December 16, 2013

Springfield News-Leader Does A Nice Job Editing…NOT!

Newspaper1

“Not” is such an important word. Consider the following sentence without the word “not”:

“Officer, I have [not] been drinking.”

We can all see the importance of “not.” That is why it is particularly unnerving that the Springfield News-Leader removed “not” in a key sentence in a recent op-ed that I penned.

Here is the passage:

Jonathan Shorman’s piece in the News-Leader reported that the Show-Me Institute requested funds to conduct research on these pension systems, “but has already determined the conclusions it plans to reach.” But that is [not] the case.

As you can see, the word “not” is integral in the meaning of my reply. With it, I’m denying Shorman’s claim; without it, I’m verifying the claim.

I hope the News-Leader’s error was poor editing, not malice. However, this is not the first time I have noticed, shall we say, inattention to detail. In the past year, the newspaper ran my photo with a byline that said I was running for Nixa School Board, which I did in 2006.

Whatever the reason for the mistake, I think it is important that Missourians have a chance to read my op-ed without the News-Leaders edits. You can do so by visiting the Show-Me Institute website.

For more information about problems with Missouri’s teacher pension systems, I suggest you also read “Robbing Peter to Pay Paul’s Defined Benefit Pension” and “Salary Spiking Boosts Pensions, But Cripples Taxpayers.”

December 6, 2013

The Sorry State Of The Professional Left In Missouri

Yesterday, the Springfield News-Leader published a supposed scoop about the Show-Me Institute and the blase art of grant applications, a story undoubtedly connected to a poorly produced smear campaign led by a credibility-challenged liberal group. I would expect rehashes of tired opposition research from liberal flacks, but it is pretty surprising that the News-Leader would so blithely do the Left’s tactical bidding, I guess without realizing it.

So there is no misunderstanding the dynamic at play here, the liberal groups promoting these stories are supported by special interests who, like their free-market counterparts, fund what they tend to believe in. In this case, what these liberal funders “believe in” generally works out to be cookie-cutter reports attacking state-based think tanks nationwide. To each her own. To be clear, that the progressive network has well-heeled supporters doesn’t bother me a bit. The Left has its patrons — check out this revealing chart from 2008 — and the free-market movement has its patrons. The Left has populist supporters; we have populist supporters.

What baffles me is why any reporter would think this “leaked” document about pension grant proposals is some sort of revelation about the Show-Me Institute, or even think tanks generally, because little if any of it is surprising even to a casual observer of the policy world. Probably the most chuckle-inducing example of the article’s shallowness is this section (emphasis mine):

Although Show-Me is open about its conservative viewpoint, the summary of the grant proposal provides a glimpse into how the non-profit charity organization works and is evidence of its ties to larger, national organizations such as the State Policy Network [SPN].

“Evidence of its ties”? The Show-Me Institute is and has been listed as a member of SPN on SPN’s own website for as long as I can remember. The way it’s being portrayed here, it’s as if the Show-Me Institute or SPN have tried to conceal the fact that we know each other and intermittently share resources. It’s like saying a letter from Kansas City Chiefs CEO Clark Hunt to NFL Commissioner Roger Goodell is “evidence of the team’s ties to the NFL.” Uh, yeah. And? Even the document that’s cited in the main article reveals that the Show-Me Institute hasn’t received even a wooden nickel from this particular grantor since at least 2009. So, what’s the story again?

And I hate to have to spell this out, but the Show-Me Institute is composed of free marketeers, not intellectual nihilists. The market-based diagnosis of the pension problem is pretty straightforward when you just look at the basic facts: defined benefit pension programs tend to hurt both the state and, in the long run, many pensioners, by cutting out market forces that would diversify risk to both the pension provider and the beneficiary. Just ask Detroit; just ask Detroit’s pensioners. That analysis doesn’t require a complete intellectual build-out from nothing, and even a cursory dive into the subject of defined benefit pensions produces an incredible amount of data from which an institution or researcher could start a well-founded and intellectually honest project.

Which is, of course, all beside the point of this story. This wasn’t so much about informing people as it was about promoting a very caustic brand of bad-faith politics — an attempt by the Left to cast aspersions on free marketeers rather than fight these important policy fights on the field of ideas.

It’s pitiable that this is the best the Left has to offer to Missourians. Heck, just look at Progress Missouri’s silence on the cronyism of the Boeing deal, which we’ve roundly criticized in print and on the airwaves over the last week. What’s their excuse for hiding rather than fighting this latest case of corporate welfare? What do they really stand for? What do they really believe in? We’d all like to know.

What does the Show-Me Institute believe in? Free markets. Who do we believe in? You. People are the market. We believe in, seek, and promote free-market solutions because we trust our fellow Missourians and Americans to make their lives and our lives better. They’re people-powered solutions. They’re solutions that work. That premise is what under-girds this organization, and I suspect our opponents find this bottom-up philosophy to be a startling threat to their top-down sensibilities — a sensibility that can’t even drag itself out of its hole to engage even an obvious and bipartisan instance of cronyism.

September 5, 2013

Steve Kraske’s Quality Of Life

In today’s Kansas City Star (last item), Steve Kraske listed our Sept. 17 Kansas City Policy Breakfast, “Is it Time To Leave Kansas City?” It is the first of our series in Kansas City, and we are eager for people to attend and learn more about the Show-Me Institute and the policies that affect them. To that end, we are grateful that Kraske mentioned us.

However, Kraske’s post includes a little dig. Here is his offering in its entirety (emphasis his):

•  “Is It Time to Leave Kansas City?” — the title of a mid-September program sponsored by the conservative Missouri-based Show-Me Institute. The institute has recommended big tax cuts in Missouri to allow the state to, in its view, better compete with Kansas.
Talk about a gathering with a loaded agenda. Just guessing there won’t be much talk about why people choose to live in KC. Can you say “quality of life?”

First, Kraske pretends that the issues with which Kansas City struggles — crime, education, high taxes, ineffective government — do not impact quality of life. They most certainly do. Second, he leaves out that Kraske himself lives in Kansas. I don’t know if Kraske ever lived in Missouri. But if he did, at some point he asked himself, “Is it time to leave Kansas City?” and answered that it was.

Kraske would not be alone; hundreds of Missourians ask themselves this question all the time. Not everyone chooses to leave the state, but many leave the city. The Show-Me Institute merely wants to shed light on the process.

We look forward to seeing Kraske at the event. And we welcome learning his own reasons for leaving, or at least not living in, Missouri.

June 28, 2013

James Shuls On KMOX

I will be on the Charlie Brennan show on NewsRadio 1120 KMOX in Saint Louis at 10:05 a.m. this morning. We will discuss my recent op-ed about public employee pension spiking. Tune in and listen live.

June 9, 2013

Dismantling The Post-Dispatch’s Piece About Education (Part 4 of 4)

The St. Louis Post-Dispatch editorial board recently issued an opinion piece riddled with errors, faulty assumptions, and half-truths. This post is the fourth of four posts (part 1, part 2, and part 3) that aims to point out where the editorial board got it wrong.

Fallacy 4: State-by-state comparisons need not adjust for the cost of living

Teachers in Missouri are among the worst paid in the nation, right? That is what the editorial board of the Post-Dispatch would have you believe. As evidence, they link to a piece in The Atlantic, which lists the 10 best and 10 worst states in terms of teacher salaries. Missouri ranks 3rd on the 10 worst list.

As with almost everything else written in the editorial piece, there is a huge problem with this comparison — the cost of living.

The average teacher salary listed for Missouri is $46,411. This seems much lower than the $72,708 salary listed for New York or the $69,434 salary listed for California. Of course, it costs much more to live in those places.

A quick visit to a cost-of-living calculator can help us understand the difference between Missouri’s teacher salaries and those of the highest-paying states.

A salary of $45,000 in Saint Louis, Mo., would be approximately equal to:

$90,246 in Brooklyn, N.Y.

$108,079 in Manhattan, N.Y.

$67,821 in Boston, Mass.

$65,598 in Long Beach, Calif.

$74,242 in San Jose, Calif.

$64,807 in Newark-Elizabeth, N.J.

$61,152 in Hartford, Conn.

$72,810 in Stamford, Conn.

It is disappointing that the Post-Dispatch piece misses the mark on so many levels, because there is room for good debate on these issues.

Because I have spent the past four blog posts explaining where the Post-Dispatch went wrong, I think I should close with an area of agreement. The editors note that the legislature is not meeting its obligation because they are under-funding the foundation formula. To that, I agree.

June 8, 2013

Dismantling The Post-Dispatch’s Piece About Education (Part 3 of 4)

The St. Louis Post-Dispatch editorial board recently issued an opinion piece riddled with errors, faulty assumptions, and half-truths. This post is the third of four posts (part 1, part 2, and part 4) that aims to point out where the editorial board got it wrong.

Fallacy 3: State spending on education can easily be compared between states

In a brazen attempt to insult state policymakers, the St. Louis Post-Dispatch editorial board wrote: “No matter how you slice it, Missouri’s lawmakers value education less than their peers in 39 other states do.” In reality, it does matter how you slice it and you can get the numbers the Post-Dispatch reports ONLY the way they slice it.

As evidence of the legislature’s feeble funding of education, the Post-Dispatch points to a report by the U.S. Census Bureau, which ranks Missouri 40th for the amount of state funds spent on education (Tables 11 and 12).

There’s just one problem with this, the definition of “state” and “local” funds is not consistent across states.

In Missouri, for instance, the funding formula counts local property taxes, the statewide 1 percent sales tax, and various other sources as local dollars. Arkansas ranked eighth in state funding for education, but Arkansas has a mandatory statewide property tax rate. That means all property taxes collected at that rate are considered state dollars, not local dollars.

In a tweet to Missouri House Budget Committee Chairman Rick Stream, the Post-Dispatch’s Tony Messenger defends the paper’s reliance on the state figure. Stream stated that the Post-Dispatch did not consider local dollars in their opinion piece, to which Messenger replied:

This exclusive reliance on the state figure demonstrates a lack of understanding of school funding systems.

Funding schools is a complicated endeavor that is done 50 different ways in the 50 different states. Because of how funding formulas work, you simply cannot easily make a state spending to state spending comparison. Likewise, you should not make the types of claims the Post-Dispatch editorial board made in its piece or Tony Messenger made on Twitter.

June 7, 2013

Dismantling The Post-Dispatch’s Piece About Education (Part 2 of 4)

The St. Louis Post-Dispatch editorial board recently issued an opinion piece riddled with errors, faulty assumptions, and half-truths. This post is the second of four posts (part 1, part 3, and part 4) that aims to point out where the editorial board got it wrong.

Fallacy 2: Real spending on Missouri’s education system has been decreasing

The editors of the Post-Dispatch wrote: “Almost every budget in Missouri produces more education dollars than the one the year before. Mostly that’s because of the realities of inflation. If the education budget is measured in constant dollars, the story is entirely different.”

The editorial board is implying that real spending on education has not been increasing. In fact, they say “schools have less buying power nearly every year.”

According to data from the Missouri Department of Elementary and Secondary Education, state and local dollars in 2008 kept pace with inflation in 2009, but dropped off with the recession in 2010. Since then, state and local spending has increased approximately 5 percent. According to the U.S. Bureau of Labor Statistics, state and local spending fell off the pace of inflation by just three-tenths of a percentage point.

So yes, if we look at the facts with blinders on, it does appear that legislators are not keeping pace with inflation.

This, however, is a short-sighted analysis and ignores the long-term reality. From 1992 to 2008, we increased spending on education in Missouri by nearly 40 percent in inflation-adjusted dollars. These data come from the Digest of Education Statistics Table 194.

MO_Baumols_disease

Real spending on education has taken a slight hit in recent years due to the recession, but over the course of the past 20 years, the state has continually increased education spending.

June 6, 2013

Dismantling The Post-Dispatch’s Piece About Education (Part 1 of 4)

After reading “Reality of school funding in Missouri? It gets worse every year” by the St. Louis Post-Dispatch editorial board, I’m left with one conclusion: The board should stay out of the number-crunching business. The piece is so riddled with errors, faulty assumptions, and half-truths that it will take multiple posts to address all of them. So, that is exactly what I am going to do.

Fallacy 1: Percent of general revenue spent on education is the most important comparison

It’s one thing to make bold claims that you can back up. It’s another thing entirely to make a bold claim that you yourself probably don’t actually agree with.

The Post-Dispatch editorial board stated the “amount of general revenue dollars the state is investing in schools, compared to how much money they spend on everything else” is the most important comparison.

Really?

You would be hard-pressed to find anyone else who agrees with this sentiment. Would the editors be fine with a tax cut that led to across-the-board cuts to every spending program, as long as the percent of the pie spent on education increases? Not likely. In fact, the editors deride policymakers for passing a “bill that cuts Missouri’s already very low taxes even lower, thus starving the schools of future revenue.”

It seems obvious that the Post-Dispatch editorial board cares about the percent of the pie spent on education and the size of the pie.

Nevertheless, the editors continue with their overemphasis of the “slice of the pie” analogy and make an incorrect statement: “In fact, as a percentage of the overall general revenue pie, the slice devoted to education has been shrinking since 2002.” They note that in 2002, the state spent 37 percent of general revenue on education. The budget for 2014 calls for 35 percent to be spent on education. They claim this is a “historic” low. But, the historic low that the Post-Dispatch is reporting doesn’t really seem that historic. In fact, in 2010, education was just 32 percent of the budget and in 2011, it was just 34.73 percent of the budget.

On this matter, the Post-Dispatch was simply wrong, and there is more of that to come.

Analysis continued in part 2, part 3, and part 4.

Going Pee-Wee: Missouri Dailies ‘Boldly’ ‘Eviscerate’ Tax Cut, Laud Veto

As expected, the Kansas City Star and St. Louis Post-Dispatch have come down in support of the governor’s veto of the Broad-Based Tax Relief Act of 2013. Given the choice between spending taxpayers’ money and returning it to them, the governor will gladly spend it; the state’s major dailies were only too happy to support him in that strange odyssey.

Of course, their verbiage could have been a little more diverse. Under the headline, “Jay Nixon boldly rejects destructive Missouri tax bill,” the Star declared:

This is what a strong-willed, plain-spoken governor fighting for what’s best for Missouri looks like.

Speaking Wednesday in Kansas City, Jay Nixon eviscerated and vetoed a tax bill approved by the General Assembly.

Meanwhile across the state, the Post-Dispatch declared under the headline “FAIR: Nixon eviscerates GOP arguments for ‘ill-conceived’ tax cut bill”…

In an unusually long veto message that absolutely eviscerated the arguments the GOP made in passing the bill, Mr. Nixon called it an “ill-conceived, fiscally irresponsible experiment,” and that was just for starters. It was among the boldest, clearest and most significant actions the usually cautious governor has taken.

Noted. The approved adjective for the governor’s actions is “bold.” The approved adverb is “boldly.” The approved verb is “eviscerate.” Reminds me a bit of the “secret word” they used to use on Pee-Wee Herman’s show years ago.

Of course, there is nothing surprising about two of the state’s major dailies getting foursquare behind the governor spending more and returning less to taxpayers or even — intentionally or unintentionally — coordinating editorial language. The Star and Post-Dispatch’s proclivities are well known, and while the words they’re using these days may be “secret” in the Pee-Wee sense, the newspapers’ politics are as transparent as they could possibly be. This is just another exhibition of the point.

May 25, 2013

Show-Me Hits (May 25)

In the press:

New this week:

And much more from the Show-Me Institute on our Show-Me Daily blog.

April 25, 2013

Didn’t We Do This Already?

Despite my young age, I will admit that I have a pretty bad memory. That is why I am meticulous about organizing everything and recording notes so I do not lose track of what I have done. When I do forget, I simply search back through my notes and files — problem solved. Call me crazy, but I did not think I was unique in doing this.

Well, Jefferson City City Council members just decided to hire an outside party to complete an in-depth study of transportation system needs and resources. But a couple of years ago, the city hired a $150,000 consultant to do just that. The mayor aimed to justify a new study, suggesting that things have changed enough to warrant a new study. Yet, when asked whether he had reviewed the last study’s recommendations, he said, “It’s been a long time … I don’t want to go there today … I plan on it.” How does he know a new study is needed, if he does not even know what the last one said?

Apparently, many city council members were not even aware of the previous study. I would think a review of that one is necessary before they, or the mayor, can decide what action needs to be taken next. As Bill McClellan has pointed out in some old St. Louis Post-Dispatch columns, we are not doing anyone any favors (besides consultants) when governments pay for expensive studies that sit on the shelf, only to be duplicated again after they are lost under a layer of dust.

The cost of a new consultant was not mentioned in the article, but the city should evaluate the previous study and other options before throwing money into something that may simply reproduce previous work. I have to wonder, is there no one who works for the city (perhaps the Transit Division director) who is capable of making transit recommendations?

April 19, 2013

As Reported In The Wall Street Journal: American Federation of Teachers Attacks Show-Me

It seems James Shuls’ ongoing efforts to make our children’s education better and Andrew Biggs’ report on Missouri’s public pension liabilities have struck a sour chord with the American Federation of Teachers (AFT), a nationwide public employee union. How sour? So sour that the AFT named the Show-Me Institute on a “blacklist” meant to attack supporters of education and pension reform (emphasis mine).

The union report says it wants pension trustees to “take into account certain collateral factors, such as a manager’s position on collective bargaining, privatization [read: vouchers] or proposals to discontinue providing benefits through defined benefit plans.”

The report adds the lovely threat that “The American Federation of Teachers is committed to shining a bright light on organizations that harm public sector workers, especially when those organizations are financed by individuals who earn their money from the deferred wages of our teachers.”

The report goes on to list StudentsFirst, the Show Me Institute and the Manhattan Institute as special bêtes noires that promote school and pension reform. And it helpfully lists no fewer than 34 funds whose “directors, managers, advisors and executives” have dared to support reform organizations. The funds on the blackball list include such well-known names as Appaloosa Management, Elliott Management, Khronos, KKR and Tudor Investment.

The AFT’s national report also appears to have been coordinated with a local AFT affiliate. Today, the St. Louis Post-Dispatch published a letter to the editor by Byron Clemens that assailed the Show-Me Institute and the pension work of Mike Podgursky, a Show-Me Institute board member and economist. Yet despite all of Clemens’ supposed sleuthing, the author ironically failed to reveal that he . . . is a “union organizer” with AFT. For a letter so intent on establishing “links,” it is curious Clemens did not reveal his own.

But what the AFT and Clemens did get right, explicitly and implicitly, is that if public unions such as the AFT stand in the way of reforms that would protect taxpayers and help kids, they should absolutely worry about the threat the Show-Me Institute poses to them. And to be clear, we will, with great pleasure, continue the fervent, methodical, and fact-based research that has raised their ire.

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