Market Reform for Education

Former school superintendent Ed Eiler, makes some excellent points in his recent OpEd in the Lafayette Journal & Courier. His observation that “no one person or entity has the standing to begin a real conversation to build a state and national consensus about how to move forward” is astute. But his solution that “real reform must entail not only inviting teachers into the conversation, but enabling them to lead reform efforts” is narrow minded.

Superintendent Eiler puts a great deal of emphasis on people. If the right person, or a person representing the right group of people, comes along then a real conversation about school reform can begin.  Apparently, previous discussions about education reform were “fake”. The problem is not that the wrong people are leading the reform efforts, nor is the problem solved if just the teachers lead. The problem is the system.

West Lafayette School Corporation spends $12,000 a year per pupil. Faith Christian School charges tuition of $5000 a year per pupil, at most. Yet the two schools have almost identical ISTEP scores.

So here’s a “real” question, why can a private pay school get the same results as the taxpayer school using about one half the money? It’s not the people as Mr. Eiler would have us believe, it is the system that is the problem. There is no market discipline creating economic efficiencies and improved quality in the government funded system.

The funding for the government schools is archaic and wasteful. Funds flow from private citizens to counties, to the state, through the state’s bureaucratic mess (including formulas that make the IRS blush because they are so convoluted) then back to the district. The oversight of the districts is worse; how do the Gary and Muncie school districts “lose” millions of dollars?

The funding for the private pay school is direct. The school determines a budget and charges a tuition to cover the expenses. Decisions on curriculum, standards for students and staff and other associated activities are developed and enforced by the school and paid for through the cost of tuition or through private gifts.

It is true that the private pay schools are the recipients of government largess in the form of vouchers. That leads to a series of “real” questions that Mr. Eiler, and the professional education bureaucrats refuses to acknowledge: “Why are so many parents using vouchers? Why are government schools so unresponsive to parents? Why are education professional scared of school choice efforts?” While Mr. Eiler’s is wondering among other things, “how much and what type of education should each child receive?”, parents and private pay schools have already answered the question. He is still waiting for the next taxpayer funded study to give him the answer about how you should educate your child; obviously you do not know how to do it.

There is an empirical test to determine what parents want. Let Mr. Eiler and the current government school system have their way, with one exception. Everything they do, including the cost of legislation regarding education, studies to determine the latest trend, covering the costs of failed districts like Muncie and Gary (how do you lose $13 million?) must be funded from tuition and private gifts. No taxpayer dollars.

Likewise for the current private pay schools. No taxpayer dollars.

Then let’s see where the students go, what kind of scores they achieve on standardized tests and how much it costs.

Until there is a direct economic relationship between parents and educators, the education system will never produce the desired results parents want; excellence in education for their specific child. The best the current system can offer is more of the same; expensive, one size fits all mediocrity.

Economic Fascism – Grant County Style

“The county is coming around to the idea because they see how much it really helps our local employers and ANYTHING we can do to help them thrive in this community is a good thing,” said Grant County Economic Growth Council Victoria Herring.

And she does mean anything, including looting current residents under the guise of “it’s good for you”. “I am here from the government and I am here to help”…yikes, hold on to your wallet.

The Grant County (Indiana) Economic Growth Council has decided that it is good to give away incentives in the form of payment assistance or housing costs reduction if you fit the correct special interest group.

Grant County voted 67% for Donald Trump in 2016, begging the question, “What is the difference between modern conservatives and liberals when it comes to the role of government interference in the economy?”. The answer: None. Both love to spend your money for you.

Phil Bowers, President of Advance Cabinet Systems, gushes, “It’s really helped a lot”. It is a plan for the county to pay closing costs, up to $5000, or give a 20% rent rebate, to qualified transplants to Grant County. The goal is to attract more of the right kind of people to Grant County. Hard to believe? No, not really, both dominant political parties have their favorite special interest groups to payoff.

Consider the plight of Phil Bowers. He can not find enough qualified workers, so what does he, and others like him, do?

Consider his options: He can increase the compensation package that he is offering to perspective workers to make work more attractive to them. He can offer job training to his current workers to elevate their skills and thus make them more valuable to his company. Or, he can convince the county to take wealth from the citizens and then give that wealth to his perspective employees.

The first two options affect his bottom line. The last one affects yours. Gives new meaning to “what’s mine is mine and what is yours is negotiable”.

Some would call it socialism. Others would say it is communism. It’s closer to fascism (private ownership directed by government) says me. Nonetheless, it is killing liberty.

Block Grants or Economic Block Heads

Our local state representative sent out the following tweet the other day and it made me think, “Who is paying for this?”.

The Indiana Office of Community and Rural Affairs (IOCRA) grants funds to “help rural communities improve their quality of of life and ensure the health and safety of their citizens”. Apparently, rural communities are not capable of improving their own lives, using the means available to them, and need the resources of other communities.

In 2017, $37 million in block grants were given to Indiana communities through IOCRA. As Lt. Governor Suzanne Crouch (R – Evansville) stated, “We must continue to provide support for our rural communities if we want to keep Indiana’s economy thriving…..and encourage more growth opportunities.“. The Lieutenant Governor Crouch believes the widespread economic fallacy; market intervention keeps economies thriving and creates growth opportunities. Politicians fail to acknowledge the corollary, block grants do so only by deteriorating another’s economy or growth opportunities.

The state spends on things the state wants; individuals spend on what they want. The state spends on things that will satisfy the state’s needs and desires; individual citizens will spend it on their needs and desires. Immediately, it is seen there is a disconnect between the two groups when the state forces the individual to surrender their wealth to the state, for the state’s purposes.

There are six categories of grants that rural communities can apply for assistance to help with: Blight Clearance Program, Planning Grants, Public Facilities Program, Main Street Revitalization Program, Stormwater Improvement Programs and Wastewater Drinking Water, all of which can be addressed by the local citizens, should they choose to do so.

If a local community is in need of Stormwater Improvement then it is reasonable that they use the mechanisms available to pay for the improvement. Either through bond issuance or rate hikes, the means are available for the community to bear the cost of the improvement themselves. But according to Lt. Governor Crouch, and others, somebody other than the local community should pay. That “other” is you and me.

Voluntary Exchange Keeps Economies Thriving

First, what keeps Indiana’s economy thriving? The same principle that keeps all economies thriving; the free market not government confiscation and redistribution of wealth. Market intervention distorts and inefficiently allocates limited resources to the preferred project of the political body. If individuals, want it, they will pay for it. If government wants it, the individual will still pay for it.

Individuals working each day to produce goods and services and exchanging what they produce with those who produce something different creates a “thriving economy”. As more goods varying in content, use, price etc are produce, more are exchanged. With each exchange, those who serve others best and efficiently, create wealth, which in turn creates more opportunity to produce more goods.

Block grants do not meet a logical economic standard

Can block grants help a local community to “improve their quality of of life and ensure the health and safety of their citizens”? Absolutely, but not without a cost to the receiving community and the rest of the state.

Before the state gives block grants to a local community, it must first take the funds from its citizens. Before the funds return to a community in the form of a block grant, the state pays itself (politicians, administrators) for their labor. They forcibly take it from the individual taxpayer, pay themselves for doing so and then maybe the state will give some back to your community.

Second, some communities are more equal than others. If you live in Vincennes you love it. Why? Because the state sent you $500,000 in 2017 for Downtown Revitalization . If you are in West Lafayette, you are not so happy, you received zero. Taxes are levied across the state, an administration fee is withheld and then some is given back to the communities deemed worthy; to the rest of the state? “Stinks to be you”.

How is it possible for local economies (West Lafayette for example) to experience “more growth opportunities” when the block grant program reduces the wealth of the community available for investing? They don’t. Reality is that block grants only work for the select few who receive more in grants than tax dollars taken.

And it is questionable whether the block grant actually helps the recipient. The creation of a dependency relationship works to the disadvantage of both parties. Individuals within a community cease to take the initiative to solve their problems and the state increases it’s intervention under the “if not us, than who will” logic.

The illogic of intervention

The justification for economic illogical is the grants go to programs necessary for economic growth that the private market will not fund. Market economic logic tells us the projects are funded when private citizens are willing to risk their wealth for the prospect of a positive return. Main Street Revitalization Program demonstrates the economic illogic of the interventionist.

Main Street dies because its businesses fail to give what the consumer wants. Main Street was replaced by a new paradigm (big box retailer/strip mall) and that paradigm is being replaced by the next wave of entrepreneurship (have you used Amazon recently?) and that paradigm will change in the future.

In a free market, Main Street Revitalization will happen when an entrepreneur senses an opportunity and takes a risk. Risking their capital, they offer a new product. If she succeeds, then she is rewarded for taking the risk. If she fails, she loses her capital. But, in the world of block grants, the entrepreneur risks the public’s wealth, not their own, but they still keep the reward. Block grants assign the risk to the taxpayer, but privatize the reward.

In Vincennes, $500,000 will be spent on “facade improvements for nine properties on Main Street”. If I were one of the nine property owners about to benefit, I would be ecstatic. My building is about to get a face lift at the expense of someone else, ostensibly creating a competitive advantage for my property.

If I were property owner who is not getting a face lift, I would be mad. Why should my tax dollars pay for my competitors to get a “free” face lift? If I own property in some other city that did not receive a grant, I would be just as upset. “What is so special about Vincennes?”. As one of the “gang of nine” I have no risk, yet I will receive all the potential gain.

In the long run, this type of block grant actually is a disincentive for property owners to rehabilitate their property. The incentive to improve my property is lessened for two reasons. First, if I rehabilitate my property, but my neighbor receives a grant I have just created a market disadvantage for myself. Second, if I do not improve my property, the prospect exists that someday the state will give me a grant to do it for me. Until then, let the property rot thus agitating for more block grants to “improve Main Street”.

The worse part, is in thirty years, Main Street Revitalization will be joined by “Big Box/Strip Mall” Revitalization as this retailing paradigm becomes obsolete. No doubt, “unsightly” buildings are an irritating, but that is no justification for confiscating another’s wealth for your own self interest.

Economic Growth: Organic of Manufactured

Organic growth is the product of the free market. Individuals pursuing their ends by exchange. Acquiring what they value more, by giving up what they value less; creating wealth and investing in new products and services all under the auspices of government that protects the property they use for exchange. The simplicity is lost in the age when “experts” know best.

All the economic theory and it’s associated mathematical equations and use of statistics will never manufacture economic growth and wealth as efficiently and equitably as the “invisible hand” of the market. The problem is “experts” think they “know how” to live your life better than you do. Worse yet,we let them.

Securing Property

I take something, anything that is yours; is that good for you? There might be something that I can forcibly take from you and you would not care. More than likely though, if I were to take your wealth, you would not consider it “good”.

After I take your wealth, I tell you that it is for the good of “the public”. You can either agree or disagree. If you agree, then you probably do not consider it a problem that I took your wealth. If you disagree, then you would consider it a bad thing that I took your wealth. Therefore, it may or may not be good. As a member of the public, for whom I took your wealth, it is possible that the loss of wealth is “bad”.

How can I say it is for the public good, if indeed it may not be? In fact it can not. The oft used argument “It’s for the public good” is a misnomer. The forcible taking of another’s wealth may in fact be good or bad, depending on the perspective of the one who losses their wealth, but it can not be “good” all the time, in all situations to all people.

Then how does society do the least amount of damage by taking individuals wealth, while doing the most “public good”? What is the most “public good”?

Genesis 9:5 “And surely your blood of your lives will I require; at the hand of every beast will I require it, and at the hand of man; at the hand of every man’s brother will I require the life of man. (6). Whoso sheddeth man’s blood, by man shall his blood be shed: for the in image of God made he man.”

God gives life to each one of us. Included in “life” are physical and non-physical attributes that yield “stuff”. The fullness of this idea may be better understood as “property” as it expounded upon in Deuteronomy and Leviticus. Consider: your body is your property. So is your mind, conscious, soul and their respective products; thoughts, beliefs, attitudes, sin, guilt. We own these things. Additional, we own the physical products that these non-physical properties produce. What I write is mine. The wealth I generate from the exchange of my labor (labor is property) is also my property. Relating back to the original statement in Genesis, property that is violently taking shall meet with violence itself as it is judicially meted out by mankind.

What can we conclude from God’s directive to man? First, shedding another man’s blood shall result in the shedding the perpetrator’s blood, by man. The collective, mankind, is to take the life of those who shed another man’s blood. In subsequent books, the Lord would expand upon this principle. Elaborating on the circumstances surrounding the takin go life and explaining that there are various forms of violence being done to another person’s property each requiring a different from of retribution. The highest expression of human government then is the judicial taking of life, followed in lesser degree retribution for the taking of lesser forms of property.

Mankind is to organize itself under a civil authority (king, elected official, board etc.) with the singular purpose: Secure property.

The “most public good” then is the securing the property of individuals. The “least damage to the public good” is the appropriation for funding of the means to secure property.

Should West Lafayette Build an Aquatic Center

West Lafayette is a diverse community.  We don’t look, talk, think or act the same.  There is no template of behavior that can explain why each of us does what we do.  Nor is there one single source of information that can account for all action that we take; to claim there is such a source is a claim to deity.

How are the diverse needs, wants and beliefs of a community met and expressed?  Through voluntary association and exchange we each act in a way to bring satisfaction to our own lives.  We may disagree with our neighbors on the value they place on their desires, but we grant them the liberty to pursue the ends they want.  My closest friends shake their heads at the things I value.

How do we, as a community, place value on the ends we desire?  We don’t.  What we value is the freedom (freedom, not anarchy, save the hyperbolic agreements for another day) to pursue the ends we desire.  We do not value the ends, we value the means to the ends.  As a community we do not value Chinese food, we value the freedom of the suppliers and consumers to pursue Kung Pao Chicken.  It is freedom that allows individuals to use what belongs to them to pursue the things they want without infringing on others.

But what happens when we are coerced into giving our means to another, who dictates for us what our desired ends should be?    There is a knock at your door, “Hello, I am here to take your money.  Here is your veggie burger”.  Nothing against veggie-burgers, if you like them fine, but not for me, thanks.  I would rather keep my money and buy my own dinner.

Am I not free to decide my own actions?  Thankfully for the most part, I am, as are you. But what happens when our individual wealth is taken and directed to an end dictated by another party?  Why should the city of West Lafayette build a recreation/aquatic center?

Is there a need?  If there was, wouldn’t it be met by another means?  Recreation is not like police or fire protection, or streets and sewers.  Recreation is a highly personalized activity.  Golf is fine, I guess, but chess is better.  Swimming is good, but walking is better.  Hard to believe, but others would disagree.  They value other activities more and would pursue them, or some other activity, that meets their desires.

How can government possibly know what all of its citizens want for recreation?

Is there a questionnaire that yields such information?  Or, are city leaders myopic in their vision and focused on their own special interest (noble service in the public interest)? And if there is such a questionnaire, was the question posed as, “Would you like a recreation/aquatic facility if you knew it would cost each of your neighbors thousands of dollars”?  Some how, I think the moral acumen of our community would be, “No thanks.”

Slaves and Tyrants

“What’s mine is mine, and what’s your’s is….well negotiable.” Freedom dies by a slow torturous process of compromise.

You may own the building, but the renown artist’s spray paint graffiti is more important than your ownership of private property. Knock down your building, it will cost you $6.7 million. Your private property is important, but not as important as interest New York City has in the graffiti.

You may own the building, but economic development is more important. The fact the property was never used for economic development is of no consequence. As Clarence Thomas opined, “Though citizens are safe from the government in their homes, the homes themselves are not.” Which begs the question, how safe can we be in our homes?

It may seem absurd that knocking down your property results in a fine. Or that condemning your property for the sake of economic development, that never happens, is sanctioned. But it is not absurd to those that feel they should control their fellow citizens in order to establish a more just society.

Tyrants come in all shapes, sizes and political affiliation. Whether they are “pointy headed academics” on the left, or “flag waving rednecks” on the right, it does not matter. Their movements are synchronized to take away others freedoms because, well, they just do not like how that freedom is being used. They simply know better, whether that knowledge is masquerading as “academics” or “common sense” is irrelevant.

You can not change use your property, I like it the way it is.” So the superfluous arguments begin as private property ownership shifts from the individual to the collective. Principles do not matter. Political bullying is in method of vice.

It’s a local matter, so it should be controlled locally”. Control being the hinge on which the door of freedom swings and they want that hinge to swing one way; we can use our property, but you can not build a quarry on your’s. Control, whether it emanates from the federal or local level does not matter. Power is power and limiting is the goal of freedom; expanding it is the goal of the tyrants. Seriously, someone spray paints your building and you can not clean it up?

But the environment will suffer” are code words for your science is wrong, ours is right. The world is flat until is was proven otherwise. How was it proven? By science, over the course of hundreds of years. There are reasons we have traditions and institutions built on centuries of trial and error. But, appealing to “pop science” is in vogue. The freedom deniers are sponsoring “Americus Rallies Against Global Warming” next week.

The ultimate insult to freedom and private property ownership? “Our property values will decrease.” In a market economy the door swings both ways. If your property value decreases because of your neighbors utility, then their value must suffer if you prohibit their use. “What’s mine is mine, and what’s yours is mine to control” is the tyrant’s chant. Christopher Lasch was right, we are a culture of narcissists.

Once the personality cult catches hold it is hard to shake. C.S. Lewis’s character Wormwood said it best, “Liberalism (classical) is the boogeyman as men are hastening to become slaves and tyrants”. The question we must ask ourselves is, “Do we want a free society or not?”.  Some people want to be slaves and some want to be tyrants.

PayDay Lenders

Marie Morse, executive director HomesteadSC makes good points about PayDay lenders, but she is wrong for deny others the use of their services.

Her concern for the financial well being of individuals is laudable. The mistake she makes is assuming that all individuals need or want the help she and the organization she represents offer. In a free society, individuals make decisions and accept the consequences of the decision. Limiting the free market, voluntary interaction of private parties, is in fact limiting freedom.

HomesteadSC offers financial counseling to help people achieve a certain end. The means that HomesteadSC uses are paternalistic in nature. Concern and empathy for one another is a good thing, but limiting their freedom is not. The problem arises when she assume that all people want what HomesteadSC offers.

Ms. Morse goal is for people to make decisions that are financial sound. Good goal, but it ignores the reality that some people could care less about their credit worthiness. They value other things more highly and act accordingly.

Secondly, her opposition to PayDay lending is based on the assumption that she knows all the values, needs and desires for people that use PayDay lending. This is not possible. Contrary to her believe, PayDay lending does make sense to some and the service provided is valuable, but not to everyone. Just as her service makes sense to some people and not to others.

The goal of a free society is to allow individuals to make decisions, accept the consequences (be they good or bad) and not shift the responsibility for those decisions and consequences to other members of society.