Author: steve buckstein

You Can Stop New Health Care Taxes

By Steve Buckstein

The Oregon Health Authority has finally removed nearly 55,000 people from its Medicaid program because an audit found they no longer qualified or failed to complete an eligibility check. At $430 a month per person, this can save taxpayers some $550 million a biennium.

This tremendous savings means that there is even less reason to let some $320 million in new health care taxes go into effect next year.

Why should some Oregonians have to pay a new tax on their health insurance premiums, and why should many hospitals have to pay a new tax on their income that will be passed on to patients?

If you are a registered Oregon voter, you can sign the petition to put these new taxes on the ballot by going to StopOregonHealthCareTaxes.com. Signatures should be returned in the mail no later than October 1, which is less than two weeks away.

Assuming enough signatures are gathered, the Referendum will appear on a special election ballot in January. You will then have a chance to undo what the legislature and the Governor tried to do, which is make health insurance and health care even more expensive than they are now.

So sign the petition, and then vote against these new health care taxes.


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Whose Money Is Your Oregon Kicker Refund?

By Steve Buckstein and Kathryn Hickok

State economists have confirmed that individual Oregon income taxpayers will receive kicker refunds next year. Based on the May revenue forecast, more than $463 million will be returned to taxpayers as a credit on their 2018 tax bills, with the average refund being $227.

But with the news that the coming refunds will reduce our tax liabilities, some are criticizing the way the kicker law works, while others argue the money really belongs to the state, not the taxpayers. They argue that as long as any group of Oregonians—or any state government budget item—has a “need” for that money, then the money should go to them instead of back to the individuals who earned it.

Whether the kicker law is good or bad public policy doesn’t change the answer to a more fundamental question: Whose money is it? Is the kicker a rebate for overpaying your taxes or is it somehow the State of Oregon’s money, better left in government coffers? If we can find a better way to restrain runaway government spending, we should do so. But until that day arrives, Oregon’s kicker law is one defense against those who argue that some of the money you earned belongs to someone else just because they “need” it.


Steve Buckstein is Senior Policy Analyst and Founder at Cascade Policy Institute, Oregon’s free market public policy research organization. Kathryn Hickok is Publications Director at Cascade.

Read Blog Detail

Time to Stop Forcing Union Membership

By Steve Buckstein and Kathryn Hickok

This week (August 20-26) is National Employee Freedom Week, a national effort to inform union members about their freedom to opt out of union membership if they choose and to make decisions about labor representation and the use of their union dues. The effort “empowers union employees with information to make the decision about union membership that’s best for them, including identifying non-union alternatives that better suit their needs.” An interactive map at employeefreedomweek.com lets workers in Oregon and other states find links to information helpful to those wanting more employee freedom. More than 100 organizations across the country, including Cascade Policy Institute in Portland, are affiliated with the annual campaign.

“Right to Work” states are states in which union membership may not be enforced as a condition of employment. Workers may choose to join a union or not, without fear of losing employment, salary, benefits, or seniority. Workers in the 22 states that are not yet Right to Work, such as Oregon, do not have full freedom to opt out of union membership. However, they do have the right to become agency fee payers, to identify as religious/conscientious objectors, or to require that their dues not be used for political purposes. According to National Employee Freedom Week’s website, “many employees are thrilled to learn that alternative professional associations provide better benefits and professional development opportunities for a fraction of the cost of union membership.”

Last year a survey of union members and union households found that about two-thirds nationwide agree that if members opt out of paying all union dues and fees, they should represent themselves in negotiations with their employer, an option known as “Worker’s Choice.” By the same margin (66.9% to 33.1%), Oregonian union members support Worker’s Choice, too. Worker’s Choice would end the so-called free-rider problem (really a forced-rider problem) commonly touted by union leaders, who argue that labor laws require them to continue representing workers even after they stop paying all dues and fees.

Oregon labor law is similar to that of many states that don’t allow individual workers to represent themselves if a union has organized their workplace. But now we know that most Oregon union members want this to change. They want workers to be able to represent themselves, and they don’t want to force unions to represent these non-dues-payers.

You would think the unions would be all over the Worker’s Choice solution, but they aren’t. Unions want to be forced to represent all workers because under current labor law, states like Oregon that don’t have Right to Work require that non-union members still contribute the non-political portion of dues to their unions to cover bargaining and representation costs. The unions want the money, pure and simple. Of course, they also wanted compulsory political dues, but in 1988 the U.S. Supreme Court Beck decision gave all workers the right to opt out of those, thanks to now-Oregonian Harry Beck’s decades-long battle to preserve his free speech rights. He tells his story at oregonemployeechoice.com.

A case heard by the U.S. Supreme Court last year (Friedrichs v. California Teachers Association) could have freed all public sector workers nationwide from paying compulsory union dues based on the argument that such compulsion violates their First Amendment rights to free speech and free association. Before the case could be decided, Justice Antonin Scalia died, leaving a four-four tie vote in the Court. This resulted in upholding a lower court decision denying ten California public school teachers their rights to be free of union compulsion.

This union compulsion brings to mind the well-known statement by Thomas Jefferson:

“To compel a man to furnish funds for the propagation of ideas he disbelieves and abhors is sinful and tyrannical.”

That is what the Supreme Court left in place—the right of public sector unions to compel workers to fund the propagation of ideas they disbelieve. It remains for future court decisions, or other political efforts, to end union compulsion in Oregon and nationwide. Until that happens, National Employee Freedom Week will continue to bring this injustice to the attention of union members and the public.


Steve Buckstein is Senior Policy Analyst and Founder at the Portland-based Cascade Policy Institute, Oregon’s free market public policy research organization. Kathryn Hickok is Publications Director at Cascade. A version of this article originally appeared in The Portland Tribune on August 24, 2017.

Read Blog Detail

Oregon Takes a Big Step to Battle Opioid Overdoses

By Steve Buckstein

For a variety of reasons, many Americans are becoming addicted to both legal and illegal opioid drugs, risking overdose and death.*

Oregon just made it easier for friends and family members of those at risk to save their lives by administering what is known as the “overdose drug” naloxone. It “counteracts the potentially lethal effects of heroin, oxycodone and other abused narcotics.” It has become relatively easy to use in the form of a nasal mist and does not require a physician prescription.

Passed overwhelmingly in both the Oregon House and Senate, House Bill 3440 was signed into law by the Governor last week. Among other provisions, the law shields persons “acting in good faith, if the act does not constitute wanton misconduct” from “civil liability for any act or omission of an act committed during the course of distributing and administering naloxone….”

Adoption of such so-called “good Samaritan” laws in a number of states has been found to reduce opioid-related deaths.

Some critics believe that such laws encourage drug use and hamper law enforcement efforts. But, if fighting the drug war comes at the expense of lives that could readily be saved, Oregonians should reject that war, and celebrate laws that make it easier to help those harmed by dangerous drugs.

* The Wall Street Journal just editorialized on the opioid epidemic on August 15, noting that overdose deaths are rising much faster in certain states like Oregon that opted into ObamaCare’s Medicaid expansion.


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Cascade Policy Institute Endorses Referendum 301 to Stop New Health Care Taxes on Oregonians

August 2, 2017

FOR IMMEDIATE RELEASE

Media Contact:
Steve Buckstein
(503) 242-0900
steven@cascadepolicy.org

PORTLAND, Ore. – The Cascade Policy Institute Board of Directors has voted to support State Referendum 301 which seeks to refer certain taxes approved in House Bill 2391 to the November 6, 2018 General Election ballot (unless the date is changed to January 23rd by an Act of the legislature).

The Referendum primarily seeks to refer some $333 million in new taxes, in the form of a 1.5 percent tax on health insurance premiums and a new 0.7 percent tax on certain hospitals. The Referendum does not affect the rest of HB 2391 which specifies how the state collects money to pay for the Oregon Health Plan, the state’s version of Medicaid, through assessments and taxes on health care providers.

Signatures must be filed with the Secretary of State’s office no later than October 5, 2017. The petitioners request that all signatures be returned to them no later than October 1.

Cascade Senior Policy Analyst and Founder Steve Buckstein has written in favor of the Referendum and now makes the following statements about why the Institute believes that Oregon voters should sign it:

• The Oregon legislature passed, and the Governor signed, a bill designed to generate some $550 million in new taxes on health care, hospitals, and health insurance premiums. Ostensibly, this money is needed to help balance the budget, even after strong revenue growth, and to help maintain the controversial Medicaid expansion.

• Since the bill’s passage, it has become clear that that nearly half the Medicaid recipients checked in recent months no longer qualify for benefits. This alone eviscerates the supposed need for most or all of these new tax revenues.

• Referendum 301 only targets the most egregious of the taxes in HB 2391. It allows Oregon voters a say in whether or not they want to slap a sales tax on health care.

• According to an Oregonian editorial, when word got out that someone might refer these new taxes to the ballot, legislative leaders showed “how they’re willing to protect that new revenue at all cost—even hijacking the referendum process at the core of Oregon’s identity.”

• The Oregonial editorial went on to say, “Worse, however, the bill tosses aside the usual process requiring impartial groups to describe the measure on the ballot and in the voter’s pamphlet. Instead, [they gave] all that power to a committee made up of four Democrats and two Republicans.” They also moved the referendum vote up from November 2018 to a January special election that will cost taxpayers more than $3 million. As of August 2, the Governor has not yet signed this referendum hijacking” bill, but is expected to do so.*

Petitions can be downloaded from StopHealthCareTaxes.com. They should be properly signed by registered Oregon voters and returned no later than October 1 to:

Stop Healthcare Taxes
29030 SW Town Center Loop E, Suite 202, #514
Wilsonville, OR 97070

Questions to the petitioners can be addressed to info@stophealthcaretaxes.com.

* The  Governor did sign the bill changing the election date. The Referendum did collect enough signatures, and is now Ballot Measure 101 on the January 23, 2018 Oregon ballot. A No vote will keep these taxes from going into effect.

________________________________________
Cascade Policy Institute is a 501(c)(3) non-partisan, non-profit public policy research organization. Its mission is to promote public policies that foster individual liberty, personal responsibility and economic opportunity in Oregon.

###

Read Blog Detail

Stop Health Care Taxes dot com

By Steve Buckstein

The Oregon legislature just passed, and the Governor signed, a bill designed to generate some $550 million in new taxes on health care, hospitals, and health insurance premiums. Ostensibly, this money is needed to help balance the budget, even after strong revenue growth, and to help maintain the controversial Medicaid expansion.

According to an Oregonian editorial, when word got out that someone might refer these new taxes to the ballot, legislative leaders showed “how they’re willing to protect that new revenue at all cost—even hijacking the referendum process at the core of Oregon’s identity.”

“Worse, however, the bill tosses aside the usual process requiring impartial groups to describe the measure on the ballot and in the voter’s pamphlet. Instead, [they gave] all that power to a committee made up of four Democrats and two Republicans.”

They also moved the referendum vote up from November 2018 to a January special election that will cost taxpayers more than $3 million.

The petitioners have just 90 days to collect nearly 59,000 valid voter signatures to refer the most egregious of these new taxes to the ballot.

These allow insurance companies to pass on to many of us, their policyholders, a new 1.5 percent tax on health insurance premiums in the state, at a time when premiums are rising out of sight already.

If you want to vote on the new premium taxes, go to StopHealthCareTaxes.com, download, sign and return a Petition sheet today.*

* The Referendum did collect enough signatures, and is now Ballot Measure 101 on the January 23, 2018 Oregon ballot. A No vote will keep these taxes from going into effect.


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

When Government Gets It Backwards, Reread Jefferson

By Steve Buckstein

Two hundred and forty-one years ago this July 4, the world was gifted with one of the most significant political documents ever written. When Thomas Jefferson authored the Declaration of Independence, he boldly stated:

“We hold these truths to be self-evident; that all men are created equal, that they are endowed by their Creator with certain inalienable rights, among these are Life, Liberty and the pursuit of Happiness. That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed.”

Jefferson realized that government and society are not synonymous. He argued that government’s purpose is to protect the inalienable rights of the individuals that make up society. He understood that such rights are not granted by government; and that any rights government does claim to grant are really claims on someone else’s right to life, liberty, or property. What would he think of today’s politicians in Washington, D.C. and Salem, Oregon who propose law after law ordaining right after right?

Jefferson also understood that he wasn’t elected President in 1801 to “run the country.” He was elected President to run the executive branch of a limited, constitutional government that coincidentally he helped to create. To reinforce these concepts, why not read the Declaration again this Independence Day and consider the power it had—and still has—to change our world for the better.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization. He was the 2016 recipient of the Thomas Jefferson Award by the Taxpayer Association of Oregon and the Oregon Executive Club.

Read Blog Detail

Are Smartphones in Class a Problem or an Opportunity?

By Steve Buckstein

To hear some teachers talk, you would think before smartphones became ubiquitous in their classrooms that every student sat politely and paid attention every minute of the day. Of course, anyone who was ever a student knows the messy truth about this assertion. So, a little perspective may be in order, both about the evolution of the telephone and what should be the evolution of our educational system.

It wasn’t too long ago that if our parents or grandparents wanted to make a phone call from home, they would pick up the receiver and ask the monopoly “phone company” operator to place their calls. Later, how glorious it was that we could use our rotary phones to spin out our own calls, even long-distance ones if we could afford the high per-minute costs. Then came digital phones, and finally cell phones became affordable to the masses. But even the early cell phones had limited uses.

You may not remember, but none of us had any cell phone apps before 2008, because there weren’t any. None. Imagine: All you could do on your cell phone before 2008 was make calls, maybe text, and maybe connect to the World Wide Web on a slow Internet connection.
Just nine years later, more than two billion people worldwide use apps on their smartphones. You may have dozens of apps on your phone today and, even if you only use a handful of them regularly, that’s a world away from what it was like before 2008. Lots of things are a world away from what they were like before 2008—except for public education.

Consider the children in our schools today. Many of them have never known a world without smartphones and their apps. Rotary telephones, even landlines, are likely just historical oddities to them. Much of their world is new, except the way we adults try to educate them. First, we assign them to a school based on their ZIP code; then we sit them down in rows, in a classroom with kids their same age, all in front of one teacher lecturing about some subject they may or may not find interesting and relevant to their lives.

We say that we want our kids to learn how to take advantage of technology, take STEM courses, and be prepared for the new careers awaiting them. So why do we see their use of that technology every day in school as a problem? They’re not paying attention to the teacher! They’re watching their screens instead of sitting politely in rows listening to the math lesson at 10 am, or the history lesson at 2 pm. The very technology that we want them to be able to use in their careers is enabling them to tune out the lessons we think they need to learn now before entering those careers.

We know that they’ll likely find value in many of these subjects later in life; but if they can’t learn those lessons in ways that are relevant to them now, they may never learn them at all; or they may learn them too late to avoid painful life experiences between now and then.

As the nation’s largest teachers union recently documented, taxpayers pay nearly $15,000 every year for all the costs associated with each student attending Oregon public schools—more than in 33 other states. Rather than let a smartphone costing a few hundred dollars get in the way of any student’s $15,000 education, we need to find ways to let it supplement or enhance their learning experience.

As one high school teacher put it in an Atlantic magazine article on this subject last year,

“If educators do not find ways to leverage mobile technology in all learning environments, for all students, then we are failing our kids by not adequately preparing them to make the connection between their world outside of school and their world inside school.”

One systemic way to think about how smartphone technology can enhance learning is through Education Savings Accounts. Unlike school vouchers that act more like the rotary telephones of the school choice world, ESAs act more like the smartphones of that world, complete with countless apps that can help students learn virtually any subject, often at a fraction of the cost associated with traditional brick and mortar schools.*

While vouchers only let parents pay for private school tuition, ESA funds may also be used for other approved educational expenses, such as online learning programs, private tutoring, community college costs, and other customized learning services and materials.

Also, while voucher funds all go to private school tuition or are lost to the families, funds remaining in ESA accounts each year may be “rolled over” for use in subsequent years, even into college. This creates incentives for families to “shop” for the best educational experiences at the lowest cost, as well as incentives for schools and educational programs to price their services as low as possible, not as high as possible as might be done under a voucher program.

The bottom line is that, while smartphones in school can be a distraction, they can also pave the way to better, more efficient use of educational resources. It is up to us as adults to harness their power for good instead of just bemoaning their power to distract.


* To see how Oregon’s former State Treasurer sees smartphones undercutting the entire economic model of higher education (and by inference K-12 education), watch this 59-second video.


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization. This Commentary is adapted from a portion of the author’s written and oral testimony at the Oregon State Senate Education Committee’s Informational Hearing on Education Savings Account bill SB 437 on June 13, 2017.

 

Read Blog Detail

Who says Oregon pays public school teachers more than other states? The National Education Association, that’s who!

By Steve Buckstein

As Oregon legislators wrestle with how much money to spend on public education, advocates claim that we spend too little compared to other states. They demand that legislators spend more, and raise taxes to do it. But, according to the nation’s largest teachers union, the reality is quite different.

As I noted recently, in its Rankings & Estimates report for 2016 and 2017, the National Education Association says that Oregon spends more per student than 33 other states: $13,320 per Average Daily Attendee versus $12,572 nationally.

Another interesting finding in the NEA report is how much Oregon pays its public school teachers. In 2015-16 it shows the average teacher salary in the country was $58,343, compared to $60,459 here in Oregon. We spend three percent more on teacher salaries than the national average.*

But, the report also shows that our per capita personal income is nine percent less than the national average: $48,783 versus $43,783.

So, while we pay our teachers three percent more, we do that out of incomes that are nine percent less than the average American. Add those two numbers together, and it’s clear that based on our ability to pay we compensate Oregon teachers very well.

All this data add weight to the argument that we don’t need new taxes to better fund public education. We fund it very well already.


*“Where applicable, ‘average teacher salary’ includes the contract amount plus 6 percent for the employer portion of retirement contributions.” Page 146 of the NEA report.


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Education Savings Account Informational Hearing Testimony in Favor of SB 437

Before the Senate Education Committee

By Steve Buckstein
Cascade Policy Institute

Chair Roblan and members of the Committee, my name is Steve Buckstein. I’m Senior Policy Analyst and Founder at Cascade Policy Institute, a public policy research organization based in Portland.

I want to share some thoughts about the value of Education Savings Accounts in general, and SB 437 in particular, which we’ve branded the Educational Opportunity Act: The Power of Choice.

Next, Professor Eric Fruits will briefly discuss the Fiscal Impacts of the bill.

Finally, you’ll hear from Oregon’s 2012 Mother of the Year, Bobbie Jager, about the importance of providing different educational options for different children.

School Choice programs allow students to choose schools or other educational resources and pay for them with a portion of the tax funding that otherwise would go to the public school assigned to them by their ZIP code.

While school choice is popular with large segments of the public, opponents worry that specific programs like vouchers or Education Savings Accounts may drain funds from the public school system.*

What these concerns overlook is that public funding for K-12 education should actually help educate students, not simply fund schools whether or not they meet specific student needs.

The latest and most versatile school choice programs being enacted across the country are Education Savings Accounts. Unlike vouchers, which only let parents pay for private school tuition, ESA funds may also be used for other approved educational expenses, such as online learning programs, private tutoring, community college costs, and other customized learning services and materials.

Also, while voucher funds all go to private school tuition or are lost to the families, funds remaining in ESA accounts each year may be “rolled over” for use in subsequent years, even into college. This creates incentives for families to “shop” for the best educational experiences at the lowest cost, as well as incentives for schools and educational programs to price their services as low as possible, not as high as possible as might be done under a voucher program.

Five states already have limited ESA programs. Nevada passed a near-universal ESA program in 2015, but its legislature has yet to fund it. In November 2015 your Committee heard from the author of that bill, 16-year public school teacher and state senator Scott Hammond. He told you that he viewed vouchers as the rotary telephones of the school choice world, and that ESAs are the smartphones of that world.

Vouchers just let parents choose a different school, but ESAs offer the equivalent of apps on your smartphone. You can use ESA funds for tuition at a private school, to pay for online courses, pay for tutors, pay for a Sylvan Learning type program, and/or pay for other approved educational options. A student is free to spend part-time at their local public school, and the rest of the time making other educational choices with the proportional share of their ESA funding.

In 2008, Cascade Policy Institute sponsored a School Choice Video Contest in which we asked parents and students to tell us what school choice meant to them. I want to show you one of my favorite entries. It’s from a 15-year-old homeschooled student in Southern Oregon.

[Shoes video]

If the Shoe Fits, Wear It! This legislature is about to allocate at least $8.2 billion taxpayer dollars to an education budget that may, in effect, fund shoes that aren’t a good fit for many of our children. ESAs would help some of those families find better-fitting shoes for their kids.

In addition to funding concerns, some critics of ESAs argue that they violate the principle of church/state separation. In Oregon, they might think that SB 437 violates Article 1, section 5 in our state constitution, which basically prevents the state from spending money for the benefit of any religious institution.

But it won’t! The public interest law firm Institute for Justice has studied the bill and concluded that it doesn’t violate either the Oregon or the U.S. Constitution. You have their complete legal analysis on OLIS.

Briefly, at the federal level, the 2002 Zelman Case before the Supreme Court found that as long as it’s the parents, not the state, deciding where a school choice program’s funds go, it doesn’t matter if the parents choose religious schools because it’s the parents, not the state, making those choices.

At least two state supreme courts, in Arizona and Nevada, have found the same thing with regard to ESAs and those state constitutional provisions, which are similar to Oregon’s so-called Blaine Amendment.

Now, let me give you a feel for how much more flexibility ESAs offer over the old voucher plans, and why they’ve sprung up so recently.

It wasn’t too long ago that if our parents or grandparents wanted to make a phone call they would pick up the receiver and ask a phone company operator to place their calls. Later, how glorious it was that we could use our rotary phones to spin out our own calls, even long-distance ones if we could afford the high per-minute costs. Then came digital phones, and finally cell phones became affordable to the masses. But even the early cell phones had limited uses.

You may not remember, but none of us had any cell phone apps before 2008, because there weren’t any. None. Imagine: All you could do on your cell phones before 2008 was make phone calls, maybe text, and maybe connect to the World Wide Web on a slow internet connection.

Just nine years later, over 2 billion people worldwide use apps on their smartphones. You may have dozens of apps on your phone today, and even if you only use a handful of them regularly, that’s a world away from what it was like before 2008. Lots of things are a world away from what they were like before 2008 — except for public education.

Consider the children in our schools today. Many of them have never known a world without smartphones and their apps. Rotary telephones, even landlines, are likely just historical oddities to them. Much of their world is new, except the way we adults try to educate them by sitting them down in rows, in a classroom with kids who are the same age, all in front of one teacher lecturing about some subject they may or may not find interesting and relevant to their lives.

Yet, many teachers see kids’ smartphones as a problem, right? They’re watching their screens instead of sitting politely in rows listening to the math lesson at 10, or the history lesson at 2.

We say that we want our kids to learn how to take advantage of technology, take STEM courses, and be prepared for the new careers awaiting them. So why do we see their use of that technology every day as a problem! They’re not paying attention to the teacher! They’re bored with school. The Shoes we make them wear aren’t good fits for many of them.

We know that they’ll likely find value in many of these subjects later in life, but if they can’t learn those lessons in ways that are relevant to them now, they may never learn them at all; or they may learn them too late to avoid painful life experiences between now and then.

In 2007, the House Subcommittee on Education Innovation, chaired by Representative Betty Komp, heard compelling testimony about some of those kids during a hearing on an earlier school choice bill, HB 2010. It was given by Black Portlander Jomo Greenidge, who describes himself as an educator and technologist.

Jomo can’t be here to talk with you today, but he hopes you’ll watch his earlier testimony and think about how Education Savings Accounts could help kids like these today.

[Jomo Greenidge video testimony]

Since Jomo gave that testimony in 2007, smartphone apps emerged, followed by Education Savings Accounts, which act much like smartphones of the school choice world. Many students in our schools today, and all the kids entering our schools tomorrow, will grow up in a world with modern communication and app technology.

It’s time we recognize that much of the money we tax and spend on their educations might not be meeting their educational needs. It’s time that we consider the Education Savings Account approach to let their families have some control over how that money is spent so it better meets their needs.

Other states have debated, and some are adopting, ESA programs this year. The pressure to pass more such bills will only grow.

We know that SB 437 won’t pass this year. While we’re thankful for this Informational Hearing, many Oregon families want more. Many Oregon families can’t wait for years to get their kids into better fitting Educational Shoes.

We can debate the details, but please take this issue seriously and help these families by passing an ESA bill soon, hopefully in the 2018 session.

Thank you.


* A 2009 scientific survey showed us that 87 percent of Oregon families with school-aged children want the ability to choose other than their local public school. And the results were similar for Republicans, Democrats, and Independents. So why do some 90 percent of them still send their kids to their local public school? You know why. It’s because they can’t afford to pay federal, state, and local taxes to fund that local school and pay for private school tuition at the same time. ESAs will give them the financial ability to make some other choices if they want to.

And, if 20 percent of Portland public school teachers send their kids to private schools, why would we think that 20 percent of their neighbors might not want to do the same, if they could afford it?

Based on data from the 2000 US Census, a report was published looking at where public school teachers sent their own kids to school in the nation’s 50 largest cities. It found that public school teachers send their own kids to private schools at much higher rates than their neighbors.

In Portland, 12.7 percent of parents sent their kids to private schools, but 20 percent of public school teachers who lived in Portland sent their kids to private schools. Doing some basic grade school math shows that teachers in the largest cities were 23 percent more likely to send their children to private schools, but in Portland they were 57 percent more likely to do so.

So, will SB 437 bill drain funds from public schools, or will it leave them harmless while allowing many students to make different choices? The answers depend on several assumptions which have now been evaluated by Eric Fruits, Ph.D. in a new review and evaluation of a universal ESA program for Oregon. The amount of the ESA deposits is the biggest driver of fiscal impacts.

As introduced, SB 437 would provide participating students with disabilities and in low-income households $8,781 per year (current state funding) in their ESAs. All other participating students would receive $7,903 (90% of current state funding). As Introduced, based on the assumptions below, the Fiscal Impact on the state and local school districts could be in the range of $200 million annually based on the following assumptions:

■ 90 percent of 61,000 students currently enrolled in non-public education would participate in the program.

■ Seven percent of 563,000 students currently enrolled in public schools would participate.

Based on these assumptions, the program has a fiscal “break even” for state and local school districts combined at an ESA annual amount of $6,000 for each participating student with disabilities and/or in a low-income household and $4,500 for all other students.

These are the dollar amounts proposed in the -1 Amendment to the bill. If fiscal impact were the only measure by which to evaluate this ESA program, the analysis shows that the program is “optimized” at an amount of $3,000 for each participating student with disabilities and/or in a low-income household and $2,250 for all other students. Once fully implemented, the program would save state and local governments $53 million a year.

Of course, fiscal impact is not and should not be the primary measure of this, or any well-designed school choice program. But, it is a political reality that such a program should not impose a fiscal burden on the state at a time that all budgets are under pressure.

The primary measure of this ESA program should be that it offers Oregon families as much choice as possible in how their children take advantage of educational opportunities funded by the state. The full report is here: Education Savings Accounts: Review and Evaluation of a Universal ESA in Oregon

Read Blog Detail

Testimony in Opposition to HB 2720 A Regarding Virtual Charter Schools

By Steve Buckstein

Co-Chairs Monroe and Smith Warner and members of the Joint Committee on Ways and Means Subcommittee on Education:

I’m Steve Buckstein, Senior Policy Analyst and Founder of Cascade Policy Institute, a public policy research center based in Portland. I’m writing in opposition to HB 2720 A which would require the Oregon Department of Education (ODE) to conduct a study on virtual public charter schools.

My major points of opposition second those of Dr. David Gray, Executive Director of the Metro East Web Academy. He “…served in traditional public education for over 30 years as a state department executive, superintendent, assistant superintendent, National Blue Ribbon School Principal, and a state and nationally recognized teacher.”  In his written testimony submitted on March 3rd he stated, in part:

“I share your passion for public education. Unfortunately, the traditional education system is broken….Traditional systems are effective for some students but not all and many of those succeed in spite of the good intentions of professional educators This is why we must not limit options for students.

“Although HB 2720’s purpose seems innocuous as some would perceive it to just be a study; it is actually one more study to examine a system of virtual schools that have been studied over and over throughout the United States. In fact, the study purports to use the same data points that are readily available on the ODE website, which will undoubtedly include metrics such as graduation rates, state assessment results, and attendance data. I can not think of a bigger waste of taxpayer dollars, especially in a year when resources are scarce and legislators are scrambling to create an adequate educational budget.

“Ultimately, if it is important to study virtual schools – why don’t we do a study on all of our high schools to determine why students are leaving traditional high schools and coming to charter schools? Why are there so many at-risk students? Do traditional brick and mortar schools add value to a student’s education? Do we know the answers to these questions?” [emphasis added]

In light of these well-stated concerns, HB 2720 A seems a costly distraction that could keep the legislature, ODE and all Oregonians from focusing on the real problems facing our public education system.

I urge you to oppose HB 2720 A.

Thank you,

Steve Buckstein
Senior Policy Analyst and Founder

Read Blog Detail

Who says Oregon spends $13,230 per public school student? The National Education Association, that’s who!

By Steve Buckstein

Ever since Oregon’s property tax limitation Measure 5 shifted the bulk of education funding from local sources to the state general fund in 1990, public education advocates have claimed that our schools are severely underfunded, spending less than most other states. They want the legislature to raise taxes now to rectify this supposed crisis.

Ask a knowledgeable Oregonian how much money is spent per student in our public schools and they might say the number is about $8,781, which is what the state currently gives school districts per student.

But, ask the nation’s largest teachers union, the National Education Association, and you’ll get a much different answer. According to the NEA’s just-released Rankings & Estimates report for 2016 and 2017, when you count local, state, and federal funding, current expenditures per Oregon student in Average Daily Attendance are estimated to be $13,230. That puts us five percent above the national average of $12,572. Oregon spends more than 33 other states.*

Add in spending for capital outlays and interest payments, and that $13,230 number goes up to total expenditures per student of $14,911.**

Even at the lower number, public schools spend over $396,000 a year for each 30-student classroom. Subtract the average teacher salary plus benefits of some $85,000, and Oregonians should ask where the additional $300,000-plus is going before even thinking about raising taxes on anyone.


* There are several ways to calculate current expenditures per student. The NEA computes two of those ways in this report. Definitions are given in the report Glossary. Oregon’s 2017 Average Daily Attendance (ADA) of pupils “under the guidance and direction of teachers” is estimated in Table I-3 to be 531,434. Oregon’s 2017 Fall Enrollment of pupils registered in the fall of the 2017 school year is estimated in Table I-6 to be 578,176. Because there are more pupils registered in school districts than actually in class on an average day, current expenditures per ADA of $13,230 (Table J-9) is higher than current expenditures per Fall Enrollment, which is $12,161 (Table J-10). Oregon spends more than 33 other states under both these methods.

** Under the two ways of calculating expenditures per student explained above, the author’s calculation of estimated 2017 total expenditures based on Average Daily Attendance of $14,911 is higher than that based on estimated Fall Enrollment, which is $13,705.


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Kicker Envy 2017

By Steve Buckstein

Individual Oregon income taxpayers may receive kicker refunds when they file their 2017 tax returns based on a percentage of the state income tax they paid in 2016. Based on the May revenue forecast, $408 million could be coming back to taxpayers, with the average refund being $210. A final determination of whether the kicker will “kick” and how big it will be should be announced on August 23.

But even before those potential refunds reduce our 2017 tax liability, some are questioning whose money it is, and others seem envious that the “rich” will get much bigger refunds than the rest of us. So, whether the kicker law is good or bad public policy, let’s think a little about who this money really belongs to. Is it a rebate for overpaying your taxes, or is it somehow “our” money that is better left in government coffers?

How the kicker works 

First, the mechanics of the kicker law: Oregon state government is highly dependent on the personal income tax for its General Fund budget. With a fairly flat tax structure, most wage earners are in the nine percent income tax bracket, while the highest income earners are in the top 9.9 percent bracket. Therefore, state revenue can be quite volatile, going up and down as the economy cycles between boom and bust.

The legislature first passed the kicker law in 1979, and voters added it to the state constitution in 2000. It mandates that state economists estimate what income tax revenue will be over the following two-year budget period. The legislature then must balance the budget by not allocating more money than the estimate. If the estimate is low by two percent or more, then the entire surplus must be returned to taxpayers. The kicker law actually is composed of two parts, dealing with personal income taxes and corporate income taxes differently. In 2012 voters decided that any corporate kickers would be returned to the state general fund to provide additional funding for K-12 public schools.

Some people argue that the way the kicker “kicks” makes little sense. They correctly note that projecting state revenue two years out to within a two percent margin is terribly difficult, and has been done only rarely. Others defend the kicker law as an important brake on runaway government spending, especially since voters have rejected other tax and expenditure limitations at the polls.

Whose money is it? 

Whether the kicker law is good or bad public policy doesn’t change the answer to a more fundamental question: Whose money is it?

Some argue that the kicker money really belongs to the state. After all, they say, it’s in the state’s coffers because individuals paid what the tax law said they owed on their tax returns. As long as any Oregonian has a “need” for that money—be they school children, the elderly, the disabled, etc.—then the money should go to them instead of back to the individuals who earned it.

How much is that latte? 

Of course, this is the Marxist “from each according to his ability, to each according to his need” justification. Taken further, not only would the kicker money remain with the state, but the state could retroactively come after even more of your previous income if, in the wisdom of government officials, anyone still “needed” those funds.

One way to look at this argument is to think about walking into a coffee shop today and ordering a $3 latte. The price is posted on the wall, but the person behind the counter asks you a question before accepting your order. “Did you get a raise last year?” “Yes,” you tell her proudly, “I was very productive last year and my boss gave me a 10 percent raise.” “That’s great,” she replies. “The $3 latte will cost you $3.30.” “Why?” you wonder. “Because your ability allows me to better meet my needs.”

You wouldn’t accept this argument from your barista, and you shouldn’t accept it from your government.

Next, some argue that the kicker “lavishes a windfall on those who don’t need it.” They point to the top one percent of taxpayers with adjusted gross incomes over about $386,000 who would receive more than $4,500 each, while the average taxpayer would only get back $210. What is often unstated in this argument is that those “lucky” top taxpayers paid way more income tax than the rest of us, and they will get back exactly the same percentage of their tax payments as everyone else does.

Envy is a powerful emotion, but it should not trump reason. If we can find a better way to restrain runaway government spending, we should do so. But until that day arrives, the kicker law is one defense against those who argue that some of the money you earned belongs to someone else just because they “need” it.


Oregon Income Tax Calculator: https://smartasset.com/taxes/oregon-tax-calculator


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization. An earlier version of this Cascade Commentary was published in November 2007.

 

Read Blog Detail

Oregon Legislature Should Make It Easier for Individuals to Enter the Landscaping Business

Below is a letter being distributed to all members of the Oregon House of Representatives prior to their voting on House Bill 3337 in the 2017 Oregon Legislative Session, which would make it easier for individuals to enter into the landscaping business in this state.


April 20, 2017

Floor Letter in support of HB 3337

Cascade Policy Institute supports passage of HB 3337 which creates a limited landscape construction professional license. This bill is in line with the framework for policymakers on occupational licensing issued by the Obama White House in 2015 which found…

“…the current [occupational] licensing regime in the United States…creates substantial costs, and often the requirements for obtaining a license are not in sync with the skills needed for the job. There is evidence that licensing requirements raise the price of goods and services, restrict employment opportunities, and make it more difficult for workers to take their skills across state lines.”  And…

“There is ample evidence that States and other jurisdictions should review current licensing practices with an aim toward rationalizing these regulations and lowering barriers to employment.”

The White House report also argues that reducing barriers to employment is especially helpful for “marginalized persons such as young people, minorities and individuals with felony convictions.” It notes a 2012 report by the Institute for Justice, License to Work, which found that Oregon is the third most broadly and onerously licensed state, placing it in the top tier just below Arizona and California. Oregon licenses 59 of the 102 low-to-moderate-income occupations studied. Surprisingly, only ten states even licensed landscape contractors. Oregon is one of them.

There is growing awareness on both ends of the political spectrum that many state occupational licensing laws actually stifle economic opportunity and make it particularly hard for lower-income people to move their way up the economic ladder and use their entrepreneurial talents for their own benefit and the benefit of all Oregonians. Licensing can also marginalize consumers who suffer the most when goods and services they need cost more by keeping more people from vying for their business.

HB 3337 is a step in the right direction for those Oregonians who want to work and start landscaping businesses without the burden of excessive occupational licensing restrictions. We urge its passage.

Sincerely,
Steve Buckstein, Senior Policy Analyst and Founder, Cascade Policy Institute


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

 

Read Blog Detail

Proposed Oregon ESA Law Would Offer Students Choices While Breaking Even for Public Schools

By Steve Buckstein

Senate Bill 437, under consideration this legislative session, would offer Oregon K-12 students the flexibility to choose the educational options that best meet their individual needs through a universal Education Savings Account program. ESAs deposit a percentage of the funds that the state otherwise would spend to educate a student in a public school into accounts associated with the student’s family. The family may use the funds for approved educational expenses such as tuition, tutors, online courses, and other services and materials.

The fiscal impact of a universal ESA program for Oregon has been evaluated in an analysis released by Cascade Policy Institute. The fiscal “break even” for state and local school districts would be reached at an annual amount of $6,000 for each participating student with disabilities and/or in a low-income household and $4,500 for all other students. These dollar amounts are proposed in an amendment to the bill.

Of course, fiscal impact should not be the primary measure of this or any well-designed school choice program; but it is a political reality that a fiscal burden should not be imposed on the state at a time that all budgets are under pressure. An ESA program would offer Oregon families as much choice as possible in how their children take advantage of educational opportunities funded by the state. For more about the Educational Opportunity Act: The Power of Choice, visit schoolchoicefororegon.com.


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Education Savings Accounts Can Help Students Without Hurting Public Schools

By Steve Buckstein

School choice programs allow students to choose schools or other educational resources and pay for them with a portion of the tax funding that otherwise would go to the public school assigned to them by their ZIP code.

While school choice is popular with large segments of the public, opponents often claim specific programs like vouchers or Education Savings Accounts (ESAs) drain funds from the public school system, and so must be rejected.

What opponents overlook is that public funding for K-12 education should actually help educate students, not simply fund specific schools whether or not they meet specific student needs.

The latest and most versatile school choice programs sweeping the country are Education Savings Accounts. ESAs deposit a percentage of the funds that the state otherwise would spend to educate a student in a public school into accounts associated with the student’s family. The family may use the funds for private school tuition or other approved educational expenses such as online learning programs, private tutoring, community college costs, higher education expenses, and other customized learning services and materials. Funds remaining in the account each year after expenses may be “rolled over” for use in subsequent years, even into college.

Here in Oregon, this school choice debate will center upon the latest proposal to offer all K-12 students many more educational options: a universal Education Savings Account program contained in Senate Bill 437. SB 437 is also known as the Educational Opportunity Act: The Power of Choice.

So, will this bill drain funds from public schools, or will it leave them harmless while allowing many students to make different choices? The answers depend on several assumptions which have now been evaluated in a new review and evaluation of a universal ESA program for Oregon.

The amount of the ESA deposits is the biggest driver of fiscal impacts. As introduced, SB 437 would provide participating students with disabilities and in low-income households $8,781 per year (current state funding) in their ESAs. All other participating students would receive $7,903 (90% of current state funding).

As Introduced, based on the assumptions below, the Fiscal Impact on the state and local school districts could be in the range of $200 million annually based on the following assumptions:

■ 90 percent of 61,000 students currently enrolled in non-public education would participate in the program.
■ Seven percent of 563,000 students currently enrolled in public schools would participate.

Based on these assumptions, the program has a fiscal “break even” for state and local school districts combined at an ESA annual amount of $6,000 for each participating student with disabilities and/or in a low-income household and $4,500 for all other students. These are the dollar amounts proposed in the -1 Amendment to the bill.

The Figure below shows the net fiscal impact on state and local budgets across a range of ESA amounts, again based on the assumptions above. 

If fiscal impact were the only measure by which to evaluate this ESA program, the Figure shows that the program is “optimized” at an amount of $3,000 for each participating student with disabilities and/or in a low-income household and $2,250 for all other students. Once fully implemented, the program would save state and local governments $53 million a year.

Figure:

ESA_FIGURE

Of course, fiscal impact is not and should not be the primary measure of this or any well-designed school choice program; but it is a political reality that such a program should not impose a fiscal burden on the state at a time that all budgets are under pressure.

The primary measure of this ESA program should be that it offers Oregon families as much choice as possible in how their children take advantage of educational opportunities funded by the state.

The full report, Education Savings Accounts: Review and Evaluation of a Universal ESA in Oregon, can be found online here.


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Now Is the Time: Oregon’s Educational Opportunity Act, The Power of Choice

By Steve Buckstein

Oregon now has the chance to become an early adopter of a universal Education Savings Account program. An ESA program allows Kindergarten through 12th grade students to use part of the state funds allocated to their local school districts for other educational expenses and services of their choice, such as private or home schools, tutors, and online courses. Funds not used by the student in a given year can be rolled over, all the way to college.

Senate Bill 437 as Introduced would allow 100 percent of the average annual state funding (currently $8,781) for disabled and low-income students, and 90 percent for all other students, to fund ESAs for any students wishing to use them. This likely would result in a $200 million fiscal impact on the state and local school districts combined. A small price to pay for educational freedom, but not likely to happen in a legislative session facing a budget shortfall.

So, the bill has been amended to virtually eliminate any negative fiscal impact. It lowers ESA accounts to $6,000 for disabled and low-income students and $4,500 for all other students. These accounts represent real money…for real educational opportunities…for every student—with no fiscal impact on the state budget.

Please share your interest in Senate Bill 437, the Educational Opportunity Act, with your state legislators. And get involved at the Educational Opportunity Act Facebook page and at SchoolChoiceforOregon.com.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Testimony Before the House Committee on Health Care in Support of HB 2128

To: Chairman Greenlick and members of the House Committee on Health Care

From: Steve Buckstein, Senior Policy Analyst and Founder, Cascade Policy Institute, a non-profit, non-partisan public policy research organization based in Portland

HB 2128 is a common-sense response to Oregon’s overreach when it became the first state to require a prescription for drugs containing pseudoephedrine in 2006. Only Mississippi has followed our lead.

While our prescription-only law was meant to reduce the incidence of meth labs in the state, federal government data show that by the time our law went into effect, we had already seen an 89 percent drop in the previous two years. Why? Because Oregon adopted its earlier behind-the-counter law for pseudoephedrine drugs in 2004.

As federal data in Figure 1 of Cascade Policy Institute’s 2012 study show, Oregon reported 467 meth lab incidents in 2004, and just 50 by 2006. By 2010 we reported 12 meth lab incidents. So, the overwhelming drop came before our prescription-only law even went into effect. As shown in Figure 1, our two neighboring states of Washington and California showed similar declines over the same period; and they only put these drugs behind the counter, as all states were required to do by federal law starting in 2006.

While I don’t have access to the meth lab incident data from more current years, we do know that according to recent reports from the U.S. Customs and Border Patrol, 99.8 percent of meth seized in the United States in 2015 was produced in Mexico.

Let’s be clear: Neither putting pseudoephedrine drugs behind the counter nor making them prescription-only did anything to reduce meth use and abuse.

Requiring prescriptions simply inconveniences Oregonians who want to treat minor cold or seasonal allergy symptoms, something consumers in 48 other states don’t have to bother with.

Oregonians have to make an appointment, take time off work to visit their doctor, ask for a prescription, and then go to the pharmacy to buy a product they previously could purchase by just asking their pharmacist.

A 2014 study found that this prescription requirement increased consumer prices for these drugs by 35 percent.

Making pseudoephedrine Rx-only is also likely to result in some patients relying on less effective treatments or avoiding treatment altogether due to additional cost and hassle. This could result in more lost work time for individuals and lost productivity for employers.

It’s time to recognize that we solved most of the meth lab problem by placing these drugs behind the counter in 2004. We didn’t need to overreach with our prescription-only law in 2006.

It’s time to repeal the prescription-only restriction and let honest consumers buy the cold and allergy medicines they prefer, just like people in 48 other states.

Thank you.

Click here for Figure 1 of Cascade Policy Institute’s 2012 study

Read Blog Detail

Testimony Before the House Committee on Revenue in Opposition to Tobacco and Inhalant Nicotine Tax Bills

To: Chair Barnhart and members of the House Committee on Revenue

From: Steve Buckstein, Senior Policy Analyst and Founder of Cascade Policy Institute, a Portland-based non-partisan, non-profit public policy research organization

Re: Tobacco taxes and inhalant nicotine taxes proposed in
HB 2037, HB 2056, HB 2062, HB 2084, HB 2119, HB 2662, and HB 3178

Why the state should not depend on increased sin taxes

  • Oregon’s addiction to tobacco/nicotine revenues will only grow if we become more dependent on them to fund new or existing programs.
  • Taxes on alcohol and tobacco are frequently justified as a means of discouraging “unhealthy” behavior. But this objective quickly gives way to a different one: raising revenue. This creates a “moral hazard” problem: sin taxes cannot simultaneously both discourage consumption and raise more revenue. For one to succeed, the other must fail.
  • As cigarette smoking continues to decline, tobacco taxes will continue to shrink, punching one more hole in future state budgets.

The regressivity of Sin Taxes

Paying for any state programs by taxing smokers may make some program recipients better off, but it will also make smokers and their families worse off.  As you may know:

  • Cigarette smoking adults are more likely to be uninsured than non-smoking adults.
  • Cigarette smokers are in poorer physical condition than non-smokers.
  • Cigarette smokers generally have lower incomes and less formal education than non-smokers.
  • Cigarette smokers are more likely to be unemployed or unemployable than non-smokers.

Policy option:

Currently, less than eight percent of Oregon tobacco taxes are used for the Tobacco Use Reduction Program. Funding other state programs through cigarette, tobacco and/or nicotine taxes is very regressive, targeting less educated, lower income and sicker Oregonians. If anything, these taxes should be reduced, not increased.

Read Blog Detail

Parental Choice Champion Betsy DeVos Confirmed as U.S. Secretary of Education

By Steve Buckstein

Opponents of Betsy DeVos tried everything they could to keep her from becoming U.S. Secretary of Education. In the end, she was approved by the Senate on Tuesday with Vice President Pence breaking a 50-50 tie vote.

In addition to arguments that she is wealthy (which she is) and that she never attended public schools (which she didn’t), opponents feigned shock that she had the temerity to argue that educating children takes precedence over protecting and funding public schools that may not meet their needs.

Perhaps her opponents’ biggest error is thinking that private schools are not providing “public education.” But they are. Many Americans recognize that meeting the educational needs of children trumps meeting the financial needs of the adults who work in public school buildings.

Public education means educating the public—or it should. Students don’t suddenly stop being part of the public just because their parents believe they will be better educated in other than their local public school building.

Betsy DeVos believes that public funding of education shouldn’t be limited to schools dominated by public teachers unions. She may not be a friend of those unions, but she is a friend of children who may need those funds to help them learn somewhere else. She has, and will advocate for school choice programs including charters, vouchers, and Education Savings Accounts that allow those children to take their public education funds to the schools they and their families—not the government—choose.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

The Past, Present, and Future of School Choice in Oregon

By Steve Buckstein

The vast majority of Oregonians attended public schools assigned to them based on their ZIP codes. Yet, everyone has friends or relatives who made different choices such as private, religious, and home schooling.

Few know, however, that these other choices were almost eliminated in the 1920s. Bigotry was strong across America then, and not only against Blacks. The Ku Klux Klan and others placed a measure on Oregon’s 1922 ballot that would have required children to attend only schools run by the government. The Oregon Compulsory Education Act was defended as “a “precautionary measure against the moral pestilence of paupers, vagabonds, and possibly convicts.”

Approved by a narrow margin, the measure was challenged and overturned by a unanimous U.S. Supreme Court decision in 1925. In its ruling the Court said “the fundamental theory of liberty upon which all governments in this Union repose excludes any general power of the State to standardize its children by forcing them to accept instruction from public teachers only. The child is not the mere creature of the State; those who nurture him and direct his destiny have the right, coupled with the high duty, to recognize and prepare him for additional obligations.”

So, while choices other than public schools remained available, most families have been unable to afford public school taxes and private school tuition at the same time. This reality caused a small group, including myself, to place a citizen initiative on Oregon’s ballot in 1990. Measure 11 would have provided refundable tax credits to every K-12 student in the state, which they could use to attend any public, private, religious, or home school of their choice. No state had voted on such a sweeping reform before, and we felt it was time for Oregon to lead the way.

On election night that November we came up short, with only about one third of the vote. That didn’t surprise us, because school choice was a new concept to most people, and it was easy for our opponents to scare voters into saying No. Before the votes had even been tallied, we began thinking about how we could move our school choice agenda forward in the future. We decided that Oregon needed a free-market think tank to advocate for school choice as well as other limited government ideas. We incorporated Cascade Policy Institute two months later. In the 25 years that have now passed some significant progress on the school choice front has been made.

We worked hard to introduce the charter school concept in the state in the mid-1990s. By 1999 the Oregon legislature passed a charter school bill that now allows more than 120 public charter schools to operate across the state.

Also in 1999 we evolved from just talking about school choice to actually providing choice to hundreds of low-income kids in the Portland area through our Children’s Scholarship Fund program. We initially raised $1 million of private money that was matched by $1 million nationally to provide partial scholarships to over 500 students for four years at the schools of their choice. The fact that over 6,600 children applied for those 500 slots demonstrated that the demand for school choice is great in Oregon. We can’t help them all, so we continue to advocate for broader programs that will.

In 2011 three school choice bills passed as part of an education reform package, including expansion of online charter schools, more options to sponsor new charter schools, and open enrollment between public school districts.

Over these past twenty five years Cascade and others have brought a number of national speakers to the state talking about the benefits of school choice elsewhere, including some 61 privately or publicly funded scholarship programs, charter schools, education tax credits, vouchers, and Education Savings Accounts (ESAs).

In 2014, Cascade proposed a limited Education Savings Account bill to help disabled, foster, and low-income children. ESAs allow students to take some or all of the money the state would spend on them in a public school and put it on a restricted use debit card. They can fund a wide variety of approved educational options, such as private school, individual tutoring, and distance learning. Any money not used in a given year can be rolled over to spend on educational expenses in the future, even into college.

Earlier tax credit and voucher programs are now seen as the rotary-dial telephones of the school choice movement. ESAs, with their expansive array of options and their ability to hold costs down as students plan and save for the future are seen as the smartphones of the movement— smartphones with virtually unlimited apps to help children learn in their own unique ways.

This year, Cascade is promoting a broad ESA proposal in the Oregon legislature. Senate Bill 437, and other bills that may emerge, are designed to enhance school choice for everyone. In the future, our mission—and yours if you choose to accept it—will be to help our fellow Oregonians understand and support what many now call the new civil rights issue in America: the right of every child, no matter where they live or their parents’ financial means, to reach their own potential by making their own educational choices affordable. Until this right is achieved, too many children will remain trapped in schools assigned to them by their ZIP code that fail to meet their needs.

We won’t stop advocating for school choice until every child has the real choices they deserve. We appreciate the help of everyone who shares this vision. It can’t become a reality too soon.


Steve Buckstein is Senior Policy Analyst and Founder of Cascade Policy Institute, Oregon’s free market public policy research organization. 

Read Blog Detail

Bad Consequences of Public Policies Aren’t Really “Unintended,” Just “Unacknowledged”

By Steve Buckstein

Decades of research and experience tell us that raising the government-imposed minimum wage results in fewer younger and lower-skilled individuals being hired, and in some of them losing jobs they previously held at lower wages.*

Decades of research and experience also tell us that requiring landlords to charge lower rent than market conditions dictate results in fewer housing units being built, making housing shortages worse and raising housing costs in areas not subject to rent controls.**

During last year’s minimum wage debate in Oregon, pointing out the negative consequences was not enough to stop the legislature from imposing significant wage increases. Likewise, this year the legislature may allow local jurisdictions to impose rent controls even though opponents will surely point out the negative consequences of this policy also.

It now seems obvious what is happening. Supporters of minimum wage increases and rent control aren’t blind to their negative consequences; they simply refuse to acknowledge them because the political benefits outweigh the real costs imposed on those forced to endure them.

The harm done by minimum wage increases and rent control is so obvious that we should probably stop saying that their negative consequences are “unintended.”  Rather, we should say that their negative consequences are “unacknowledged” because their supporters refuse to admit that they exist.

* Making Youth Unemployment Worse, Randall Pozdena and Steve Buckstein, Cascade Policy Institute, December 2016

** The Rent Is Too Damn High! — Why Rent Control Won’t Help, Steve Buckstein, Cascade Policy Institute, September 2016


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Now What?

By Steve Buckstein

Here at Cascade Policy Institute, as a nonprofit, nonpartisan think tank we don’t support or oppose political candidates. But we aren’t shy about telling candidates and elected officials what we think about their policies.

Now that this especially contentious election is finally over, you’re probably happy about some of the results and unhappy about others. But even if you got what, or whom, you wanted, you might think about some timeless insights from two discerning historical figures.

The first insight comes from Eric Hoffer, known as the longshoreman philosopher. In his 1951 book The True Believer, Hoffer noted:

“A man is likely to mind his own business when it is worth minding. When it is not, he takes his mind off his own meaningless affairs by minding other people’s business.”

The second insight comes from American statesman Daniel Webster, who in the early 1800’s said:

“There are men in all ages who mean to govern well, but they mean to govern. They promise to be good masters, but they mean to be masters.”

Even if the worst happened on election night in your opinion, remember that America has survived as a free and strong nation since declaring our Independence in 1776. In those 240 years we’ve benefited from some great public servants, and suffered some terrible ones. But we’ve always survived and generally prospered, and odds are that we will this time too.

Read Blog Detail

Does Oregon Rank Dead Last in Corporate Taxes? NO

Trying to sell voters on the largest tax increase in Oregon history, Measure 97 proponents claim that Oregon ranks dead last in corporate taxes.” But the nation’s leading independent tax policy research organization, The Tax Foundation, says this claim is misleading. It looked at three ways to rate corporate taxes and found:

• Oregon’s top marginal corporate income tax rate is the 18th highest in the nation.
• On a revenue per capita basis, Oregon’s corporate income tax is the 28th highest.
• The Foundation’s State Business Tax Climate Index ranks Oregon 37th nationally for overall corporate income tax structure.

The dead last corporate tax claim relies on two national reports (AEG, COST) that look at total business tax burdens, not just the tax burdens of large C corporations; the only entities directly targeted by Measure 97. Even so, both these reports make clear that they rate Oregon’s business tax burden low not because corporate taxes are low, but rather because Oregon doesn’t have a sales tax.

As the COST report notes, “If sales tax revenue is excluded…[Oregon] moves from the lowest…to the 20th-lowest rate.”

Misleading voters about Oregon’s corporate tax structure may simply be a tactic to keep us from focusing on the fact that Measure 97 is really a hidden sales tax on steroids that will hit every Oregonian. When we realize that, Measure 97 should suffer the same fate as every other statewide sales tax measure – defeat.

Read much more about Measure 97 and why you should vote against it on
Cascade’s Measure 97 webpage.

Read Blog Detail

Does Oregon Rank Dead Last in Corporate Taxes? NO

By Steve Buckstein

Trying to sell voters on the largest tax increase in Oregon history, Measure 97 proponents claim that “Oregon ranks dead last in corporate taxes.” But the nation’s leading independent tax policy research organization, The Tax Foundation, says this claim is misleading. It looked at three ways to rate corporate taxes and found:

  • Oregon’s top marginal corporate income tax rate is the 18th highest in the nation.
  • On a revenue per capita basis, Oregon’s corporate income tax is the 28th highest.
  • The Foundation’s State Business Tax Climate Index ranks Oregon 37th nationally for overall corporate income tax structure.

The “dead last” corporate tax claim relies on two national reports (AEGCOST) that look at total business tax burdens, not just the tax burdens of large C corporations, the only entities directly targeted by Measure 97. Even so, both these reports make clear that they rate Oregon’s business tax burden low not because corporate taxes are low, but rather because Oregon doesn’t have a sales tax.

As the COST report notes, “If sales tax revenue is excluded…[Oregon] moves from the lowest…to the 20th-lowest rate.”

Misleading voters about Oregon’s corporate tax structure may simply be a tactic to keep us from focusing on the fact that Measure 97 is really a hidden sales tax on steroids that will hit every Oregonian. When we realize that, Measure 97 should suffer the same fate as every other statewide sales tax measure—defeat.

Read much more about Measure 97 and why you should vote against it on Cascade’s Measure 97 webpage.

Read Blog Detail

“The Rent Is Too Damn High!” — Why Rent Control Won’t Help

Once again, Portland led the nation this July with its home prices rising 12.4 percent year-over-year versus the national average of just 5.0 percent. As of April, Portland remained the 12th most expensive rental market in the nation. These numbers are not unrelated. Housing prices are often related to what units can be built for, whether they are single-family homes or multifamily apartment houses.

Whatever the causes of rising rents in Portland and elsewhere, the political fix bubbling to the surface not only won’t help most people afford housing, it likely will make the situation worse. That political fix goes by the name of rent control.

Last year, Willamette Week published an informative and entertaining piece entitled “The Five Myths About Portland Apartments.” In response to Myth 3, which is that rent control is the answer, Jerry Johnson of Portland real-estate consulting firm Johnson Economics noted:

“Rent control is an Econ 101-level policy disaster. If you happen to get one of the rent-controlled units, good for you. But it’s basically a lottery of who wins and who loses.”

Apparently unaware of the policy disaster that rent control forebodes, Oregon Speaker of the House Tina Kotek recently proposed allowing localities to enact their own rent control programs. She also wants to end so-called “no-cause” evictions and to ban rent increases above a “reasonable” percentage “for the foreseeable future.” In her prepared remarks she said, “Our housing crisis is a man-made emergency that demands bold action,” and, “We have privileged the right to make a profit on property far above the universal human right to safe and stable housing.”

Our housing crisis may very well be a man-made emergency. If so, the Speaker has misdiagnosed the cause, which has more to do with Oregon’s “man-made” restrictive land use laws than it does greedy landlords. And, the “bold action” she proposes likely will make the situation worse.

Economists of virtually every political stripe reject rent control as a viable way to improve housing affordability. They recognize what too few of our political leaders and voters recognize: namely, that controlling the price of a commodity, in this case rental housing, actually harms the very people the policy is designed to help. They know from economic theory and observation over many decades The High Cost of Rent Control. They know that it misallocates housing resources, heightens tensions between landlords and tenants, stifles private investment in affordable housing, and leads to deterioration and eventual abandonment of the very housing stock that middle- and lower-income tenants wanted it to protect for them at affordable prices.

Three local economists were quick to respond to Speaker Kotek’s suggestions:

“Rent control just sends us a couple hundred miles closer to San Francisco in terms of housing policy,” said Gerard Mildner, director of the Center for Real Estate at Portland State University.

“It’s almost textbook that any form of rent control ultimately harms consumers, as well as landlords,” said Eric Fruits, an economist and editor of Portland State University’s Center for Real Estate quarterly reports. “It may benefit some in the short term, but in the longer term, there will be fewer units available to rent, which will only make matters worse.” Instead, Fruits said, the free market should be allowed to work, with higher prices sending signals to developers that more units are needed.

“The demand for urban living is increasing and cities are not increasing the supply nearly fast enough,” Portland economist Joe Cortright said. “The only solution is to build new housing.”

As an Oregonian editorial then pointed out:

“Among other things, limiting rent growth dampens future investment in housing, inflates rents for unregulated units and discourages residents who secure rent-controlled units from moving, even when it’s in their best interest.”

In a lively discussion on social media following Speaker Kotek’s pronouncements, one person responded to her call for an end to “no-cause” evictions:

“No cause eviction benefits good tenants. When the bad guys move in, they threaten the good tenants who are afraid to testify about their behavior. The good tenants become prisoners in their apartments while the bad guys run wild. A landlord’s only defense is to become more restrictive on who they will rent to, therefore decreasing options for all renters.”

Even self-proclaimed “progressive” Portland city commissioner, Steve Novick, notes:

“…most economists say rent control has unintended consequences, including a decline in the production of new rental housing.”

While this is true, in “progressive” Portland and in the state Capitol economic laws are often trumped by political laws that make people feel better for a while, until economic reality rears its ugly head. Of course by then those who passed the laws have often moved on.

Accountability is rarely a part of the political process, which may be why it so often leads to unintended consequences that harm the very people the politicians were trying to help. Unfortunately, we may be destined to repeat this process again as rent control lurches onto the 2017 legislative agenda.


* Political activist and frequent candidate Jimmy McMillan memorably used “The Rent Is Too Damn High!” as his main campaign issue, slogan, and the name of his political party during his campaigns, including the 2010 New York gubernatorial election.

Read Blog Detail

Twenty-Five Years Litigating for Liberty

How many attorneys do you know who make their living defending liberty? Well, 43 attorneys work full-time at the national public interest law firm Institute for Justice. They protect school choice, economic liberty, the First Amendment, and private property. Supported by generous donors, the Institute for Justice never charges its clients.

Founded 25 years ago, the Institute for Justice has litigated over 200 cases, including five before the U.S. Supreme Court, where it won four times. The fifth case led to the infamous Kelo decision, where the Court unfortunately seemed to forget that private property cannot be taken through eminent domain for a “public purpose,” but only for a “public use.”

This year, Arizona Governor Doug Ducey appointed Institute for Justice co-founder Clint Bolick to the state Supreme Court, saying that “Clint is nationally renowned and respected as a constitutional law scholar and as a champion of liberty.”

It is fitting on this 25th Anniversary of Clint Bolick’s Institute for Justice that Oregon’s free-market think tank Cascade Policy Institute has chosen him as the Keynote Speaker at our 25th Anniversary Dinner on October 20. There, Justice Bolick will talk about how important defending personal and economic liberty has been—and still is in his new role on the Court. You won’t want to miss his inspiring talk.

For full details and to RSVP, go to CascadePolicy.org/25.

Read Blog Detail

Improve Education Outcomes Through Education Savings Accounts, Not Measure 97’s Hidden Sales Tax

On the third day of the new school year at Portland’s Madison High School, Governor Kate Brown spoke about her goal to improve educational outcomes for all students. She bemoaned the fact that at 74%, Oregon has one of the lowest high school graduation rates in the country, and then she noted that “For me this is a very personal issue”:

“My stepson blew out of one of the local area high schools a few years ago. We were very fortunate. We had the resources to provide him with another educational opportunity, but not all families do. That’s why it’s absolutely imperative that we work together to improve Oregon’s high school graduation rates.”*

So how does Governor Brown propose to assist families that don’t have the resources hers had to help their children achieve educational success? Apparently, by supporting Measure 97 on the November ballot, which would be the biggest tax increase in Oregon’s history.

In reality, Measure 97 is a sales tax hidden behind the façade of being a tax on big business. Its passage will actually make it harder for many of the families the Governor wants to help, in the questionable hope that the revenue it generates would be spent properly to give their kids a better chance at graduation from the same schools that have failed so many in the past.

Measure 97 will not only act as a consumption tax on many of the goods and services Oregon families buy every day, but it also will reduce private sector employment opportunities as more than $3 billion are siphoned out of the private sector into the state general fund each year. From there, all this money—which is about what a six-percent retail sales tax would produce—may or may not be spent in ways that would give struggling families the same opportunities that the Governor’s family had when her stepson needed help.

Rather than ask voters to take a $30 billion gamble over the next ten years on a tax measure that may not show any positive economic or educational results for Oregon families, the Governor and voters should consider another way to provide all families with the resources they need to give their children the educational opportunities they deserve. And, this other way will not raise anyone’s taxes, and it will not reduce anyone’s job prospects.

This other way is school choice. Governor Brown’s predecessor, John Kitzhaber, took a major step toward this other way when he signed Oregon’s public charter school law in 1999 that currently allows more than 30,000 students to attend some 127 charter schools for educational opportunities they otherwise would have been denied. All without costing taxpayers or the public school system one additional dime.

Oregon is one of forty-three states and the District of Columbia that offer public K-12 charter school opportunities to their families. Now, the newest wave in the school choice movement is offering Education Savings Accounts in five states, and that number is sure to grow.

Education Savings Accounts, or ESAs, are not a college savings plan. Rather, if families decide the public schools their children are assigned to are not meeting their needs, they can leave those schools and instead receive money from the state to pay for approved alternative education options and expenses. Parents can spend the funds on private school tuition, individual courses at public schools, tutoring, online learning, textbooks, educational therapies, and other education-related services and products. They can use a combination of these services based on what they think would best meet their child’s learning needs.

Each eligible child is able to draw from his or her own personal Education Savings Account maintained by the state and funded by most, but not all, of the money that otherwise would have been sent to the local school district. When properly structured, ESAs require no new taxes and are not a financial burden on the state or local public school districts. They simply allow money already allocated for public education to be used in ways individual families choose, instead of in ways dictated by the ZIP code students happen to live in.

In an improvement over earlier school choice programs such as vouchers, ESAs let families spend only what they want to each year, and save or rollover the balance toward future educational needs. If not all the money in an ESA is spent by the time a student graduates from high school, the remaining funds may be used to help cover his or her higher education costs.

So, let’s not ask taxpayers to gamble that our troubled public schools will somehow get it right this time if we simply give them enough new money out of our pockets with the hidden sales tax in Measure 97. Instead, let’s ask our legislators in Salem to explore a new, truly innovative way to improve educational outcomes for each individual student with personal Education Savings Accounts.


* Governor Brown’s complete remarks at Madison High School were recorded and can be heard on this KXL radio episode of Beyond the Headlines in the first segment of about seven minutes at https://soundcloud.com/kxl-beyond-the-headlines/week-of-8-28-16-episode-130

Read Blog Detail

Policy Picnic – September 21, 2016

Please join us for our monthly Policy Picnic led by Cascade’s Senior Policy Analyst and Founder, Steve Buckstein


Topic:  Measure 97 – A Hidden Sales Tax on Steroids

Description:

Measure 97 on Oregon’s November 2016 ballot would impose the biggest tax increase in Oregon history: a sales tax on steroids, hidden behind the facade of being a $3 billion annual Gross Receipts Tax on business. It will raise taxes by $600 per capita.

Contrary to claims that it is only a tax on big corporations, the nonpartisan Legislative Revenue Office found that it will act largely as a consumption tax on Oregonians, with lower-income households being hurt the most. Prior to receiving its ballot measure number, Measure 97 was known as Initiative Petition 28.

Steve Buckstein will explain what the measure really does and what it means for you, your family, or your business. Bring your friends and coworkers!

Admission is free, but reservations are required due to space limitations. You are welcome to bring your own lunch; light refreshments will be served.

Please click here to reserve your free tickets.

Cascade’s Policy Picnics are generously sponsored by Dumas Law Group, LLC.

Dumas Law Group
Read Blog Detail

Cascade Policy Institute Says NO to Measure 97

ELECTION RESULT: 59 percent of Oregon voters said NO to this sales tax on steroids. Only 41 percent voted to impose it on all of us.
Measure 97 on Oregon’s November 2016 ballot would impose the biggest tax increase in Oregon history: a sales tax on steroids, hidden behind the facade of being a $3 billion annual Gross Receipts Tax on business. It will raise taxes by $600 per capita.
Contrary to claims that it is only a tax on big corporations, the nonpartisan Legislative Revenue Office found that it will act largely as a consumption tax on Oregonians, with lower-income households being hurt the most. Prior to receiving its ballot measure number, Measure 97 was known as Initiative Petition 28.
Below are factual and opinion sites to understand what the measure is and why it is in effect a sales tax on steroids, hidden behind the facade of being a tax on business.

•  Text of Measure 97 (IP28)

•  No on Measure 97: Defeat the Tax on Oregon Sales

The official campaign to defeat Measure 97

•  Does Oregon Rank Dead Last in Corporate Taxes? NO

by Steve Buckstein, Cascade Policy Institute, October 2016

•  Improve Education Outcomes Through ESAs, Not Measure 97’s Hidden Sales Tax

by Steve Buckstein, Cascade Policy Institute, September 2016

•  Measure 97: A $30 Billion Gamble Oregon Voters Shouldn’t Make

by Steve Buckstein, Cascade Policy Institute, August 2016

•  Cascade Policy Institute Opposes Measure 97,
the “Sales Tax on Steroids”

Media Release, August 2016

•  Like a Sales Tax on Steroids

by Steve Buckstein, Cascade Policy Institute, July 2016

•  A Sales Tax by Any Other Name

by Steve Buckstein, Cascade Policy Institute, June 2016

•  Assaulting “Corporate Profits” Will Hit Average Oregonians

by Steve Buckstein, Cascade Policy Institute, October 2015

•  Shifting the Cost of Measure 97 Forward

The Tax Foundation, October 2016

•  Supporters of Measure 97 Mislead On Corporate Taxes

The Tax Foundation, September 2016

•  Gross Receipts Taxes: Lessons from Previous State Experiences

The Tax Foundation, August 2016

•  Oregon Initiative Petition 28: The Threat to Oregon’s Tax Climate

The Tax Foundation, April 2016

•  Oregon Legislative Revenue Office Report on IP 28

(now Measure 97)

•  Portland State University Report on IP 28

(now Measure 97)

•  Oregon Legislative Counsel Opinion Letter on Measure 97

Concluding that contrary to proponents’ claims, “the Legislative Assembly may appropriate revenues generated by the measure in any way it chooses.”

Willamette University Economics Professor and Cascade Policy Institute Academic Advisor Fred Thompson has written a series of informative blog posts related to IP28/Measure 97 on the Oregon Economics Blog:

Why Are State Corporate Income Taxes Disappearing?
Tax Mavens Talk About Disappearing State Corporate-Income-Tax Revenues; Oregon Did Something About It
Where, Oh Where, Has Oregon’s Corporate Tax Gone? Where, Oh Where, Can It Be?
Update on IP28
More Background on IP28 (Measure 97?)
Measure 97: Any Pinocchios Yet?
The LRO’S Research on Measure 97

 

Read Blog Detail

Measure 97: A $30 Billion Gamble Oregon Voters Shouldn’t Make

The massive gross receipts tax Measure 97 on Oregon’s November ballot (previously known as Initiative Petition 28) is guaranteed to suck more than three billion dollars a year out of the productive private sector and deposit them in state coffers. What isn’t guaranteed is how all this new government spending might impact the state economy.

While union proponents of this “sales tax on steroids” argue that putting more money into education and other public services will be good for the state, two reputable economic studies don’t show it.

A nonpartisan Legislative Revenue Office report looks ahead five years and sees no positive economic effects showing up by then. While LRO economists may believe there will be positive effects later, that assumes the money will be spent effectively by a state that has a poor track record of doing so.

A Portland State University report, actually paid for by the measure’s public employee union proponents, looked ahead ten years and still found no positive economic effects showing up. Again, the PSU economists assume there will be positive effects eventually, but their model doesn’t show them.

So, we’re left with this inconvenient truth: If Measure 97 passes, taxpayers will send more than $30 billion to the state over the next ten years without any noticeable positive economic effects to show for it. That’s a $30 billion gamble that Oregon voters should turn down.

Read Blog Detail

Oregon Union Members Want the Option to Represent Themselves

National Employee Freedom Week (NEFW, August 14-20, 2016), aims to educate union members across the country about their rights to opt out of union membership and stop paying some or all of their dues and fees to unions they do not support. NEFW has conducted various surveys of union members and union households over the last several years. One of this year’s significant findings is that a strong majority of union members nationwide agree that if members opt out of paying all union dues and fees they should represent themselves in negotiations with their employer.

Over two-thirds of union members nationwide agree. By the same margin, 66.9% to 33.1%, Oregonian union members agree with this proposition. This would end the so-called free-rider problem unions hide behind (really a forced-rider problem), arguing that labor laws require them to continue representing workers even after they stop paying all dues and fees. Oregon labor law is similar to that of many states that don’t allow individual workers to represent themselves if a union has organized their workplace.

Now we know that two-thirds of Oregon union members want this to change. They want workers to be able to represent themselves, and they don’t want to force unions to represent these non-dues payers. You would think the unions would be all over this solution, known as Worker’s Choice; but they aren’t. Unions want to be forced to represent all workers because under current labor law, states like Oregon that are not Right to Work states require that non-union members still contribute the non-political portion of dues to their unions to cover bargaining and representation costs. The unions want the money, pure and simple.

A case heard by the U.S. Supreme Court in January (Friedrichs v. California Teachers Association) could have freed all public sector workers nationwide from paying compulsory union dues based on the argument that such compulsion violates their First Amendment rights to free speech and free association. Before the case could be decided, Justice Antonin Scalia died, leaving a four-four tie vote in the Court. This resulted in upholding a lower court decision denying ten California public school teachers their rights to be free of union compulsion.

This union compulsion brings to mind the well-known statement by Thomas Jefferson,

“To compel a man to furnish funds for the propagation of ideas he disbelieves and abhors is sinful and tyrannical.”

That is what the Court left in place, the right of public sector unions to compel workers to fund the propagation of ideas they disbelieve. An Oregon initiative measure that would have allowed public sector workers to opt out of all union dues and represent themselves did receive a ballot title this year, but did not collect signatures to be placed on the November ballot. Backers were hoping that the national Friedrichs case would have made their effort unnecessary, but for various reasons they were unable to mount a successful campaign.

It remains for future court decisions, or other political efforts, to end this union compulsion in Oregon and nationwide. Until that happens, National Employee Freedom Week will continue to bring this injustice to the attention of union members and the public.

Read Blog Detail

Oregonians Should Oppose Measure 97’s Regressive Taxation

The biggest proposed tax increase in Oregon history now has a measure number. Measure 97 on this November’s ballot would create a 2.5 percent gross receipts tax on C corporations with Oregon sales above $25 million.

Contrary to union claims, Measure 97 will not simply tax big out-of-state corporations. As the non-partisan Legislative Revenue Office Report has found, it will act primarily as a consumption tax on Oregonians. The estimated cost of this tax is $600 per year per person, with lower-income households being hurt the most. It is an eight-times-larger tax increase than Measures 66 and 67, which voters approved six years ago.

“Corporate taxes” are really paid by individuals, including consumers in the form of higher prices, employees in the form of lower compensation, and owners in the form of lower profits. The union backers of Measure 97 know this but claim that it will simply make corporations “pay their fair share.” This tactic is not only misleading, but if successful will harm every Oregon taxpayer.

Consumers will see price increases that in many cases will be much more than the stated 2.5 percent rate, without having any idea that the cause is Measure 97. As such, Measure 97 is the epitome of a regressive tax, and Oregonians should oppose it.

Read Blog Detail

Ten Years After Milton Friedman

One of the greatest minds of our era passed away in November 2006. This Sunday would have marked his 104th birthday. Milton Friedman won the Nobel Prize for Economics; but it was his ability to relate complex economic ideas in simple terms the average person could understand, and his devotion to liberty, that made him truly great.

Milton and his economist wife Rose spent literally decades researching, writing, speaking, and popularizing free-market economics and its connection to liberty and freedom. Rose actually grew up here in Portland, and it was my privilege to call her and Milton my friends.

This Friday, July 29th, the Friedman Foundation for Educational Choice will celebrate the 10th and final Friedman Legacy Day, which began after Dr. Friedman passed away. Rather than continue these annual celebrations, the foundation, created by and named after Milton and Rose Friedman, will move forward with a new name and a new strategic plan. Both will be announced on the foundation website, at www.edchoice.org.

Please join all of us at Cascade Policy Institute as we celebrate the lives and contributions of a great couple, and renew our commitment to promote their ideas and ideals, which include the goal of every child being able to attend the public, private, religious, or home school of their choice, with funding following the student.

Read Blog Detail

Celebrating the “Christopher Columbus” of School Choice, Milton Friedman

School choice has entered a new world. Because Americans are increasingly vocal about providing parents with the ability to choose their children’s schools, states are adopting broad-based school choice initiatives. Those successes can be attributed to various individuals, groups, and campaigns nationwide. However, it is school choice’s “Christopher Columbus” who deserves recognition for starting this movement more than 60 years ago.

In 1955, the yet-to-be Nobel Prize winning economist Milton Friedman introduced his vision of school choice as a way to improve the quality of American education. His idea was simple: Give parents access to their children’s public education funding, rather than require they attend the government (public) schools nearest their homes.

“Governments could require a minimum level of education which they could finance by giving parents vouchers redeemable for a specified maximum sum per child per year if spent on ‘approved’ educational services,” Friedman wrote in 1955. “Parents would then be free to spend this sum and any additional sum on purchasing educational services from an ‘approved’ institution of their own choice. The educational services could be rendered by private enterprises operated for profit, or by non-profit institutions of various kinds. The role of the government would be limited to assuring that the schools met certain minimum standards such as the inclusion of a minimum common content in their programs, much as it now inspects restaurants to assure that they maintain minimum sanitary standards.”

Because of vested interests in the education arena, including powerful public school teachers unions, Friedman’s suggestions were ignored. And, as a result, the cost of public education doubled while its academic performance stayed the same. As Friedman noted, that should come as no surprise because that’s exactly what monopolies do: They offer a product of similar, if not worse, value at a higher price than normally would be allowed if they had to compete in the free market.

But those days are over. Many states are broke, preventing them from dropping more money out of airplanes over public schools. And many parents are fed up, wondering why their kids are underperforming or unmotivated in K-12 schools and unprepared for their college courses and future careers.

Because of that sentiment and cash crunch, according to the Friedman Foundation for Educational Choice, named after Milton and his wife Rose, we now see over half the states with one or more school choice programs, consisting of vouchers, tax-credit scholarships, individual tax credits and deductions, and Education Savings Accounts.

Oregon is behind the curve, with no significant private school choice programs―yet. But widening charter school and online school options hopefully will soon lead to more school choice for all Oregon children. The most promising possibility here involves an update of Friedman’s original voucher idea, now seen as the “rotary phone” of the school choice movement. The school choice “smart phone” is now Education Savings Accounts. ESAs give parents and students even more choices, while replacing the old “use it or lose it” funding mechanisms with a market system. This system allows parents to shop for educational services and use their savings toward future educational needs of their children.

Limited Education Savings Account programs now exist in several states, and Nevada is on the verge of implementing a near universal ESA program that soon could be available to all its K-12 students. If achieved, this will be seen as the realization of Milton Friedman’s 60-year-old vision of full school choice for every child, at least in one state with more to follow.

But Friedman’s vision was not for school choice to be just another government program. He wanted to see school choice fundamentally change the way public education operates from its current structure that supports government schools and the adults who work in them, to a better model that empowers parents. He argued that if both rich families and poor ones could receive government funding when their kids use public schools, then both rich and poor should be able to receive that same funding to make educational choices outside the government school system.

It took America more than 60 years to reach today’s environment in which parent empowerment in education is celebrated more than ridiculed. Moving forward, around the country and especially here in Oregon, we should celebrate the new world that the school choice movement’s “Christopher Columbus” opened up for us.

Milton Friedman died in 2006. For the ten years since, Cascade Policy Institute and more than one hundred other organizations around the world have celebrated what has become known as Friedman Legacy Day each year on or around his birthday, July 31. This year marks the last such formal celebration. The Friedman Foundation for Educational Choice, which has sponsored these events to honor and reflect on the life and legacy of its founder, has announced that on the day of this year’s final formal celebration, Friday, July 29, it will unveil its new name and new strategic plan designed to move Milton Friedman’s school choice vision even more effectively into the future. Please join us as we celebrate both the man and his vision, and as we look forward to many more children getting the quality educations they have been so long denied in our one-size-fits-all government school system.


A version of this Commentary first appeared in Cascade Business News on what would have been Milton Friedman’s 100th birthday, July 31, 2012. Steve Buckstein wrote about Friedman’s ties to Portland in The Oregonian the day after he died in 2006.

Read Blog Detail

Like a Sales Tax on Steroids

Now that the massive Gross Receipts Tax measure IP 28 will be on Oregon’s November ballot, we likely will see many estimates of its impact on the state economy.

An economic research center at Portland State University just came out with its report on the measure, funded by the measure’s sponsor, union-backed Our Oregon.

Too bad that the sponsors picked a center headed by a respected former Oregon State economist who said publicly in March that their proposal would be “like a sales tax on steroids.”

Dr. Tom Potiowsky now chairs the PSU Economics Department and directs the Northwest Economic Research Center at the university. While the new PSU report doesn’t include the “sales tax on steroids” language that he personally used in March, it does confirm that such taxes “share many characteristics with sales taxes, and thus a greater burden on lower income households.”

The report also finds that because the tax will increase the cost of doing business in Oregon, it will destroy some 13,500 private sector jobs by 2027, while the added tax revenue will enable government employment to grow by 33,600 positions over the same period.

So, the tax will most hurt those least able to afford it, and will shift employment from the private to the public sector. Not bad for a sales tax on steroids.

Read Blog Detail

“When in the Course of Human Events…”

—A Declaration That Never Goes out of Style

Two hundred and forty years ago this July 4, the world was gifted with one of the most significant political documents ever written. It began with these words:

“When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another…”

 Thomas Jefferson authored the Declaration of Independence to set out the reasons for the American people to “dissolve the political bands which have connected them” with Great Britain.

The Declaration also boldly stated:

“We hold these truths to be self-evident; that all men are created equal, that they are endowed by their Creator with certain inalienable rights, among these are Life, Liberty and the pursuit of Happiness. That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed.”

Before the Declaration, individuals accepted that Kings would run their lives. Afterward, they realized that they could run their own lives. As more people around the world discover this fact, thank Jefferson for inspiring mankind with the ideas and ideals they can use to take their lives back from Kings.

This year, for example, the people of Great Britain have just voted to “dissolve the political bands which have connected them” with the European Union in what became known as the Brexit election. While that vote is causing political and economic uncertainty in Europe and beyond, Jefferson and America’s founders would likely understand the “causes which impel them to the separation.

Jefferson also realized that government and society are not synonymous. He argued that government’s purpose is to protect the inalienable rights of the individuals that make up society. He understood that such rights are not granted by government; and that any rights government does claim to grant are really claims on someone else’s right to life, liberty, or property. What would he think of today’s politicians—and aspiring politicians—in Washington, D.C. and Salem, Oregon who propose law after law ordaining right after right?

Jefferson also understood that he wasn’t elected President in 1801 to “run the country.” He was elected President to run the executive branch of a limited, constitutional government that coincidently he helped to create.

As we consider candidates for state and federal executive offices this year, remember that Jefferson might tell us we aren’t voting for any of these men or women to “run the state of Oregon” or to “run the country.” We are voting for individuals to run the executive branches of limited, constitutional governments. Outside those governments’ limited responsibilities, we should be free to run our own lives.

To reinforce these concepts, why not read the Declaration again this Independence Day and consider the power it had—and still has—to change our world for the better.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization. He was named the 2016 recipient of the Thomas Jefferson Award by the Taxpayer Association of Oregon and the Oregon Executive Club.

Read Blog Detail

A Sales Tax by Any Other Name…

Public employee union backers of Initiative Petition 28 have turned in more than enough signatures to place their massive 2.5 percent gross receipts tax measure on Oregon’s November ballot.

While supposedly dedicating most of the $6 billion per biennium additional tax revenue to public education, health care, and senior services, in reality legislators would be under pressure from powerful lobbyists in the Capitol to substitute at least some of this new revenue for money they would otherwise dedicate to those services. In short, the loudest voices in Salem, not voters, will ultimately control where this extra tax money goes.

While the unions portray their measure as making large, out-of-state corporations pay their fair share of Oregon taxes, the nonpartisan Legislative Revenue Office has released a detailed report giving a much more balanced perspective, which includes:

■ IP 28 will increase state and local taxes by $600 per year on average for every man, woman, and child in Oregon, totaling over $6 billion each full biennium.

■ IP 28 will dampen income, employment, and population growth over the next 5 years. In fact, it is expected to reduce employment growth by more than 20,000 jobs over the next five years, with private sector job growth slowing while public sector job growth accelerates in order to spend all that new tax money.

■ IP 28 will hit lower- and middle-income Oregonians harder than it will affect high-income earners. In other words, it is a regressive tax.

Perhaps most telling, the Legislative Revenue Office concludes that IP 28 will act largely like a consumption tax. It estimates that roughly two-thirds of that $6 billion per biennium tax increase will be passed on to Oregon consumers in the form of higher prices. Another name for a consumption tax is a sales tax.

The reality that IP 28 would effectively be a sales tax should be a lesson for all Oregonians that businesses generally don’t pay taxes, people do. Even the largest corporations are made up of people, namely employees, and sell their goods and services to other people, namely customers. It is largely these two groups of people who pay so-called business taxes like the one that IP 28 would impose.

The backers of IP 28 certainly understand that it is really a tax on people, not corporations. But, it is harder to get voters to approve a tax measure when they think it will hit them with rising prices at the store and fewer job opportunities. Better to promote the fiction that big faceless corporations have some magic pots of money that they will simply hand over to state government and public employees without any consequences for the rest of us.

Public employee unions back IP 28 because most of the tax revenue it would generate will go into the pockets of their members. Once the rest of us realize that this money will come primarily out of our pockets, we might not be too excited about voting for this massive new money grab.


A version of this article originally appeared in The Coos Bay World on June 1, 2016.

Read Blog Detail

Voters Decided to Leave Themselves Stranded by the Side of the Road

In the month since voters in Austin, Texas upheld new city regulations on ridesharing companies like Uber, the law of unintended consequences has been confirmed.

Austin’s highly regulated taxi industry got the city to impose strict regulations on their competition, but Uber and Lyft threatened to pull out of the city rather than comply with rules they said would be bad for them and their customers. The ridesharing companies backed an initiative to repeal the regulations.

As one pundit noted, a majority of voters decided “…to leave themselves stranded by the side of the road frantically searching for a ride. Well, that’s not what they’d say they did. Strictly speaking, they voted to stick it to corporate interests—by supporting political interests who favored other corporate interests.”

The unintended consequences of that vote included about 10,000 ridesharing drivers losing their employment, bars losing business as people had fewer ways to get home safely, and disabled residents looking for new ways to get around the city.

The market responded quickly with unregulated “black market” services such as Austin Underground Ride springing up to meet demand.

Austin voters may not have realized that the only way big corporations become big in a free market is by meeting consumer demand. In this case, Uber and Lyft may become a little bit smaller, but everyone in Austin lost some of their transportation freedom.

Read Blog Detail

A Sales Tax by Any Other Name

Public employee union backers of Initiative Petition 28 appear to have turned in more than enough signatures to place their 2.5 percent corporate gross receipts tax on Oregon’s November ballot.

While the unions portray their measure as making large, out-of-state corporations pay their fair share of Oregon taxes, the nonpartisan Legislative Revenue Office (LRO) just released its more balanced perspective, which includes:

■ IP 28 will increase state and local taxes by $600 per year on average for every man, woman, and child in Oregon, totaling over $6 billion each full biennium.

■ IP 28 will dampen income, employment, and population growth over the next 5 years.

■ IP 28 will hit lower- and middle-income Oregonians harder than it will affect high-income earners. In other words, it is a regressive tax.

■ Finally, the Legislative Revenue Office concludes that IP 28 will act largely like a consumption tax. It estimates that roughly two-thirds of the $6 billion per biennium tax increase will be passed on to Oregon consumers in the form of higher prices.

Another name for a consumption tax is a sales tax.

Public employee unions back IP 28 because most of the tax revenue it would generate will go into the pockets of their members. Of course, that revenue will come out of everyone else’s pockets.

Read Blog Detail

Help the Working Poor Adam Smith’s Way

This year’s May Day activities in Portland centered on promoting “workers’ rights” and “resistance to capitalism.” Unfortunately, too few critics of capitalism seem to realize that many of the workers they seek to help are being kept from using their knowledge and talents by a system of occupational licensure that dates back centuries.

May Day activists may not know that eighteenth-century Scottish philosopher and political economist Adam Smith, Capitalism’s Founding Father, was not simply interested in how markets profit those they now call “the one percent.” In fact, Smith strongly condemned restrictions on the working poor that kept them from benefiting from free exchange and the division of labor enabled by markets.

What in Smith’s day was called “incorporated trade” is today known as occupational licensure. Smith noted that apprenticeship requirements for weavers, hatters, tailors, etc., kept many out of these trades, while raising the wages of those already secure in them.

Today, most states impose fees and training requirements that keep many workers from entering dozens of occupations such as cosmetology, athletic training, and dry wall installation. Oregon, in fact, imposes some of the heaviest occupational licensing burdens on the working poor.

So, rather than simply berating capitalism, it would be nice if May Day activists could study a little economic history and then help reduce some of the licensing restrictions that limit workers’ rights today.

Read Blog Detail

Do You Support the Free Market, But…?

I first wrote in 2003 about what I call “The Statement”:

“I support the free market just as much as you do, but….”

I had been hearing versions of The Statement in and around political and business circles for years. It impinged on one of the first issues Cascade Policy Institute tackled in the year of our founding, 1991. The city of Portland was planning to franchise residential garbage service (which it eventually did at the expense of consumers). At the time Portland was the largest city in the country without government garbage service or a private monopoly protected by law.

After I had written and testified before city council about the harmful effects of government intrusion into the garbage business, a local garbage hauler called me. He wanted to explain how protected franchises—that is, government-protected private monopolies—were actually a good thing.

After a few minutes he realized that I wasn’t buying his arguments, so he made what I later labeled The Statement: “I support the free market just as much as you do, but….” The “but” in this case was the exception he felt should be made to protect his business from competition and consumer choice.

Over the years I’ve heard The Statement from business people who argue that the State of Oregon and local jurisdictions should continue protecting them from new competition in all sorts of industries. The Portland taxi cartel successfully protected its position for decades before Cascade and others helped a group of Ethiopian immigrants to enter the market with Green Cab in 1998. Then, in 2015 the expanded taxi cartel tried to rely on The Statement to fight off ridesharing companies like Uber until the new smartphone technology that enabled them gave consumers power to demand that local governments allow the transportation freedom they promised…and delivered.

At the Capitol in Salem, I heard The Statement from business lobbyists who argued that the free market was great…except that their clients should be protected from new competitors in the home moving and natural hair braiding fields. Of course, these lobbyists weren’t simply protecting the interests of their paying clients…no, they always argued that keeping competitors out was for the benefit of the public health and safety. Luckily for the public, these arguments failed; and it is now much easier for aspiring entrepreneurs to enter these fields in Oregon, providing more choices for consumers and more economic opportunities for themselves.

On the national scene we’re now hearing a version of The Statement when presidential candidates say something like, “I’m for free trade too, but….” Flawed economic arguments about foreigners “taking our jobs” and other nations harming America by somehow imposing trade deficits on us are trotted out to justify protecting some businesses against others, and against consumers.

Business people argue for government protection at their peril. If government is justified in controlling who can provide our garbage service, or taxi service, or natural hair braiding, then why shouldn’t it control who can sell us our food, clothing, and shelter—all things we cannot do without?

If government can deny us the right to buy products produced in other countries, or can slap high tariffs on those products so that we have to pay much higher prices, how is this protecting “we the public”? Isn’t it really protecting “they, the special business interests”?

Lest anyone mistakenly believe that Cascade Policy Institute is “pro-business,” we are not. Rather, we are pro-liberty, pro-free-markets, and pro-consumer-choice. We understand that the slippery slope to a government-controlled economy begins when capitalists fail to consistently defend capitalism. The resulting economy harms most consumers and businesses alike at the expense of those who work for and are protected by big government.

There may be a case for government limiting competition in some fields and subsidizing some businesses at the expense of others; it’s just not a free-market case.

Read Blog Detail

Enjoy the illusion that you’re not really paying taxes, when you cash that expensive refund check

Are you happy getting three extra days to file your income tax returns this year?

For nearly eighty percent of us, it doesn’t matter much because we are expecting refunds. No check writing for us. Why? Because the withholding system almost encourages over-withholding, thus giving the impression that we don’t pay taxes, the government pays us!

Try a little experiment. Ask ten of your friends how much they paid in taxes. Chances are, eight of them might say something like, “I didn’t pay anything, I’m getting money back!”

This happened because my hero Milton Friedman had one of his few bad ideas when he proposed the withholding concept while working at the Treasury Department during World War II. The government needed money fast to finance the war effort, and as Friedman said years later:

“It never occurred to me at the time that I was helping to develop machinery that would make possible a government that I would come to criticize severely as too large, too intrusive, too destructive of freedom. Yet, that was precisely what I was doing.”

Of course, by over-withholding we’re just giving the government an interest-free loan. But psychologically, doesn’t it feel nice getting that refund check?

So, enjoy the illusion that you’re not really paying taxes when you cash that expensive refund check. You paid dearly for it!

Read Blog Detail

Governor Jerry Brown: “Economically, Minimum Wages May Not Make Sense”

As California Governor Jerry Brown signed his state’s $15 minimum wage bill into law on April 4, he acknowledged, “Economically, minimum wages may not make sense.” He went on to say that work is “not just an economic equation,” calling labor “part of living in a moral community.” “Morally and socially and politically, [minimum wages] make every sense because it binds the community together and makes sure that parents can take care of their kids in a much more satisfactory way,” Brown said.

So now it’s official—at least in our neighbor to the south—that laws don’t have to make economic sense for politicians to enact them. Laws just have to somehow “bind the community together.” When a strong majority of voters want a law to pass, as they apparently do for higher minimum wages, politicians take that as a signal that they can give voters what they want even if the law will hurt many of the very people they claim it will help. Governor Brown was just honest enough in this case to effectively admit that people may be hurt, but so what? Binding the community together apparently makes everything OK.

Of course, communities bound together by such faulty ideas will eventually come unbound, at least in the sense that many of their members will be priced out of the jobs and economic opportunity the politicians promised they would enjoy.

Minimum wage laws primarily hurt younger, less skilled, and less educated workers who will lose their jobs or not get jobs in the first place because employers can’t justify paying them what the law says they must. Employers who can’t generate enough, or any, profits at mandatory higher wage rates will also be hurt, as will consumers who end up paying higher prices they can ill afford in return for “binding their communities together.”

The governor of New York signed his state’s new $15 minimum wage law on April 4 also, and Oregon’s Governor Kate Brown signed our new slightly lower minimum wage law on March 2. Neither of these two leaders acknowledged what California’s governor did: that minimum wage laws may not make economic sense. They probably know it, but why raise doubts? They would much rather take plenty of credit, and later blame employers for not delivering the economic goodies government is so good at promising and so bad at producing.

Read Blog Detail

Where Did President Obama Stay in Cuba?

This week, Barack Obama became the first U.S. President in nearly 90 years to visit the country of Cuba. While security concerns may have prevented him staying in a private home rented through Airbnb, he would have had some 2,700 such homes to choose from in Havana alone.

The amazing thing is that Cuba is a communist country, yet it allows short-term room rental services to operate, while some major American cities such as Atlanta, Denver, and Los Angeles do not.

While the American President likely rode through the streets of Havana in his own armored limousine, he apparently could have ridden in one of those iconic 57 Chevys if the driver had one of the still rare and expensive Cuban email accounts. Such ride-sharing services are also allowed in Havana, while Uber and Lyft are still fighting powerful taxi monopolies in some American cities.

We can have legitimate disagreements about normalizing diplomatic and economic relations with Cuba; but we should applaud the movement toward private home ownership and use, and the entrepreneurial opportunities its communist government now allows.

It will be ironic if Cuba comes into the modern free-market era at the same time that some American politicians try to impose more government restrictions on the very economic freedoms that many Cuban refugees risked their lives to achieve by coming here.

Read Blog Detail

If Socialism Is Like Playing Checkers, Capitalism Is Like Playing Chess

Now that former world chess champion Garry Kasparov has weighed into the American presidential campaign, it seems fitting to explain his support of capitalism and disdain for the socialism he lived under as a Soviet citizen in terms of the differences between playing chess and playing checkers.

When you hear the expression “We’re playing checkers, while they’re playing chess,” you understand that the speaker believes his opponents are playing a more sophisticated game. In this sense, socialism is a simple economic game: You see a problem and you assume that the government is the tool that will solve it. It’s relatively easy to sell a straightforward checker move to the public. It may be harder to sell a more sophisticated chess move, even if it is the better solution to your problem.

A fascinating commentary in AgainstCronyCapitalism.org points this out:

It rarely occurs to the people calling in the government that perhaps the government will create more problems than it solves. Indeed this concept is so foreign, that when something breaks in our society due to government intervention, the call by many is almost always for yet more government intervention. It’s ridiculous. But I wonder if it is just a reflection of a checkers mentality in a world which demands an understanding of chess. 

The free marketeer is more like the chess player.…

Free market people have a better understanding of chain reactions and of unintended consequences than their statist brothers and sisters. They think a few moves ahead while also understanding the limit of their foresight.…

Society is a living, breathing being. It is organic in nature. It spins out in fractal complexity in every direction. The free marketeer understands this and is humbled by this reality.

On March 1, Garry Kasparov’s self-described “rant” against Bernie Sanders’s socialist “prescription for America” went viral on Facebook, eliciting more than 3,300 comments. Over 63,000 people have shared it with their “friends.” Here it is:

Garry Kasparov

March 1 at 11:57am

I’m enjoying the irony of American Sanders supporters lecturing me, a former Soviet citizen, on the glories of Socialism and what it really means! Socialism sounds great in speech soundbites and on Facebook, but please keep it there. In practice, it corrodes not only the economy but the human spirit itself, and the ambition and achievement that made modern capitalism possible and brought billions of people out of poverty. Talking about Socialism is a huge luxury, a luxury that was paid for by the successes of capitalism. Income inequality is a huge problem, absolutely. But the idea that the solution is more government, more regulation, more debt, and less risk is dangerously absurd. 

Garry Kasparov Yes, please take Scandinavia as an example! Implementing some socialistic elements AFTER becoming a wealthy capitalist economy only works as long as you don’t choke off what made you wealthy to begin with in the process. Again, it’s a luxury item that shouldn’t be confused with what is really doing the work, as many do. And do not forget that nearly all of the countless 20th-century innovations and industries that made the rest of the developed world so efficient and comfortable came from America, and it wasn’t a coincidence. As long as Europe had America taking risks, investing ambitiously, and yes, being “inequal [sic],” it had the luxury of benefiting from the results without making the same sacrifices. Who will be America’s America?

Kasparov then followed up with this longer article amplifying on his points:

Garry Kasparov: Hey, Bernie, Don’t Lecture Me About Socialism. I Lived Through It.

I don’t know if Kasparov thinks of socialism and capitalism in terms of playing checkers versus chess, and I don’t necessarily agree with everything he says. But, his insights are important and worth considering by anyone and everyone considering what economic system has and will best serve America and the world.

Read Blog Detail

No Fake Emergencies

I’ve written and spoken about the damage that minimum wage laws do, not only to business owners, but to their customers and their younger, less experienced, and less educated workers and potential workers.

Normally, bills become law in Oregon no earlier than 90 days after the end of the legislative session in which they pass. But the latest ill-advised minimum wage bill had an Emergency Clause attached, so it becomes law today, the day the Governor signed it. Why is a law that phases in wage increases over six years deemed an Emergency? Because supporters didn’t want to let voters refer it to the ballot.

A real emergency, such as a major earthquake or other natural disaster, may require immediate state action, which is what the Emergency Clause is for. But over half of all bills passed by the legislature last year contained such a clause. Most were emergencies only in the political sense, not the real sense.

It’s time to stop such political games by putting the No Fake Emergencies initiative on the November ballot. It will restore Oregonians’ Constitutional rights to refer most laws to a vote of the people if they wish. Bills will still be able to take effect immediately in the face of real emergencies, just not fake ones.

You can sign the petition to place this initiative on the ballot by going to NoFakeEmergencies.com.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Open Wide Your Hand to the Needy; Don’t Coerce Others to Open Wide Theirs

Oregon is on the way to becoming the highest minimum wage state in the nation. From this year’s $9.25 per hour rate (more…)

Read Blog Detail

Is Oregon Getting More Business Unfriendly?

Oregon is known as a small business state. Few large corporations are headquartered here, and current policy debates in the legislature and measures headed for the November ballot threaten to make our state even less friendly to business than it already is.

Two recent publications document how bad the outlook for Oregon’s economy is now. The Eighth Annual Rich States, Poor States report from the American Legislative Exchange Council calculates every state’s Economic Outlook based on fifteen public policies under state control such as personal and business tax levels, minimum wage rates, and Right to Work status. On this scale, Oregon has slipped from 35th in 2008 to 45th today.

The Small Business Policy Index for 2016, published by the Small Business and Entrepreneurship Council finds that “Oregon offers the eighth worst policy climate for entrepreneurship and small business growth among the 50 states.” It comes to this conclusion based in part because “Oregon imposes the second highest personal income and capital gains taxes, high unemployment taxes, a state death tax, and a high state minimum wage. Oregon also has a weighty energy regulatory burden.”

In light of such findings, should certain state legislators, union leaders, and political activists be promoting a massive increase in Oregon’s minimum wage rate and a drastic increase in corporate taxes? Of course not. But don’t expect economic reality to always win the day. If it could, Oregon’s economic outlook would be a lot better than it is.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Oregon’s Minimum Wage Law Perverts Compassion into Coercion

Picture two Oregon workers. One, a highly skilled and educated woman named Kate, earns well over $40 per hour based on a 40-hour work week. The other—a younger, less skilled, and less educated woman also named Kate—has a job that pays her Oregon’s minimum wage rate of $9.25 per hour.

The first Kate happens to be the Governor of Oregon. She, along with some of her colleagues in the legislature and activists on the campaign trail, believe that the second Kate should be paid as much as $15.00 per hour by law, depending on where she lives.

Wanting our second Kate to earn more is commendable; but forcing Kate’s employer to pay her more than he or she can afford, or more than Kate may be worth to their business, is not commendable.

Some politicians may feel good by “giving” more money to the Kates of Oregon, but how should they feel for “taking” that money from someone else?

I join many policy analysts, economists, and business owners in pointing out the negative effects of raising Oregon’s minimum wage. Younger, less educated and lower-skilled workers may lose their jobs, or not gain jobs in the first place, if the law prices them out of the labor market. Some employers will be forced to hire fewer workers, let some workers go, and/or raise their prices to all the Kates of Oregon who will blame them, not the politicians, for their suddenly higher cost of living.

But, the practical effects of raising the minimum wage, good or bad, should not cause us to forget the moral aspects of a state policy that dictates what one adult is required to pay another. Voluntary transactions between workers and employers are moral; imposing wage floors from Salem or any other layer of government is not.

I have no illusions that Oregon’s Governor, legislature, and activists will now see the light and abandon their plans to impose yet another burden on employers while helping some workers at the expense of others. I simply want it on the record that I agree with the author who wrote:

“The minimum wage is the modern perversion of compassion into coercion: I believe there is a moral imperative for you to earn more, so I force someone else to pay more. I feel moral while sticking someone else with the bill.”*

So, rather than raise Oregon’s minimum wage rate, the legislature should do the moral thing and end the policy altogether. Then we can all work together with Oregon Governor Kate Brown to find better, moral ways to help all the other Kates of Oregon earn more money without perverting our compassion into coercion.

* Doug Bandow, Cato Institute, January 14, 2014, The Minimum Wage: Immoral and Inefficient.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

 

Read Blog Detail

Will Oregon Price the Least-Skilled out of the Workforce…Too Slowly?

As Oregon’s February legislative session approaches, Governor Kate Brown wants to head off a contentious minimum wage ballot measure that would raise Oregon’s rate up to $15 per hour over three years. But, her plan seems to upset all sides.

She has determined that the Portland area minimum wage should be exactly $15.52 by 2022. She has also figured out that the rest of the state should impose a $13.50 minimum by 2022. “That is entirely too long” to wait, according to activists behind the ballot measure.

Solid research concludes raising the minimum wage at all is not an effective way to alleviate poverty. It is, however, an effective way to pander to voters who either don’t read the economic literature, don’t believe it, or don’t care.

Oregon already has one of the highest minimum wage rates in the country at $9.25 per hour. But, with some cities and states determined to raise their rates to $15 soon, our Governor’s $15.52 Portland area proposal over six years may not be enough to keep us at the forefront of pricing the least-skilled people out of the workforce altogether.

Perhaps she should go for a $30 minimum wage rate by 2030. Or a $40 rate by 2040. Or…well, you get the idea.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Freedom in Film: Nicky’s Family (2011)

As the world approaches 2016, we reflect on what transpired in 2015 and what lies ahead in the New Year. The terrorism we saw recently in Paris and San Bernardino was terrible; but 6,000 people are alive today who witnessed those events through the eyes of 669 relatives who would have perished in the Nazi Holocaust if it hadn’t been for one man—a man who passed away July 1 at the age of 106.

In 1938, 29-year-old British stockbroker Nicholas Winton saw a tragedy unfolding, as Hitler’s army threatened to occupy Czechoslovakia and exterminate its Jewish population. His story and that of his “family” is portrayed in one of the most powerful documentary films I’ve ever seen.

Nicky’s Family [2011] is an emotional retelling of the remarkable efforts one man took to rescue 669 Czech children from near-certain death during World War II. Sir Nicholas Winton was a young English businessman when chance brought him to Nazi-occupied Czechoslovakia. He put aside his own pursuits and began organizing the many children of Jewish refugees who were trying to escape Nazi clutches. Once he had appointed himself the authority for such matters, Winton went to work arranging transport and placing these children in English homes.”

As the film’s director noted about Winton, “His exploits would have probably been forgotten if his wife, fifty years later, hadn’t found a suitcase in the attic, full of documents and transport plans. Today the story of this rescue is known all over the world. Dozens of Winton’s ‘children’ have been found and to this day his family has grown to almost 6,000 people, many of whom have gone on to achieve great things themselves.”

The film was produced in 2011 when Winton was 102. It features him and many of the children he saved, who are now in their seventies and eighties themselves. The most emotional scene to me is when Sir Winton (he was knighted by the Queen for his efforts) first met many of these now-grown children whom he hadn’t seen since 1939.

I found the most powerful statement he made in the film was when he related how, during his rescue operation, two British rabbis told him they objected to him placing some of his Czech Jewish children with English Christian families. Winton told them that he preferred Jewish children living in Christian families than dying with their families in what quickly became the Nazi Holocaust.

My friend Larry Reed, now President of the Foundation for Economic Education, first met and interviewed Nicholas Winton in 2006, and visited him regularly until last year. When I first heard Larry’s story about his friendship with Sir Nicholas, I thought how fortunate I was to be separated by just one degree from this hero of humanity.

Freedom and liberty are universal human aspirations, but they are continually under assault here and around the world. Nicholas Winton wouldn’t accept the fact that many countries closed their borders to helpless children trying to escape near-certain death at the hands of what can be seen today as 1930’s Nazi terrorists.

If you appreciate inspiring stories about real-world heroes, you won’t find a better one than Nicky’s Family. Watch the movie trailer here; then you can buy the 96-minute DVD or stream it at Netflix and Amazon.

As you celebrate this New Year, realize that more than 6,000 people are celebrating it with you thanks to Nicky Winton.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Give Every Oregon Employer a Personalized Minimum Wage

Union-backed and activist groups are trying to put measures on the November 2016 ballot to raise Oregon’s minimum wage from the current $9.25 to either $13.50 or $15, and to allow local governments such as the city of Portland to go above whatever the statewide minimum ends up being.

State Senator Michael Dembrow (D) thinks he can improve minimum wage policy by recognizing that different regions of that state have different costs of living and employment climates. He’s trying to craft a bill for the February 2016 legislative session that would set three different minimum wage rates: one for the Portland Metro region, one for the Willamette Valley, and one for everywhere else.

Assuming the Senator is on to something (a dubious assumption at best), why stop at three rates? Clearly, every employer has somewhat different circumstances, so why not set a different rate for each of them? Dembrow could give each employer a hearing lasting as long as the legislature gives the public to testify on bills—three minutes—to explain their particular circumstances. He then could assign them their own personalized minimum wage rates. Assuming about 100,000 employers in the state, working eight hours every business day with no breaks, the Senator could have the perfect minimum wage bill crafted in only two and a half years. Voilà, problem solved! Or is it?

Of course, in reality, Dembrow and the activists are trying to solve a problem through government that is better left to free people in a free society. Minimum wage laws are nothing more than price controls that end up hurting the very people they purport to help: often young, less educated, and less experienced workers who will find it harder to get or keep a job when the government prices their labor above what a business can economically justify.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Uber and Portland: “The Future and Its Enemies” Clash in the Rose City

The Portland City Council has voted 3-2 to let ridesharing companies Uber and Lyft operate permanently in the city. The normally “progressive” council members’ split decision revealed a conflict of visions that does not fall along ideological lines as much as it falls along lines revealing how they view the future.

Author Virginia Postrel wrote a book in 1998 that virtually foresaw the conflict Portlanders and others around the world are wrestling with in the new sharing/app economy – an economy that didn’t even exist until 2008. In The Future and Its Enemies: The Growing Conflict Over Creativity, Enterprise, and Progress, Postrel argued that the opposing world views of “stasis” and “dynamism” are replacing “left” and “right” as we struggle to define our cultural and political debate in the twenty-first century.

Many large cities, including Portland, have regulated the taxicab industry for over 100 years. Regulating prices and limiting the number of taxis on the road has resulted in a small group of crony capitalist companies benefitting at the expense of their passengers, and often at the expense of their own drivers.

It got so bad in Portland, that for over twenty years beginning in 1976 not one new taxi company was allowed to enter the market. And regulators wouldn’t even let one new cab on the streets unless an owner could prove the demand existed for that vehicle; something that was almost impossible to do even as the city’s population grew.

In 1998, Cascade Policy Institute helped a group of Ethiopian immigrants win approval from the city to start Green Cab, the first new Portland cab company allowed in more than two decades. Regulators agreed, not because the proposal made sense (which it did), but likely because they knew that the libertarian public interest law firm Institute for Justice would go to federal court to protect the economic liberty rights of those wanting to earn an honest living by providing transportation services to consumers.

Once smartphone apps emerged in 2008, the “stasis” of the transportation marketplace began giving way to the “dynamic” future that Uber pioneered in 2010. Thanks to the mobile devices most of us now carry in our pockets, the future of transportation and many other fields are quickly changing for the better…at least in the minds of the dynamists.

Once Uber entered Portland without city approval on December 5, 2014 and thousands of Portlanders put the app on their smartphones, city officials may have realized that most of these folks were also voters. They struck a temporary deal with Uber and agreed to develop new rules that would let it operate permanently in the city.

Even the city commissioner once seen as Uber’s biggest foe, Steve Novick, now says he never understood why the city should have a limited-entry system in which a small number of taxi companies were given a sharply restricted number of permits to operate cabs. He says the taxi companies had a sense of “entitlement” after being treated like a city utility for the past century. After being given authority for taxi regulation by the Mayor, Novick ended the strict limits on taxi permits, and the city increased the number of permits by 64 percent.

Novick set up a Task Force to suggest rules for both taxi companies and ridesharing firms like Uber. Traditional taxi drivers quickly became disappointed that “The Future” wasn’t going to include protections for them and strict limits on their new competitors. On December 2, 2015 Novick joined two other commissioners in voting Yes for dynamism, while two voted to keep the stasis that is quickly becoming transportation’s past.

The foremost opponent of the plan to let Uber operate permanently was commissioner Amanda Fritz. She prepared and read a ten-minute statement before voting No. She delineated several issues she believed were unfair to existing taxi companies and that could be harmful to Portlanders, including relatively low insurance limits for ridesharing drivers when passengers aren’t in their cars. One part of her statement clearly puts her on the side of “stasis” and denies the liberating power that the free market and technology provide for drivers and passengers alike:

“New taxi companies will no longer be scrutinized by the grueling public vetting and approval by City Council in an open public hearing. I feel so sad for my friends in Union Cab, supported by the Communication Workers of America Local 7901. You worked so hard to win approval. You offer dozens of immigrant families not only a chance at the American Dream, but an opportunity to belong to an American union, part of the united American Federation of Labor movement. You achieved the dream, in winning approval of your franchise. And now the majority of Council is telling you you’re an expendable casualty in the free market – the free market that is grinding the working class and the middle class into the servants of the billionaire corporations.”

Contrary to Fritz’s charges, the free market is liberating people worldwide from grinding poverty. In Portland it is allowing several thousand people to work for themselves as full- or part-time Uber and Lyft drivers. It is giving passengers new, cheaper, and quicker options to travel around the city.

The free market and technology are combining to help mold a dynamic future. Those trying to stop this future, including city commissioners who voted against it, are clinging to a stasis that cannot and should not prevail. “The Future and Its Enemies” is playing out right now in the City of Roses. Thankfully, The Future is winning.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

 

Steve was interviewed about this topic on KUIK’s The Jayne Carroll Show on Wednesday, December 9, 2015. You can listen to his interview here.

Read Blog Detail

This Thanksgiving, Are You Part of the One Percent?

You may not have learned this in school, but prior to the 1623 Thanksgiving celebration in the Plymouth colony it had the equivalent of a modern-day socialist economy. Land and crops were held in common; and food was distributed based on need, not on production. Able young men were often unwilling to work hard for the benefit of other men’s families.

After several disastrous harvests, each household was given its own plot of land. They could keep what they produced, or trade their crops for things they needed. Private property and a free market economy resulted in a truly bountiful harvest in 1623 and beyond.

Today, most Americans are actually rich, thanks in large part to retaining those private property and free market traditions. Perhaps not rich in relation to other Americans, but rich in relation to people around the world.

If your family earns more than $32,400 per year, you are in the top one percent of all income earners worldwide. Recently, half of all American families earned more than $51,939, and the average family earned $72,641. Even the lowest family income group by race, African Americans, had a median income over $33,000. Looked at this way, most Americans are part of the world’s one percent.

Things are far from perfect, but most of us have a lot to be thankful for this Thanksgiving.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

That “old technocratic central planning impulse” is alive and well in Oregon

One of the most memorable and talked about lines from the November 10th Republican presidential debate came from Senator Marco Rubio, who said, “For the life of me, I don’t know why we have stigmatized vocational education. Welders make more money than philosophers. We need more welders and less philosophers.”

The fact-checkers quickly came up with data from the Bureau of Labor Statistics to counter his earnings claim; but the larger question might be whether the president, or any level of government in America, should use the power of the state, and taxpayer money, to choose one career path over any other for students in a free society.

In Oregon you can find lots of politicians who are sure that our state education system needs to focus on Science, Technology, Engineering, and Math, or STEM for short. Labor Commissioner Brad Avakian wants to return shop classes to high schools. In 2013 the Legislature created the Oregon STEM Investment Council (under John Kitzhaber’s Oregon Education Investment Council, which no longer exists).

To encourage certain students to pursue technical or vocational careers is one thing. But pretending that the state knows what is best for all students and that it should set goals for college participation (such as Oregon’s 40-40-20 goal) and STEM education is another. As former Reason magazine editor and author Virginia Postrel noted a few years ago,

“The argument that public policy should herd students into Stem fields is as wrong-headed as the notion that industrial policy should drive investment into manufacturing or ‘green’ industries. It’s just the old technocratic central planning impulse in a new guise. It misses the complexity and diversity of occupations in a modern economy, forgets the dispersed knowledge of aptitudes, preferences and job requirements that makes labor markets work, and ignores the profound uncertainty about what skills will be valuable not just next year but decades in the future.”

Those in and around Oregon government and educational arenas seem to always be concerned about attracting good manufacturing and “green” jobs to the state. But, as Postrel says, much of this talk is “just the old technocratic central planning impulse in a new guise.”

So, for sure, let students with an aptitude and interest in technical and vocational careers know about the opportunities and earning potential they offer, but don’t ask the state to pick winners and losers between STEM and other educational pursuits. And don’t let the state tell us how many students need to complete four-year degrees, versus two-year degrees, versus simply graduating from high school. Those are decisions best left up to students and their parents.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

 

Read Blog Detail

Policy Picnic – November 18, 2015


Please join us for our monthly Policy Picnic led by Cascade Founder and Senior Policy Analyst Steve Buckstein


Topic: “Right to Work” Reaches the Supreme Court  

Description: The U.S. Supreme Court is set to hear the case Friedrichs v. California Teachers Association this fall. Will the Court side for teacher Rebecca Friedrichs, or for the powerful union that wants to collect dues against her will? If the Court rules for Rebecca, what does that mean for forced unionization across the country? Steve Buckstein will tell us.

“We’re asking that teachers be able to decide for ourselves, without fear or coercion, whether or not to join or fund a union. It’s that simple.”

–Rebecca Friedrichs

There is no charge for this event, but reservations are required as space is limited.  To reserve your free tickets, click here.

Admission is free. Please feel free to bring your own lunch.
Coffee and cookies will be served. 
 
Sponsored by:
Dumas Law Group
Read Blog Detail

Get Oregon out of the Liquor Business

There are still eighteen so-called “control states” in America that exert substantial control over the sale of liquor. Oregon is one of them, virtually monopolizing its warehousing, distribution, and sale through the Oregon Liquor Control Commission (OLCC). You would think that independent-minded Oregonians would have rebelled against such control by now. Next year, they might.

The grocery industry now plans to place a measure on the 2016 General Election ballot that would allow consumers to buy hard liquor in the same private grocery stores where they can already conveniently purchase beer and wine.

While there is likely to be a lively debate over the pros and cons of making it easier, and possibly cheaper, for adults to purchase the alcohol of their choice, this debate should be about more than how one type of consumer product is sold.

It should also be about the role of government in a free society. In that context, we should remember that government in America was instituted to protect our lives, liberty, and property. Oregon state government was not meant to provide our jobs through picking winners and losers in the marketplace, our entertainment through the Oregon Lottery, or our alcohol through the OLCC.

Next November we can hopefully do something about that last item—getting state government out of the liquor business.

 

Read Blog Detail

Assaulting “Corporate Profits” Will Hit Average Oregonians

A union-backed group is planning to put an initiative on Oregon’s 2016 General Election ballot that would result in the largest tax increase in Oregon history. Designed to tax sales of large corporations doing business in Oregon, Initiative Petition 28 may raise more than $5 billion every biennium, increasing Oregon’s General Fund budget by twenty-six percent.

Voters should realize that this proposal is not simply a way to capture revenue from big business. Actually, it’s a way to hide the fact that most of this new state revenue will come out of the pockets of average Oregon consumers and workers. That’s because neither large nor small corporations have a magic pot of money from which they can painlessly bestow more to government. All corporate money ultimately belongs to some individuals, and it is generated by selling goods and services to other individuals.

The tax measure in question basically will impose a 2.5 percent gross receipts tax on most corporate sales above $25 million in the state, on top of other business taxes. While that can be seen as just two-and-one-half cents on every dollar of sales, what percentage of corporate profits does 2.5 percent represent?

A 2013 national poll found that Americans believe the average company makes a 36% profit on sales after taxes. The actual median and mean profit margins of 212 industries nationwide are 6.5% and 7.5% respectively.

So, imposing a 2.5 percent tax on gross sales actually represents at least one-third of the average company’s profit margin. It’s closer to 80 percent of the profit margin of that big company some Portlanders love to hate—Walmart—which only earns about 3.1% on every dollar of sales.

Thinking that corporations will take such huge financial hits without passing most or all of them on to workers and consumers is a little like believing that shooting a loose cannon on a dark night will somehow hit the target.

Proponents of this huge tax increase know full-well that they won’t be blamed when consumer costs rise and workers see pay and/or benefits restricted. The tax will be hidden from them. They’ll blame those evil businesses that they think are gouging them, without looking into the real culprits.

If the proponents were honest, they’d propose taxing consumers or workers directly to raise the extra money they want to fill government coffers. But that wouldn’t poll well, so it’s not likely to happen.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

How Would You Spend $100 Million?

How would you spend $100 million? If you’re Mark Zuckerberg, founder of the most successful social network on the planet, you spend it trying to improve one of the most unsuccessful public school districts in America: the one in Newark, New Jersey.

In 2010 Zuckerberg donated $100 million to the Newark Public School System on condition that then-Mayor Corey Booker, a Democrat, and Governor Chris Christie, a Republican, directed how the money was spent. Booker was a school choice supporter, and Christie took on the powerful teachers unions.

Five years later, Zuckerberg’s money has apparently been spent on consultants and teacher compensation, with little to show in the way of better educational outcomes. A recent Wall Street Journal op-ed explained how this was just one more failed top-down reform attempt by private and non-profit donors working with government education systems.

Booker and Christie were unable to fundamentally change the top-down school system that put bureaucrats and unions, rather than parents, in control.

It’s amazing what lessons can be (re)learned when you spend $100 million dollars in ways guaranteed not to improve education. Hopefully, all of us will learn from this failure that you can’t reform the public school system just by giving it more money. Next time, give the money to the parents to spend on the schools and educational resources of their choice.

Read Blog Detail

TeachersPayTeachers Creates Learning Entrepreneurs

The debate over the sharing economy often revolves around the well-known players such as the room rental company Airbnb and the ridesharing company Uber. These firms have harnessed the liberating power of technology to unleash billions of dollars of so-called dead capital, while turning millions of people around the world into entrepreneurs, serving their fellow man and making a profit at the same time.

As the sharing revolution evolves and matures, it promises not only to improve the lives of countless individuals, but it may also help to revolutionize a critical part of our lives that for too long has been dominated by status quo lobbies such as teachers unions and the governments they influence—education.

Education is critical to human progress, but for too long it has largely been provided outside the market framework that makes everything better in our world.

Now, thanks to a small company called Teacher Synergy, Inc., and its online marketplace TeachersPayTeachers.com, educators are beginning to directly benefit from a free market in their intellectual property (IP). On the site they can buy and sell their own original lesson plans and related educational resources that up until now have benefitted their own students, but nobody else’s.

In the words of Jason Bedrick, a policy analyst at the Cato Institute’s Center for Educational Freedom:

“Words like ‘market’ and ‘competition’ or—worst of all—‘profit are considered dirty words in some circles, particularly in education. Perhaps that’s why some people prefer the more anodyne (if less accurate) term ‘sharing economy to describe how online platforms and apps are enabling people to monetize resources they own by connecting them directly with potential buyers.”

TeachersPayTeachers recognizes that not all teachers are the same. Some teachers are better than others at creating lesson plans that engage students and help them learn. So, for example, a teacher who is great at teaching math may not be so great at teaching geography. Why not let the good math teacher profit by selling his or her lesson plans to other teachers while she, perhaps, buys geography lesson plans from teachers who excel in that discipline?

Since its founding in 2006 by a New York City public school teacher, TeachersPayTeachers has allowed more than 10,000 teachers to earn $175 million from its 3.4 million active teacher members. Some teachers have earned over $100,000 selling lesson plans for just a few dollars apiece to thousands of their colleagues all over the nation, and even in other countries.

So, if teachers buying and selling lesson plans can benefit both teachers and students, who could be opposed? Well, just like existing taxicab monopolies opposed ride sharing firms like Uber for obvious reasons, those who currently control public school districts might feel threatened by teachers acting more like entrepreneurs and realizing the benefits of markets and capitalism.

Some districts claim that any intellectual property created by their teachers belongs to the district, even if created on the teachers’ own time. TeachersPayTeachers addresses this issue and concludes that teachers often do own their own IP in lesson plans. Even the nation’s largest teachers union, the National Education Association, has stated that “staff should own the copyright to the materials they create for use in the classroom.”

Jason Bedrick concludes that “[t]eachers tend to be less enthusiastic about market-based reforms to education, but perhaps some experience with the ‘sharing economy’ will show them how the best teachers stand to benefit greatly from Uber-ized education.”

While the best teachers will benefit greatly from Uber-ized education, other teachers can benefit also, and many students will benefit as their teachers have access to better teaching tools. Big picture, Uber-ized education can help create a diverse marketplace of educational options that will turn not only teachers, but students, into capitalist entrepreneurs. It can’t happen too soon.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

The Minimum Wage Conversation Never Ends

Oregon and some other states mandate that their minimum wage increase every year with the Consumer Price Index. Based on that formula, last Wednesday it was announced that Oregon’s minimum wage, the second highest in the country at $9.25 an hour, will stay unchanged in 2016.

That same evening during the Republican presidential debate, one candidate called for both a higher national minimum wage and for indexing it to inflation. He argued that this would mean “we never have to have this conversation again in the history of America.”

Well, if Oregon is any example, that’s not exactly true. Oregon began indexing its minimum wage in 2002. Yet, earlier this year, there were no fewer than twelve legislative bills introduced to raise the rate to as high as $15 per hour. Activists promised that if the legislature didn’t act, they would put a measure on the 2016 General Election ballot.

So clearly, putting minimum wage increases on autopilot won’t take this conversation off the table. Until legislators and voters understand that income cannot be generated by state mandate, minimum wage increases will continue to hurt the very workers they’re meant to help: the young, the less educated, and the less skilled. They are the ones who often can’t produce enough value for employers at higher wage rates to justify gaining or keeping a job.

Read Blog Detail

Most Teachers Oppose Mandatory Union Fees

A national education journal, EducationNext, has just released results of its annual poll asking a number of education-related questions. One question has particular relevance now because this happens to be National Employee Freedom Week, a nationwide campaign offering an unparalleled focus on the freedoms union employees have to opt out of union membership.

The EducationNext poll asked people in general, parents, and teachers, among other demographic groups, how they feel about mandatory union fees. Here is the exact question asked in the poll:

Some say that all teachers should have to contribute to the union because they all get the pay and benefits the union negotiates with the school board. Others say teachers should have the freedom to choose whether or not to pay the union. Do you support or oppose requiring all teachers to pay these fees even if they do not join the union?

Only 34 percent of the general public supports such mandatory union fees, while 43 percent oppose them.

Only 31 percent of parents support such fees, while 47 percent oppose them.

Most surprising of all, only 38 percent of public school teachers support mandatory union fees, while 50 percent oppose them. As a Reason.com “Hit & Run” blog post notes, “It’s not just non-unionized teachers who think this; unionized teachers made up almost half the sample, and only 52 percent of them said agency fees should be mandatory.”

One public school teacher who opposes mandatory fees could be instrumental in seeing them banned not only for all teachers, but for all public employees across America. California teacher Rebecca Friedrichs has filed a lawsuit against the California Teachers Association, arguing that mandatory fees violate her Constitutional First Amendment rights of free speech and free association. The U.S. Supreme Court recently agreed to hear her case, with a decision likely by next June.

While the Court ruled in 1988 that no one must join a union or pay the political portion of union dues, many workers are still required to pay so-called “fair share” non-political union fees for services such as collective bargaining. Now the Court will take up the argument that at least in the public employment setting, all union activities can legitimately be considered political.

Rebecca Friedrichs says, “It’s time to set aside this union name calling and all this fear mongering and let’s put America and her children first, and let’s put the rights of individuals above the rights of these powerful unions.”

It is clearly time to put individual rights above those of the powerful unions, and now we know that even most teachers agree.

Read Blog Detail

Put Individual Rights Above Those of Powerful Unions

By the time the U.S. Supreme Court rules in the Friedrichs v. California Teachers Association case next June, Rebecca Friedrichs may be the most well-known public school teacher in America—and the most controversial. She is asking the Court to uphold the Constitutional First Amendment free speech and free association rights of all California public school teachers, and by extension all public sector workers across America, against the demands of unions that now require even non-members to pay “agency fees” or “fair share dues.”

The Friedrichs case is just the latest to come before the Supreme Court pitting individual workers against the powerful unions that seek to take their money without their consent. In Abood v. Detroit Board of Education (1977), public sector unions were allowed to impose fees on all workers for collective bargaining purposes. Then, in Communication Workers of America v. Beck (1988), the Court found that unions could not compel fees for political purposes that workers opposed. Finally, just last year in Harris v. Quinn, the Court went further and ruled that at least some workers could opt out of both the political and bargaining portions of public sector union dues. This set the stage for freeing all public sector workers from any forced union dues, which is what the Friedrichs decision hopefully will accomplish.

In Oregon, there also may be a citizen’s initiative on the ballot next November granting freedom from all union dues for public employees. Public employees are the focus of this initiative, and the Friedrichs case, because it has become clear that all public sector union activities are political, including the inherently political act of collective bargaining with public bodies. Union arguments that they should collect fees from all workers because they represent them all increasingly ring hollow because unions lobby to represent everyone. They could just as well lobby to only represent those who voluntarily agree to pay them.

Several scientific surveys have been conducted to see how the public and members of union households feel about these issues. The 2013 survey found that more than 30 percent of Oregon union households would opt out of union membership if they could do so without penalty. Last year, more than 80 percent of all Oregonians surveyed agreed that employees should be able choose whether or not to join a union or pay union dues. This year’s survey again asked members of union households the following question:

“Are you aware that you can opt-out of union membership and of paying a portion of your union dues without losing your job or any other penalty?”

Surprisingly, over 27 percent of Oregon union household members surveyed answered No. This implies that over 65,000 of Oregon’s some 243,000 union members don’t realize that membership and some dues are optional. This is even more surprising given that their so-called “Beck rights” granted by the Supreme Court in 1988 are named after Harry Beck who is now retired in Oregon and still advocating for worker freedom.

These surveys were conducted for National Employee Freedom Week, which this year runs from August 16th through the 22nd.

Rebecca Friedrichs is taking her case to the Supreme Court because, in her own words, “It’s time to set aside this union name calling and all this fear mongering and let’s put America and her children first, and let’s put the rights of individuals above the rights of these powerful unions.”

“Put[ting] the rights of individuals above the rights of these powerful unions” is something every Oregonian should support.

Read Blog Detail

Portland Rideshare Drivers Praise “The Land of Opportunity”

Call it the smartphone/mobile app economy. Call it the Free World of Ridesharing. Call it the future. Whatever you call it, Uber, Lyft, and a host of smaller innovative companies are quickly transforming the century-long, highly government-regulated transportation market in Portland and around the world. And this is just a subset of a much broader technology-enabled transformation process that paints a vivid picture of what economist Joseph Schumpeter called the essential fact of capitalism: “creative destruction.”

By far the largest of the new ridesharing companies, Uber entered the Portland market uninvited in December 2014 and then stepped back to allow the city government time to revamp its antiquated taxi regulations. In April, the city enacted a four-month pilot program that basically let Uber and its smaller rival Lyft enter the Portland market and removed many regulations from the existing taxi companies.

Now, half-way through the pilot period, the City Council received an interim report on the program’s initial results and held a public hearing on July 15. Nearly 70 taxi and ridesharing drivers were given two minutes each to either praise their newfound opportunities to make a living, or bemoan the cuts in their incomes due to competition they felt was unfair.

While the interim report was full of statistics, it was the driver testimony that really personalized the issues before the Council. Time after time, rideshare drivers explained how upset their passengers had become with traditional taxi service, because of either long wait times or poor service.

Once seen as ridesharing’s staunchest opponent on the Council, Commissioner Steve Novick noted that he thought the report showed that “the experiment was working pretty well for consumers,” but that he wanted to hear more about the impact on drivers. He specifically asked drivers to say whether they preferred to be treated as employees subject to minimum wage law, workers compensation, and unemployment insurance—or do they prefer to be treated as independent contractors?

Novick’s question to drivers was in the context of a recent decision by the California Bureau of Labor that one specific Uber driver should be considered an employee even though ridesharing companies treat all their drivers as independent contractors who are able to set their own hours, use their own vehicles, etc. Uber has appealed the ruling, and has already prevailed in at least five other states in keeping its definition of drivers as independent contractors.

The way Novick phrased his question, it seemed he was hoping to hear many drivers testify that, sure, they would prefer all the guarantees and benefits afforded to employees over being independent contractors. Not one driver gave him that response. Time after time, rideshare drivers made obviously heartfelt statements about how thankful they were for the flexibility that being an independent contractor afforded them and their families.

Some drivers were caregivers for family members and so needed to be home when required. Others had been laid off elsewhere and appreciated the flexibility of driving while having time to seek other employment. Some had other jobs and used driving for Uber and/or Lyft as a way to generate extra income to pay their mortgages and other bills.

One woman told the Council how driving for Uber let her get off food stamps and become more independent. More than one noted that they had been entrepreneurs who had fallen on hard financial times and saw driving as simply one more entrepreneurial activity affording them much needed income.

One driver urged the Council to continue allowing ridesharing, noting that “this is the land of opportunity.” Another said, “I don’t work for Uber. I work for myself!” Still another noted, “We must all adapt to the world around us….Dinosaurs did not adapt!”

When one traditional taxi driver told Novick that he, too, preferred to be an independent contractor because of the flexible hours, the Commissioner told him that employees could be offered flexible hours also. Even with that information, the driver said he would be neutral as to his employee status. Not one driver at the hearing said they clearly preferred employee status over working for themselves as independent contractors.

There surely are individuals who prefer the benefits and safeguards afforded to formal employees. But obviously, many recognize and value the opportunities and the freedom of being independent contractors, now better enabled by smartphone technology. Let’s hope that Portland City Commissioners and Oregon’s Labor Commissioner all recognize these preferences and are willing to protect them. Otherwise, we risk going backward to the government-protected monopoly taxi industry that stopped working for many passengers long ago.

Read Blog Detail

Press Release – Oregon Right to Try Bill Unanimously Passes the House and Senate

July 6, 2015

FOR IMMEDIATE RELEASE

Media Contact:

Steve Buckstein

503-242-0900

steven@cascadepolicy.org

Oregon Right to Try Bill Unanimously Passes the House and Senate

PORTLAND, Ore. – Oregon’s Right to Try bill, HB 2300 B, passed 29-0 in the Senate and was re-passed with some restrictive amendments in the House by 60-0 last week. It now goes to Governor Kate Brown’s desk for her signature. The law will give some terminally ill Oregonians the Right to Try experimental drugs and devices not yet approved by the FDA.

Cascade Policy Institute founder Steve Buckstein noted, “The final bill is more restrictive than similar statutes in 21 other states (with its 18-year-old minimum age limit and its six-months to expected death definition of terminal illness), but it’s a good start and hopefully can be expanded in the future to cover children and people who have terminal illnesses such as ALS where patients may live for a number of years.”

Buckstein thanked House Health Care Committee Chair Mitch Greenlick (D), committee member and work group leader Knute Buehler, MD (R), and Senate Health Care Committee Chair Laurie Monnes Anderson (D) for all their hard work on the bill. He noted that these three legislators started working on this legislation before the session even started, and stuck with it all the way to final unanimous passage in both houses.

Buckstein also thanked the Goldwater Institute of Arizona for pioneering the Right to Try concept around the country and for its help in Oregon. He also thanked Diego Morris, the Arizona teenager who had to move to London for treatment approved in Europe but not in the United States when he contracted terminal osteo sarcoma at age eleven. The treatment was successful and Diego is now cancer free. Diego and his mother Paulina visited the Oregon Capitol in February to make their case for allowing terminally ill Oregonians the right to try experimental drugs. When asked by a reporter what he would say to critics of the Oregon Right to Try bill, he looked up at her and said, “Wait until they find themselves in my situation, and then ask them.”

Buckstein concluded, “This truly bipartisan effort resulted in a bill that could literally mean the difference between life and death for some terminally ill Oregonians. I’m proud of the work Cascade Policy Institute did to promote the Right to Try concept and bill in Oregon, and look forward to Governor Brown signing the bill so it can take effect at the beginning of 2016.”

Cascade Policy Institute is a nonprofit, nonpartisan public policy research and educational organization that focuses on state and local issues in Oregon. Cascade’s mission is to develop and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity.

###

Read Blog Detail

The Crisis of Common Sense

I’ve taken two tours of Independence Hall in Philadelphia. Though it was full of vivid history about the signers of the Declaration, it was nearly silent about one relatively unsung hero of the American Revolution. Thomas Jefferson wrote the Declaration of Independence, but it was his friend Thomas Paine who stirred the new nation to action.

Most literate Americans read Paine’s pamphlet, Common Sense, in the months before our country declared its independence from his native England on July 4, 1776. Later that year after the war for independence started, Paine published The Crisis, which began, “These are the times that try men’s souls. The summer soldier and the sunshine patriot will, in this crisis, shrink from the service of their country, but he that stands now, deserves the love and thanks of man and woman.”

In Common Sense, Paine wrote, “Society in every state is a blessing, but government, even in its best state, is but a necessary evil; in its worst state, an intolerable one.” He argued for free trade and individual liberty with phrases that captured the imagination of his adopted countrymen.

Paine and Jefferson realized that government and society are not synonymous. They argued that government’s purpose is to protect the inalienable rights of the individuals that make up society. They understood that any right granted by government must be paid for by diminishing someone else’s right to life, liberty, or property. What would they think of today’s politicians in Washington, D.C. and Salem, Oregon who propose law after law ordaining right after right?

In the introduction to Common Sense, Paine wrote, “[A] long habit of not thinking a thing wrong, gives it a superficial appearance of being right, and raises at first a formidable outcry in defence of custom. But the tumult soon subsides. Time makes more converts than reason.”

Paine and Jefferson didn’t wait for time to convert people. We at Cascade Policy Institute aren’t waiting either; we’re providing the Intellectual Ammunition today’s freedom fighters need to win new battles for liberty.

Many Americans believe modern society requires more government control; we believe just the opposite. Free individuals are perfectly able to run their own lives today, just as they were in 1776. Paine and Jefferson would be dismayed at the size of modern governments, and so are we.

Read Common Sense and The Crisis this Independence Day, remember what the holiday is really all about, and do what you can to reinvigorate the ideals Jefferson and Paine proclaimed.

(This Cascade Commentary is adapted from Steve Buckstein’s President’s Corner column in the Summer 2001 Cascade Update newsletter.)

 

Read Blog Detail

Press Release – Statement on the Supreme Court’s King v. Burwell Decision

June 25, 2015

FOR IMMEDIATE RELEASE

Media Contact:

Steve Buckstein

503-242-0900

steven@cascadepolicy.org

Cascade Policy Institute Statement on Today’s Supreme Court King v. Burwell Decision: More Oregonians will lose rather than win

PORTLAND, Ore. – The U.S. Supreme Court decision today in the King v. Burwell case is a sad reminder that the President of the United States and his Administration can arbitrarily interpret laws passed by Congress to suit their own purposes.

In this case, the Affordable Care Act clearly states multiple times in its text that federal subsidies to offset insurance premiums can only be granted to individuals purchasing policies through an exchange “established by the state.” When most states failed to establish such exchanges, the IRS arbitrarily decided to grant subsidies to individuals who purchased insurance through the federal exchange, healthcare.gov, as well. By a six to three vote, the Court told us that the President and his Administration need not follow the language of the law because in the Court’s opinion that could cause harm to the intent of the law which was to make insurance more affordable.

How this decision will affect Oregon is fairly clear. Oregon originally set up its own state-established exchange, Cover Oregon. But when that $305 million project failed to sign up one person for insurance on its flawed website, the Cover Oregon board voted to scrap the exchange and migrate Oregonians over to the federal exchange, healthcare.gov. Board members didn’t seem to care how this decision might impact subsidies for Oregonians, and after the fact said they were relying on federal assurances that they considered this arrangement a “supported state based marketplace”—meaning that it would still qualify for subsidies even if the Court were to rule opposite of how it ruled today.

What is clear now is that today’s decision could actually harm more Americans, and more Oregonians, than it helps. According to a March 3rd press release by Michael Cannon of the Cato Institute and Cascade Policy Institute’s Steve Buckstein, “If subsides are denied under a King ruling, Oregon will join the majority of states in reaping benefits.” Now that the King ruling has found for the government, the Cato Institute believes that “approximately 157,000 [Oregon] individuals likely will continue to be subject to the law’s individual mandate requirement,” and 890,000 working Oregonians “also will continue to be subject to the employer mandates that are putting downward pressure on our economy.” These negative results stem from the ACA’s provisions that as long as subsidies make insurance somehow “affordable,” then the act’s mandates to purchase it remain in place.

Cascade Senior Policy Analyst Steve Buckstein says, “Today’s Court decision does not end the discussion about who should control your health care and who should decide what, if any, insurance you must purchase at what price; but it does push that discussion farther into the future. It unfortunately postpones our ability to move toward a more individual, patient-centered health care and health insurance world. Oregonians who watched their state government bungle an expansive insurance exchange project using other people’s money should be a big part of this discussion.”

Read Blog Detail

Minimum Wage Follies

Fourteen bills have been introduced in the Oregon legislature to raise Oregon’s already high minimum wage or let localities do so. Apparently, some legislators believe that political laws can override the laws of economics.

In this case, the law of supply and demand tells us that raising the price of labor will lead employers to demand less of it. Those hurt will likely be less skilled, younger, and less educated workers who will find it harder to find jobs or will be let go from jobs they did have at lower wages.

Not exactly the outcome proponents foretell, but they may be OK with it because those harmed by their policy aren’t likely to blame them. They’re more likely to blame the employers who let them go or don’t hire them in the first place.

Proponents know that they have little to lose and much to gain politically by telling workers that they deserve to be paid more, and that it’s only greedy business owners standing between them and the higher wages they desire.

If legislators don’t commit the folly of increasing the minimum wage this year, a union backed group has filed an initiative to raise it from the current $9.25 up to $15 per hour. That will give voters the opportunity next year to commit the folly themselves.

Read Blog Detail

Don’t Steal the Kicker

Would you like to pay $284 less in Oregon personal income tax next year? That’s what the average taxpayer may save if Oregon’s constitutional kicker law is allowed to take effect.

The kicker law requires that if actual state revenue for a biennium exceeds the official economic forecast by two percent or more, the entire surplus is returned to those taxpayers who earned it. It now appears that the state will collect $473 million more than projected and thus have to give all that money back to taxpayers, in the form of a 6.7% credit on their tax bill.

Well, not if State Representative Tobias Read of Beaverton has anything to say about it. He’s introduced House Bill 3555 that would suspend the kicker and send all that money to schools and the state’s rainy day fund. The bill requires a two-thirds super majority vote in both houses of the legislature, something that hopefully will be very hard to do.

Read says that his bill “gives us an opportunity to invest in the things that reflect our values as Oregonians….” Apparently, “our values” don’t include things like carrying out the intent of the voters when they put the kicker in the Oregon Constitution. “Our values” apparently also don’t include letting people keep as much of their own money as possible to spend on the things that they think will benefit their own families.

Read Blog Detail

June 1st Public Debate: Do Citizens in a Free Society Have a Right to Privacy in Charitable Giving?

Do you donate to any nonprofit organizations such as charities, churches, or think tanks? Would you rather not be subject to possible retribution for supporting what others might think are the “wrong ideas”? Then you won’t want to miss a free public debate on donor privacy the evening of Monday, June 1 in Portland.

As debates on controversial topics such as global warming and gay marriage heat up, there are calls to make organizations espousing views on such issues reveal not only the names of their donors, but their addresses, occupations, and employers, just like political candidate committees must do.

Such disclosures could deter some people from donating at all, thus stifling the free exchange of ideas that helps make our society strong.

Arguing in favor of donor privacy will be James Huffman, Dean Emeritus of Lewis & Clark Law School. Jim was the 2010 Oregon Republican candidate for the U.S. Senate.

Arguing for donor disclosure will be Dan Meek, a public interest attorney in Portland. Dan is Co-chair of the Independent Party of Oregon.

The debate will be moderated by Willamette Week’s Pulitzer Prize winning investigative journalist Nigel Jaquiss.

Join us the evening of June 1 in Portland for this public debate asking whether citizens in a free society have a right to privacy in charitable giving.

Full details and free tickets are available at CascadePolicy.org.

Read Blog Detail

A Generational Mistake

The Oregon Supreme Court last week struck down key 2013 legislative reforms to the Oregon Public Employee Retirement System (PERS) that would have saved taxpayers billions of dollars.

The Court in effect added some $5 billion back to the unfunded liability of the PERS system, which will now stand at over $14 billion. If not offset by new taxes or spending reductions elsewhere, public bodies such as school districts and state agencies will have to allocate even more of their budgets to pay for worker retirement benefits.

Before most Oregonians understood that the state retirement system was headed for trouble, Cascade Policy Institute published a 2001 report which concluded that “PERS is almost guaranteed to fall into steep unfunded liabilities over and over again because of its design.”

This conclusion was seconded last week when EcoNorthwest economist John Tapogna noted that “Oregon made a generational mistake in public policy, and the Supreme Court has essentially ruled that we have to live with it.” He noted, “That puts Oregon in a challenging economic position for the next couple of decades.”

The best way to keep such generational mistakes from happening again is to limit the size and scope of government so that future politicians have less control over our lives. Let’s make the $14 billion PERS generational mistake our last.

Read Blog Detail

Government-Imposed Minimum Wage Increases Don’t Work for Oregon Small Businesses

The concept that everyone should earn at least some government-mandated minimum wage is politically very appealing. It’s almost the classic example of taking from the few and giving to the many. “The few” in this case are portrayed as rich businessmen who could never spend all the money they have, so what’s wrong with making them pay their workers a little more? Now, proponents of raising Oregon’s minimum wage are trying to convince us that somehow such policy is actually good for small business owners.

A recent report from the Oregon Center for Public Policy claims that a higher minimum wage works for small businesses by giving them “more of what they need most: customers with money.”

In reality, raising the minimum wage would only benefit small businesses if owners didn’t mind depleting their own savings or investment funds in order to support higher labor costs. Otherwise, they would have little choice but to raise prices, which would harm all their customers, especially those on the lower rungs of the economic ladder.

And, because minimum wage laws actually cut off those lower rungs on the economic ladder, younger, less educated, and less experienced workers will be even less likely to get or keep the very jobs they need to be customers in the first place. They may spend their unemployment checks, but those checks won’t go as far once prices are raised to cover the higher labor costs that a boost in the minimum wage imposes.

The argument that a higher minimum wage pumps more money into the economy assumes that the resulting pay increases are somehow “new money.” In reality, much if not all of that “new money” will be offset by a corresponding loss of savings or investment funds that otherwise would contribute to more economic growth and hiring more workers.

Just because low-wage workers are likely to quickly spend any wage increases doesn’t mean that on balance that’s good for small business. Taken to its logical conclusion, that would mean small business owners, and everyone else, should never save and invest for the future, but immediately spend every dollar they earn also. If this behavior really benefitted the economy, why are we seemingly so concerned about the dismal rate of saving and investing for retirement among Oregonians? Couldn’t small businesses benefit even more by encouraging everyone to spend all their income right now?

Another set of arguments for raising the minimum wage include the assumptions that higher wages “motivate employees to work harder;” “attract more capable and productive workers;” “lead to lower turnover, reducing the cost of hiring and training new workers;” and “enhance quality and customer service.”

While higher wages may lead to the benefits stated above, if business owners believe that is the case then they should be willing and eager to raise wages whenever possible. The fact that minimum wage proponents want to force business owners to reap these benefits weakens their case.

Finally, there is a real irony in the campaign to boost Oregon’s minimum wage. Minimum wage laws conspicuously leave out a class of individuals who don’t get a paycheck from someone else, but hopefully get one from themselves. Self-employed people, small business owners, and entrepreneurs trade a steady paycheck for the opportunity to be their own boss. They often risk everything―their homes, their savings, all their assets―to build a business that might someday earn them a much higher paycheck than they could ever earn working for someone else.

But, while building a business, many entrepreneurs actually earn less than the minimum wage. They may actually have negative earnings, dipping into savings or borrowing money to keep their doors open and pay their employees. And yet, if these risk-takers hire anyone to help them make their dreams come true, government says they must pay those workers at least $9.25 per hour in Oregon today, and perhaps as much as $15 per hour in the near future.

So, while business owners are free to do a lot of things, and take a lot of risks, one thing they cannot do is hire anybody for less than the minimum wage, even if they are earning less than that themselves. Of course, this may not be a winning argument politically.

It’s easier to demonize supposedly “rich” business owners than to tell workers and job seekers the uncomfortable truth that to be employed in a successful business they must produce as much or more value than they wish to be paid.

Proponents of raising the government-mandated minimum wage know that they have little to lose and much to gain politically by telling young, less educated, and less skilled workers that they deserve to be paid more, and it’s only greedy business owners standing between them and the higher wages they desire.

Let’s just hope that if another bump in Oregon’s minimum wage results in some workers losing their jobs and others not getting hired in the first place that they place the blame for their troubles where it belongs―not on employers, but on those who promised them higher wages but couldn’t deliver because economic reality stood in the way.

Read Blog Detail

Oregon Children Deserve the Right to Try

Oregon hopefully will join twelve states that have enacted Right to Try legislation, allowing terminally ill patients to try experimental drugs not yet approved by the FDA.

In several states, the face of Right to Try efforts was a child. Fourteen-year-old Diego Morris was honorary chairman of the Arizona campaign that saw 78 percent of voters approve Right to Try last November. Diagnosed with a deadly form of bone cancer when he was eleven, Diego and his family had to move to London for treatment with a drug approved there, but not in the United States. Now cancer free, Diego visited the Oregon Capitol in February to meet with legislators. When asked what he would say to opponents of Right to Try, Diego answered, “Wait until they find themselves in my situation, and then ask them.”

Five-year-old Jordan McLinn handed the pen to Indiana Governor Mike Pence when he signed that state’s Right to Try law last week. Jordan has Duchenne Muscular Dystrophy, a terminal illness that without experimental treatment may kill him before he turns 20.

No doubt some Oregon children could benefit from the Right to Try. House Bill 2300 would give adults that right, but not children under age 15. Those who favor Right to Try might let their state legislators know that faced with a terminal illness, children should have the same Right to Try as adults do.

Read Blog Detail

Oregon Seniors Deserve Truth in Medicare Reform

By Steve Buckstein and Patrick M. Gleason

If Congress doesn’t act by the end of this month, when payment cuts to Medicare providers are scheduled to hit, there will be a major health care crisis. Topping the to-do list is addressing urgent problems with Medicare, the most costly federal program and the largest driver of national debt. Failure to act would have harsh ramifications for seniors and caregivers in Oregon.

The first step is to address accounting gimmicks that hide Medicare’s true cost and its effect on federal debt in the years ahead. The program operates under a phony spending baseline that conceals its true cost.

How did this come about? In 1997, Congress instituted a new spending formula, the Sustainable Growth Rate (SGR). It would institute physician reimbursement rate cuts in order to ensure that Medicare spending did not exceed the rate of economic growth. Noble goal, except that’s not what happened.

In 2003, the first time Medicare cuts were scheduled to take place under SGR, lawmakers balked and delayed the scheduled reduction in physician payments. In the 11 years since, Congress has delayed these scheduled payment cuts a whopping 17 times. This maneuver is referred to as the “doc fix.”

The Congressional Budget Office is forced to operate under the assumption that Congress will comply with SGR, even though the last 11 years have shown that to be pure fantasy. CBO treats passage of a doc fix as a spending increase. But it’s not, in reality, because Congress always passes a temporary reprieve. The worst kept secret on Capitol Hill is that Congress will always, just in the nick of time, pass a doc fix to prevent these payment reductions.

Underscoring this fact, for the first time ever, even Medicare’s own actuaries admitted last year that scheduled SGR payment cuts never would occur. The solution is to end this game, start being honest with ourselves, pass a permanent doc fix, and move on to reforms necessary to ensure the nation’s fiscal health and Medicare’s sustainability.

For Oregon, failure to pass a permanent doc fix would reduce seniors’ access to care. Oregon has 16 practicing physicians per 1,000 Medicare beneficiaries, which is below the national average. If Congress does not act, the result will be a 24 percent across-the-board pay cut for caregivers treating Medicare patients. With 46 percent of Oregon’s physicians over the age of 50, the age at which surveys show many physicians begin to consider cutting back on patient care, scheduled provider cuts would only exacerbate Oregon’s problems with access to care.

A temporary doc fix breeds corruption and legislative chicanery, producing a gold mine for lobbyists and political fundraisers. Worse, the constant need to pass an emergency, temporary doc fix distracts from much-needed Medicare reforms. If Congress continues to ignore the unsustainable trajectory of Medicare spending, the result will be harm to seniors and a federal budget drowning in red ink.

Fixing what’s wrong with Medicare is the top health and budgetary issue facing the country. As former Congressional Budget Director Doug Holtz-Eakin warns, “By 2020, as Baby Boomers continue to age into Medicare at the rate of more than 10,000 a day, Medicare’s cumulative $6.2 trillion in cash flow deficits will constitute 35 percent of the nation’s total debt accumulation.”

It’s time for members of Congress to stop kicking this can down the road, institute truth in accounting by passing a permanent doc fix, roll up their collective sleeves, and get to work on the real reforms that will save Medicare and put the nation on a sound fiscal path.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization. Patrick Gleason is director of state affairs at Americans for Tax Reform in Washington, D.C. The Bend Bulletin newspaper op-ed version of this commentary was originally published on March 25, 2015 here: www.bendbulletin.com/opinion/3004859-151/letter-oregonians-deserve-medicare-reform.

Read Blog Detail

Human Achievement Hour 2015

This Saturday you’ll have the opportunity to vote with your light switches. Either turn your lights off from 8:30 pm to 9:30 pm local time to “show your commitment to climate change action now” or turn your lights on to celebrate “human progress and our advancements in various fields of industry, including technology, medical, energy, and more.”

Turning your lights off makes you part of Earth Hour, a project of the World Wide Fund for Nature (WWF). Turning them on makes you a part of Human Achievement Hour 2015, a project of the Competitive Enterprise Institute (CEI).

Since this isn’t a secret ballot, I’ll tell you that I’m voting for Human Achievement. As CEI notes, “Earth Hour does little to protect the environment” and “completely ignores how modern technology allows societies around the world to develop new and more sustainable practices that help humans be more eco-friendly and better conserve our natural resources.”

You don’t have to wait until Saturday to see what a large-scale expression of the “dark ages” versus human achievement looks like. Just check out any NASA nighttime photo of North and South Korea from space: “North Korea is almost completely dark compared to neighboring South Korea….The darkened land appears as if it were a patch of water joining the Yellow Sea to the Sea of Japan.”

North Koreans may simply be celebrating Earth Hour every hour of every day, but somehow I doubt it.

Read Blog Detail

Mandating Common Core, High-Stakes Testing Drives Oregon Further into the "Bureaucratic Trap of Good Intentions"

The Oregon Department of Education currently requires Oregon school districts to align instruction and assessments with the Common Core State Standards. A bill now before the state legislature, HB 2835, would end this requirement, possibly helping to end the latest chapter in nearly forty years of national education reform failures and what I call Oregon’s decline into our own “bigger is better” top-down education reform trap.

I saw this decline begin here in 1991 when the legislature overwhelmingly enacted the Education Act for the Twenty-First Century. It was full of new committees, new high school CIM and CAM tests (which were eventually abandoned), and a promise from the legislature that it would produce “the best educated citizens in the nation by the year 2000.” So, how did that work out?

In 1999 the legislature created the Quality Education Commission, which led to adoption of the Quality Education Model. The Model proposed entirely theoretical prototype elementary, middle, and high schools that, again theoretically and with enough funding, would get 90% of our kids to state standards.

When these last two big reforms didn’t work, Governor John Kitzhaber proposed and the legislature created the Oregon Education Investment Board (OEIB) in 2011 with the goal of unifying everything from early childhood through graduate school education. Of course, that goal can’t be accomplished without pushing power and control even farther away from the people who should matter most in education—parents, students, and teachers. This accelerated our decline into the “bigger is better” trap.

Why haven’t such revolutionary reform efforts in our K-12 education system achieved their goals? Because, according to the late John T. Wenders, Ph.D., they…

“…suck power upward and away from parents and students into top down, centralized and inflexible political arrangements, where unions and other special interests have more political clout. This causes accountability to decline and results in higher per pupil costs and lower educational results.”

I’m sure that now-former Governor Kitzhaber and the people he appointed to the OEIB are very smart. But no such group can hope to design a system that meets the needs of all Oregon children and their parents. Mandating Common Core State Standards and their accompanying high-stakes Smarter Balanced tests simply moves us even further down into the “bigger is better” education reform trap.

Yong Zhao, Ph.D. is the Presidential Chair and Director of the Institute for Global and Online Education in the University of Oregon’s College of Education. He gave an entertaining and provocative presentation to the Senate Education Committee on February 10, 2015 in which he set out some compelling reasons for us to reject both Common Core and high-stakes testing.

One of Dr. Zhao’s examples is very relevant when considering the benefits of passing HB 2835. He told the Committee that imposing any “common” educational requirements promotes conformity in our children, when we should be helping them foster their own creativity, diversity, and entrepreneurial inclinations.

He noted that when he was a child in his Chinese village, the Common Core was knowing how to ride a water buffalo. The most important and valued jobs in that time and place revolved around agriculture. He couldn’t drive a water buffalo very well, so as he put it, they encouraged him to leave and go to Oregon.

In a 1991 Wall Street Journal column, “Education by Committee in Oregon,” Cascade Policy Institute Academic Advisor, former public elementary school teacher, and assistant professor of education Richard Meinhard, Ph.D. explained why the “revolutionary” Oregon Education Act for the Twenty-First Century was no such thing:

“…[T]o be ‘revolutionary,’ educational change must be systemic. It must reform the system, not just add to it. Oregon’s educational reformers are unwittingly legitimizing the very system that needs reform. Well-meaning politicians have once again increased state control over education in order to mandate desirable goals. The Oregon plan provides the nation with an important lesson in reform: how easy it is to fall into the bureaucratic trap of good intentions.”

This 1991 critique could just as easily be said about the current “revolutionary” reforms of Common Core and Smarter Balanced high-stakes testing. It’s time to stop increasing state control over education and start moving accountability and control down toward parents, students, and teachers.

We can start crawling out of Oregon’s “bigger is better” trap by prohibiting the Department of Education from imposing any standardized curriculum and testing regime on school districts. This can start by approving HB 2835.

Read Blog Detail

Should Compulsory Schooling Start at Age Five?

Every state in the union has what are known as compulsory school attendance laws. Oregon currently requires that virtually every child attend school from age seven to age 18. A bill before the State Senate, SB 321, would decrease the compulsory school age from seven down to five.

Before deciding whether this is a good idea, it may be time to reconsider why we compel parents to send their children to school at all. We might ask ourselves some hard questions, including:

  • How does compulsion further our interest in encouraging a passion for learning in our children?
  • In a free society, shouldn’t we be looking for ways to reduce compulsion, rather than to increase it?
  • If compelling seven-to-18-year-olds to attend school isn’t working very well, why compel five- and six-year-olds to attend also?”

Some of the written testimony from professional educators in favor of SB 321 assumes that the bill would reduce the “compulsory education” age. But we can’t really compel students to learn, so is the next best thing compelling them to sit in classroom seats?

Schooling may facilitate good education, but they are not always the same thing. As Harvard Professor Lant Pritchett says, “Good governments do schooling, but nearly all bad governments do it, too.” He is talking here about different national governments since his field is global development, but the thought applies to our state and local governments as well.

Pritchett goes on to say, “We know that if you impose a top-down educational system, often it breaks down—you get a bureaucracy that doesn’t work, and the outcomes get worse than if you allow local control.” If this is true in Oregon, then former Governor John Kitzhaber’s flawed Oregon Education Investment Board approach may be doing more harm than good.

More and more Oregon parents and teachers are standing up to oppose top-down approaches such as new high-stakes tests designed to measure how well public schools are teaching the controversial Common Core Standards.

The so-called Smarter-Balanced tests are on track to be given to students in grades three through eight and high school juniors to measure how well they’ve mastered reading, math, writing, listening, research, and thinking. Official estimates are that over 60 percent of students may fail the tests this spring.

Dr. Yong Zhao, Director of Global and Online Education at University of Oregon, is a critic of both high-stakes testing and the Common Core Standards themselves. He gave an entertaining 51-minute presentation to the Senate Education Committee on February 10.

While Dr. Zhao doesn’t have a formal position on whether Oregon’s compulsory school age should be lowered, he does make the points that we shouldn’t make kids ready for Kindergarten; we should make Kindergarten ready for kids, and creative kids aren’t Kindergarten-ready because they don’t conform. Lowering the compulsory school age to five may put more kids in Kindergarten seats, but it will do nothing to make Kindergarten ready to meet their individual needs.

Dr. Zhao’s presentation stood in stark contrast to that of Oregon “education czar” Nancy Golden who spoke before him at the hearing, and that of Deputy Superintendent of Public Instruction Rob Saxton who spoke after him. It should be noted that Golden and Saxton were handpicked by Governor Kitzhaber to help promote his top-down, birth-through-graduate school vision for education in Oregon.

Questioning the value of compulsory schooling is nothing new. Here is what a past president of the American Psychological Association, Knight Dunlap, said in his 1929 article, Is Compulsory Education Justified?:

“…education is a good thing for us, and so we wish to bestow its blessings on others. If they will not take it gladly, we will make them take it: for their own good…”

So, before we agree to reduce Oregon’s compulsory school age from seven down to five, let’s ask the hard questions about what our compulsory schooling system is really doing for, and to, the children it captures now.

Read Blog Detail

The Man Who Could Bring Down ObamaCare

Would you like to meet the man the media says could bring down ObamaCare? You’ll have that opportunity on Thursday evening, February 26, when Michael Cannon of the Cato Institute speaks in Portland.

Cannon is an architect of the legal strategy that could force the Obama Administration to follow the letter of its own Affordable Care Act and stop subsidizing insurance unless it is purchased through a state-established exchange. Cover Oregon was established by the state, but its website was so flawed that it couldn’t sign up a single person.

If Oregonians lose their subsidies because Cover Oregon failed, they will quickly find out just how unaffordable the Affordable Care Act really is.

To make this even more interesting, on the day Governor Kitzhaber resigned, the U.S. House Oversight Committee sent him a letter telling him not to destroy any documents that might shed light on the Cover Oregon fiasco.

And the U.S. Supreme Court will hear oral arguments in the case orchestrated by Michael Cannon on March 4.

Don’t miss your chance to meet The Man Who Could Bring Down ObamaCare on Thursday evening, February 26, in Portland.

For details and to RSVP, call Cascade Policy Institute at 503-242-0900, or visit cascadepolicy.org.

Read Blog Detail

Right to Try Is Right for Oregon: Let terminally ill patients try to save their own lives

If you or someone in your family had a terminal illness, would you want the right to try an experimental drug that might save a life? That’s what eleven-year-old Diego Morris of Phoenix wanted when he was diagnosed with a rare, deadly form of cancer. Traditional treatment didn’t work; and after an exhaustive search, his family found a “miracle drug” that was approved in much of the world but not in the United States. So, the whole family moved to England where Diego was successfully treated. Now back in Phoenix, Diego has been cancer-free for two years.

Now thirteen years old, Diego Morris was the Honorary Chairman of the campaign that saw 78 percent of Arizona voters approve a Right to Try referendum last November. It will give terminally ill patients the right to try to save their lives by allowing access to investigational medicines that have not yet been approved by the U.S. Food and Drug Administration (FDA). Diego supported the measure because he said “…hope was the most important thing to him and giving hope to others is what he thinks the right to try law will do.”

Oregon legislators are now being asked to approve Right to Try legislation here. HB 2300 in the House Health Care Committee would not compel physicians or drug companies to provide any treatment; it would simply allow terminally ill patients the right to try to get access to drugs or devices not yet approved by the FDA.

In addition to Arizona, Right to Try laws have been enacted overwhelmingly within the last year by legislatures in Colorado, Louisiana, Missouri, and Michigan. Legislatures in more than twenty states are now being asked to give their citizens this important right.

Designed by the Goldwater Institute in Arizona, the Right to Try concept addresses a growing dissatisfaction with the slow process of approving life-saving medications in America. Creating, developing, testing, and getting government approval to market a new drug here can take upwards of ten years and cost more than one billion dollars. While this process may keep unsafe or ineffective drugs off the market, it may also keep effective drugs away from critically ill patients for so long that they literally die waiting.

Only about three percent of the sickest Americans qualify for or have access to FDA-approved clinical drug trials, and even those who enter such trials cannot be sure whether they are receiving a potentially useful drug or a placebo. Some medical researchers worry that granting terminally ill patients the right to try investigational medicines may make it harder to recruit people for randomized controlled trials. However, more and more people now recognize that an individual’s right to try to save their own life should trump the need that researchers might have to control how those drugs are tested.

As Goldwater Institute president Darcy Olsen says, “Terminal patients shouldn’t have to ask the government for permission to try to save their own lives.”

While the FDA does allows people to request access to medicines that have not yet been approved, the process can require 100 hours of paperwork and months to complete, with no assurance that access will be granted. Currently, fewer than 1,000 individuals get such approval annually. Right to Try offers a better way.

Some legal scholars worry that the federal government will challenge state Right to Try laws under the Supremacy Clause of the U.S. Constitution, which says that when federal and state laws conflict it is federal law that should take precedence. While this is often the case, Oregon is in the forefront of what could be a very relevant exception.

Oregon voters twice approved the state’s controversial Death With Dignity Act, in 1994 and again in 1997. The law allows “terminally-ill Oregonians to end their lives through the voluntary self-administration of lethal medications, expressly prescribed by a physician for that purpose.” The medications, however, are deemed controlled substances by the FDA and not federally approved for such a purpose.

The U.S. Attorney General argued that because federal law prohibited controlled substances from being used to intentionally end life, the Courts should strike down the Oregon law. The U.S. Supreme Court disagreed. In Gonzales v. Oregon (2006), the Court upheld Oregon’s law. It found that states generally have wide discretion in regulating health and safety, including medical standards. Finding that the Bush Administration’s reading of the federal statute would mark “a radical shift of authority from the States to the Federal Government to define general standards of medical practice in every locality,” the Court ruled that Oregon could protect the rights of its citizens, at least in this specific instance.

If Oregon can protect the right of its citizens to end their own lives with controlled substances, it should be able to protect the right of its citizens to try to save their own lives with substances not yet approved by the federal government.

As thirteen-year-old cancer survivor Diego Morris believes, Right to Try can offer hope to people facing life-ending situations when federal law offers no hope. It’s a policy whose time has come, and Oregonians deserve.

Right to Try is right for Oregon.

Read Blog Detail

“Don’t Say You Represent the Students”

Republican politicians may no longer be the loudest critics of teachers unions. Influential Democrats are now speaking up also, such as New York Governor Andrew Cuomo. Here’s what he said in a recent interview:

“If (the public) understood what was happening with education to their children, there would be an outrage in this city,” Cuomo said. “I’m telling you, they would take City Hall down brick by brick.

“It’s only because it’s complicated that people don’t get it.”

Cuomo said the teachers union is “more interested in protecting the rights of its members than improving the system for the kids it is supposed to be serving.”

“Somewhere along the way, I believe we flipped the purpose of this,” Cuomo said. “This was never a teacher employment program and this was never an industry to hire superintendents and teachers.

“This was a program to educate kids….”

Responding to a union member who said he represents the students:

“No, you don’t,” Cuomo said he told the person. “You represent the teachers. Teacher salaries, teacher pensions, teacher tenure, teacher vacation rights. I respect that. But don’t say you represent the students.”

If the liberal Democrat Governor of New York can say such things, shouldn’t Oregon’s Governor do the same? After all, he’s the same Governor who signed Oregon’s 1999 charter school bill into law against the objections of―guess who? The teachers union.

Read Blog Detail

Education Savings Accounts Should Be in Oregon’s School Choice Future

School choice is widespread in America, including in Oregon—unless you are poor. Affluent families have choice because they can move to different neighborhoods or communities, send their children to private schools, or supplement schooling with tutors, online courses, and enrichment programs. Lower- and middle-income families, meanwhile, too often are trapped with one option: a school in need of improvement assigned to them based on their zip code.

Some states such as Arizona, Wisconsin, and Florida have made significant progress toward providing more Kindergarten through 12th grade options for many children. Public charter schools (including online charters) and private school attendance made possible by state funded vouchers or tax credits are increasing families’ opportunities to find the right fit for their children. But these options are constantly under attack by those who represent the status quo: those who want the public school system to stay just the way it is, so it continues to provide virtually guaranteed jobs and benefits for certain teachers and administrators―regardless of the results achieved by the children they are supposed to serve.

Nobel Prize winning economist Milton Friedman first popularized the school choice voucher concept in his 1962 book, Capitalism and Freedom. Now, a new concept is capturing the imaginations of a new generation of parents and policy makers: Education Savings Accounts (ESAs). Going beyond the voucher or tax credit idea for school choice, ESAs introduce market concepts that help parents become active shoppers for educational services, thus improving their quality while reducing costs.

As Matthew Ladner, Ph.D. wrote in a major study for the Friedman Foundation for Educational Choice:

Education savings accounts are the way of the future. Under such accounts—managed by parents with state supervision to ensure accountability—parents can use their children’s education funding to choose among public and private schools, online education programs, certified private tutors, community colleges, and even universities. Education savings accounts bring Milton Friedman’s original school voucher idea into the 21st century.

ESAs differ from state-funded vouchers. Typically, parents can redeem vouchers only at state-approved public and private schools. In contrast, ESAs allow parents to choose among public schools, private schools, private tutors, community colleges, online education programs, and universities. In addition, ESAs allow parents to put unused funds into college savings plans, thus changing the “use it or lose it” mentality in the current public school funding system. ESAs promote user-based subsidies (like the food stamp program) rather than supplier-based subsidies that represent the current public school funding model.

Conceived of by the Goldwater Institute of Arizona, Education Savings Accounts were first passed by that state’s legislature in 2011 for special-needs children. Known as Empowerment Scholarship Accounts there, the program was expanded in 2012 to children adopted out of the state foster system, children of active-duty military parents, and children in “D” and “F” failing schools. Children entering Kindergarten were added in 2013 and funding for the accounts was increased. Arizona parents can get all the information they need about these accounts from the state’s Department of Education.

Nationally, school choice is becoming a more bipartisan issue as many Republicans are being joined by leading Democrats, such as former Clinton White House Press Secretary Mike McCurry. McCurry is now chair of the national Children’s Scholarship Fund, which provides privately funded tuition scholarships to low-income elementary school kids. He describes the school choice movement as a rare example of centrism in our increasingly polarized American politics.

And, U.S. Senator Cory Booker of New Jersey (D) has long been a school choice advocate. Speaking in 2001 for Cascade Policy Institute, Booker told Black students at Portland’s Self-Enhancement, Inc. how important school choice is for his fellow African Americans.

It is time for Oregon to move further toward school choice for every child, and ESAs offer an attractive way to start the journey. Already, our state has over 120 public charter schools made possible by passage of a 1999 bill in a Republican-controlled legislature that was signed into law by a Democratic governor (John Kitzhaber).

In the 2015 state legislative session, Oregonians will have an opportunity to start down the ESA road with passage of House Bill 2770, the Education Equity Emergency Act (E3). It will create Empowerment Scholarship Accounts modeled after the highly successful Arizona program. These scholarships will help level the educational playing field for kids with special educational needs, in foster care, or in low-income families. Scholarship recipients can use ninety percent of their state education funding for approved educational expenses like private schools, tutoring, education therapy, textbooks, online education programs, community colleges, universities, or college savings plans.

One sponsor of the 2014 version of the bill, SB 1576, noted, “These students have had unique challenges in their lives and require enhanced educational flexibility to ensure successful degree attainment.”*

The Act is designed to impose no financial burden on the state or on the school districts that scholarship students currently attend. Scholarship participation will be capped at 0.5% of students in a school district unless a district chooses to allow additional participation.

Oregon has a history of bold experimentation in other policy areas. Now is the time to experiment with expanding the role of parents choosing―and the market delivering―better education for Oregon’s children. Education Savings Accounts will empower families to find better educational options, leave the “use it or lose it” funding mechanism behind, and save toward their children’s higher education. Altogether, ESAs will provide winning solutions for children, their parents, and Oregon’s future.

* From a letter by State Senator Tim Knopp to then Chair of the Senate Education and Workforce Development Committee Mark Hass requesting a hearing on SB 1576 during the January 2014 interim legislative hearing days. The hearing took place on January 16, 2014. Archived video is here.

(January 25-31, 2015 is National School Choice Week, an annual public awareness effort in support of effective education options for all children. An earlier version of this Commentary was published in January 2014.)

Read Blog Detail

Imagine a World…2015

Imagine a world where we buy our groceries in government stores. We can only shop at the store nearest our house. If we want to shop somewhere else, we’re forced to move our family into another neighborhood―if we can afford it.

In this imaginary world, we elect food boards to oversee our grocery stores. And many of us think the food is free. Well, not quite. We all pay taxes to the government, which then recycles those dollars to grocery store districts and eventually down to our neighborhood stores. We think we eat pretty well, although the government spends five dollars for a gallon of milk and six-fifty for a loaf of bread. The bread is often stale and the milk is often sour.

Each district has a central office staff of specialists and administrators who work hard designing store shelves, checkout lanes, and (most importantly) the nutritional content of every food item. Since we’re a nation that separates Church and State, the big battles at food board meetings often revolve around whether stores can sell Christmas cookies.

Now, imagine that voters decide to give the government less money for the public food system. Suddenly, food stores find themselves in a crisis. There isn’t enough tax money to keep food district central bureaucracies intact. Stores don’t have enough money to keep all the clerks employed. Food superintendents are faced with the difficult task of eliminating some items from the shelves.

How could we possibly feed ourselves without the government taxing us, building big brick food buildings, and telling us where to shop?

If this imaginary world―and its problems―sounds familiar, you’re way ahead of me. It’s the world of our public school system. It’s the world most of us grew up in. Our parents grew up in the same world, but children now are growing up in a different world.

We can no longer afford to dump more money into a system that isn’t keeping pace with the progress all around us. Technology has opened limitless ways for students to gain knowledge and skills and to interact with their instructors and peers. The landscape of educational options centered on the needs and aspirations of individual students is far more diverse than it was even ten years ago. And many of these new options can actually save taxpayers real money.

Many advocate that we should lead the world in education spending. But you don’t get to be the competitive leader in any industry by being the world’s highest-cost producer. Don’t you want to be the producer with the highest quality, but at an affordable cost? The driving force to achieve high quality, while keeping costs down, is the profit motive. But that’s exactly the motive that doesn’t exist in our public school system.

Why aren’t we worried about a tax revolt decimating our local grocery store shelves? It’s because our grocery stores are private. They’re subject to intense competition, and each of us has virtually unlimited choices about where we shop.

For those who can’t afford food, we don’t build government food stores. We give them food stamps, and they shop in the same stores and for the same products that everyone else does. In essence, our public schools are the equivalent of the former Soviet Union’s collective farms. Communism said government should own and run the food stores―and the farms. The result was a nation that couldn’t feed itself.

We don’t have to ask whether to replace our current public school system with a private one. We can simply let education dollars be spent where the customers (parents) think they should go.

Please don’t let the details of any specific “school choice” proposal stop you from accepting the concept. Instead, let’s figure out why so many of our tax dollars don’t reach the classroom―and why nearly half the people who work for our public school system don’t teach. Let’s look for ways to put the children first and the system second.

The only proven way to accomplish these things is through competition and parental choice. Spending more dollars in the current system will just get us more of the same. Many states are broke, preventing them from spending more money on public schools. And many parents are fed up, wondering why their kids are underperforming or unmotivated in K-12 schools and unprepared for their college courses and future careers.

School choice has entered a new world. Because Americans are increasingly vocal about providing parents at every income level with the ability to choose their children’s schools, states are adopting broad-based school choice initiatives. Every child who drops out of school, or who graduates functionally illiterate, is being tossed into the sea without a lifeboat. If you think rearranging the deck chairs on this ship will save those children, think again. The way of the future is to put the power of educational choice back into the hands of parents, where it belongs.

(January 25-31, 2015 is National School Choice Week, an annual public awareness effort in support of effective education options for all children. Different versions of this Commentary have been published starting in 1994.)

Read Blog Detail

The Regime Trembles at the Sight of a Smartphone

“The regime trembles at the sight of a smartphone.”* That quote comes from Portland-based independent journalist and world traveler Michael J. Totten. One might guess that he wrote it about Portland’s city government and its aversion to ridesharing services like Uber that rely on smartphone apps to put riders and drivers together. But he didn’t.

He wrote it about the Cuban government after his visit to Havana last year. He summed up his observations in a lengthy piece he titled “The Last Communist City.” Hopefully, now that President Obama is taking steps to liberalize relations with Cuba, Havana may not be a communist city much longer.

But as we celebrate a new year, Portland still seems mired in the past. City regulators first tried to fine Uber for picking up passengers without official permission in December. Then the Mayor agreed to form a Task Force to revise its antiquated taxi regulations. Uber agreed not to initiate rides within city limits until April 9, by which time the City hopes to figure out how to accommodate the modern app economy.

Still, given how upset Portland officials were when Uber entered the city unannounced, the next question one might ask is:

Which city will welcome Uber and other ridesharing companies to serve their citizens first: Portland, Oregon or Havana, Cuba?

* Letter from Cuba: To Embargo or Not, Michael J. Totten, “World Affairs,” March/April 2014

Read Blog Detail

Why Do City Leaders Keep Portland in the “Transportation Dark Ages?”

In November, Beaverton, Gresham, Hillsboro, and Tigard joined Vancouver, Washington in welcoming ridesharing juggernaut Uber to operate legally in their cities. Last weekend, Uber began operating in Portland without permission, in effect daring the authorities to stop it. While the City has issued a cease-and-desist order against Uber, more than 10,000 people have signed an online petition asking Mayor Hales to let the company operate in Portland.

Until now, most major cities have granted virtual monopolies to a few taxicab companies on the assumption that government must protect both the livelihoods of drivers and the safety and convenience of passengers within their jurisdictions. But in a truly free economy, we should celebrate the technological innovation that allows people with cars to make money by giving rides to people who want them.

The “sharing economy” stems from the realization that all of us own assets that we may not use all the time, whether it’s a spare bedroom in your home (think Airbnb), or an automobile that sits in your driveway for hours a day. It’s time for Portland to live up to its hype and let young (and not so young) creatives do what they do best—create services that the rest of us want and need. It’s time to legalize transit freedom and bring Portland out of the Transportation Dark Ages.

Read Blog Detail

Portland Should Join the “Free World” of Ridesharing

In November, Beaverton, Gresham, Hillsboro, and Tigard, Oregon joined Vancouver, Washington in welcoming ridesharing juggernaut Uber to operate legally in their cities. Conspicuously absent from this list was the region’s largest city, Portland, which became virtually surrounded by the smartphone app transit economy. Then, on the evening of December 5, Uber began operating without permission in Portland, in effect daring the authorities to stop it.*

If Soviet East Berlin couldn’t keep Western freedom out by building its infamous Wall, what chance does Portland have keeping its residents from exercising their freedom to choose ridesharing within arbitrary lines on a map?

Until now, most major cities have granted virtual monopolies to a few taxicab companies on the assumption that government must protect both the livelihoods of drivers and the safety and convenience of passengers within their jurisdictions. Economists will tell you that here, and in virtually every government-regulated industry, “the regulated end up capturing the regulators.” In this case the taxicab companies end up influencing government regulators to protect them from competition at the expense of the public.

Such influence is now ending in many cities, thanks to the rise of mobile applications, but it’s still going strong in Portland. So strong that a recent study of 50 large American cities gave Portland a grade of “F” for Transportation-Friendliness, primarily because it is so hostile to ridesharing.

Ridesharing can mean anything from carpooling with your neighbors to using a mobile app to summon one of many cars in your community whose owners are willing to drive you for money to your destination. Drivers can work as much or as little as they wish, “clocking in” to the app and out of it to fit their own lifestyles.

The new app economy has sprung up over a few short years, thanks to the creativity and productivity unleashed after another American “Berlin Wall” was torn down. The mandated breakup of the government-protected monopoly Bell Telephone System in 1982, and the rise of the Internet a few years later, led to the smartphones we all hold in our hands today. Going from no mobile applications in 2007, some two billion people worldwide now use them to improve their lives.

Mobile apps do virtually anything you can think of, from facilitating your online banking, to investing, to checking your health status…to helping you find quick, reliable transportation through companies such as Uber, Lyft, and a host of others.

Uber requires that drivers pass background checks, carry the proper insurance, own relatively new cars, etc. The beauty of ridesharing apps is that they can let drivers and passengers know something about who they’re riding with through instant feedback on the app. You can see your driver’s name, photo, car, license plate number, and rating by other passengers before ever getting in his or her car. Likewise, the driver can know your name and reputation assigned by your previous Uber drivers. Such feedback encourages everyone to be on their best behavior.

Uber requires that you pay with a previously enrolled credit card. No cash changes hands in the car, which may mean speedier and safer transactions. And, before ordering a ride the app can estimate the cost of your trip (often lower than a taxi) and how many minutes it will be before your car arrives. Note that nothing stops current taxicab companies from doing these same things―except perhaps government regulations.

This isn’t all about Uber. Uber is simply the largest ridesharing company at the moment, having just closed a $1.2 billion investment round that values the company at $40 billion. But if Uber fails to innovate or succumbs to recent bad publicity, it could end up like other also-ran technology firms. No ridesharing company has government-monopoly protection to shield it from your choosing another provider.

Beyond opening up transportation options for the public, ridesharing companies open up income-generating opportunities for car owners. In a truly free economy, we should celebrate the technological innovation that allows people with cars to make money by giving rides to people who want them.

The sharing economy itself stems from the realization that all of us own assets that we may not use all the time, whether it’s a spare bedroom in your home (think Airbnb), or an automobile that sits in your driveway for hours a day.

In city after city, people recognize the benefits of allowing ridesharing companies to operate. Portland Commissioner Steve Novick apparently justifies his decision to wait by saying he wants to find “…a way to adopt a less anachronistic [taxicab] system without destroying people’s livelihoods.” There is a way, Commissioner. Rather than imposing anachronistic regulations on ridesharing companies, remove them from the taxi industry and let everyone earn a living by offering customers more and better service.

Recently, more than 40 Portland business leaders demanded taxi reforms, calling on the City Council to legalize ridesharing. They wrote,

“…We have confidence you will see the laws and regulations that protect the taxi industry here in Portland for what they really are: outdated….They’re making people wonder―how can a taxi industry lobby keep Portland from being counted among the progressive, forward-thinking cities that are providing their residents and visitors with fast, easy, on demand services like Uber and its peers.” 

It’s time for Portland to live up to its hype and let young (and not so young) creatives do what they do best—create services that the rest of us want and need. It’s time to legalize transit freedom and bring Portland out of the Transportation Dark Ages.

* On December 8 the City issued a cease-and-desist order against Uber for 5pm December 11 and asked a Multnomah County judge to stop Uber from operating in Portland. Within less than 24 hours of these developments, Uber’s online petition asking Mayor Hales to let Uber operate in the City gathered more than 10,000 signatures.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

 

Read Blog Detail

The Governor’s Budget: Much More Than Beer Money

Governor John Kitzhaber released his proposed 2015-17 budget this week. Critics were quick to argue that it’s either too much or too little, depending on their point of view. Media reports focused on his General Fund budget which, at $18.6 billion, would be an eleven percent increase over the current budget.

In an attempt to make this number seem inconsequential, one person commented on an Oregonian story that $18.6 billion over two years works out to about $6.50 per day per Oregonian. He characterized that as less than the price of one beer at a Blazer game, and noted that with the Governor’s budget “you get a whole state, and you’re only renting the beer.”

But that’s less than one third of the story. While the General Fund is, in effect, the discretionary part of the budget funded primarily by state income tax revenue, the All Funds budget is much larger.

At $66.5 billion, the Governor’s All Funds budget proposal is more than three-and-a-half times bigger than the $18.6 billion General Fund amount. Much of that comes from fees and federal funds, but it’s still our money.

So, in the words of that one-beer-a-day commenter, the Governor’s total budget proposal actually would buy every Oregonian three Blazer game beers a day. Put in a more meaningful way, that’s $16,625 over the two-year period for every man, woman, and child in the state. Or, $66,500 for a family of four. Now that’s real money.

Read Blog Detail

Let’s Talk Turkey – with Uncle Sam

On this Thanksgiving I have to give credit to The Blaze for alerting me to a serious issue of public concern. Apparently the U.S. government, in its collective wisdom, believes that Americans need its help to purchase, prepare, and eat the traditional holiday turkey.

The United States Department of Agriculture is devoting resources (read, your tax dollars and/or some of the nearly $17 trillion federal debt) to maintain a website called Let’s Talk Turkey—A Consumer Guide to Safely Roasting a Turkey. On it, you’ll find some helpful, and some less than helpful, tips that apparently your government doesn’t think you can find on any of the thousands of sites a quick Google search on turkey preparation will reveal before your eyes.

Sites hosted privately by the likes of Safeway, Butterball, and even the Mayo Clinic apparently aren’t sufficient to give you the reliable information you need on this significant national holiday.

But wait, there’s more. If you need more personal turkey help, there’s a federal Meat and Poultry Hotline you can call and speak with a live government employee. Just think of the last time you sought “help” with your taxes from an IRS phone line. Of course, the government turkey hotline is only live from 5am to 11am Pacific time on Thanksgiving Day. After 11am you may have to rely on that for-profit turkey purveyor Butterball, which answers its Turkey Talk-Line until 4pm and even answers the phone starting at 4am on Thanksgiving.

Please understand I’m not suggesting that you use any but an official government, taxpayer/debt funded website or phone line to get your turkey tip information. But if you’re going to ignore my advice and feel particularly rebellious this Thanksgiving, you might want to watch this State Farm video featuring “Duck Dynasty” turkey safety tips.

No matter how you glean your turkey safety and cooking tips, let’s be careful out there. After all, who could know more about turkeys than the federal government?

Steve Buckstein is Founder, Senior Policy Analyst, and Satirist-in-Residence at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Tear Down Oregon’s (Self-Created) Berlin Walls!

The Berlin Wall came down twenty-five years ago this week. The Wall, which separated East and West Berlin, was one of the most powerful visible symbols of the metaphoric “Iron Curtain” which divided the Soviet Bloc nations from the free countries of Europe during the Cold War.

My friend John Fund, the former Wall Street Journal editorial writer, has often shared a human story from when the Berlin Wall fell in 1989. He once met four teenage girls while visiting East Berlin in 1984. As he prepared to board the train that would take him back to the West, John asked them what they wanted to be when they grew up:

“A schoolteacher, said one. A hairdresser, said another. A nurse, said the third. Only Monika, the oldest and clearly the wisest, hesitated. Finally, she sighed and said, ‘It doesn’t make any difference what we become when we grow up. We will still always be treated like children.’”

That statement made a profound impact on John. He noted how he could go anywhere in the world from that street corner, but these teenagers could not go 500 yards to see the bright lights of West Berlin.

They had to remain in “a semi-comfortable, but drab existence, in which any independent thoughts they might have would be hidden within themselves from the government.”

John and Monika kept in touch over the next few years. Then, two days after the Berlin Wall fell on November 9, 1989, John’s phone rang.

There was the unmistakable sound of an overseas call. “This is Monika!” she shouted in halting English. “I am calling from Berlin West! I am over the Wall!”

Monika did not plan to flee East Germany. But now that the Wall was down, she could leave if the people who ran that government reneged on their promises of free elections and economic reforms.

John reminded Monika of their first meeting and asked if she felt she was finally being treated like a grownup.

“Yes,” she said. “I think everyone in my country decided for themselves to grow up overnight.”

Monika knew what it was like to be finally treated like an adult by her government; but Americans are now being treated more like children, as the limited government our Founders gave us morphs into a behemoth. It’s up to us to “tear down the Walls” of national programs like ObamaCare and the myriad regulatory barriers that impede freedom and opportunity here in Oregon.

Cascade Policy Institute has helped educate Oregonians since 1991 about the benefits of freedom and liberty. We look forward to working even more closely with everyone who is committed to keeping our communities and our state from being encircled by our own, self-created Berlin Walls.

Read Blog Detail

A Time for Choosing

Did you choose between a left or right in yesterday’s election? If that phrase sounds familiar, perhaps you watched an emerging leader utter it 50 years ago last week.

In 1964 an actor named Ronald Reagan gave what has become known simply as “The Speech” on behalf of his ill-fated Presidential candidate, Barry Goldwater.

The half-hour TV address, “A Time for Choosing,” wasn’t able to propel Goldwater to the Presidency, but it is credited with launching Reagan’s political career and his eventual landslide victory in 1980 against a sitting president, Jimmy Carter.

You can watch The Speech online. Here are two of my favorite lines:

“This is the issue of this election: Whether we believe in our capacity for self-government, or whether we abandon the American Revolution and confess that a little intellectual elite in a far-distant capitol can plan our lives for us better than we can plan them ourselves.”

And…

“You and I are told increasingly we have to choose between a left or right. Well I’d like to suggest there is no such thing as a left or right. There’s only an up or down: [Up to] man’s age-old dream—the ultimate individual freedom consistent with law and order—or down to the ant heap of totalitarianism.”

I didn’t fully appreciate these concepts then; I do now.

Read Blog Detail

More Tax Dollars for College ― Or Prepare Students to Succeed There?

Oregon voters are being asked this November to authorize spending more tax dollars to help some students afford an arguably unaffordable higher education. Measure 86 will create a permanent fund to subsidize certain students, which can be financed several ways including through state general obligation bonds. Any bonds issued under the so-called Oregon Opportunity Initiative will have to be paid off over 30 years, primarily by income tax payers, not by students. Only the earnings on bond proceeds and other funds will be available for subsidies.

There are several problems with this proposal:

First, Measure 86 does nothing to reduce the overall cost of higher education in Oregon. In fact, it actually could increase those costs as more taxpayer dollars flow into the system.

Second, even if the measure does help some students afford college, we don’t know if they will be prepared to succeed there, or if they will need costly and time-consuming remedial courses to learn what they should have learned in high school.

Our educational leaders in Salem anticipated the need to prepare students better for college years ago, and they took steps that they hoped would address the issue. In 2007 the state Board of Education adopted The Oregon Diploma, which was intended to ensure that students are prepared to enroll in postsecondary education without the need for remedial courses.

The Oregon Diploma “…requirements are designed to better prepare each student for success in college, work, and citizenship. To earn a diploma, students will need to successfully complete the credit requirements, demonstrate proficiency in the Essential Skills, and meet the personalized learning requirements…A phase-in schedule (2007 – 2014) has been created to allow students, families, schools and teachers to adequately prepare to meet these new requirements.”

Apparently assuming that The Oregon Diploma would get all students college-ready by 2014, Governor John Kitzhaber recommended, and the Legislature adopted in 2011, what has come to be known as Oregon’s 40-40-20 educational attainment goal. By 2025, this state policy aims for 40 percent of Oregonians to have a four-year baccalaureate degree or higher, 40 percent to have an associate’s degree or certificate in a skilled occupation, and the remaining 20 percent to have at least a “college and career-ready” high school diploma or its equivalent.

So, how are we doing in getting to that 40-40-20 goal by 2025? Three national reports issued over the last two months raise serious questions as to whether most Oregon high school graduates are coming anywhere close to being “college and career-ready.”

First we learned that only 30 percent of Oregon’s 2014 high school graduates are deemed “college ready” based on their American College Testing Organization (ACT) college admissions examinations in all four tested subjects of English, Reading, Math, and Science.

Then, a U.S. Chamber of Commerce report revealed that “Oregon is one of the very worst states when it comes to preparing students for college and the work force.” It noted that “Oregon ranks in the bottom 10 when it comes to getting students ready for college and careers.” We earned a grade of “D” in Academic Achievement and an “F” in Postsecondary and Workforce Readiness.

Finally, we found out that only 46 percent of Oregon public high school students who took the SAT college entrance tests scored high enough to demonstrate that they are prepared for college.

So, it looks like Oregon has struck out three times when it comes to meeting The Oregon Diploma goal of better preparing each student for “success in college, work, and citizenship” by 2014. We have eleven more years to see if the Governor’s 40-40-20 goal pans out, but it isn’t looking good so far.

Before we encourage more taxpayer spending on higher education through Measure 86, shouldn’t we find ways for our public school system to prepare most college-bound students to actually succeed there?

As I’ve noted before, that won’t take more money, because research shows that spending more money doesn’t lead to better educational outcomes; it just rewards the adults who get paid by the system. Instead, we should take the top-down control away from bureaucrats in Salem and give it to parents and students through a genuine system of school choice. Then watch our college readiness numbers climb. Otherwise, we’re just paying twice for remedial courses to teach college students what they should have learned in high school.

Removing the need for those remedial courses could help more students than Measure 86 ever would, and it should help Oregon taxpayers by reducing the cost and the time it takes to educate college students.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Dissing Online Education

One can imagine that blacksmiths and buggy whip makers didn’t take kindly to the automobile revolution that started in the late 19th century. Those at risk of losing their horse-related jobs likely made the case for resisting the new, glitchy, and dangerous metal machines. We all know how that rivalry turned out.

Today, another revolution is beginning. Just as thousands of years of horse travel were largely replaced within a few decades, one wonders what the future of physical classroom education might be in the face of the online education revolution.

A Portland State University professor of educational leadership recently authored an op-ed making the case that “effective teaching practices such as class discussion, relational learning and other activities of the traditional classroom are hard to offer on a computer screen.” That might be true; face-to-face educational interactions may never go away, but soon they could be greatly supplemented or even overshadowed by online innovation.

The future is always daunting to those at risk of being displaced, but the future is coming and we will find ways to adapt to it and even improve upon it. Buggy whips may be a thing of the past, but there are still plenty of jobs for people who know how to make and care for our modern horseless carriages.

Read Blog Detail

Washington County Public Affairs Forum

Watch Cascade’s own Steve Buckstein take on State Treasurer Ted Wheeler to debate this November’s ballot Measure 86, the Oregon Opportunity Initiative.

Click here to learn more.

Read Blog Detail

The election is coming!: A discussion of Oregon’s 7 statewide ballot measures

Please join us for Cascade’s monthly Policy Picnic led by founder and senior policy analyst Steve Buckstein on October 22, at noon.

There are seven statewide ballot measures on Oregon’s General Election ballot. Cascade has taken positions on two of them: Yes on Measure 91 to decriminalize marijuana, and No on Measure 86 to direct more tax money into subsidizing certain higher education students. Come join us in a conversation about the latest election-related issues – we’d love to hear your opinion!

Admission is free. Please bring your own lunch. Coffee and cookies will be served. Space is limited to sixteen guests on a first come, first served basis, so sign up early.

Sponsored By

Read Blog Detail

No Death Panels Here―Yet

ObamaCare mastermind Dr. Ezekiel Emanuel recently published an Atlantic magazine essay explaining why he hopes to die at age 75, which for him is eighteen years away.

He won’t kill himself, but plans to refuse any medical treatment other than palliative care for pain or disability. He says that like death, “…living too long is also a loss. It renders many of us, if not disabled, then faltering and declining, a state that may not be worse than death but is nonetheless deprived.”

Psychotherapist Michael Hurd explains that Emanuel takes his position from “the oldest, most primitive creed of ethics in human history: Self-sacrifice….Like all self-conscious advocates of selflessness, he seems proud of his willingness to hurt his family by proclaiming his wish to die. ‘Hey, look at me. I’m so selfless I don’t even wish to live. It hurts my family, but that shows how willing I am to be sacrificial.’”

Hurd notes, “This is what passes as the standard of sophisticated, high-end, state-of-the-art ethics, at least among the sophisticates and elite whom we have given permission to run our lives.”

Of course, Emanuel leaves himself an out: “I retain the right to change my mind and offer a vigorous and reasoned defense of living as long as possible.”

So there you have it: Emanuel’s 57-year-old self making the sacrificial case for not wanting to live more than 18 more years, but admitting that his 75-year-old self might very well make a different choice. Who would have guessed?

Steve Buckstein is founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Testimony on Measure 86 to Portland Community College Board

The following testimony was presented to the Portland Community College Board at their meeting on September 18, 2014.  The Board then voted 5 to 2 in favor of a Resolution giving their support to the Oregon Opportunity Initiative, Measure 86 on the November ballot.

Testimony before the Portland Community College Board in Opposition to the Oregon Opportunity Initiative (Measure 86):

Good evening, Chair Palm and members of the Board. My name is Steve Buckstein. I’m Senior Policy Analyst and founder of Cascade Policy Institute, a public policy research organization based in Portland.
I urge you to reject this Resolution for the following reasons:

First, you have no assurance that any funds generated by the Opportunity Initiative won’t simply replace funds the legislature already allocates to higher education. Plus, there’s no assurance that one community college student will benefit. Decisions about what, if any, funding will benefit specific students will be left to some unnamed public body, subject to the same lobbying efforts the legislature faces now.

Second, even if the Opportunity Initiative helps some students in the short run, it will make the whole system less affordable in the long run. Such third-party payments from states and the federal government are a big part of the reason that college costs and student debt are rising rapidly.

I’m sure you work hard to keep student prices under control. But, to the extent that Measure 86 puts more taxpayer money in student pockets, it will take some pressure off you to do so.

Third, I’m not sure voters understand that even if the Treasurer’s optimistic investment assumptions for Measure 86 work out, income taxpayers will be on the hook to repay all the principal and interest on any bonds issued by the state for decades into the future.

Before asking taxpayers to repay those bonds for the next thirty years, you might consider how technology is beginning to reduce higher education costs.

One Oregonian who recognizes the power of the coming technological revolution is the chief sponsor of the Oregon Opportunity Initiative himself, Treasurer Wheeler. Last October in a public meeting, he criticized the university system for being…

“…very slow to adapt the opportunities around technology.” He said that “there’s a lot of institutional inertia in the university system just as there is in Salem. And, all of these new technologies have opened up new windows to learning that do not require a student to even be in the same state.” He noted that online programs such as iTunes University on his own smartphone “don’t cost…a cent” and are a “game changer” that “undercut the entire economic model of the university system as it currently exists today.” *

So, if technology will put downward pressure on college costs, why saddle Oregon taxpayers with perhaps one hundred million dollars or more in debt over the next 30 years to fund the current high-cost model?

Finally, based on recent ACT test scores, only 30 percent of Oregon’s high school graduates are competent enough at English, reading, math and science to pass freshman college classes. Before you encourage more spending on higher education, shouldn’t we find ways for our public school system to prepare most college-bound students to actually succeed there? Otherwise, we’re just paying twice for remedial courses to teach college students what they should have learned in high school.

Wouldn’t you rather see every new PCC student ready for college-level courses, rather than dump more of your limited budget into teaching them what they should already know?

In conclusion, whatever the value of a college degree is to an individual, it’s becoming clear that Opportunity Initiative state funding of those degrees is likely to cost taxpayers more than they gain. I urge you to reject the Oregon Opportunity Initiative.

Thank you.

* Ted Wheeler, Washington County Public Affairs Forum, October 28, 2013.
59-second answer: youtube.com/watch?v=ZMPMtmEyieg.
Entire hour-long presentation with Q&A: youtube.com/watch?v=l1hYXGA3CLA.
Relevant question starts at 52:16.

Read Blog Detail

Cascade Policy Institute Encourages a ‘No’ Vote on Measure 86

The Board of Directors for the Cascade Policy Institute recently voted to oppose Measure 86, known as the Oregon Opportunity Initiative, on November’s ballot.

Measure 86 would require the creation of a Permanent Fund for Post-Secondary Education, which can be funded a number of ways, including by the state selling general obligation bonds. Earnings on the Fund can be used to subsidize certain students, but it will be taxpayers who are saddled with paying off any bonds for 30 years, with interest.

Further, only 30 percent of Oregon’s 2014 high school graduates showed readiness for college, based on ACT college admissions tests.

“We shouldn’t spend more money on higher education until our public school system prepares most college-bound students to actually succeed there,” said Cascade Founder and Senior Policy Analyst Steve Buckstein. “Otherwise, we’re just paying twice for remedial courses to teach college students what they should have learned in high school.”

Measure 86 is based on what one researcher calls “one of America’s most durable myths…that the more people who graduate from college, the more the economy will grow.” However, Richard Vedder, author of the book “Going Broke by Degree: Why College Costs Too Much,” notes that conclusion may depend on how those educations are paid for. He found statistical evidence that states which provide more higher education funding actually have slightly lower economic growth rates than states which provide less.

“Individuals know their needs better than politicians do, so leaving the money in private hands produces better results,” said Buckstein.

Finally, even the chief sponsor of Measure 86, State Treasurer Ted Wheeler,  criticized the university system for being slow to adapt to new opportunities in technology which can make education cheaper and easier for students*.

“As technology drives down higher education costs, why saddle Oregon taxpayers with perhaps $100 million or more in debt for the next 30 years to subsidize the old, high-cost economic model? The answer is we shouldn’t,” said Buckstein.

* Video of Treasurer Wheeler’s statement is online at:
youtube.com/watch?v=ZMPMtmEyieg
Read Blog Detail

Don’t Pay Twice for Public Education

Last week, the American College Testing organization (ACT) released the results of its national college admissions examination consisting of tests in English, Reading, Math, and Science. Thirty-six percent of Oregon’s 2014 high school graduates took the tests. Only 30 percent of those students scored high enough to be ready for college in all four subject areas.

One conclusion we might draw from these findings is that we shouldn’t spend more money on our higher education system until we can honestly say that our K-12 system is preparing most college-bound students to actually succeed there. Otherwise, we’re just paying twice for remedial courses to teach college students what they should have learned in high school.

This is yet another reason for voters to reject Measure 86 on the November ballot. It will encourage state legislators to borrow perhaps $100 million or more to subsidize certain student higher education costs. Before we saddle taxpayers with such debt, let’s fix our K-12 system. That won’t take more money, because research shows that spending more money doesn’t lead to better educational outcomes; it just rewards the adults who get paid by the system.

Instead, we should take the top-down control away from bureaucrats in Salem and give it to parents and students through a genuine system of school choice. Then watch our college readiness numbers climb.


Steve Buckstein is founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

Eight Out of Ten Oregonians Agree: Let employees choose whether or not to join a union or pay union dues

Because of a deal struck by Governor John Kitzhaber, Oregonians won’t have the opportunity to end forced union dues in the public sector this year. However, a just-released public opinion poll makes it clear that if the Public Employee Choice Act had been on this November’s ballot, most voters likely would have supported it.

The poll, conducted for National Employee Freedom Week (August 10-16) asked adults across America:

“Should employees have the right to decide, without force or penalty, whether to join or leave a labor union?”

Nationwide, 82.9 percent of respondents answered Yes. Of the 500 respondents in Oregon, a resounding 84 percent answered Yes.*

These results are significant because Oregon and twenty-five other states require workers to pay so-called “fair share” dues even if they decline union membership and refuse to pay the political portion of union dues. The other 24 states have taken advantage of federal Right to Work law that lets workers choose not to pay any dues at all if they decline to join a union. The federal government also prohibits forced union dues in its own workplaces; yet unions still represent some federal workers, and they represent workers in Right to Work states who voluntary choose to join.

Forced union dues are on the political front burner this year because of the recent Harris v. Quinn U.S. Supreme Court decision. It favored certain Illinois home care workers who don’t want to join a public employee union or pay dues just because their services are paid for with state funds. While the ruling may be narrowly interpreted, it did cause two of Oregon’s largest public employee unions to stop collecting fair share dues from some ten thousand home and child care workers in this state who have chosen not to join their ranks.

Unions claim that such workers should pay fair share dues because the unions are currently required to bargain for and represent them even if they decline union membership. But that is not the fault of those workers, and the unions haven’t seemed to mind as long as their dues money kept flowing.

Unions also claim that without their representation, workers would see their pay and benefits decline. But, after union stronghold Michigan became the latest Right to Work state in December 2012, per-capita personal income actually rose from $38,291 in 2012 to $39,215 in 2013, according to the U.S. Department of Commerce’s Bureau of Economic Analysis. That was the ninth highest increase in the country.

Why do workers want to opt out of union membership and all union dues? Some think they have better uses for their own money. Some want to “vote with their feet” against what they see as poor union service or negotiating results. Still others oppose their unions’ political agendas. They simply don’t want to support any organization that doesn’t share their political beliefs, whatever those might be.

The right to work without third-party interference is more than an economic issue; it is a profoundly moral one as well. No one should be compelled to pay union dues in order to hold a job. Hopefully, Oregon will soon grant true employee choice to every worker in our state.

* Last year’s National Employee Freedom Week poll asked union households, “If it were possible to opt out of membership in a labor union without losing your job or any other penalty, would you do it?”

The results were released in this June 2013 Cascade Commentary: More than thirty percent of Oregon union households want out.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

Read Blog Detail

New Poll Shows 84% Percent of Oregonians Support Employee Choice

Eighty-four percent of Oregonians support allowing union employees to leave their union without force or penalty, a concept generally referred to as Right to Work. That’s the finding of a new poll, released today by Cascade Policy Institute as part of National Employee Freedom Week, which runs from August 10 to 16. NEFW is a grassroots campaign of 77 organizations in 44 states dedicated to helping union employees learn about their right to leave their unions.

The poll, with a sample size of 500 Oregon residents, asked this question: “Should employees have the right to decide, without force or penalty, whether to join or leave a labor union?” Of the respondents, a resounding 84 percent answered Yes.

The coalition also released a poll showing 82.9 percent of Americans nationwide support the Right to Work principle. Currently, 24 states have passed Right to Work laws which allow workers to leave their union without penalty or having to pay dues to an organization they choose not to belong to. Because of a deal struck by Governor John Kitzhaber, Oregonians won’t have the opportunity to end forced union dues in the public sector this year.

The poll results are significant because Oregon and twenty-five other states require workers to pay so-called “fair share” dues even if they decline union membership and refuse to pay the political portion of union dues. The other 24 states have taken advantage of federal Right to Work law that lets workers choose not to pay any dues at all if they decline to join a union. The federal government also prohibits forced union dues in its own workplaces; yet unions still represent some federal workers, and they represent workers in Right to Work states who voluntary choose to join.

Cascade Policy Institute founder Steve Buckstein notes, “Most Oregonians now support letting workers decide whether to both join and pay any dues to a union. Cascade research finds significant economic benefits if Oregon becomes a Right to Work state, but employee choice is more than an economic issue. It’s a profoundly moral one as well. No one should be compelled to pay union dues in order to hold a job.”

Unions often do as little as is required by law to inform their employees that they have the right to opt out. But as previous NEFW polling illustrates, over 33 percent of those in union households want to leave. Therefore, educational efforts like NEFW are necessary to inform and educate union members about their workplace rights and empower them to make the decision about union membership that’s best for them. More information is available at www.EmployeeFreedomWeek.com and at Cascade’s new website, www.OregonEmployeeChoice.com.

The poll was conducted by Google Consumer Surveys, between July 11 and July 31, 2014. It surveyed adults nationwide, including roughly 500 Oregonians and has a margin of error of approximately 3.76 percent.

Cascade Policy Institute is Oregon’s free market public policy research center. Cascade’s mission is to explore and promote public policies that advance individual liberty, personal responsibility, and economic opportunity.

Read Blog Detail