I wrote two posts about Quest to Learn under the impression that it’s a charter school. I was mistaken. Quest to Learn is not a charter school; it’s a New York Department of Education public school. Although in some ways it looks more like a charter than a traditional public school (it has outside sponsors, and students choose to attend rather than being assigned by residence), it is not a charter.

Clearly, I was wrong to criticize Popular Science for leaving out “information” about Quest to Learn that I myself didn’t get right. My apologies go both to Quest to Learn and to Popular Science for my mistake.

One result of competition from charters, online schools, and other options is that public districts respond with innovative schools of their own. In this case, New York did such a good job that I couldn’t tell the difference!

Today’s edition of the Maneater featured an op-ed attacking the notion that a public option in health care is necessary to keep health care costs in this country low. From the article:

Indulge me in a very simplified thought experiment. You, reader, enjoy beer, and I have deep pockets. We come to an arrangement: you pay me a fixed fee, and I will heavily subsidize each of your purchases of beer over the course of a night.

What would we expect to see happen? I expect that your demand for beer will increase toward over-consumption since the more you use this service, the more attractive the deal becomes. Perhaps an astute bartender notices the strength of your demand and decides to react by raising the price of each beer by 25 percent. As far as you are concerned, you continue to pay the same as before. As far as the bartender is concerned, he’s reacting rationally to forces of supply of demand. As far as I’m concerned, I’m going to have to raise the price of my fee for future nights if I’m going to keep from losing money.

The price of beer will balloon and the culprit is an economic wedge — the difference between the price a consumer pays and a producer receives.

Applying the analogy to health care, we can see that a public option would produce unintended consequences of health care cost inflation by exacerbating the effects of an economic wedge in the health care market. Sounds a lot like the conclusion of this recent Show-Me Institute study.

The St. Joseph News-Press reports that Missouri lawmakers recently proposed a solution to the problem of “tax stacking” — the practice by which municipalities attempt to pass additional tax increases through referendums in order to circumvent the state-mandated limit of an additional 1.5 percent in sales taxes. The lawmakers proposed two things:

The resolution would protect cities from the threat of lawsuit, as they believed a 1999 letter from the Missouri Department of Revenue condoned the taxes. However, the two legislators want to cap general sales taxes at one cent and other authorized sales taxes — such as St. Joseph’s CIP [Community Improvement Project] tax — at one-half cent.

These extra taxes usually come in the form of CIP taxes (also known as CID, Community Improvement District, taxes). CID taxes are levied when at least 50 percent of the property holders holding at least 50 percent of the property in the area decide to levy a voluntary tax. In practice, this money could be used for landscaping or infrastructure improvements that benefit 51 percent of the owners, to the detriment of the other 49 percent. The use of CIDs is of questionable value, at best, and this proposal would essentially prohibit further CID taxes.

When I wrote about the topic of tax stacking earlier this summer, a Farmington lawyer was suing cities to repeal these taxes. At the time, I was conflicted over my desire to see taxes lowered and my concern that the lawsuit was redistributing city money inappropriately, essentially hurting the taxpayers it was intended to help. Recollecting the money would not solve matters, because the transaction cost of both the initial collection and the recollection process (as well as the difficulty of determining the appropriate reallocation) would be prohibitively costly. Considering the situation, strengthening the tax cap is the best solution to protect Missouri taxpayers from further harm.

Tax caps would require Missouri’s cities to promote further growth if they want to increase tax revenue. Preventing extra taxes from being collected — thereby leaving more money in the hands of consumers — would permit more growth, and would result in a far better long-term outcome than simply raising taxes.

If Pennsylvania were to rescind its remaining restrictions on ticket scalping, this kind of thing would happen less often.

Less than a month after the federal ban on clove cigarettes began, a close substitute good, clove cigars, has hit the market.

During the drive home from work yesterday, I listened to a discussion of high-speed rail on NPR’s “Marketplace.” Mitchell Hartman discussed a new report from the Pew Research Center reminding us that high-speed rail depends on federal assistance. Pew calculated that Amtrak receives a $32 subsidy per ticket, on average, from taxpayers. Amtrak, however, estimates that the size of the subsidy is $8. From the show’s transcript:

The difference is Pew includes all the costs of running a railroad, like depreciation — that’s wear-and-tear on tracks and trains — and overhead, like the legal and HR departments. Taxpayers pick up those costs too. Amtrak got $1.3 billion in funding last year.

The program even quoted Randall O’Toole, a Cato Institute senior fellow and self-described “Antiplanner”:

Best thing we can do for mass transportation would be to privatize it, let the private operators respond to the market, and then we’ll have a more efficient system that might be attractive to more people.

O’Toole has written several policy studies for the Show-Me Institute on the subject of high speed rail and its free-market alternatives. His most recent, “Why Missouri Taxpayers Should Not Build High-Speed Rail,” was published late last month.

High-speed rail is relevant to Missouri, particularly as officials consider upgrading the tracks from Saint Louis to Kansas City to accommodate high-speed trains. As David Stokes testified before the Joint Committee on Transportation Oversight earlier this month:

For Missouri to build true high-speed rail — the type that American tourists ride in Europe at 150 mph — would cost Missouri taxpayers billions more, all to serve the small percentage of the population that uses passenger rail.

New York’s higher-income residents are fleeing the state, and they are taking their tax dollars with them. The New York Post reports that this is because of the state’s high cost of living and high taxes:

It all adds up to staggering loss in taxable income. During 2006-2007, the “migration flow” out of New York to other states amounted to a loss of $4.3 billion.

Not coincidentally, states that have lower tax burdens experience positive domestic migration. According to information from the Tax Foundation, New York has one of the highest marginal tax rates on personal income in the nation. In New York, the top marginal tax rate in 2009 is 8.97 percent. In Florida and in Tennessee, it’s 0.00 percent. In Missouri, this rate is 6.00 percent.

The Show-Me Institute has extensively explored the relationship between tax policies and domestic migration. In an op-ed, “Tennessee vs. Missouri: Taxes May Tip the Odds,” the institute’s executive vice president Dr. Joe Haslag explained how different tax structures contribute to domestic migration:

Economic theory indicates that the difference in income tax rates — that is, the property rights enforced on people’s labor, and the payment for that factor of production — can help to account for the differences in growth rates.

The basic idea is elementary economics. Consider two people with identical characteristics, one in Missouri, the other in Tennessee. Suppose those two people were given identical work opportunities, so that they had access to the same machines and plant surroundings. For one hour of work, each produced the same amount, and was paid $20. Excluding federal taxes, the person in Missouri would take home $18.80 while the person in Tennessee would take home $20. (If the person worked in Saint Louis or Kansas City, take-home pay would only be $18.60. We will save that discussion for another time.) The person in Tennessee will supply more labor because he realizes a higher return for his effort.

Related to this subject, Jenifer Zeigler Roland and Dave Roland recently published a case study that explores how different tax policies may have played a significant role in Tennessee outgrowing Missouri. They provide another explanation:

A lower overall tax burden is attractive to prospective businesses and residents, because it leaves more money available for consumers to spend on goods and services.

Edspresso links to this essay by Hope Frick, a virtual school student in Pennsylvania. She’s written an articulate explanation of why she chose to attend a virtual academy. You have to sympathize with her frustration at the responses she gets when she tells people about her school. Frick is absolutely right that online high schools should be accepted as mainstream.

There is one thing that bothers me about the essay. I’ve highlighted it in the following quote:

Approved by the state, cyber schools enable students from pre-kindergarten to 12th grade to gain a public school education from their homes.

Frick refers several times to state approval and regulation, implying that government involvement is key to virtual schools’ success. Now, it’s true that many good online schools are run by states or strictly regulated, but states are closely involved with public brick-and-mortar schools, too — and the results aren’t always stellar. That’s not to say that they’re all bad, just that there’s a lot of variation, despite the government authorization they have in common. We have to conclude that factors other than state approval cause the difference in outcomes.

The real test of a school’s quality, be it online or brick-and-mortar, is whether students learn from it and parents are satisfied. Given that thousands of students voluntarily choose virtual schools over other options, I’d say they’re doing well by those measures.

Laura Dekker is still waiting for permission to set sail; latest reports say the Dutch court will issue its decision on Friday.

Dekker is bending over backward to respond to criticisms of her plans. She’s delaying her trip until after this school year. She says she’ll study while she’s sailing, and take exams when she stops at ports along the way. She’s already submitted to an IQ test for the court’s scrutiny. (What will they ask her to do next? Postpone the voyage until she gains entrance to Harvard Law School?)

Another boat will shadow her in the most challenging waters, and a veteran sailor has volunteered to escort her the entire way.

And the big news is that she might have her own reality show. I can hear the response now: “These reality shows have gone too far. People need to stop doing outrageous things to get on television.” But I think a show could be a positive thing. It would involve a lot of close monitoring of Dekker’s voyage, and probably extra safety measures. Dekker would not be able to recklessly head off into a storm or other dangerous situation into which a film crew would not agree to come along. (Although I doubt Dekker would act foolishly on her own, considering that she intends to break up the trip into short segments and take other precautions, the close presence of people and cameras should reassure everyone further.)

I’m looking forward to hearing the court’s decision. There are just a few more days to wait!

Don’t worry, I still detest red light cameras and think they are a total violation of our rights. I think the state should ban them throughout Missouri. However, I give Springfield some credit for truly using them for public safety purposes rather than as a back-door revenue generator. The article in the Springfield News-Leader (link via Combest, who is a very safe driver), details how the city has made almost no money from the cameras, although the company that installed them has certainly made its share.

I am not generally someone who gives much credit for intent over results (that is a mindset of the left side of the political spectrum), but I am going to make a slight exception here. I still think the people of Springfield should demand that the cameras be removed, but it is better if they are only used for traffic enforcement, and not as a money raiser. Springfield’s city traffic engineer (Earl Newman, quoted below) sums it up nicely at the end:

St. Louis’s mixture of significant additional revenue with those public safety benefits worries Newman, who is concerned the financial windfall muddies the water.

“When you’re making a lot of dollars, that means people are still running lights,” he said. “And it’s going to give the appearance it’s being done for the money.”

According to a little-known website, the Drudge Report, Chicago is considering privatizing its water utility. This would follow on the heels of: a very successful privatization of a local highway, the Skyway; the successful near-privatization of Midway Airport (it was successful because even though the deal fell through, the city got to keep the enormous down payment); and the not-successful-at-all (at least not yet) privatization of the city’s parking meter system.

This is something that could, and should, also be considered by Kansas City and Saint Louis. Both cities function with private utilities providing electricity and gas, but both have municipal water systems. In St. Louis County, even the water is provided by a private company, Missouri-American Water. Both St. Louis city and Kansas City have a valuable asset at their disposal that the private sector is fully capable of operating. I hope both cities are willing to give this a careful review, just like Chicago appears to be doing.

The Columbia Daily Tribune examines school lunches in this interesting article. Like many districts, Columbia Public Schools is trying to serve healthier lunches. And the locavore philosophy is in fashion, so the district wouldn’t mind jumping on the local food bandwagon, either.

But the district is learning that buying local is easier said than done:

One hurdle is finding the local produce to feed 10,000 or more children per day. The demand for local produce continues to grow, but local suppliers are too few for large institutions such as schools, Fullum learned.

Too many farmers in “Missouri are growing hay, wheat and soybeans. We don’t use that in our kitchens. We need spinach. Farmers have to change that. Our farmers are just now getting the idea that maybe our schools and our university are potential customers and maybe we should do more specialized farming,” she said.

It looks like the district is allowing the locavore philosophy to distract it from its goal of serving healthy food. Local produce is not the only alternative to canned or processed food. For example, fresh oranges are nutritious, and they don’t have any added salt, sugar, or preservatives. But they’re shipped in from warmer climates, so locavores overlook them.

The district should seek out healthy products to serve at lunch, regardless of where they come from. Restricting itself to food grown in Missouri could limit kids’ diets, besides burdening taxpayers. (Even if it gets a grant from the Department of Agriculture, the money had to come from taxpayers at some point.) And it’s unrealistic to expect demand from schools to change Missouri’s agricultural output, which is at least partially determined by factors like climate and soil quality that are outside of Columbia Public Schools’ control.

If some parents care about where the food comes from as much as how healthy it is, that’s their choice. They can buy food at a farmers’ market themselves — and send it to school with their kids in a lunch bag.