Archives: 02/2015

2015: The Year of Educational Choice

The Wall Street Journal declared 2011 “The Year of School Choice” after 13 states enacted new school choice laws or expanded existing ones. By that measure, 2015 could be “The Year of Educational Choice” as at least 10 state legislatures consider new or expanded education savings accounts (ESAs) in addition to at least 11 states considering new or expanded scholarship tax credits.

ESAs represent a move from school choice to educational choice because families can use ESA funds to pay for a lot more than just private school tuition. Parents can use the ESA funds for tutors, textbooks, homeschool curricula, online classes, educational therapy, and more. They can also save unused funds for future educational expenses, including college.

Currently, two states have ESA laws: Arizona and Florida. Both states redirect 90% of the funds that they would have spent on a student at her assigned district school into her education savings account. The major difference between the two laws is that Arizona’s ESA is managed by the Arizona Department of Education while Florida’s is privately managed by Step Up For Students and AAA Scholarships, the nonprofit scholarship organizations that also issue scholarships through the Sunshine State’s tax credit law. As the Heritage Foundation’s Lindsey Burke and I explained in the most recent edition of National Affairs, there are several reasons to believe that Florida’s model holds advantages over Arizona’s:

First, the non-profit scholarship organizations are less likely to be captured by opponents than is a government agency. The non-profits are dedicated to the scholarships, and the idea of school choice is built into their mission. Second, awarding scholarships is the primary mission of a scholarship organization but only an ancillary function of a state education agency — which means that not only will they be more dedicated to the concept but they can generate and retain best practices more easily. Third, scholarship organizations have the ability and incentives to be more flexible in their operation than government agencies, and therefore more responsive to the needs of families. The Arizona education department did not offer workshops for parents outside of regular business hours because employees were not paid for those hours. Non-profits can more easily implement policies like flextime.

While both Arizona and Florida redirect public funds into the ESAs, a state could create an ESA that is funded through tax credits, which would minimize the threat of overregulation and avoid coercing people into supporting the teaching of ideas that they dislike. New Hampshire’s scholarship tax credit law already has an ESA-style provision that allows homeschoolers to use scholarship funds for a wide variety of educational expenses. 

Several state legislatures are moving fast to enact ESA laws this year. Both the Mississippi Senate and Virginia Assembly passed ESA bills last week. This week, the Virginia Senate’s Education Committee and Oklahoma Senate education subcommittee both approved ESA bills and a Florida Senate panel approved an expansion of their state’s ESA law. Arizona is also considering expanding eligibility for its ESA law.

Other states considering a new ESA law include Colorado, Delaware, Georgia, Montana, and Oregon. Additionally, Politico reported that Iowa, Nebraska, Nevada, Rhode Island, Tennessee, and Texas are likely to take up ESA bills as well. States considering new or expanded scholarship tax credit laws include Georgia, Indiana, Maryland, Missouri, Montana, Nebraska, Nevada, New Mexico, New York, South Carolina, and Texas. In addition, two state senate committees in Colorado have approved a personal-use education tax credit.

There’s no guarantee that any of these bills will become law, but the number of state legislatures exploring educational choice is encouraging.

[Updated to include Oregon’s ESA bill.]

Europe: A Fiscal & Monetary Reality Check

Led by Alexis Tsipras, head of Greece’s newly-elected, left-wing coalition, some other leading political lights in Europe—Messrs. Hollande and Valls in France and Renzi in Italy—are raising a big stink about fiscal austerity. Yet they always fail to define austerity. Never mind. They don’t like it. The pols have plenty of company, too. Yes, they can trot out a host of economists—from Nobelist Paul Krugman on down—to carry their water.

But public expenditures in Greece, Italy and France are not only high, but growing as a proportion of the economy. One can only wonder where the austerity is. As the first chart shows, only five of 28 European Union countries now spend a smaller proportion of national income on government than they did before the current crisis. For example, Greece spent 47.5% of national output on government in 2007 and 58.5% in 2013, an increase of 11 percentage points. 

Government expenditures cut to the bone? You must be kidding. Even in the United States, where most agree that there is plenty of government largesse, the government (federal, plus state and local) still accounts for “only” 38.1% of GDP.

Police Officers Must Keep the Cameras Rolling

Recently released dash camera footage of an arrest in St. Louis, Missouri offers an example of the disturbing flippancy with which cameras can be turned off during police interactions with the public.

According to a police report, on the evening of April 10, 2014, officers Nathaniel Burkemper and Michael Binz stopped a silver Ford Taurus after it made an illegal U-turn and “abruptly parked.” Only minutes earlier, 911 operators had received calls reporting shots fired. One of the calls mentioned a silver car with big rims.

Footage from the dash camera on Burkemper and Binz’s cruiser shows that shortly after the Ford Taurus pulls over, Binz moves to the passenger side of the vehicle, where he searches and handcuffs the passenger. Burkemper speaks to the driver, Cortez Bufford. Burkemper filed a report stating that he smelled marijuana and that both Bufford and his passenger did raise their hands when asked. However, Bufford reportedly “became agitated.” From the St. Louis Post-Dispatch:

Bufford “became agitated,” Burkemper wrote, refusing to give his name and reaching for a pants pocket before the officer warned him to keep his hands in view. Bufford refused orders to get out. Burkemper called for backup when Bufford became “increasingly hostile.”

The report says Binz told Burkemper he had found two bullets in the passenger’s pocket. Burkemper then ordered Bufford out again, saying he was under arrest. Bufford unlocked his door, but refused to exit.

The dash camera footage shows officers pulling Bufford from the car. Then, at least seven officers are involved in kicking, tasing, and subduing Bufford while he is on the street. According to Burkemper’s report, once Bufford was on the street he struggled and reached for his pocket. The  Post-Dispatch reports that Binz “recovered a Kel-Tec 9mm semi-automatic pistol with four rounds in the magazine and one in the chamber.”

Bipartisan Baloney About Top 1 Percent Income Gains

In the State of the Union address on January 20, President Obama said, “those at the top have never done better… Inequality has deepened.”  The following day, Fox News anchor Brett Baier said, “According to the work of Emmanuel Saez, a professor at the University of California, Berkeley, during the post-recession years of 2009-2012, top earners snagged a greater share of total income growth than during the boom years of 2002-2007. In other words, income inequality has become more pronounced since the Bush administration, not less.” 

Senator Bernie Sanders agrees that “in recent years, over 99 percent of all new income generated in the economy has gone to the top 1 percent.”  And Senator Ted Cruz likewise confirmed that, “The top 1 percent under President Obama, the millionaires and billionaires that he constantly demagogued earned a higher share for our income than any year since 1928.” 

When any statistic is so politically useful and wildly popular among left-wing Democrats and right-wing Republicans you can be pretty sure it’s baloney.  Bipartisan baloney.

In November 2013, I wrote that, “Because reported capital gains and bonuses were…shifted forward from 2013 to 2012 [to avoid higher tax rates], we can expect a sizable drop in the top 1 percent’s reported income when the 2013 estimates come out a year from now. The befuddled media will doubtless figure out some way to depict that drop as an increase.” As predicted, the New York Times took one look at a 14.9% drop in top 1% incomes and concluded that “The Gains from the Recovery are Still Limited to the Top One Percent” That involved slicing the same old baloney very badly.

The Future of NATO (Event: March 4th)

Russian aggression in Eastern Europe during the last year has brought to the fore many of the issues surrounding the transatlantic security relationship, in particular, the role of NATO. Since the end of the Cold War, NATO has been floundering, seeking new missions and goals, with recent involvement in military campaigns in Afghanistan and Libya emblematic of this search. In some ways, Russia’s recent actions have brought back a sense of purpose to the alliance.

Unfortunately, NATO still has many problems. Common vision among members is lacking, a problem exacerbated by the expansion of NATO from sixteen members at the end of the Cold War to twenty-eight members today. Many of these new member states in Central and Eastern Europe feel – understandably – more threatened by Russian aggression than West European or North American member states, creating tension within the organization.

NATO itself has increasingly become a political entity. Indeed, the growth of NATO membership among East European states during the last decade has been a key impediment to improved relations with Russia. The suggestion that Georgia and Ukraine might become EU or NATO members has also been widely discussed as one of the roots of the current conflict.

NATO funding is a big problem. Though most member states hail NATO’s importance and demand its services, few are willing to pay the costs, which fall disproportionately on the United States. In 2012-2013, only three other member states met NATO’s stated military spending target of 2% of GDP: the United Kingdom, Estonia and Greece. Many countries which rely heavily on NATO nonetheless contribute little to the alliance or their own defense, relying instead on the United States.

The Libertarian Mind in the News

I’ve been busy talking up the libertarian moment, libertarian ideas, and The Libertarian Mind (buy it now, available everywhere) in person and in print lately. Here are a few recent examples.

My article on America’s libertarian roots in Sunday’s Philadelphia Inquirer:

Indeed, the principles of the Declaration are so closely associated with libertarianism that the Chinese edition of my previous book, Libertarianism: A Primer, features a cover photograph of the famous room in Independence Hall, complete with Windsor chairs and green tablecloths.

Libertarianism is the philosophy of freedom. It has, in different form throughout history, inspired people who fought for freedom, dignity, and individual rights - the early advocates of religious tolerance, the opponents of absolute monarchy, the American revolutionaries, the abolitionists, antiwar advocates and anti-imperialists, opponents of National Socialism and communism.

The next day, Nick Gillespie interviewed me at the National Constitution Center in Philadelphia. Video here.

My article “Black History Is American History” at HuffingtonPost:

Black history is American history, a story of oppression and liberation rooted in the libertarian idea of individual rights. Much of the progress we have made in the United States has involved extending the promises of the Declaration of Independence – life, liberty and the pursuit of happiness – to more and more people. The emphasis on the individual mind in the Enlightenment, the individualist nature of market capitalism and the demand for individual rights that inspired the American Revolution naturally led people to think more carefully about the nature of the individual and gradually to recognize that the dignity of individual rights should be extended to all.

And my interview with African American Conservatives.

My print interview yesterday with Salon:

Where am I the most optimistic? I am optimistic that around the world more and more people are moving into a world of property rights, markets, globalization, human rights, women’s rights, access to information and opportunity. Now that’s obviously not true everywhere; there are, at any given moment, unfortunate setbacks in Venezuela and Russia and some of Eastern Europe. But I do think the largest historical trend of our time is the move in a broadly libertarian direction, and therefore toward a higher standard of living for billions of people around the world.

Are you thinking of the growing middle class in China and India when you say this?

Absolutely. The change in economic conditions in China and India — right there you got one-third of the world. But also there have been some advances in the direction of human rights in Africa as well. So in a great deal of the world, you’ve seen a huge reduction in poverty and absolute poverty, and a rising middle class in many of these countries.

Interviews with Jim Bohannon, Garland Robinette, Bill Frezza, and others can be found here.

Buy the book!

 

What Fed Officials Really Don’t Want You to Know (Hint: They Are Telling You)

Yesterday morning I had a query from someone asking me to share my thoughts about the Federal Reserve Transparency Act, better known as the bill to “Audit the Fed.” Having given him a brief answer, I thought I might say a little more here.

Although Rand Paul promises that his measure will shed much-needed light on the Fed’s undertakings (the Senate version of his measure was even called “The Federal Reserve Sunshine Act”), the truth is that it’s unlikely to reveal anything of importance beyond what existing Fed audits–including those provided by Title XI of the Dodd-Frank Act (which provides for a GAO audit of the Fed’s crisis-related emergency lending)–can themselves reveal.

True, unlike existing measures Paul’s bill would also let the GAO “audit” the Fed’s conduct of monetary policy, including its open-market operations and financial dealings with other central banks. But if “sunshine” is the first word that pops into your head when contemplating this possibility, you probably have had a little too much of it already. Certainly you have not read many GAO reports.

Don’t get me wrong: the GAO does its job well, and a report by it on the Fed’s conduct of monetary policy would probably be a much better read than most academic papers on the same topic. But if you’re looking forward to seeing the GAO give the FOMC a good thrashing, or to any other sort of scintillating reading, you’re barking up the wrong tree, because what you’re likely to be in for instead is a bunch of charts and tables, accompanied by a competent but very measured and detached review of the Fed’s activities, of the sort that might prove very handy, but that is hardly likely to be the least-bit earth-shattering.