necessary to reduce carbon emissions. The question is, if they continue to support policies that don't actually reduce carbon, do they really care about the environment?
As part of an effort by Governor Gregoire to reduce duplicative process in government, the Governor’s Natural Resource Subcabinet has released more than twenty “ideas” that they hope will provide “a starting point for further discussion” as they seek ways to consolidate services, improve efficiency and reduce costs within the natural resource agencies.
Some of the ideas that are being suggested by the Subcabinet include: · Reorganizing existing agencies in to new agency models, · Using a unified vision model to prioritize and synchronize management, · Re-align and co-locate regional offices, · Sharing Services and functions, · Improving environmental protection, permitting and compliance and · Streamlining of quasi-judicial boards.
The Subcabinet is also looking for feedback from citizens. To provide feedback on the Subcabinet’s “ideas”, as well as provide your own ideas, you can use the Electronic Feedback Survey or send an email to resource [dot] reform [at] ofm [dot] wa [dot] gov.
The state Appeals Court Division II ruled this morning to invalidate three of the Department of General Administration's (GA) rules for implementing the competitive contracting provisions of the 2002 Civil Service Reform. The ruling affirms a May 23, 2008, decision by Thurston County Superior Court Judge Chris Wickham. The Washington Federation of State Employees (WFSE) sued to have the rules thrown out.
At issue are WAC 236-51-006, 236-51-010(11) and 236-51-225. The controversy focuses on what it means to be a "displaced employee" due to an agency competitively contracting work.
The state noted in its
href="http://www.washingtonpolicy.org/Centers/government/WFSEvGAbrief.pdf" target="_blank">legal brief:
Under General Administration’s rules, a fair bidding process is established allowing an agency to determine with relative ease and certainty which civil service employees would be entitled to the opportunities offered under RCW 41.06.142. In contrast, the Federation’s approach would result in practical problems in agencies being able to identify which employees may access the opportunities set out in RCW 41.06.142(1)(b) and (c), i.e., to receive notice that the agency is considering contracting, to offer alternatives, to form an employee business unit, to bid on the contract, and to be considered for employment if the contract is awarded to a non-employee business unit. As discussed earlier, these are not theoretical problems. If an agency fails to properly identify employees and ful!
fill the requirements under RCW 41.06.142 and General Administ!
ration’s rules, the agency might well have to begin the entire contract solicitation process over, resulting in a loss of money, time, and efficiency.
The Federation’s approach would also lead to absurd results if an employee business unit did win the contract. Under the Federation’s approach, an agency could propose a contract that would cover some of the duties of one or more civil service employees but not result in the employees being laid off or reclassified. The employees would continue to be fully employed by the agency, at the same salary, in the same job classifications. However, the employees would be entitled to form an employee business unit and bid on the contract. Assuming the employee business unit won the contract, when would the employee business unit members, who remain employed full time by the agency doing their normal duties, perform the contract? On weekends? At night? Neither of these t!
imes may meet the agency’s need to be in communication with or have oversight over those performing the contract. Or would such employees seek to cut back on their normal duties for the agency? However, civil service employees have no right to unilaterally cut back on their hours . . .
The legislative history of the Personnel System Reform Act of 2002 does not show that General Administration’s rules defining displaced employee are inconsistent with RCW 41.06.142. In its challenge below, the Federation argued that RCW 41.06.142 was intended to continue in place the statutory and judicial restrictions against contracting out that were in place prior to the 2002 act. The Federation is incorrect in this assertion.
As discussed above, the 2002 reform act rested on three “legs”: Granting greater collective bargaining rights to state employees; removing the general restriction against state agencies to contracting f!
or services customarily and historically performed by civil service emp!
loyees; and making various changes to the civil service system. The Federation’s view that the 2002 reform act essentially retained the severe limitations on contracting out that were in existence prior to 2002 fails to acknowledge the political trade-offs that made passage of the 2002 act possible. In exchange for full-scope collective bargaining, which some unions had been seeking for decades, state agencies got most of the restrictions lifted on contracting out civil service work. The legislature did not retain the general prohibition against agencies contracting for services customarily and historically performed by civil service employees. On the contrary, it repealed the statute (former RCW 41.06.380) that had embodied that general prohibition.
Even before today's ruling, the use of competitive contracting by state agencies under the 2002 reform has been less than stellar. A performance audit conducted by the Joint Legis!
lative Audit and Review Committee (JLARC) in January 2007 found:
“…few agencies have competitively contracted for services in the 16 months since receiving authorization to do so. Agency managers reported two main reasons for not competitively contracting. First, managers perceive the process itself to be complicated and confusing, providing a disincentive to pursue competitive contracting. Second, competitive contracting is a subject of collective bargaining, which creates additional challenges by requiring labor negotiations. Managers must bargain, at a minimum, the impacts of competitive contracting. Additionally, some agency collective bargaining agreements include provisions which prohibit agencies from competitively contracting.”
Regardless of whether the state appeals today's ruling on the GA rul!
es, Washington policymakers should simplify the bidding process to make!
it easier for agencies to use competition to improve services. Lawmakers should also shield contracting out from union and political influence by removing it from the collective bargaining process. Improving service to the public is too important to be a bargaining chip in government labor negotiations.
Last week, TVW's Austin Jenkins interviewed Superintendent Randy Dorn about the state of public education:
Austin Jenkins asked the Superintendent to respond to an observation made on this blog, here , which was that "pouring more money into the current dysfunctional system will yield the same mediocre to poor results at a higher cost to taxpayers, and even worse, to the students who are not being educated sufficiently to give them a life of success in college or the workplace."
Significantly, the Superintendent's exact response to this observation was "when you provide more funding you are going to have to show how some things have changed."
With these words, Superintendent Dorn has signalled he is open to real improvements to the way we run our schools. He indicated support for paying math, science and special ed teachers more, to attract them to classroom. He indicated support for quality pay for the best teachers. He indicated support for creating a process to remove the weakest teachers from the classroom.
These are all good ideas contained in our Education Reform Plan. The fairest and most effective way to implement these reforms is to put a human face on managing schools: the school principal and his school leadership team. The Superintendent must unravel the centralized way we run our schools, and avoid (like the plague) creating another formula broadly applied across an entire group of teachers. Decentralizing school authority (and accountability) to the local school principal, allowing him or her to act as real instructional leaders, with the power to reward teachers who are going the extra mile for students, is the way forward.
Protests were held across the country this past Saturday by citizens frustrated with the spending decisions being made in Washington D.C. Among the local protests were rallies at the state capitol in Olympia and in Yakima. Here are some photos of the Olympia rally.
When asked by The Yakima Heraldwhy he was at the Yakima rally, sixty-nine year old Jack Weston replied:
“Bank bailouts should never have happened. Taking over the car companies should never have happened,” he said.
He ultimately came away encouraged. “I’m doing a small part in protecting this county.”
The largest of the spending protest occurred in Washington D.C. with a!
n estimated tens of thousands converging on the Capitol. The New York Times reports the number of protesters took authorities by surprise:
A sea of protesters filled the west lawn of the Capitol and spilled onto the National Mall on Saturday in the largest rally against President Obama since he took office, a culmination of a summer-long season of protests that began with opposition to a health care overhaul and grew into a broader dissatisfaction with government.
On a cloudy and cool day, the demonstrators came from all corners of the country, waving American flags and handwritten signs explaining the root of their frustrations. Their anger stretched well beyond the health care legislation moving through Congress, with shouts of support for gun rights, lower ta!
xes and a smaller government . . .
tyle="margin-left: 40px;">The demonstrators numbered well into the tens of thousands, though the police declined to estimate the size of the crowd. Many came on their own and were not part of an organization or group. But the magnitude of the rally took the authorities by surprise, with throngs of people streaming from the White House to Capitol Hill for more than three hours.
The federal budget deficit for the first 11 months of fiscal year 2009 was almost $1.4 trillion, CBO estimates, close to $900 billion greater than the deficit recorded through August 2008. Outlays were $518 billion (or 19 percent) higher and revenues $365 billion (or 16 percent) lower than the amounts recorded during the same period last year!
. . .
Outlays for the first 11 months of fiscal year 2009 neared $3.3 trillion, 19 percent more than in the same period last year. (The increase comes to 20 percent when the amounts are adjusted for shifts in the timing of certain payments.) Much of the growth in outlays stems from spending for the Troubled Asset Relief Program (TARP), cash disbursements for Fannie Mae and Freddie Mac, and spending for ARRA. Without those effects, total federal spending would be up by only 7 percent.
Thus far, the Treasury has recorded $174 billion in costs for the TARP and $83 billion in net cash payments to the GSEs. Through August, approximately $85 billion has been spent as a result of ARRA. About one-third of that amount ($28 billion) was for the temporary increase in the federal share of Medicaid costs. Unemployment benefits also have been boosted—by $16 billion—because of ARRA; higher unemployment and other legislat!
ed increases also contributed to the rapid growth in that program’s s!
pending since last year. Other provisions of ARRA contributed about $40 billion to the increase in outlays for “Other Activities,” mainly for payments to Social Security beneficiaries, grants to states (from the State Fiscal Stabilization Fund), student aid, and food and nutrition programs.