The Republicans’ Post-Election Personal Pork Party

At The Hill, I have an article about a little-known dip into the pork barrel: big bonuses for congressional staff if there’s money left over at the end of the year, especially if the money will fall into the hands of the other party at the end of the year.

How can there be money left over when the government is running multi-hundred-billion dollar deficits? Well, you might ask. But each department has its own appropriation, and those accounts often have “money left in the budget” as the end of the year approaches, necessitating the famous end-of-the-year spending spree.

In the congressional case, I found examples like this on committee staff budgets:

The House Energy and Commerce Committee showed similar patterns. In 2005, when the Republican leadership was spending its “own money” on year-end bonuses, several staffers received less than 10 percent of their annual salaries, while a few lucky staffers received extra payments of as much as 17 percent.

But when GOP Energy and Commerce bosses faced losing their chairmanship after the 2006 election, they decided to leave no dollar behind for the Democrats. Lucky staffers then got windfalls of 31 percent on a $35,000 salary, 30 percent on a $50,000 salary, 18 percent on a $100,000 salary, and so on. At least 15 committee staffers got bonuses of between $11,000 and $17,600.

And I concluded, cheekily:

Members of Congress are free to pay their staffers whatever they choose, up to an annual ceiling, so there’s nothing illegal about year-end bonuses, even year-end, post-election, before-the-other-party-gets-in bonuses.

But this pattern illustrates a big difference between the private and public sectors. In the private sector, if your customers become dissatisfied with your product, you tend to make less money. In the public sector, you get a couple of months to double-dip before you lose control of the money. For participating in a Congress that voters booted out of office, these bonuses are a handsome parting gift.

A big tip of the hat to Cato interns Schuyler Daum and Jonathan Slemrod for poring over payroll records, and to LegiStorm for making such information about Congress public and accessible.

A Second Industrial Revolution?

Peter Goodman has a fine article in Monday’s Washington Post about the resilience and tenacity of the manufacturing sector in the United States – even in the storied ghost towns that dot the once-bustling textile regions of North Carolina.  Like my recent paper on the topic, Goodman points out that U.S. manufacturing is thriving:

The United States makes more manufactured goods today than at any time in history, as measured by the dollar value of production adjusted for inflation – three times as much as in the mid-1950s, the supposed heyday of American industry. Between 1977 and 2005, the value of American manufacturing swelled from $1.3 trillion to an all-time record $4.5 trillion, according to the Bureau of Economic Analysis.

And he reinforces a key point of my paper that has yet to penetrate the pessimistic political discourse:

With less than 5 percent of the world’s population, the United States is responsible for almost one-fourth of global manufacturing, a share that has changed little in decades. The United States is the largest manufacturing economy by far. Japan, the only serious rival for that title, has been losing ground. China has been growing but represents only about one-tenth of world manufacturing.

The major difference between my paper and Goodman’s story is that the former takes a birds-eye view of the manufacturing sector, presenting an impersonal, data-driven assessment of the state of U.S. manufacturing.  Goodman’s story focuses on a particular biotechnology company that occupies a former textile mill, producing a drug for liver ailments from a local pond weed.  The story is emblematic of the metamorphosis throughout the North Carolina and U.S. manufacturing sectors:

North Carolina encapsulates the forces remaking American manufacturing. Between 2002 and 2005, the state lost 72,000 manufacturing jobs, about three-fourths in textiles, furniture-making and electronics, according to the North Carolina Commission on Workforce Development. At the same time, the state has become a rising powerhouse in lucrative new manufacturing sectors such as biotechnology, pharmaceuticals and sophisticated textiles.

During the most recent decade, U.S. manufacturing has become increasingly oriented toward the middle and upper ends of the value-added spectrum.  Opportunities abound for workers with skills or the willingness and wherewithal to acquire them.  In fact, the title of the National Association of Manufacturers tenth annual Labor Day Report on the state of U.S. manufacturing is “Rising Incomes Cushion Economy,” and its subtitle is “Finding Highly Skilled Workers Remains a Challenge for Manufacturers.”  It seems to me that rising wages should make more workers willing to get the skills, and the need to find highly-skilled workers should induce manufacturers to assist on the wherewithal front.

National Health Care and the Nanny State

As if John Edwards proposal for mandatory preventive care wasn’t proof enough that national health care means less freedom, the Tories have now proposed that the UK’s National Health Service monitor Britons to ensure they are living “healthy lifestyles.” Those who don’t measure up could be denied treatment under the NHS (which could be a blessing in disguise). Those who lose weight, give up smoking, and make other healthy changes can have the government pay for their gym memberships and even buy them fresh fruit and vegetables.

Sometimes politics is beyond parody.

And We Thought Mitt’s Mandate Was Bad…

Democratic presidential candidate John Edwards has announced that preventive care and regular check ups would be mandatory under his new health care plan. Every American would be required to get an annual physical and tests, such as mammograms and colonoscopies as frequently as the government deemed prudent. Although he didn’t spell out the penalties, we can look forward to Americans being hauled into court for failing to provide proof of a blood test.

The Nanny State marches on.

The Left Is Half Right on NCLB

Over at the popular leftish blog Crooks and Liars, Bluegal laments the No Child Left Behind Act, which is up for reauthorization this month. The nearly 100 comments on her post overwhelmingly echo her negative views. Nevertheless, it seems that she, her commenters, and the vast majority of Democrats in Congress want the law reauthorized. Why?

The reason for this apparent contradiction is that NCLB is only the latest incarnation of the Elementary and Secondary Education Act (ESEA), which has been directing federal tax dollars to public schools since 1965. Leftish critics of No Child want to dilute or repeal most of the testing requirements introduced to the law in 2002, while increasing its funding. They believe that the testing provisions of NCLB are ineffective and likely harmful, but that federal spending is good for American education so long as it is not narrowly channeled into high-stakes testing. They’re half right.

As Neal McCluskey and I demonstrate in our new NCLB study (which we’ll be releasing on the Hill tomorrow), the evidence shows that the law’s testing and teacher qualification regimes have failed to improve achievement or narrow the gaps between groups. So the left’s skepticism on this point is justified. But the left-liberal goal of securing higher federal spending without bureaucratic “accountability” is both unattainable and undesirable.

A perennial blind spot of both major political parties is that they love to seize new powers and revenue streams while they’re in office, failing to realize that those same powers and dollars will inevitably fall into the hands of their ideological opponents. The Democrats gave us ESEA, and the Republicans eventually turned it into NCLB. As long as Republicans are elected they will try to hold schools bureaucratically “accountable” for the federal funding they receive – particularly given that real federal per pupil education spending has risen by a factor of 18 or so since the ESEA was passed in 1965. So even if the left manages to enact a “hands off but wallet open” version of NCLB this fall, it will live a short policy life, succumbing again to federal testing/performance mandates the next time Republicans control Congress.

For the sake of argument, though, would it do any good if it were a realistic long-term goal? Since it took Republicans a long time to get around to imposing the testing standards of NCLB, we actually have nearly four decades of experience with the ESEA with which to answer that question. Did higher spending translate into higher achievement? No. Federal spending went from about $50 per student in 1965 to nearly $900 per student in 2003-04. Total per pupil spending doubled to more than $11,000 over the same period. But at the end of their public schooling careers, students perform no better in reading and math today than they did nearly four decades ago. They’ve actually gotten worse in science (data from the Long Term Trends studies of the National Assessment of Educational Progress, for 17 year-olds).

If liberals want to stop Washington from meddling in the classroom, as most claim, there is only one way to go about it: stop collecting and spending federal tax dollars on it. So long as American schools are beholden to the federal purse, they will be puppets on the end of federal purse strings – strings held, on a recurring basis, by Republicans.

John Edwards’ Nurse Ratched Plan

John Edwards says that his universal health care plan will be mandatory not just for taxpayers and doctors, but for patients: You will get preventive care, and you will like it:

“It requires that everybody be covered. It requires that everybody get preventive care,” he told a crowd sitting in lawn chairs in front of the Cedar County Courthouse. “If you are going to be in the system, you can’t choose not to go to the doctor for 20 years. You have to go in and be checked and make sure that you are OK.”

He noted, for example, that women would be required to have regular mammograms in an effort to find and treat “the first trace of problem.”

As Jon Henke notes, Edwards also proclaims that “the right to choose and the right to privacy are fundamental constitutional rights.” But apparently abortion is the only thing you have a constitutional right to choose. You have no fundamental right to choose not to get a mammogram. Or any other kind of preventive care. Shades of This Perfect Day and Brave New World.

This is, of course, a fundamental problem with socialism, or with socialization of the cost of anything. Edwards sincerely believes, with good reason, that preventive care helps to reduce costs by catching problems early and helping people stay healthy. (Though he may not be right about that.) But why is my health care budget his concern? Because he plans to socialize the costs of health care. So indeed, if I fail to take care of myself, I’m imposing costs on the collective. And as the collectivist-in-chief, Edwards wants to treat me as a national resource, not as a free adult individual.

This isn’t the first time such arguments have been made. What’s the argument for requiring adults to wear bicycle helmets and seat belts? That otherwise the taxpayers might have to pay for the costs of injury. Activists who want to restrict smoking, trans fats, and other unhealthy habits make the same argument: The collective is going to be paying for your health care, so you owe it to us to hold down our costs.

When we realize that socializing costs creates such unpleasant conflicts, we can respond in one of two ways: We can move away from socialization and allow people to make their own decisions and bear the consequences, or we can increasingly restrict freedom in order to hold down collective costs. Libertarians prefer the former approach, John Edwards the latter.

In One Flew over the Cuckoo’s Nest, Nurse Ratched was a tyrannical nurse who forced medical care on people who didn’t want it. She was known as “Big Nurse,” which might be a better metaphor for our increasingly therapeutic state than “Big Brother.” Democrats love Hollywood celebrities (and vice versa). Maybe Edwards can get Louise Fletcher to do a health care tour with him. She could wear her state nurse’s uniform and sing “You Belong to Me.”

The Reagan Revolution Sweeps the World

Steve Moore’s Wall Street Journal column celebrates the global shift to lower tax rates and free markets. To be sure, most foreign politicians are adopting pro-growth policies because of tax competition, not because they share Ronald Reagan’s vision. But the end result is a much stronger global economy:

…the Reagan economic philosophy of lower taxes, less regulation and free trade has never been more in vogue abroad – so much so that it has become the global economic operating system. …nations of old-Europe seem to be in a sprint to see which country can get their tax rates lowest quickest. Nicholas Vardy, the editor of “The Global Guru” economic newsletter calls the phenomenon “Europe’s Reagan Revolution.” …Austria cut its corporate tax rate to keep pace with its neighbor, Slovakia which recently adopted an 19% flat tax. Singapore is cutting taxes to compete with its 16% flat-tax rival Hong Kong. Northern Ireland wants to cut its tax rates so that it can compete with the economic gazelle of Europe, the Republic of Ireland. In 1988 Ireland was a high-unemployment stagnant economy with a 48% corporate tax rate, today that rate is 12.5% and the rest of the world is now desperate to match its economic results. Meanwhile German Finance Minister Peer Steinbrueck sold the latest tax cuts as “an investment in Germany as a business location.” …it is a testament to the Reagan economic revolution launched in 1981 that, a quarter century later, global tax rates are 25 percentage points lower on average today than in the 1970s. And those figures don’t even include this latest round of chopping under Reaganomics 2.0. The enactment of supply-side policies is helping ignite one of the strongest and longest world-wide economic expansions in history.