In A Flash

It’s been almost a year since I commented on anything written by Oklahoma Council of Public Affairs contributor Greg Forster who is a fellow with the Friedman Foundation for Educational Choice.  He’s the one who early on eased my conscience about referring to these fellows as Limited Thinkers when he used the oh so clever term “Blob” to refer to Oklahoma’s school teachers, bus drivers, classroom assistants, cafeteria workers, custodians and building principals who work hard to educate over 650,000 children in our state.  In his latest “contribution” to the Oklahoma Council of Public Affairs website, Does School Choice Expand the Welfare State?, June 1, 2017, he doubles down on his name calling, but argues so shallowly that “in a flash” we will see how he is so enamored with his own rhetoric that he misses the point entirely.

But first to another flash, the Green Flash, the second of my Pacific Beach trifecta sightings (see A Rise By Any Other Name for the first).  Don’t you love the segue?  It may have been our second visit to San Diego–first was with children so no romance–in the late eighties, but was at least early nineties, when we enjoyed a dinner for two at the Marine Room in the La Jolla Shores area.  Linda and I were watching a beautiful sunset through the picture window on a perfectly clear evening and when the sun finally disappeared beneath the ocean we turned to each other and said, simultaneously, “Did you see that?”  Right at the moment the sun disappeared, its yellow falling behind the ocean’s blue, a brief green flash of light appeared and then was gone.  It was memorable for us, but I don’t think we were able to substantiate our vision until a few years later when an internet search confirmed that our experience was a real phenomenon.

As we became regular semiannual visitors to San Diego in the years that followed our son’s permanent relocation there in 1998, we became well acquainted with the Pacific Beach and Mission Beach neighborhoods, including a restaurant named the Green Flash right on the beach promenade where Pacific Beach becomes Mission Beach (it closed a couple of years ago).  We have watched many sunsets over the years from these beaches and mostly due to cloudy skies have usually failed to see the green flash; but at least twice, and maybe more, we have again enjoyed the brief pleasure of a green flash sighting.  It is a phenomenon, according to internet postings, that can occur with a sunset over any body of water under the right conditions, though we have not experienced it elsewhere.  To my simple understanding it is just the effect of the color wheel, blue and yellow briefly mixing to create the green flash.

Here is a photo something like what we’ve seen I found on the internet, followed by a photo we took when we tried, but failed, to see the flash at PB.

Now to Limited Thinker Forster.  It’s hard to wade through his language like “omnipotent and omnibenevolent state”, “ever-expanding technocratic state”, “bureaucratically bloated, lethargic, and incompetent”, “leeches who suck money out of the school bureaucracy without contributing to education”, and “greed and sloth”, and get directly to his point, which centers around this quote by State Superintendent Joy Hofmeister who, concerned about the state’s revenue shortfall, opposed legislation that would establish Education Savings Accounts (ESAs) in Oklahoma, “Is this the right year, is this the right time to start a new government program?”  In Forster’s one size fits all little mind this marks Superintendent Hofmeister’s concern as disingenuous “anti-government rhetoric”.  You see Forster is employed by a foundation whose mission is to promote the expansion of “school choice” legislation like Education Savings Accounts, so Hofmeister’s opposition is messing with his livelihood which includes trying to deliver access to tax dollars to those businesses that make financial contributions to his employer (just guessing here, but bet it’s true).  You see public education in this country spends a lot of money and shifting control of those expenditures to individual parents, whose only responsibility is to their family, not to the public who has provided the funding through taxation, will open up new markets to businesses seeking to profit.  That’s not necessarily bad, though I doubt Forster’s claim that such will always “improve educational outcomes”, and suspect his vision will lead to more TV Ads for the latest and greatest sure fire educational programs than we now have for prescription drugs, though absent the warnings.

Anyhow I digress.  My “in a flash” point is that Forster misses the point of Superintendent Hofmeister’s concern.  She is responsible for following the laws of this state and to supervise the provision of educational services to over 650,000 students; Forster is apparently only responsible for regurgitating the same anti-government rhetoric over and over.  I think “Is this the right year, is this the right time…” clearly is referring to the flat, at best, and uncertain budget she faces for FY 2018.  As a prudent public servant she is right to be concerned about any new program that could add to costs in the short run when, as Forster acknowledges, the state “can’t pay its bills”.  You see despite Forster’s generalized statements like “a well-designed school choice program won’t cost money, but merely redirect existing levels of spending.  Most choice programs actually save money for state budgets,” etc., thoughtful analysis concerning the short run impact suggests otherwise.

Here is how one researcher puts it:  “What can complicate the task of calculating potential voucher savings are other factors that can affect the results:  First and foremost, eligibility for a voucher program may include some students who would have enrolled in a private school even without the vouchers’ financial assistance.  This “private school propensity” effect is an incremental public cost that must be taken into account.”  Translated, what Hofmeister must be concerned about is that a new ESA program could draw in students who, without the ESA program, would have cost the state of Oklahoma nothing, but now become an additional cost.  According to the Oklahoma Council of Public Affairs there are some 100,000 private school students in Oklahoma (I show why the number is more like 45,000 in my post This Is Too Much Fun) so it is not a concern she can ignore.  I don’t know if anyone attempted to estimate this additional cost with respect to the Education Savings Account legislation Forster is mourning, but a good resource in making that effort would be to check out the work of the researcher I quote above, namely Jeff Spalding whose paper The-School-Voucher-Audit:  Do Publicly Funded Private School Choice Programs Save Money?” was published by, wait for the drum roll, The Friedman Foundation for Educational Choice, Forster’s employer, in 2014.

This gets me back to my primary gripe about the Oklahoma Council of Public Affairs and its brother The 1889 Institute.  Hofmeister’s comment was reacting to actual legislation that had been filed.  She was right to be concerned about its impact on the state’s budget and needed to look no further than The Friedman Foundation to find support for her concern.  What a good think tank would do, one that is serious about real research, is to produce an analysis of the incremental cost to implement the ESA legislation, perhaps using Spalding’s work as a framework for that analysis.  I haven’t asked, but I doubt either one took the time and, sadly, doubt that either one has the thinker power to do such work.  They aren’t even curious enough about the underlying facts to figure out how many children are educated at home and by private schools, the necessary starting point.  What the OCPA has given us is just Forster’s misguided and warmed over sour grapes.  By the way, Mr. Forster, I’m still involved in government and I use email all the time.  When I do I keep it professional and to the point—you should try that, it works.

As always lunch is on me for the first to ID the location of the photo.

There’s No Such Thing as a Free Lunch

 

 

Nelson-Atkins Museum of Art, Kansas City.  ID’d by Greg Morris and John Gammie.

We just returned from a six-day road trip through a lot of farm land and a few small cities in five other states—a real

The day before we left I had lunch with one of the “fellows” at the Oklahoma Council of Public Affairs, yes one I have referred to as a limited thinker in a couple of posts, and B J Ryan, CFO for Moore Public Schools who had ID’d my Thinker photo from Roswell, New Mexico.  It is a burden of thinking about all things economic that I realize my Social Security income is dependent on the ongoing productivity and good graces of those currently employed as well as many, I hope, not yet even born.  For that reason, I try to share my good fortune by buying lunch on occasion for those who are paying into the Social Security Trust Fund and supporting public and private programs that help children become productive adults.  You see, unlike the Oklahoma Teachers Retirement System Trust Fund that is as real as much of Warren Buffet’s investments, the Social Security Trust Fund is mostly a creative accounting entry on the books of the United States Treasury so that the future security of my “entitlement” income depends less on the amount in the Trust Fund than on the ability and willingness of current workers to keep paying in.

The father of American conservative economic thought Milton Friedman used the phrase “There’s No Such Thing as a Free Lunch” to remind us that government programs that provide free services, such as SNAP or food stamp benefits, to individuals, no matter how deserving, may appear “free” to the recipients, but to society or the economy represent a diversion of resources from some, through taxation or public debt, to others, and often result in perverse incentives that lower overall productivity and welfare, possibly even for those receiving the “free” benefit.  One of his many books even bears that title.

The economic principle behind the phrase is “opportunity cost” which refers to the fact that using a resource to do one thing precludes it being used to do something else which (the “something else”) is in effect the real “cost” of the choice that has been made.  The lunch we enjoyed was not free to me because, obviously, the money I spent on it is now not available for my preferred “something else”, such as theater tickets.  And truly the lunch was not free to my guests because they lost the opportunity to use their time doing something else and instead had to listen to my old man stories.  It can be fairly stressful to think like an economist.

It would be helpful though if more of our political leaders in Oklahoma would think like economists.  A Tulsa World article on June 2, 2017 quoted several Oklahoma lawmakers who have come to the realization that there are essential services provided by the state that should be funded and that recent tax cuts have deprived our state of sufficient revenue to provide those services, i.e. we have a revenue problem.  But one legislator from Broken Arrow, showing his disagreement with the obvious, “repeated a favorite quote from Winston Churchill about a state trying to tax itself into prosperity and said, ‘Government does not produce wealth. Government consumes wealth. You as taxpayers, you as business owners, create wealth. That’s what we need more of — not more government.’”

I don’t know if Winston Churchill really said that, but if he did it was likely taken out of context.  Here are a couple of excerpts from Wikipedia about Churchill:

“In 1909, he set up Labour Exchanges to help unemployed people find work.[79] He helped draft the first unemployment pension legislation, the National Insurance Act of 1911.[80]…Churchill also assisted in passing the People’s Budget,[82] becoming President of the Budget League, an organisation set up in response to the opposition’s Budget Protest League.[83] The budget included the introduction of new taxes on the wealthy to allow for the creation of new social welfare programmes. After the budget bill was passed by the Commons in 1909 it was vetoed by the House of Lords. The Liberals then fought and won two general elections in January and December 1910 to gain a mandate for their reforms. The budget was passed after the first election, and after the second election the Parliament Act 1911, for which Churchill also campaigned, was passed. In 1910, he was promoted to Home Secretary…The People’s Budget attempted to introduce a heavy tax on land value, inspired by the economist and philosopher Henry George.[84]  In 1909, Churchill made several speeches with strong Georgist rhetoric,[85] stating that land ownership is at the source of all monopoly.[86] Furthermore, Churchill emphasises the difference between productive investment in capital (which he supports) and land speculation which gains an unearned income and has only negative consequences to society at large (“an evil”).[87]”

I realize later Churchill may have had different views on such domestic policy matters than did early Churchill, but still I suspect Churchill’s views on government’s role in the economy were always much more nuanced than the simple quote “Government does not produce wealth; Government consumes wealth” suggests.  Wealth, as economists understand the term, refers to productive resources regardless of how they are owned.  Having just driven almost 2,000 miles on federal and state highways it is apparent that our economic prosperity is enhanced by the real wealth that is our highway system for vehicular transportation.  Yet these roads, which are an important component of our national wealth, are owned by governments—does that make them inherently wasteful or unproductive?  At the same time cigarette packaging machines and equipment are owned by private companies and are also part of our national wealth—does that make them inherently superior to government owned wealth like school buildings?

Examples of government owned and produced wealth that has enhanced our prosperity throughout history abound and refute an over-simplified understanding of Churchill’s quote.  Successful economies rely on smart production of wealth by government, whether it’s a national interstate highway system, Tulsa’s Spavinaw water project, the production of hydro-electric power in the northwest, or an aircraft carrier that maintains open commercial transit throughout the world’s oceans.  These are all examples of physical capital that are part of our nation’s wealth.  We also enjoy enormous human capital in the form of an educated, healthy and productive population, which further adds to our nation’s prosperity.  The quality of our human capital is partly due to smart government investments in education (public schools, G.I. Bill, etc.), food production (research at state universities), health care (medical research and various health insurance programs), and many other areas.

Because there’s no such thing as a free lunch when we choose to have government owned wealth and make smart government investment in education, health care, food and water supplies, energy production, etc., we must give up something else and we most often do so by paying taxes—duh.  Or we could do without those smart government investments and live in a country that would resemble any one of several nations on our planet that do not enjoy functioning governments able to produce the collective infrastructure wealth necessary for our economic prosperity.

As always lunch on me to the first to ID the location of the thinker in training photo above.

 

 

 

A Rise By Any Other Name

I began my summer “job” last week being chauffeur and companion for two 12 year olds so struggle for quality blog time.  That’s my excuse for opting to do a fairly superficial post with a summer theme.  One of our pleasures the past twenty years has been semiannual visits to San Diego, always including outings to the Pacific/Mission Beach area.  Our most fun visits include any of my “beach sightings trifecta” of grunion, the green flash and Slomo.  More about grunion and the green flash in later posts, we’ll focus on Slomo in this one.

Slomo is Dr. John Kitchin, a retired neurologist, who for many years has enjoyed inline skating up and down the Pacific/Mission Beach “boardwalk” in a graceful slow motion style, often accompanied by music.  He “dropped out” of the rat race for a very early retirement, pursuing his passion and bringing pleasure to many.  We have enjoyed a few sightings over the years and always keep an eye out while we are at the beach.  He is also a Geezer.  Here is a video link.

Slomo

Intending no disrespect to Dr. Kitchin, or to “Dr.” Schlomach, I’m designating Byron Schlomach, Director of the 1889 Institute, as “Schlomo” because, even though he purports to have a PhD in Economics from Texas A & M, he has dropped out of using his training, to pursue something—maybe his passion, but not real economic analysis, more likely a steady income—while bringing pleasure and enlightenment only to himself and his donors.  I’ve critiqued Byron Schomach’s sloppy work before in Double, Double, Toil and Trouble, Later, Sooner and Miserables Love Company, some of which he has acknowledged to me, but he doesn’t correct his published “research” so until he shows himself worthy of the PhD he touts, in this and future posts he is Schlomo.

Schlomo’s latest is a May 2017 Policy Analysis titled “Public Education Spending In a Historical Context”.  I’ll try to find the time this summer to do more analysis of his “analysis” but for now just want to make a general comment and a pedantic correction to it.  The general comment is the bottom line of Schlomo’s “analysis” is that plenty of money has gone into K-12 education over the years (love it when he starts with 1920, a year that has so much relevance for us today) but that it isn’t getting to the classrooms or the teachers, rather it’s gone to employ “non-instructional staffing” who, we must conclude, do nothing to benefit students.  His “analysis” is simply an echo-chamber for the work, actual research, done by Benjamin Scafidi shown on the website of the Oklahoma Council of Public Affairs which I’ve commented on in A Dirge for a Surge, Purging the Surge and The Glib, The Bad and The Ugly.

Scafidi’s work raises a useful question, one that real follow up research using Oklahoma data might provide some insights helpful to Oklahoma policy makers, namely what do all these “non-instructional” workers do?  Every school employee in Oklahoma has a job code associated with their cost/pay (I actually had three), so it is very knowable with real research.  In one of my posts critiquing Scafidi I point out that the largest “non-instructional” work groups at my school district are teacher assistants, child nutrition workers and bus drivers.  From my 60+ years observing public schools in Oklahoma the growth in these jobs has been driven by the IDEA (special education services), expansion of early childhood education, increased student participation in school lunch and breakfast (didn’t exist in my day) programs, and concerns about student safety (walking/biking to schools).

Until Schlomo does the analysis of these impacts on employment, for which data is available, then his generalized whining about the cost of schooling is not worth considering.  It drives me crazy that he, and his kindred spirits at the Oklahoma Council of Public Affairs, actually get paid for just repeating the same generalities when they are supposedly doing “research”.   It is also fun to note that Schlomo uses his own data when he transitions to Oklahoma, not data from the National Center for Education Statistics which I think is available for each state.  And notice that his Oklahoma data cuts off at FY 2009, not FY 2013 as for the national data–we sure don’t want to remind his readers of what has happened in Oklahoma the last eight years.  Schlomo is as shameless as he is careless.

Now here’s the pedantic part.  In painting the picture of unrelenting new money pouring into our public schools nationally, yet nothing to show for it, he describes it this way,

“Given the continued geometric rise in spending per student from 1990 to 2009, it is apparent that little of the additional money was used to hire more teachers.”

I don’t have a PhD in economics like Scholmo, but I took enough college and graduate level economics courses to know you can’t survive economics study if you don’t understand basic mathematics and statistics.  These disciplines inform us, actually in high school, that there are two basic kinds of formulaic growth or increase or “rise” definitions:  arithmetic and geometric.  Simply stated arithmetic growth projects a subsequent year (Y2) by adding a constant amount (A) to the current or earlier year (Y1), so an example of an equation generating arithmetic growth is:  Y2 = Y1 + A.  A simple arithmetic growth series is 6000, 8000, 10000, 12000, 14000; see here his Figure 1 and the $2,000 per decade increase he describes, beginning FY 1970.

By contrast geometric growth projects a subsequent year (Y2) by multiplying a constant amount (A) (which is greater than one) times the current year (Y1), so an example of an equation generating geometric growth is Y2 = A times Y1.  Here’s what geometric growth, starting with 6000 and the first decade increase of 2000 would look like; it’s a factor (A) of 1.333:  6000, 8000, 10667, 14222, 18963.  My Chart is a graph showing close to his Figure 1 numbers (series 2 in red), growing ARITHMETICALLY, contrasted with the numbers if growth truly had been “geometric” as Schlomo claims (series 1 in blue).

The blue line is what geometric growth looks like.  I guess arithmetic just isn’t as scary as geometric.  Is Schlomo’s intent to inform or to deceive or does he just not know any better.

As always lunch on me to the first to ID the photo location.