Sandoval's total proposed reduction to state education spending is less than 6.1 percent
There's a lot of nuance when dealing with education spending in Nevada, so let's look at the findings first.
Under Gov. Brian Sandoval's proposed budget (as amended on March 28), Nevada's required state support of education would decrease by less than 6.1 percent, as measured by total and per-pupil spending and compared with the previous biennium.
Less than 6.1 percent. Think about that for a moment. At a time of 13 percent unemployment and when businesses have seen their revenue decline by up to two-thirds and business owners have taken 50 percent pay cuts (or more), the reductions we've been hearing leftists and union bosses complain about ad nauseum amount to less than 6.1 - 6.1! - percent.
Some Assembly Democrats are even trying to make the case that this 6.1 percent reduction is a $1.37 billion cut to education. This claim, once you've even taken a cursory look at the numbers (pages 9 and 10), is laughably false.
So let's take a look at the Assembly Committee of the Whole fact sheet on K-12 education spending. Pages 1-7 do a good job describing what's being proposed and the recent history of K-12 spending, but it's on page 9 where you can compare total spending amounts.
Education spending in Nevada is governed by the Nevada Plan, and the state's portion of education funding is directed through the Distributive School Account. The Legislature sets the total spending amount and funds whatever part of that amount is not made up by local taxes.
All that is to say, you can compare the total required state support (including the local dollars) for the 2009-11 biennium to what Gov. Sandoval is proposing for the 2011-13 biennium. This comparison shows how much the DSA (aka state education spending) has increased or decreased. And this is a very accurate way to measure, because it includes both the local and state portions of the DSA.
In the 2009-11 biennium (fiscal years 2010 and 2011), Nevada's Total Required State Support was $5.02 billion (p. 9). For the 2011-13 biennium (fiscal years 2012 and 2013), Sandoval has proposed Total Required State Support of $4.55 billion (p. 9) plus $161.6 million for school districts in Sandoval's block grant program (p. 5 and FY 13 only), for a total of $4.71 billion.
That's a difference of $305 million, or a less than 6.1 percent reduction in total spending and in spending per pupil. (The number of students in Nevada's schools is estimated to decrease between the 2009-11 biennium and the 2011-13 biennium).
This fact is important to remember for two reasons. First, it's necessary to refute ridiculous claims, like the one on page 10 of this same document, which claims to show that Sandoval's proposal contains $1.37 billion of reductions to K-12 education. As shown above, that's absurd.
Second, if, when the economic forum meets next week, it provides a higher revenue estimate than it did in December 2010, that money isn't needed to save education from devastating cuts. If the Legislature and the governor want to budget responsibly, that extra money should go to eliminating the two major gimmicks in Sandoval's budget, the $200 million loan and the $300 million the state wants to take from school district debt service accounts.
While overstating the cuts to K-12 education may be what union bosses want to hear, it's both dishonest and distracting from what Nevada's children really need - proven reforms like the ones Florida's children are benefitting from right now.
Notes for anyone wanting to follow my math on the Assembly Committee of the Whole fact sheet on K-12 education spending p. 9: To find the total spending for the 2009-11 biennium, I combined the spending from the second and fourth columns (2010 Actual and 2011 Estimate as of 12/21/10). To find the total proposed spending for the 2011-13 biennium, I combined the spending from the seventh and eighth columns. The seventh column is mislabeled and should read 2012, not 2013. Funding figures for the block grant in FY 2013 are on p. 5.
Edited (4/28/2011) to clarify where the DSA funding comes from.
Read moreNew Keynes v. Hayek rap video released today!!!
The moment has finally come for all of you econ geeks who have been teeming with enthusiasm over the sequel to the celebrated "Fear the Boom and Bust" video featuring a battle rap between two iconic economists who became famous rivals - John Maynard Keynes and F.A. Hayek.
I've just watched "Fight of the Century: Keynes vs. Hayek Round 2" and the production quality is every bit as good as the first. In this version, they're not just debating theory, but the impact of government policies in the Great Recession.
Enjoy!!!
Mining to lose power of eminent domain abuse?
Senate Bill 86, which would strip the mining industry of its eminent domain powers, has passed both houses and appears headed for a gubernatorial signature. This bill would strengthen the rights of property owners, especially in rural areas by protecting them from a private party's ability to exercise eminent domain powers.
Such a policy change should be seen as a huge victory for those who understand the importance of private property rights. It's probably the most significant legislation along these lines since the PISTOL amendment - which prohibited Kelo-style "economic development" takings - was added to the Nevada Constitution.
ACLU misleads legislators, public on constitutionality of vouchers
Here's what Allen Lichtenstein, general counsel with the Nevada ACLU, said about Sen. Michael Roberson's recent proposal to amend the Nevada Constitution and allow parents to use education vouchers at religious schools:
More pointedly, a longtime ACLU attorney said a voucher program that catered to faith-based schools would violate the First Amendment of the U.S. Constitution. ...Now, this could be debatable, except that the Supreme Court has recently ruled on this issue - whether a voucher program that allows parents to send their child to a religious or secular private school is constitutional under the federal constitution. Here's what the U.S. Supreme Court said in its 2002 Zelman v. Simmons-Harris decision.
Allen Lichtenstein, lead attorney for the American Civil Liberties Union of Nevada, said the Establishment Clause in the First Amendment would be violated. The clause says "Congress shall make no law respecting an establishment of religion."
The State of Ohio has established a pilot program designed to provide educational choices to families with children who reside in the Cleveland City School District. The question presented is whether this program offends the Establishment Clause of the United States Constitution. We hold that it does not. ...
The Establishment Clause of the First Amendment, applied to the States through the Fourteenth Amendment, prevents a State from enacting laws that have the "purpose" or "effect" of advancing or inhibiting religion. Agostini v. Felton, 521 U. S. 203, 222-223 (1997) ("[W]e continue to ask whether the government acted with the purpose of advancing or inhibiting religion [and] whether the aid has the `effect' of advancing or inhibiting religion" (citations omitted)). There is no dispute that the program challenged here was enacted for the valid secular purpose of providing educational assistance to poor children in a demonstrably failing public school system. Thus, the question presented is whether the Ohio program nonetheless has the forbidden "effect" of advancing or inhibiting religion. ...
We believe that the program challenged here is a program of true private choice, consistent with Mueller, Witters, and Zobrest, and thus constitutional. As was true in those cases, the Ohio program is neutral in all respects toward religion. It is part of a general and multifaceted undertaking by the State of Ohio to provide educational opportunities to the children of a failed school district. It confers educational assistance directly to a broad class of individuals defined without reference to religion, i. e., any parent of a school-age child who resides in the Cleveland City School District. The program permits the participation of all schools within the district, religious or nonreligious. Adjacent public schools also may participate and have a financial incentive to do so. Program benefits are available to participating families on neutral terms, with no reference to religion. The only preference stated anywhere in the program is a preference for low-income families, who receive greater assistance and are given priority for admission at participating schools.A summary of the decision is here.
The Supreme Court really couldn't have put it any more clearly. A voucher program that empowers parents to choose a school for their child (private, religious, online, etc. ...) is constitutional under the U.S. Constitution.
The ACLU is factually wrong on the constitutionality of vouchers and should - publicly and on the record - correct its misstatements.
I called the ACLU yesterday for comment, but no one there has returned my call. If I get a response, I'll post it here.
Redistricting likely to muddy the waters
On Thursday, the legislative majority plans to release proposed political redistricting maps that would outline new legislative jurisdictions for the next decade in Nevada.
To this point in the legislative session, there has been a deafening silence on the redistricting debate and, indeed, the timing of this event immediately calls into question the majority's motives. Speculation has been rampant that Democrats will infuse the redistricting debate into the budget debate - extracting support for tax increases by threatening to draw Republican lawmakers out of their districts. The timing of the majority's unveiling of their proposed redistricting maps would seem to validate these suspicions.
The majority's last strategy for breaking impasse on the budget debate - pulling budget bills out of the budget committees and hearing them before the press in Committee of the Whole meetings - appears to have backfired. The budget stalemate between Democratic and Republican lawmakers appears to have only intensified as both sides have further entrenched their positions. As such, legislative Democrats appear to be playing their last card in order to lure some Republicans into supporting major tax increases.
It's likely that legislative Democrats will become increasingly desperate for pro-tax Republican votes as the session wears on. These majority lawmakers will try to avoid a special session to resolve the budget, wherein the agenda would be controlled by the governor.
They are ready to play their trump card. We'll see where it goes.
The racial element of prevailing wage laws
In his recent study on Nevada's prevailing wage laws, Geoff Lawrence examines how the original backers of such laws were motivated by racial factors - specifically, their desire to price black laborers out of the market.
Geoff writes:
Congressional records make it clear that the intent of the Davis-Bacon Act was to undermine the competitive advantage enjoyed by a specific category of highly mobile construction workers: Southern blacks. Sen. James Davis of Pennsylvania and Rep. James Bacon of New York, among others, feared that contractors who used black labor would underbid contractors using white labor and win federal contracts.
Now, modern-day supporters of prevailing wage laws would no doubt argue that, even if the earliest supporters of such laws were motivated by a desire to discriminate on racial grounds, no such desire exists among supporters today. And they'd no doubt be correct. So is that particular angle irrelevant?
Not at all, and for two reasons:
First, history is important, plain and simple. Even if some particular facts seem to become less relevant over time, it's still good to recognize how we got to where we are today.
Second, and more crucial, is that even if the racial motives behind the laws' creation are less relevant now, the fact remains that the tactics used to accomplish the desired goal still tell us a lot.
After all, those who pushed for prevailing wage laws as a means to price black laborers out of the market did so because they understood keenly the distortive impact that such laws have on the market. And that remains as true today as it was back then. Which is why such laws were, and are, a bad idea.
Who prevails under prevailing wage?
Not taxpayers, that's for sure.
A new NPRI study, authored by the Institute's own Geoff Lawrence, exposes how Nevada's prevailing wage laws subsidize unionized labor while increasing the construction costs paid by taxpayers.
Check out the executive summary of the study here and download the full study here.
Oh, and by the way, Geoff will be on Heidi Harris' program on Monday, April 25 at 8:00 a.m. to discuss the study. Tune in to KDWN, AM 720.
Assembly Committee of the Whole, April 19
I'm sitting in the galley for the first Committee of the Whole meeting to debate the state budget. For those who are unaware, the legislative majority has decided that a prudent strategy in rallying support for increasng the tax burden on Nevada families would be to pull all appropriations bills out from the budget committees and debate them on the floor, and before the press, in Committee of the Whole meetings. These meetings are set in the evening to coincide with the evening news hour in order to maximize the strategy's effectiveness.
Tonight's is the first of these meetings and lawmakers will be discussing state appropriations for the Distributive School Account (DSA). The DSA is the general fund appropriation that is used to supplement some local school district revenues in order to reach the legislatively-defined "Basic Support per Student" amount of per-pupil K-12 financing. The "Basic Support per Pupil" amount (usually round $5,000) does not include all school district revenues. Total support (for operating costs only) usually is closer to $8,000. Including capital expenditures and debt repayment, Nevada school districts spend closer to $13,000 per student.
However, spending amounts are not reall what matters when it comes to K-12 education. What matters is student performance. And there is no meaningful correlation nationwide between per pupil expenditures and student performance. It matters more how the educational system is structured than how much is spent per pupil. Studies nationwide have shown that the degree of school reform within the states shows a much higher correlation with student achievement. Particular areas of reform that contribute to higher results include: school choice, open enrollment, alternative teacher certification, and grading the performance of individuals schools and teachers.
With regard to expanding school choice, NPRI has already designed a Public Education Tax Credit program that would save $1 billion over the first 10 years while dramatically improving educational choice and quality.
We'll see if the legislature takes note of this data and acts to give better educational opportunities to students or, once again, elects to simply carry water for teachers' unions...
Legislative town hall today
This afternoon I will be participating in a 20-plus person panel discussion at the legislative building in Carson City discussing policy alternatives for policymakers to follow in the current session. The discussion will follow a town hall format and allow audience members to ask questions toward the end. It is open to the public and begins at 3:00 pm in Carson City.
The event will be moderated by Assemblyman Pat Hickey and the other panelists include:
Dr. Ty Cobb
Caole Vilardo
Dr. Heath Morris
Neil Medina
Mary Lau
Dr. Elliot Parker
Chuck Muth
Bob Fulkerson
Tray Abney
Heidi Gansert
Dave Mumke
Assemblywoman Debbie Smith
Danny Thompson
Senator Michael Roberson
Clara Andriola
Jim Pfrommer
Norm Dianda
Assemblyman Ira Hansen
Assemblyman Cresent Hardy
Senator Robert Townsend
Crunch time
All bills must pass out of legislative committees by tomorrow and so committees are packing bills into a marathon session until that point.
Check out the calendar of meetings for today and tomorrow. The Assembly Judiciary Committee scheduled 15 - yes 15 - bills to be heard this morning. Senate Health and Human Services has 11 bills on the agenda for this afternoon.
Odds are that committees will meet very late into the night tomorrow as crunch time arrives. Any bill that does not make it through committee before midnight tomorrow dies without a hearing. There are exceptions granted to certain budget bills. However, as per legislative leadership's new strategy, those bills will go directly to the floor to be heard by a Committee of the Whole anyway.
