Red Clay Citizen

Entitlement Nation

Max, I think I can do you one better (well, worse actually). Try this report from the National Center for Policy Analysis:

"The 2008 Social Security and Medicare Trustees Reports show the combined unfunded liability of these two programs has reached $101.7 trillion in today's dollars! That is more than seven times the size of the U.S. economy and 10 times the size of the outstanding national debt."

It's amazing to me that folks on the left actually continue to proclaim these programs to be shining examples of success.

"The CBO also found that if federal income tax rates are adjusted to allow the government to continue its current level of activity and balance the budget:

The lowest marginal tax bracket of 10 percent would have to rise to 26 percent.

The 25 percent marginal tax bracket would increase to 66 percent.

The current highest marginal tax bracket (35 percent) would have to rise to 92 percent!

Additionally, the top corporate income tax rate of 35 percent would have to increase to 92 percent."

If these estimates are even remotely accurate, the future looks grim indeed.

Government Jobs: Broken Windows Fallacy

This is the saddest thing I've read in a long time. The worst is the quote from Mike Walden, an economist at N.C. state who actually does stuff for JLF!

"Government jobs are an important cushion for the economy when the private sector falters," says North Carolina State University economist Michael Walden. Huh? Somebody please take away this man's Keynesian crackpipe.

Perhaps they took Mike out of context, but Lordy Lord, surely he knows about deadweight loss and the broken windows fallacy.

There was a light of reason in the article, on these dim circumstances of public sector growth:

"More hiring has nothing to do with good government or economic policy," says economist Kenneth Brown, research director at the Rio Grande Foundation in Albuquerque. "It has everything to do with government being slow to react to economic change." (HT: Hayes)
-Max Borders

UNC: Economic Engine?

North Carolinians have long considered the state’s public universities to be an engine for economic growth.  For most of us, a college education is the key to a better job and the means to a more fulfilling life. Such thinking in part helps to explain the ever-rising government appropriations for public higher education -- even after adjusting for inflation and population growth. Last year, NC spent about $3.5 billion on the University of North Carolina and Community Colleges.  In the past year, state spending for UNC increased 17 percent and community college spending increased by 13 percent.

Is North Carolina getting a fair return on this massive investment of public money? Not according to a new report on North Carolina's Higher Education System by the Center for College Affordability and Productivity. Dr David Vedder, Center Director and co-author of the report, states North Carolina spends $7,153 per FTE higher education student, far above the national average of $4,871 and more than neighboring states Georgia, Virginia and South Carolina. Such high levels of public investment suggest that North Carolina’s population would be highly educated. However, the data say otherwise. Vedder writes:

In 2006 only one in four North Carolinian adults possessed college degrees, falling noticeably  (slightly more than one standard deviation) below the national average of 27.2 percent. Furthermore, North Carolina’s attainment rates have lagged behind the national average every year dating back to 1989 and even back to 1960 for every year data are available. . . A relatively uneducated population despite such a massive investment in higher education suggests great inefficiencies and wasted resources in the system.

According to Vedder, state appropriations aren’t effective in maintaining a higher educational attainment among the state’s population. Vedder writes, “North Carolina spends $10.64 per capita on higher education for every 1 percent of its population possessing a bachelors’ degree, whereas  neighboring states Virginia and Georgia spend only $6.64 and $6.61 respectively, to do the same thing.”

The problem? Waste, and there’s plenty of it--- bloated faculty salaries, institutional subsidies, ballooning non-instructional costs, and rising numbers of students who attend school for several years, but never graduate.

While investment in higher education will continue to be an important issue, we’d do well to reevaluate subsidies for public higher education. A better option would be to closely link public subsidies to effective management and the realization of public benefits. Read the report and recommendations to learn more.

Taxes: Common Sense to Rockingham County

Jeffrey Sykes has a piece up in the Reidsville Review today that makes a lot of sense. Apply it statewide.
-Max Borders

Healthcare: Making Prices More Transparent

Check out this release:

"Chicago, IL, April 30, 2008 - OutofPocket.com, a technology startup dedicated to promoting health care transparency and competition, announced today the launch of its new search engine.  The search engine enables consumers to look up prices and comparison shop for health care services by searching for price data across different websites. OutofPocket.com launched an earlier version of their website in July 2007 which provided consumers with a platform to collaborate and expose the true prices of routine health care services.  With the addition of the new search engine, the enhanced website collects health care price data from multiple sources including provider price lists, consumer contributed content, claims data from businesses, Government CMS Medicare data, websites that publish health care prices (hospitals, diagnostic testing facilities, clinics, labs, physician practices), and price transparency tools on public websites.

"Consumers need to know the true price upfront before purchasing health care services.  After researching the basic price transparency tools that are available today from providers, health plans, vendor tools and state initiatives, it was obvious that the industry lacks a robust search tool that summarizes price data across different sources," said Mona Lori, founder of OutofPocket.com.  Using collaboration to bring price transparency to health care, OutofPocket.com emerges as a leader in exposing true prices for routine health care services using intelligent search technologies.

Health care costs continue to rise each year.  Consumers are paying more of their own health care costs in the form of higher premiums, deductibles, co-pays, and out-of-pocket expenses for health care.   Increasingly, businesses and individuals, in an effort to control health care costs, are adopting consumer driven health plans.  These plans have proven effective in controlling costs; however, in order for these plans to be successful, consumers need access to meaningful tools to help them make informed decisions before purchasing health care services."
-Max Borders

IBM: Pocketing Your Money

Gotta love the timing of the Triangle Business News when it hit my Google Reader today.

First message:  IBM wins NC incentive to add 600 Charlotte jobs.
Very next message:  IBM to boost dividend 25%. (and do a $12 billion stock repurchase).

So why exactly do they need $10 million of our tax dollars to add jobs they were already going to add in the first place?

Jim Hunt: Pot Meet Kettle

Good ole Gov. Hunt is on WRAL today "decrying" the use of negative ads in the Governor's race.  Him trying to preach to others on this subject is laughable at best, hypocritical at worst.  Negative ads were perfectly fine for him to use during his many runs.  But now he says that candidates should stay positive?
Puh-lease.

Check out this Time article from 1984.  Anyone remember the "right wing death squads" ad?

The Hunt organization early this summer ran a television advertisement linking Helms to the right-wing death squads in El Salvador. The commercial opened with the sound of gunfire and photos of massacred Salvadoran citizens. A picture of Salvadoran Roberto d'Aubuisson appeared, and a narrator identified him as "the man accused of directing those death squads." A picture of Helms then appeared, and the narrator said, "This is the man whose aides helped D'Aubuisson set up his political party in El Salvador . . . Now Jesse Helms may be a crusader, but that's not what our Senator should be crusading for."

I guess that is what Hunt considers focusing on "positive messages."

Or how about the ad Hunt ran in 1996 (when he was up 10+ points in the polls and didn't need to go negative) that said that Robin Hayes thought people should bathe with Lysol to keep from spreading STDs?

Was that a positive message of what he was going to do for the state, as he is advising other candidates to do?

I guess Hunt abides by the old adage of "Do as I say, not as I do" (or did in his case).

Time for Voter ID in NC

The Supreme Court did the right thing today:

In its decisive 6-3 decision, the justices upheld a lower court ruling in the combined cases of William Crawford, et al. v. Marion County Election Board, et al. and Indiana Democratic Party et al. v. Todd Rokita, et al. The plaintiffs in the case challenged a 2005 Indiana law requiring voters to present government-issued photo identification before being allowed to vote.

Now it's time for NC to follow suit. No more voter fraud.
-Max Borders

Candidates on Immigration

The N & O is running a piece that discusses the various -- presidential, gubernatorial, etc. -- candidates' views on immigration.

A few initial observations:

While immigration is one of the top concerns for voters, our polling indicates that concern over immigration has become less important as the economy has worsened. This indicates, of course, that voters aren't yet making the connection that immigration has a negative impact on jobs and the economy. More to the point, voters are most worried about the economy right now.

There are not 300,000 illegal immigrants in North Carolina, but at least twice this number. The N & O seems to be using old data from the Pew Hispanic Research Center here.

Let me explain:

Based on 2005 census data, the Pew Hispanic Research Center estimated there were between 300,000 and 400,000 illegal immigrants in North Carolina.

Hispanics are thought to account for 80 percent of illegal immigrants. FAIR estimates that as of 2005, there were 405,000 illegal immigrants in North Carolina.

According to the N.C. State Demographics office, from 1990 to 2000 the Hispanic population increased by 333 percent, or 33 percent per year (net migration). In the absence of specific data from the state demographer, we also presume a net migration rate of 1.5 percent for all other illegal immigrants.

Let us assume that Hispanic population growth has slowed as the overall Hispanic population has increased. We presume a drop off of about 25 percent. This means that Hispanic population growth is now at 25 percent per year (rather than 33 percent per year).

So, 80 percent of the illegal population of 400,000 is growing at 25 percent per year. 320,000 x .25 = 80,000 for 2006

480,000 x .25 = 120,000 for 2007.

This equals 600,000.

Of course, these calculations are just a very rough estimate. Moreover, I believe border apprehensions, as opposed to Census data, provide a more accurate predictor of the illegal alien population. Using this measure, there are probably well over 1 million illegal aliens in North Carolina.

In any case, the real problem here is that we simply don't know how many illegal aliens are in North Carolina. In our 2008 Blueprint, we recommend measures the state could implement that would help us get a more accurate count.

Other statistics used by the N & O are also either misleading or irrelevant. For instance, they assert that 3 percent of people in North Carolina don't speak English well. Consider, though, that from 2001 and 2006, Limited English Proficiency Enrollment (LEP) enrollment increased by 67 percent.

Finally, the article gives the impression that it is unconstitutional for localities to enact measures aimed at discouraging illegal immigration. If Hazelton's initial attempt at immigration enforcement was imperfect (the case is on appeal), the Immigration Reform Law Institute has since drafted model legislation that cities and towns can implement.

See, here, for additional examples of ordinances passed by several localities across the country.

... stay tuned for more analysis of the candidates' views on illegal immigration.

Incompetent Teacher Protectionism

There's a good debate about the state of education on Cato Unbound. I particularly liked this thread from Michael Strong. A slice:

The salient question is will we do more harm, on average, allowing parents and students greater decision-making powers in education than we are already doing. It seems unlikely that parents and students would do much worse and highly likely that they will do far better over time once we have created a competitive education market.

There are several features of a prospective competitive market in education that seem to confuse some observers. First of all, education is often somewhat of a natural monopoly in many places; insofar as families have to bear the costs (in time and money) of transporting their children to non-neighborhood schools, there is often a significant implicit tax associated with all but the geographically closest schools. As a consequence, most local education markets are oligopolies rather than competitive markets.

In order to overcome the quasi-natural monopoly of local schooling, we need national educational chains that compete for the opportunity to create new schools, with national brand-name appeal and associated capitalization and focused R&D to support their particular brand advantage. KIPP, Green Dot, and others are the beginning of this trend, but they are all still developing their ability to bring quality to scale. John Merrifield explains why large scale school choice is a crucial prerequisite to reaping the benefits of innovation and how the few existing choices are largely irrelevant.

Speaking of scalable franchises, Thales Academy - for $5000 per year - sounds like a very competitive model. Parents have to decide whether they like Direct Instruction, though. But ignore the unions. It works.
-Max Borders

Priorities Off the Rails

Big blue ribbons are found on big, big pigs. $8 billlion!
-Max Borders

Big Green Lobby (sung to "Big Yellow Taxi")

by Ken Green

(with apologies to Joni Mitchell)

They paved paradise
And built a bunch of a biofuel plants
Making ethanol fuel using coal
On their government grants

Don’t it always seem to go
That you don’t know what you’ve got
Till it’s gone!
They paved paradise
And put up ugly biofuel plants

Then they cut down all the trees
And planted lots of biofuel crops
Now the fertilizer runoff is
Causing giant ocean dead spots

Don’t it always seem to go
That you don’t know what you’ve got
Till it’s gone!
They ploughed paradise
To supply all the biofuel plants

Hey farmer farmer
Put away that subsidy now
Just grow the corn for tortillas
And leave me some pesos for cheese
Please!

Don’t it always seem to go
That you don’t know what you’ve got
Till it’s gone
They ploughed paradise
To supply all the biofuel plants

Late last night
I heard the screen door slam.
And a big yellow lobby
Took cheap food away.

Don’t it always seem to go
That you don’t know what you’ve got
Till its gone!
They paved paradise
To supply all the biofuel plants

Healthcare: Rebutting Adam Searing's "Rebuttal"

Adam Searing wants to deny people greater choices and more affordability. He wants to continue the favorable tax treatment of employer-based insurance, which essentially locks people into getting insurance through their employer. But if you lose your job, you also lose your insurance and the tax benefit that comes with it. Does Adam care? It's difficult to say. But he seems more interested in preserving the status quo, perhaps because he believes that this is the track that will get us to socialized medicine... And he's right about that.

But let me tell you what he's wrong (i.e. FALSE) about:

First, giving refundible tax credits is neither "radical" nor "dangerous". Tax credits allow people like waitresses, young people, the unemployed and the underemployed to get health insurance as easily (read: affordably, equitably) as someone who gets their insurance through work. It's that simple. When I was an adjunct professor teaching philosophy and making $20K a year, I had to buy health insurance on the individual market. And yet someone making $45K at a swanky office got subsidized to buy his health insurance by as much as $2000 a year. That's fundamentally unfair. But you don't have simply to believe me, ask the professors over at Duke University about this perverse, inequitable system.

Second, Mr. Searing tries to argue that the way one would pay for this system is to take the tax benefit away from employer-based insurance. This is simply FALSE. Notice how people in the background of his video keep laughing? It's because the claims he makes are laughable. All a refundable tax credit does is give you the same benefit whether you buy your healthcare on the individual market or at work--it doesn't matter which. People who would get their healthcare through work would enjoy the same benefit as they did before. So Searing is being, well, dishonest to claim otherwise. Perhaps it's desperation. Because tax credits would go a long way to reforming the healthcare market that he and his counterparts on the left have been busily trying to tear down, distort and ruin.

Finally, that means his '150 million people would be in danger of losing their health benefits' is just wrong. Mr. Searing would like for wealthier, gainfully employed people to continue to be subsidized while poorer, underemployed must fend for themselves? This suggests to me that he does not care so much about those people - including the uninsured and unemployed - who need affordable coverage, which tax subsidies would rescue. One should be very suspicious of his motives, then, as he generally claims to want to help cover the uninsured, which tax credits would most assuredly do. In fact, one would be crazy not to take $2500 for health insurance and not spend it! Carrots are preferable to Searing's sticks.

But in short, he offers NO EVIDENCE whatsoever that people with pre-existing conditions would be harmed by this. Indeed, if you have such a condition and lose your job, your healthcare is currently not portable. Under a system in which more people (not all, perhaps) get their insurance on the (more competive and thus less expensive) individual market, those people would have less chance of losing their coverage (expensive COBRA notwithstanding) no matter what happens with their job. And they'd get tax help to boot.

Adam Searing may have his heart in the right place on healthcare. But his head is totally in the wrong place. His hostility to tax credits reveals a genuine fear that his project to socialized medicine will fail if government stops privileging people with jobs. But if he really wants to help people, he'll join groups on the left who actually see the value in such a simple and elegant proposal.
-Max Borders 

Subprime Crisis: A Reasonable Post-Mortem

General hysterics about the subprime fallout and associated calls for government intervention make perfect demogoguery fodder for pundits, presidential candidates and economic illiterates. But if you've been looking for an intellectually honest, well-researched and thorough post mortem? Here's your paper.

Zywicki and Adamson not only caution us not to regulate away the aspects of the mortgage lending system that enabled millions of people to own homes at all, but not to forget the checkered history that lead up to crisis and helped to create it. In other words, blame is to be apportioned evenly among government regulators, the fed, lenders and borrowers themselves. The point of regulation going forward should not be to bail out irresponsible lenders or create impeditments to ownership, but help lenders correctly to gauge risk and to ensure abuses by either party are curbed.

The authors ask reasonable questions about the "optimum" level of foreclosure, and caution us not to forget the types of speculative investments that count among the foreclosures.In short, this is a rich complicated account written by talented economists. But it's a breath of fresh air compared to what you read in the papers.
-Max Borders

Moore's Endorsement and the State Pension Fund

By now, many of you have probably heard Barack Obama's commercial in which he proclaims he will impose a "windfall profits tax" on oil companies - specifically mentioning Exxon Mobil.

From an economics standpoint, it is an unavoidable fact that such a tax would harm shareholders of the affected companies. Oil industry analyst John Parry, senior vice president of John S. Herold, Inc., an independent research firm, explains it this way in this article:

"Giving that money (profits) to widows and retirees and grandmothers is good," said Parry. "This is a big help to smokestack America, which is holding big pension funds. If they want a windfall profits tax, taking 20 percent off the price of oil stocks, they're going to drag down a lot of buying power and hurt a lot of people."

On a related note, most of you also probably know by now that Democratic Gubernatorial candidate Richard Moore has endorsed Obama.

What do these two things have in common? Plenty.

Richard Moore's primary responsibility as State Treasurer has been to manage the state employee retirement pension fund. This fund provides retirement benefits for North Carolina's retired teachers, firemen/women, rescue squad workers and most other former government employees.

The allocation of the fund's overall "investment pool" consists of five primary subgroups: short-and long-term investment funds, the equity investment portfolio, the real estate investment portfolio, and the alternative investment portfolio.

A look through the treasurer's FY2006-07 Annual Report reveals some of the top holdings in each of the "investment pool" categories. What is the number one holding for the equity investment portfolio? See for yourself:

That's right, Exxon Mobil. In short, Treasurer Moore has endorsed a presidential candidate proposing a tax scheme that will hurt the returns of the very pension fund he has managed for the past seven years.

I'm not in the media, but if I was I just might consider asking him about this.

(HT: Francis D.)

Say Thank You

"It's not about politics." - the Gratitude Campaign.
-Max Borders

Enron, Progress and Duke: What in Common?

This history of the rent-seeking activities of Enron is a must-read when it comes to understanding the current activities of Progress Energy and Duke Energy. (If you don't know what rent seeking is, you'd better click here too and find out.)
-Max Borders

Climate Change: What Will Future Generations Say?

As MIT professor of atmospheric science Richard Lindzen observes:  "Future generations will wonder in bemused amazement that the early 21st century's developed world went into hysterical panic over a globally averaged temperature increase of a few tenths of a degree, and, on the basis of gross exaggerations of highly uncertain computer projections combined into implausible chains of inference, proceeded to contemplate a roll-back of the industrial age."

Healthcare: CAHI Roundup of Presidential Health Plans

Check it out. You be the judge.
-Max Borders

Dropping the Ball on Dropouts

Reducing North Carolina’s embarrassingly high dropout rate has been an issue that has been much in the news lately.  Over 23,500 students dropped out of North Carolina schools in 2006-07.  Last week, the Joint Legislative Commission on Dropout Prevention and High School Graduation developed ten recommendations to submit to the Legislature for consideration. (No these recommendations aren’t available online.  Maybe commission co-chairs State Senator Vernon Malone or State Rep. Earline Parmon can tell you why). Aside from a recommendation to evaluate the effectiveness of dropout prevention grants  --in my view, a good idea -- the recommendations are as disappointing as the problem they are trying to correct.  They provide nothing new and fail to offer the slightest suggestion that we’re in any way getting a handle on this problem. Recommendations like developing a system of sharing Information about dropouts (Recommendation 1), fostering a better school climate and safety (Recommendation 5) and urging more rigorous academic courses and less remediation (Recommendation 6) are vague and lack impact. 

My favorite is recommendation # 4 titled, Parental Involvement and Communication Between Schools and parents.  The text continues:

"The Commission believes that parental involvement is important to student educational achievement. . . The Commission believes that it is critical that parents be informed about a school’s expectations for students. . . The Commission encourages principals, teachers and Parent Teacher Association’s (PTAs) to develop methods to reach out to parents and guardians to involve them in student learning at home and school.”

All fine and good, but aren’t these recommendations suppose to be targeted on reducing the dropout rate? In another paragraph the Commission recommends in draft legislation that the Assembly appropriate funds for a dropout prevention coordinator in each high school that failed to attain a 65 percent 4-year cohort graduation rate. 

This is a bad idea. Last I counted, there are 147 public high schools in North Carolina that failed to achieve a 65 percent cohort graduation rate  --- about 37 percent of the High Schools in North Carolina.  A call to the NC Department of Public Instruction confirms that  although in some districts the dropout coordinator may have additional responsibilities, nearly all school districts already have a dropout coordinator.

Before spending additional funds, wouldn’t it be better to evaluate the effectiveness of these positions? Why bring in more staff if we don’t even know if dropout programs are working? Aside from the cost, adding dropout coordinators to troubled schools also seems to ignore the iron rule of the bureaucracy: bureaucracies work to expand their power and influence. Will a dropout coordinator really work to put themselves out of job? Seems to me a better option is to use incentives. Appropriate financial incentives for dropout coordinators and principals and added flexibility regarding the use of existing resources and staffing would do far more to reduce the dropout rate.  Now if only the Joint Legislative Commission believed the same we’d be making real progress.   

No More Board of Education

The Health Commission met to review its legislative agenda on Tuesday, April 22nd and at the top of the list was the latest effort to outlaw corporal punishment (CP).  The last time the Commission met, I detailed the plans by leftist Utopians to ban the practice of CP.  Little did I realize then that the days of the "board of education" were numbered.

Drafted legislation approved by the Commission states "Corporal Punishment shall be administered by hand spanking on the buttocks..."  No more paddles or rulers.  (What will creative high school shop teachers do with all of their new free time?) 

The other change to law requested by the social engineers is to report the age, gender, race  and special education status of each student disciplined.  Seems that the Utopians are worried about the number of minority kids on the receiving end of the rod.  I suppose quotas will be next. The Commission also worried that  special  education children are being punished despite laws against it.

I wonder why the NC Health Commission is pursuing this instead of a legislative committee on ... maybe, education? This is just what local school boards need.  More intervention from Raleigh that removes a tool that helps maintain discipline while adding yet another report to be collected, compiled and sent to Das Capital. 

Thank goodness that the legislature has already solved the drop out  problem and children  are capable of reading at grade level. Oh, wait a minute.  They are still "working" on it.  "Little Johnny, I know you can't read and you dropped out of school, but at least you didn't have to face the paddle."

Look for this bill to be introduced when the "Honorables" (sic) return to Raleigh for the "short" session in May.

Gas Prices: Why So High?

Here's a great econ 101 lesson on gas prices. I'd like to know why the water companies haven't been hauled before Congress and accused of price gouging.
-Max Borders

Ethanol Pro v. Con

Here's Newt Gingrich prostituting for ethanol.
Here's David Ridenour making sense. Love the phrase "fuel to nowhere."
-Max Borders

Happy Earth Day...The Lorax: An Alt Interpretation

Have you been thinking of “going green”? Do you consider yourself a Dr. Seuss fan? If yes to either of these, maybe you’ve heard of The Lorax—a popular Dr. Seuss children’s story that is held up by greens as a kind of environmentalist’s manifesto.  But what if I told you The Lorax was just as much a paean to property rights and free trade. Would you think me crazy?

For those who haven’t read The Lorax, the story goes something like this:

A character called the “Once-ler” discovers land rich with Trufula Trees, a resource that can be made into almost anything – at least when the Once-ler applies his ingenuity to creating the things his customers value. However, wildlife like brown bar-ba-loots and Swomee-Swans depend on the Trufula Trees for food and habitat. Once the Once-ler gets started harvesting the trufula trees for his lucrative enterprises (whose biggering seems never to end), the bar-ba-loots and the Swomee-Swans rapidly begin losing habitat. There is pollution, too (Gluppity Glupp and Shloppity Shlopp). Our protagonist, the Lorax, appears and begins trying to shame the Once-ler. But the profits roll in and the Once-ler ignores the Lorax’s warnings.  Then the worst comes to pass:

“And at that very moment, we heard a loud whack!/From outside in the fields came a sickening smack
of an axe on a tree. /Then we heard the tree fall./The very last Truffula Tree of them all!”

The genius of this story is that Dr. Seuss describes in simple and enjoyable terms a phenomenon called the Tragedy of the Commons, which was set out in detail by Garett Hardin in a seminal 1968 essay. Hardin uses a number of examples of showing how property owned in common (either by no one or by everyone) will tend to be overexploited. Why? Because no one has an incentive to conserve resources, since each person reasons: “if I don’t use it, the next guy will.”

We can think of a lot of examples of these tragedies:  two siblings sharing a milkshake with two straws; a pizza at a fraternity party; the Amazon Rainforest; a common pasture for grazing lifestock; the ivory of African elephants. In all of these situations, overconsumption is a result of nobody owning the resource in question and everyone racing to use it before someone else does.  A perverse result. So how do you stop the tragedy of the commons? Well, private property rights, of course.

For example, North America has more trees today than in over a century, according to the U.N. Food and Agriculture Organization, yet we probably consume more timber and paper products than ever. How is this possible? Private timber companies have an incentive not to over-consume trees and to replant whatever they harvest to ensure future returns on their stock of resources.

In Africa, a successful program called CAMPFIRE enabled villages to have property rights in elephants of their region. The villagers allowed limited hunting – but only to paying customers, not poachers. The villages, once desperate, profited.  Elephant populations soared.

Examples of how property rights ensure resource conservation abound. I need only mention Ducks Unlimited or the Nature Conservancy when discussing some of the nation’s most cherished private wildlife habitats. And what about pollution? Fishermen in the UK had rights to a stretch of river being polluted by a factory. The fishermen sued, which required the factory cease and desist—and clean up to stay in business.

So how do I know that The Lorax is not merely anti-industrialist screed, but a nod to responsible capitalism bolstered by property rights?  I read this:

“And all that the Lorax left here in this mess/was a small pile of rocks, with one word...UNLESS.
…
SO... Catch! calls the Once-ler./He lets something fall./It's a Truffula Seed./It's the last one of all!/You're in charge of the last of the Truffula Seeds./And Truffula Trees are what everyone needs.”

A pile of rocks? OK, so it helps that the illustrator shows the rocks in a circle around the last seed. But could this symbol be of property rights? It's not common property so keep off! -- that says to me. Overconsumption due to tragedy of the commons can be remedied easily with both property rights and a robust common law system to bring suits against those who would gluppity glup on our property. Now, I realize that not all environmental problems are so easily dealt with via property rights and conservation. But certainly 95 percent of them are. Sadly, environmentalists today would not only abandon private property rights for draconian regulation and state ownership of property, but many would cannibalize their own agenda for the sake of global warming (just look at ecological damage ethanol has wrought).

(Thanks to Paul Feine for introducing me to this great story and to pointing out this interpretation.)
-Max Borders

Don't Worry, Its Just Government Money

We often hear stories about the abuses of the Medicaid system and we call them "horror" stories.  Monday's News & Observer/Charlotte Observer has a real horror story about a criminal conspiracy masquerading as a dental practice in Charlotte.  The details are chilling.  A 5 year old little girl was strapped into a chair and had "mini" root canals done on 14 teeth with steel crowns  added in one session.  (Ever seen Sir Lawrence Olivier as the Nazi dentist in "Marathon Man?")

  The article states that the child's mother took her to the clinic to just have her teeth cleaned.  What ended up happening was a multi-hour torture session on Antavia Digsby. 

Where to begin?  There is just so much wrong with this story.

• Children only have 20 teeth to begin with, so this person (pretending to be a dentist) got all but 6 of them.
• The staff refused to let the mother see the child during the "procedure." (Screams?, What screams?)
• The so called Dentist noted in the file that the child was "very uncooperative."  (I'm sure.)
• The name of the practice is a dead give away: "Medicaid Dental Center" (Now known as Smile Starters)
• The owners have just agreed to pay a $10 Million settlement to avoid  going to court  for over charging Medicaid.

The Dental Board has documented other children as young as 4 years old  having teeth pulled out and mini root canals while some children had 16 and 17 teeth canaled and crowned at this "Little Shop of Horrors".  If they have the ability to pay a  settlement of $10 Million, how much  have they billed in the past?  All of this happened nearly 5 years ago.  How long have these crooks been defrauding the guv'ment (i.e. you and me)?

When dental & medical con men get wind of big money in Medicaid and Medicare, look out.  John Dillinger never got his hands on $10 Million.  Maybe he would have been better off becoming a dentist.  Let's hope the tooth fairy is good to Antavia and her mother in court.

When the government pays, fraud is inevitable.  Hopefully, these con-dentists can use their alleged talents at a federal penitentiary near you.

CLC'08: Yeoman's Work

As ever, Dean Stephens does yeoman's work (voluntarily) cataloging much of the CLC. Check out some of Dean's great highlights here, here and here.
-Max Borders

So What's Wrong with Singapore's Healthcare System?

Not much apparently.

Our friends over at NC Policy Watch took a cute lil swipe at me because I suggested we emulate Singapore's healthcare system in terms of...
a) subsidizing the poor to get private health insurance and,
b) expanding the use of health savings accounts (HSAs).

Why would the left make fun? Because the only way to argue with the truth is to deride it.

But Singapore is doing something right: see here, here and here. Oh, and here if you buy the WHO's methodology -- they put Singapore at #6. Singapore spends less than 5% of GDP on healthcare compared to 16% in the US.
-Max Borders

Healthcare: HSAs & Preventive Care - As Promised

For those of you who may have caught WRAL's Headline Saturday where I talked about our ailing healthcare system, I promised you studies that indicate increased likelihood that folks with HSAs would get preventive care. Here they are:

1. On the incentives/providers side, there's this study from AHIP.
2. In this study, use of preventive care increased over traditional HMOs and PPOs! (And no, Cigna has no incentive to bias the study in favor of the consumer driven option. Quite the contrary.)

To the latter study: are people with HSAs less likely to procrastinate on getting care with HSAs, HDHPs?

"No," says the Georgia Public Policy Institute (GPPI) referring to a Cigna study: "regardless of the type of insurance policies, Americans tend to procrastinate in going to the doctor. A comparison of HSA-eligible plans to others shows HSA enrollees are no more likely to forego care:

-Did Not Go To Doctor: 18% of HSAs; 18% of other plan types
-Delayed Treatment:  17% of HSAs; 17% of other plan types
-Delayed Prescription:  15% of HSAs; 15% of other plan types"

Folks like my counterpart on the show, Adam Searing, would have you believe that HSAs and HDHPs are "crazy". Maybe my family and I are crazy, but we like our consumer driven plan and we don't need busybodies to make our healthcare choices for us, or to obscure the facts about the benefits of such plans--plans we have enjoyed.

(Note: In a sickening turn of events, Democrats have begun trying to dismantle efforts to have more health freedom.)
-Max Borders

Woooooooooooooooooo!

Our YouTube video of the week (heck, this is already odds on favorite to be YouTube video of the Year), features Congresswoman Sue Myrick giving a speech on the floor of the US House of Representatives to honor the career of the one and only, Nature Boy Ric Flair!

Woooooooooooooooooooo!

An Idea for Charlotte

Since Charlotte's LYNX Blue Line light rail doesn't have turnstiles or ticketing gates you must pass through, they basically have an honor system of paying your fare to ride the rail.  They threaten you with a $50 fine if you are caught, but that enforcement is probably quite difficult to pull off.

Maybe they should borrow an idea from Vancouver where transit police there are tasering people who do try to skip out on paying the fare.

The country's only armed transit police have been tasering passengers who try to avoid paying fares.

According to documents provided in response to a Freedom of Information request, police patrolling public transit in the Metro Vancouver area have used tasers 10 times in the past 18 months, including five occasions when victims had been accosted for riding free.

That'll scare me into buying a ticket a heck of a lot more than a fine.

(And no, you squeamish lefties, I'm not really advocating this, just though it was interesting.)

TV Alert

Those of you in the Raleigh area not going to the CLC, make sure you tune into WRAL's Headline Saturday at 7pm tomorrow evening to see Civitas' own Max Borders debating the left's Adam Searing on health care.

Should be a can't miss event.

McCain Blocking Schuler's SAVE Act?

From Human Events:

A new wrinkle in SAVE Act politics occurred when Congressman Shuler, addressing a Rotary Club meeting last week, accused Senator John McCain of calling House Republicans and asking them not to sign the discharge petition. News reports say that McCain’s office denies those accusations, but Senator McCain’s office did not return calls for additional comment. ...

Senator McCain might believe that the passage of an immigration bill with strong enforcement provisions would be a net political negative for him, so it would not be a major surprise if he did indeed try to keep the SAVE Act stuck in the Congressional swamp. If John McCain is indeed opposing the bill (and for now I will accept his office’s denials), he’d do well to make sure he does it behind closed doors. If he thinks that conservatives are wavering about supporting him now, proven reports of his interfering in the passage of the SAVE Act could be politically devastating.

Follow the discharge petition here.

--Jameson Taylor

So, About that Budget...

Bad news for NC budget writers today.

First, Tax Collections Slowing.

Now, Feds withhold $175 million from state. (BTW, how old is that picture of Dan Gerlach? Seriously, is that his high school yearbook picture?)

The Federal government has so little faith in NC to administer the mental health program that they are withholding Medicare and Medicaid funds.  Yikes.

Maybe the session will be a little more interesting than the borefest everyone is predicting.

Civitas Poll: Voters Want Laurean Charged With 2 Murders

Should murderers who kill a pregnant woman that is carrying a viable fetus be charged with one murder or two?

34 states including California and Massachusetts say that is considered two separate murders.  In the state of North Carolina, the death of the viable fetus is an "aggravating factor" that can yield a higher punishment, but is not considered murder.

For our April poll, we asked likely voters: "If a woman is carrying a viable fetus and she is murdered, should there be one or two murder charges?"

82% of respondents said two.  12% said one.  7% were not sure.

Read our full press release here.

Immigration Reform Dies in South Carolina

South Carolina's comprehensive immigration reform bill is dead after a conference committee could not agree to eliminate the use of I-9 forms to verify legal status.

In short, the chambers of commerce killed this bill by claiming that verifying the legal status of employees is difficult, expensive, unreliable, and just downright mean-spirited. Permit me to respond to these claims:

1) South Carolina's proposed legislation would have required employers to use a state driver's license or the E-Verify system to run identification checks on potential employees. The first option sounds easy enough. The E-Verify system is a federal, Web-based system that employers can use for free. Checking immigration status takes seconds.

2) As for unreliable, this is an interesting charge given that I-9 forms, which is what the chambers of commerce want to use, are completely unreliable because the federal government does nothing to verify the names and Social Security numbers on these forms. Indeed, the Social Security Administration makes money every time an illegal alien uses someone else's Social Security number.

3) As for being mean-spirited, what is mean-spirited is the refusal to obey the law because doing so might cut into your profit margins. What is mean-spirited is rewarding law-breakers by not enforcing the law.

... To learn more about E-Verify, join us in Greensboro on Saturday afternoon, where Garrett Roe of IRLI will be discussing this issue.

Ouch: More Universal Healthcare Failures

Half the population in Britain going without dentistry in the last couple of years. People pulling out their own teeth. Yikes!
-Max Borders

Hint Hint, says Dome, Early Voting for Obama

IN CASE YOU WANTED TO VOTE EARLY FOR OBAMA... Dome lets you know that the candidate is running Google ads that tell you how if you click on them!
-Max Borders

Civitas Poll: Death Penalty Should be Used

As you know, we currently have what amounts to a de facto moratorium on the death penalty as the General Assembly finds one excuse after another to clarify the state law.

Well, the U.S. Supreme Court took one of the General Assembly's excuses off the table yesterday by upholding the constitutionality of lethal injection by a 7-2 decision.

It just so happens that we included in our poll this month a question on whether NC voters support the use of the death penalty.  From our press release yesterday:

In conjunction with today’s ruling by the U.S. Supreme Court upholding the constitutionality of lethal injection as a means to administer capital punishment, the Civitas Institute released results of its April DecisionMaker poll revealing that North Carolina voters approve of the use of the death penalty by a greater than two to one margin.

The Civitas Institute’s April DecisionMaker poll reveals that 60 percent of North Carolina voters support the use of the death penalty in North Carolina, while only 27 percent are opposed. 12 percent were undecided.

Read the full release here.

Will the General Assembly now act during the short session to clarify the use of the death penalty one way or another?  Seems as if the public deserves an up or down vote one way or another.  Either use it, ban it or pass a moratorium, but the General Assembly cannot shirk its responsibility to decide this issue (as they are elected to do, unlike the NC Medical Board) once and for all.

Hey Winston: Dole to Speak at CLC'08

According to Dome, the Winston Salem Journal has just endorsed Senator Elizabeth Dole and Kay Hagan in their respective primaries.

For a clumsy segue, Winston folks, Senator Dole will speak in nearby Greensboro tomorrow if you want to come out and see her. Or come out Saturday and spend the whole day engaging issues - Register!
-Max Borders

Skybus & Corporate Welfare

Chris Hayes's and my Skybus article is now on the Web.
-Max Borders

Durham: And Speaking of Light Rail

According to this article (registration required), Durham is thinking of copying Chapel Hill by providing "free" (read: fully tax-subsidized) bus transit. Now, notice that Chapel Hill's massively increased bus ridership has been used to justify building light rail. Notice also that Durham is slated to get part of the light rail line that planners hope to build in the Triangle - despite myriad problems, low density, exorbitant costs, etc. etc. I wonder: is this sudden spell of generosity to Durham denizens merely a pretext to set up the argument to justify the construction of light rail in the Triangle? I'm just asking.

It also leads me to ask a fairly obvious question: why can't all these yuppies that the taxpayers of N.C. are going to be subsidizing to take rail transit ride a bus? Surely it costs less by about a factor of 20-or-30.
-Max Borders

Does Rail Transit Save Energy or Reduce GHGs?

Nope.

Good Job, Chris, Dome

Dome has done a nice little piece on our own Chris Hayes who wears the hat of pollster (particularly of late.) Dome also has profiles of Elon's Hunter Bacot and PPP's Tom Jensen.

The question of bias came up in the piece, which always seems to be directed at Civitas. But there is plenty to go around in all three polls.  I'd like for the media to do a better job of ferreting out any bias all the way around.
-Max Borders

Double Standard? Eve Carson vs. Marcus Lassiter

Various N.C. news outlets are reporting today that in the wake of Eve Carson's murder, the North Carolina Department of Correction has asked the National Institute of Corrections (an agency within the U.S. Department of Justice) to "review training and practices of probation offices in the state's urban areas." Apparently, similar reviews have been done in the past.

Now, if it is appropriate for the DOJ to review the training and practices of probation officers, why is it not appropriate -- as some have suggested -- for local law enforcement officers to be trained by Immigration and Customs Enforcement (ICE) officials, as is currently being done via the 287g program in Mecklenburg, Alamance and Gaston?

Going one step further, permit me to pose a tough question: If Eve Carson had been murdered by an illegal alien -- instead of two young black men out on probation -- would the state be inviting ICE to review North Carolina's immigration enforcement policies -- or lack thereof?

I would bet not. Yet, just this past weekend we saw a 7-year-old black boy, Marcus Lassiter, killed by drunk driver Pollo Hernandez Rodriquez -- likely an illegal immigrant.

Will Marcus merely join the rolls of an ever-growing list of victims -- Scott Gardener, Lewis Fetterman, Hester Coleman -- or will his death be the tipping point that prompts real reform, as apparently Eve Carson's death has?

Polling the GOP Primary

Tom Jensen at Public Policy Polling released their weekly tracking poll in the GOP race for governor today and while it shows a similar overall lead for Pat McCrory (about 10 points) as our poll released last Friday, there are some different demographics that may paint a different picture.  One of the main differences between our polls is the age distribution of who we poll.  Our poll tends to be older, PPP's much younger.

First of all, as always, we did not poll likely Primary voters, we polled likely General election voters, so our poll numbers should not be construed as a true reflection of what Primary voters will do.  These are two completely different groups who do not always vote or think the same way.   

Our poll skews considerably towards the older age demographic since these are the people who vote in General elections.  (In our GOP sample, 37% of the respondents were 65+ and another 23% were 55-64).
Older people vote in greater intensity than younger voters, it's just the way it is.  Our poll shows McCrory leading among older votes by 12-16 points. 

PPP's poll of GOP Primary voters only has 20% of their sample coming from those aged 60 and above.  And among those voters, they have McCrory leading Smith by only 1 percentage point (34-33).

The demographics for the GOP Primary is that it has traditionally been composed of nearly half of voters coming from the 60+ age group.  So if PPP's percentages for that demographic are correct, they would show a much closer race between McCrory and Smith if you weighted that result to a larger percentage of the sample.

While our poll isn't primary voters, it shows just about the opposite of PPPs -- older voters voting for McCrory in higher numbers.

Who is correct?  I don't know, it's probably somewhere in the middle.  McCrory is up on Smith, but probably by a smaller margin that either of our polls show.

Civitas Poll: 2/3rds Think Taxes are Too High

As everyone celebrates tax day today, we are releasing results of our April DecisionMaker poll that shows that 2/3rds of NC voters think the amount of taxes they pay are too high for the services they receive from state government.

The Civitas Institute’s April DecisionMaker reveals that two-thirds (66%) of North Carolina voters believe state taxes are too high for the services they receive. 29% believed it was about right, while only 2% thought taxes were too low.

“North Carolina residents overwhelming agree that they are not getting back in services what they are paying in taxes,” stated Civitas Institute Executive Director Francis DeLuca. “North Carolina used to be known as a low-tax state, but this is increasingly farther and farther from the truth,” DeLuca added.

Read the full release here.

More Lakoff-like Pap from Richard Conniff

Conniff borrows from Lakoff (which we've covered here). Here's Professor Boudreaux's response:

Richard Conniff proposes that the money we pay to government be called "dues" rather than "taxes" ("Abolish All 'Taxes',: April 15).  He argues that "we need language to remind us that this is our government, and that we thrive because of the schools and transit systems and 10,000 other services that exist only because we have joined together."

A celebrated intellectual tradition - represented by the likes of Adam Smith, F.A. Hayek, and Ronald Coase - holds tha