The Arkansas Project

Report: Arkansas #45 In Education? But Gov. Beebe Said We Were #5!

January 27, 2012 David Kinkade Leave a Comment

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Hey, how was your National School Choice Week? Why, mine was lovely, thanks so much for asking!

We round out the week with a look at the latest Report Card on American Education from the good folks at the American Legislative Exchange Council (ALEC), ranking these 50 states for their performance on a variety of measures related to K-12 education.

OK, let’s take a look here (turns pages, turns pages, jesus this thing is long). Hmmm, Arkansas lands at number 45…But wait! Weren’t Gov. Mike Beebe and the Arkansas Dept. of Education just trumpeting news two weeks ago that Arkansas was fifth in the nation in education? I think they were! What gives, huh?

The study Beebe et al. were wetting their pants over was the Education Week Quality Counts 2011 survey, which ranked Arkansas #5 based on education policies.

But notably, the Quality Counts study gave the state “low marks in two areas two areas where the state has long struggled to advance: Student achievement and the chance for a successful career with an Arkansas education,” according to the Arkansas News Bureau’s John Lyon. Gosh, those kind of seem like areas where you’d want to get the high marks!

(In addition, here’s a good explanation of the shortfalls of the Quality Counts survey from a couple years back by all-around smart guy Stuart Buck from the University of Arkansas Dept. of Education Reform).

The ALEC study aims to provide a more comprehensive look at how state education performs based on student scores on the National Assessment of Educational Progress (NAEP). By their figuring, Arkansas lands at 45th in the nation. The ALEC study even gives letter grades for education policy, scoring Arkansas with a gentleman’s C.

The ALEC researchers are also heavy into various school reform measures, with high praise for different education reform programs in disparate states like Massachusetts, Florida and Indiana. To hear them tell it:

The past two years however have been crucial, however, in demonstrating that reform is not only necessary but in fact achievable. In the past, governors gave lip service to education reform but tended to simply increase spending and kick the can down the road. The 2010–2011 period witnessed something entirely different: lawmakers taking on the reactionary education establishment directly, and defeating them repeatedly.

States having passed reforms must move vigorously to implementation, given the huge difference between changing law and changing policy and opportunities for subversion. Reformers in other states should carefully study the comprehensive approaches of Florida and Indiana lawmakers. Dramatic improvement results from broad, rather than incremental, reform.

On a related note, you should go back and read Dan Greenberg’s Arkansas Project submission from last summer, Confessions of an ALEC Conspirator, which pooh-poohs all the paranoid liberal handwringing about the organization with a calm look at the facts about the role ALEC plays in policymaking. Facts! Is there anything they CAN’T do?

Report Card on American Education: Ranking State K-12 Performance, Progress and Reform (American Legislative Exchange Council)

Biz Tax Study Ranks Arkansas An Unimpressive 31st! (UPDATED!)

January 25, 2012 David Kinkade 2 Comments

We have established before how much I like the Tax Foundation’s studies and maps as a tool for exploring tax policy. In fact, when it comes right down to it, the Tax Foundation should probably be paying me for how frequently I pimp their work around here.

As Arkansas lawmakers gear up for a legislative session devoted strictly to budget matters, they should read this humdinger of a new study ranking all 50 states by the Tax Foundation “Business Tax Climate Index.”

The index is a magic alchemical stew of corporate, income, sales, property and unemployment insurance taxes used to determine how “which states’ tax systems are the most hospitable to business and economic growth.” That is of course a gross oversimplification of how the rankings were arrived at, but if you want to learn more then go read the study yourself, Mr. Technical Methodology.

Man, I’ll bet Arkansas comes out looking like a real peach, huh? Eh, not so much—your beloved Natural State checks in at #31. If there’s good news, it’s that Arkansas has climbed one slot since last year’s report, when we ranked #32. Why, should we keep up at this blistering pace, this state will be a veritable economic powerhouse by, uh, let’s see… 2044. Huzzah!

“But, but, but taxes aren’t the only thing that drive business decisions!” is what some of you might be sputtering right about now. Well, shut up, because economist Mark Robyn, who authored the study, covers that issue:

The modern market is characterized by mobile capital and labor, with all types of business, small and large, tending to locate where they have the greatest competitive advantage. The evidence shows that states with the best tax systems will be the most competitive in attracting new businesses and most effective at generating economic and employment growth.

It is true that taxes are but one factor in business decision-making. Other concerns, such as raw materials or infrastructure or a skilled labor pool, matter, but a simple, sensible tax system can positively or negatively impact business operations with regard to these very resources.

Furthermore, unlike changes to a state’s health care, transportation, or education system—which can take decades to implement—changes to the tax code can quickly improve a state’s business climate.

Oh, but read on, because there’s even more good stuff about the dangers of tax incentives and subsidies targeting specific businesses:

State lawmakers are always mindful of their states’ business tax climates but they are often tempted to lure business with lucrative tax incentives and subsidies instead of broad-based tax reform. This can be a dangerous proposition….

Lawmakers create these deals under the banner of job creation and economic development, but the truth is that if a state needs to offer such packages, it is most likely covering for a woeful business tax climate. A far more effective approach is to systematically improve the business tax climate for the long term so as to improve the state’s competitiveness.

Robyn also includes a nicely comprehensive review of the economic debate over just how much taxes matter (pages 5-9) that you should totally check out. Print and read! Or what, you’d rather read yet another goddamn article about the Republican presidential primary or mindlessly scan the pointless ephemera in Twitter feed? Ugh, you disgust me. I don’t know how you live with yourself. Read this instead.

UPDATE: Ha ha ha ha ha! Michael Cook, a lockstep Democratic blogger who has never been troubled by an interesting or intelligent idea, sees everyone talking about the Tax Foundation study on Twitter, and leaps into action with this dandy:

Good work, Michael Cook! You have indeed Googled a report suggesting that two counties of the state boast a relatively strong economy. Case closed! Of course, and I can’t believe I have to point this out, this doesn’t exactly contravene the findings from the Tax Foundation, for a number of reasons, including that two counties are not the same thing as a whole state.

Moreover, if we just want to wave around competing studies, here’s one from the Brookings Institution (PDF) ranking the Little Rock area as one of the 20 weakest performing metro areas over the course of the economic recovery. Your move, Michael Cook!

Oh, man, can you imagine what it must be like to be Michael Cook? I can’t help but to think that I’d just literally die from the sheer existential humiliation.

2012 State Business Tax Climate Index (Tax Foundation)

That Pesky Medical Device Tax: A Medical Manufacturing Insider Speaks Out!

January 24, 2012 David Kinkade Leave a Comment

Will medical device tax drive production overseas and stifle innovation?

We wrote here previously about the medical device tax tucked deep inside 2010 health care bill (Affordable Care Act or Obamacare, pick your poison). That’s a 2.3 percent levy on sales of all kinds of medical devices used in diagnosis and treatment (excluding items sold directly to consumers over the counter, like Band-Aids and such), expected to generate $20 billion over 10 years.

After my earlier post, I heard from some folks at Cook Medical, a medical device manufacturer located in Bloomington, Indiana, who wanted to talk more about the issue. Cook Medical makes and distributes thousands of products, including stents and catheters, for diagnostic and therapeutic purposes. I asked if they would talk on the record to give a fuller perspective on how the tax would affect their industry, and they agreed.

An industry leader’s perspective

In a phone conversation with Steve Ferguson, Cook’s chairman of the board, and John Eckberg, the company’s media relations director, I asked how this tax came to be—what policy discussions led to its being included as a funding mechanism for the president’s signature legislation? Ferguson’s answer offered a depressing, but not at all surprising, insight into how the health care reform bill developed.

“It wasn’t a policy discussion at all,” Ferguson said. “When you tried to have a policy discussion with [Congressional committee members and staff], their attitude was that ‘We just don’t care; we need the money’.”

Ferguson praised members from Indiana, like Sen. Evan Bayh and Rep. Baron Hill, both Democrats who have since left Congress, for leading opposition to the tax. They had some success, he said, cutting the tax in half from $40 billion to $20 billion over the next 10 years—but got no further.

The problem, Ferguson said, was that the Obama administration and Democrats in Congress insisted that the health care reform bill would create a “windfall” for device manufacturers—the reasoning being that, with millions of additional Americans being brought into the health care system, there would inevitably be greater demand for their products.

Ferguson dismissed that line of reasoning. Most of the newly covered beneficiaries under Obamacare, he said, would be younger people, who typically have less need for medical devices. He also noted that based upon results from Massachusetts—where former Republican Gov. Mitt Romney established a state health insurance program in 2006 similar to the federal effort—there would be no “windfall”: The demand for medical devices in Massachusetts, he said, tracks with overall national trends.

“I think that’s a fallacious argument,” Ferguson concluded.

Another common argument is that manufacturers can simply absorb the tax by passing the cost on to their customers—say, tacking on 2.3 percent to the cost of a stent or catheter. But Ferguson said that wasn’t likely, because device manufacturers are competing with other manufacturers from around the world who export and sell products in the U.S. To remain competitive, his company and other domestic manufacturers are limited in how much they can “pass on” increased costs.

He also noted that the device tax isn’t the only higher cost that Cook Medical faces—they’re also paying more for energy, utilities, employee health care, unemployment insurance and other items.

“If you add all of those together, are they gonna say I can pass everything on?” Ferguson said. “Someone who tells you that has never run a business.”

[Continue reading…]

Gird Your Loins for National School Choice Week!

January 23, 2012 David Kinkade 1 Comment

All hail school choice! All hail education reform! Our pals over at Americans for Prosperity are sponsoring National School Choice Week (January 22-28), a week-long nationwide event aimed at “shining a spotlight on effective education options for every child.” There look to be a few events taking place around Arkansas in the days to come—check out the events page on this website to track one down.

We’ve checked in on the school choice debate in recent months. Here, here are some links to a few of the Arkansas Project’s favorite pieces on school choice issues from the last year. Go read!:

October 2011: My report from an education reform panel debate at Philander Smith College in Little Rock that turned out to be feistier and more combative than anyone imagined.

August 2011: Christian Olson of the Advance Arkansas Institute supplies notes from a school choice symposium in Little Rock hosted by the Heritage Foundation.

June 2011: Our interview with University of Arkansas education reform honcho Jay Greene on the publication of his e-book, Why America Needs School Choice.

Meanwhile, over at the Arkansas Times blog, perennially outraged liberal Max Brantley, who stands bravely athwart any and all changes to the status quo in public education, notes the week’s events with a six graf post in which he name-checks his favorite bogeymen, the Koch Brothers, eight times. Bonus: It includes a darkly conspiratorial and hilariously over-the-top anti-Koch video. Do you get the feeling that Max just really isn’t even trying anymore? Yeah, me, too.

Boozman Withdraws PIPA Support! (UPDATED: Griffin Drops Off SOPA Bill!)

January 18, 2012 David Kinkade 2 Comments

Kudos to U.S. Sen. John Boozman (R) of Arkansas, who announced he is withdrawing his support for the Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act (PIPA), in response to the “chorus of concerns” that came to a head today.

Boozman posted on his Facebook page that he is having his name removed from the list of co-sponsors and would vote against the bill “in its current form.”

Full Boozman statement as follows:

Over the past few weeks, the chorus of concerns over Congressional efforts to address online piracy has intensified. I can say, with all honesty, that the feedback I received from Arkansans has been overwhelmingly in opposition to the Senate bill (S.968, the PROTECT IP Act) in its current form. That is why I am announcing today that I intend to withdraw my support for the Protect IP Act.

I will have my name removed as a co-sponsor of the bill and plan to vote against it if Majority Leader Reid brings it to the floor in its current form.

The PROTECT IP Act seeks to address an issue that is of vital importance to the future of intellectual property rights in the modern era. However, the concerns regarding the unintended consequences of this particular bill are legitimate. Therefore, we should not rush to pass this bill, rather we should be working to find another solution so that the epidemic of online piracy is addressed in a manner that ensures innovation and free speech is protected. I have confidence that we can do this, but not as the PROTECT IP Act stands today.

Online piracy hinders creativity and steals jobs. Much of this criminal behavior comes from rogue websites operating in countries like Russia and China. Their ability to operate threatens American ingenuity by distributing copyrighted material free of charge. We must work to ensure that copyright holders are protected if we want to defend American ingenuity, ideas and artwork.

The goals of the Protect IP Act are commendable, but the potential for damaging unintended consequences is its major flaw. Moving forward, I will work with my colleagues, the stakeholders and the American people to find a workable solution that protects intellectual property rights while promoting an open and vibrant Internet.

I want to thank you for raising your concerns about this bill. Your voice has been heard.

Politico has a good round-up of other House and Senate sponsors of PIPA and its House counterpart, the Stop Online Piracy Act (SOPA), who have dropped their support of the effort to censor the Internet. A similar piece in The Hill chronicles the crumbling support for the bills.

UPDATE: A statement arrives from Republican Rep. Tim Griffin, a SOPA co-sponsor in the House. Setting the stage to bail out on the misbegotten legislation, perhaps? He says he’s taking “a second look” at the legislation based on constituent feedback.

UPDATE 2: And a follow-up statement from Griffin late Wednesday evening completes the turn, as he withdraws his co-sponsorship of the House SOPA bill. Full statement:

“Stopping theft of American intellectual property by foreign rogue websites is critical to protecting American ideas and jobs. I co-sponsored SOPA because I firmly believe we must protect American ideas and innovation–the foundation of the world’s greatest economy–and job creators in my district supported it.

“I welcome input on SOPA from all sides and have heard from many constituents loud and clear. I was hopeful we could revise SOPA to address the concerns raised, but that now looks improbable, if not impossible. While many claims being made in opposition to SOPA are addressed through proposed amendments and changes to the bill, my constituents have made it clear to me that they still oppose SOPA.

“I pledged to take a second look at SOPA, and I did just that. I also said that I would not support a bill unless my constituents are comfortable with it. And I won’t. Recently, I have spoken with a number of constituents in person in Conway, Little Rock and around the District, and via Twitter and Facebook. In addition, I have received over 800 emails and over 250 telephone calls. I considered every constituent opinion expressed. In this case, I am convinced that there has to be a better vehicle to protect American intellectual property than SOPA. Therefore, I have decided to withdraw my support for SOPA and remove my name as a co-sponsor.

“It is time to press the reset button with regard to combating online theft. More work must be done by Members of Congress and the content and tech communities to reach consensus on this issue.”

All right, team, that’s a good day’s work. You can come in a little late tomorrow.

Let’s Address the Concerns Over the Protect-IP Act (Sen. John Boozman Facebook Page)

SOPA Black0ut Leads Co-Sponsors to Defect (Politico)

Fade to Black: These Awful Internet Censorship Bills Are Still A Thing!

January 18, 2012 David Kinkade 1 Comment

Today’s the big Stop SOPA/PIPA blackout day, where many popular websites are “going dark” to raise awareness of the dangers of the two Internet censorship bills in the U.S. House of Representatives and the U.S. Senate, respectively. The Arkansas Project is not going dark, since this site is not and has never been popular.

However, I did install that obnoxious pop-up window you might have seen when you clicked over here. Fear not, it’s just for one day. But I am doing my part to raise awareness, which I recommend as a way to feel good about yourself without actually having to do all that much of anything.

And if you live in Arkansas, then I regret to inform you that two of your Congressional officials—U.S. Rep. Tim Griffin and Sen. John Boozman, both Republicans—are sponsors of the bills in their respective chambers. So now would be a good time to drop them a note and give ‘em what for.

So, anyway, these bills, the Stop Online Piracy Act (SOPA) and the Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act (PIPA), have everyone up in arms for the power they’ll give the government and corporate media cronies to shut down websites in the name of “fighting piracy,” and represent not only an assault on the open nature of the Internet, but also on free speech. SOPA is on hold in the House, but not dead; PIPA is slated for a vote in the Senate on Tuesday, January 24.

If you’re late to the game and would like to learn more, here’s a previously posted video from Fight For the Future that lays out the issues with clarity and verve:

PROTECT IP/SOPA Breaks The Internet from Fight for the Future on Vimeo. More:

Tell Congress not to censor the internet NOW! – http://www.fightforthefuture.org/pipa

PROTECT-IP is a bill that has been introduced in the Senate and the House and is moving quickly through Congress. It gives the government and corporations the ability to censor the net, in the name of protecting “creativity”. The law would let the government or corporations censor entire sites– they just have to convince a judge that the site is “dedicated to copyright infringement.”

The government has already wrongly shut down sites without any recourse to the site owner. Under this bill, sharing a video with anything copyrighted in it, or what sites like Youtube and Twitter do, would be considered illegal behavior according to this bill.

According to the Congressional Budget Office, this bill would cost us $47 million tax dollars a year — that’s for a fix that won’t work, disrupts the internet, stifles innovation, shuts out diverse voices, and censors the internet. This bill is bad for creativity and does not protect your rights.

Wikipedia Blackout, SOPA and PIPA Explained (ABC News)

A Congressional Twitter Debate Is A Terrible Idea!

January 17, 2012 David Kinkade 1 Comment

The Hopefuls: Cotton, Rankin & Richmond

If you’re looking to check in on what the candidates in the Arkansas Fourth Congressional District Republican primary have to say on the issues, then you do not want to miss the Twitter debate to be hosted tomorrow (Wednesday, January 18), by the Arkansas College Republicans.

And by “do not want to miss,” I of course mean that you absolutely want to miss this, because a Twitter debate is just a terrible idea. Who needs this? This, this Twitter debate, I do not think anybody needs.

Here, to make things simpler for you, I have developed a short checklist to let you know if you should, uh, watch the Twitter debate. (watch? view? read? endure?):

You are a masochist.

You like to read boilerplate political statements in incoherent, decontextualized, non-sequential 140 character bursts.

You are Jason Tolbert.

If you suffer from one or more of the above conditions, please tune in to Twitter on Wednesday for the Arkansas Fourth Congressional District at 2 p.m. CST. The rest of you, please, for the love of god, just go about your business as previously planned.

I’m not 100 percent sure how it will work—presumably you’ll have to follow the @ARkCR feed and all the participants, if you’re not already? The College Republicans’ news release says that the two confirmed participants are Tom Cotton and Marcus Richmond, which I guess means Beth Ann Rankin won’t be participating, which I guess means we have a winner. Congratulations, Beth Ann, on your sound judgment and your decisive Twitter debate victory!

In conclusion: Terrible.

College Republicans Plan Twitter Debate for Fourth District (Talk Business)

Beebe On Arkansas Forestry Commission Financial Mess: “Not It!”

January 13, 2012 David Kinkade Leave a Comment

Ranger Mike says, "Give a hoot, don't pollute your balance sheet by illegally commingling state and federal funds!"

Ranger Mike sez, "Give a hoot, don't pollute your balance sheet by illegally commingling state and federal funds, or at least don't get caught doing that!" Catchy slogan, Ranger Mike!

It’s Friday the 13th, which is bad news for you if you planned on spending the night at Camp Crystal Lake, or if you are one of the 36 employees of the Arkansas Forestry Commission losing your job today due to the agency’s epic mismanagement.

Oh, guys, this Forestry Commission story, with all its bumbling and bungling, can we talk about this a minute? Never did we dream when the story broke in early December that it would still be boiling along six weeks later, but here we are.

The agency is $4 million in the hole, hence the layoffs of three dozen workers, and in hock to the feds for some $1.2 million for misusing federal grant funds. Gov. Mike Beebe, eager to deflect any blame for the mess, is itching to show he’s in command of the situation by issuing a supreme edict for a legislative audit of the troubled agency. And he means business, boys, so get cracking!

One obnoxious theme in this story that continues to rear its head is the notion that the dispute is simply a function of partisan politics, with those dastardly Republican lawmakers trying to get the better of good ole reliable Mike with their Washington D.C.-style tactics. Boo! Hiss!

But really, decrying the “partisanship” in this dynamic rather misses the point.

OK, fine, Arkansas Republicans are seeking to exploit some political advantage here—because, you know, people in political arenas tend to have incentives to do that. But the more important fact is that without the relentless pressure from minority lawmakers like Rep. Bryan King, Rep. Kim Hammer and Sen. Missy Irvin to keep the story alive, it’s not likely that the facts of the Forestry Commission’s dysfunction and mismanagement would have come to light.

Or perhaps you would prefer the approach of those who would just chalk it up to “partisanship” and move on from all this unpleasantness, like one lawmaker who talked to the Arkansas Democrat-Gazette’s Mike Wickline (subscription required):

Sen. Jimmy Jeffress, a Democrat from Crossett, wonders whether [Forestry Commission head John] Shannon will survive this controversy.

“I don’t want to put the governor on the spot, but it just depends on whether or not he is willing to sacrifice [Shannon] as a sacrificial lamb and get on with business or not,” he said. “I think if that should happen, some people think that that will get us over the hump. But then I think that, well, [the Republicans] will have the first bloodletting and will they look around for something else?”

I guess you could say that Sen. Jimmy Jeffress, Democrat from Crossett, can’t see the forest for the trees (“Good one, Dave!”—All Arkansas Project Readers).

Or maybe Jeffress is right: maybe the last thing we need in state government is for these legislators to go poking around “for something else” and turning up more examples of millions of dollars in mismanaged funds and dysfunctional management. That is something we simply do not want. Who knows what they might find?

Who knows indeed.

Lawmakers To Eye Forestry Commission Shortfall During Budget Hearings (Arkansas News Bureau)

Beebe Asks Legislative Audit to Review Forestry Commission (Talk Business)

Checking In On Arkansas Taxes: Yep, Still High!

January 12, 2012 David Kinkade 1 Comment

Click to see original version

Because it’s been some time since we checked in on the heavy tax burden on Arkansans…hey, look at this! The Tax Foundation, whose work I flack mercilessly on this site, has issued their latest map showing the distribution of sales tax rates nationwide, broken down by zip code.

Arkansas shows up rather red, reflecting higher sales tax rates around the state. This isn’t anything you don’t already know—you’ll recall that just a few months back we saw that the Natural State has the 7th highest combined state and local sales tax rates in the nation. Seventh in the nation!

Keep that in mind as we move toward the 2012 legislative fiscal session, where lawmakers will tackle the state’s budget priorities. For a splendid preview of what that session may hold, go over and read our friend Roby Brock’s forecast of what’s to come at Talk Business.

MORE FUN WITH MAPS!: Or if you want some good (good? sure, why not) news, you can look to this neat map from the Centers for Disease Control showing that Arkansas has one of the lowest rates of binge drinking in the nation. Because we are all on meth? Yes, I’ll bet that’s it, meth, let’s go with that.

Legislative Preview: 2012 Fiscal Session Could Get Feisty (Talk Business)

GOP House Members, Senators Blast Obamacare in Amicus Brief!

January 10, 2012 David Kinkade Leave a Comment

Here’s a notable development from late last week that escaped my notice: A sizable contingent of members of Congress (36 senators and 117 representatives, all Republicans, it appears) filed “friend of the court” briefs on Friday, Jan. 6, asking the U.S. Supreme Court to declare Obamacare unconstitutional, reports the Capitol Hill rag Roll Call.

The crux of the matter is that lawmakers question the constitutionality of the individual mandate in the Affordable Care Act, and argue that the entire law should be struck down as a result. The notable Arkansas connection is that Senator John Boozman and Rep. Tim Griffin are listed as signatories to the briefs submitted by members of their respective legislative bodies.

The House effort was spearheaded by the conservative American Center for Law and Justice (ACLJ), who explain in plainer language (read: not legalese) here:

“It is clear that ObamaCare was never designed to and cannot operate without the individual mandate, a key unconstitutional provision that forces Americans to purchase health insurance under penalty of law,” said Jay Sekulow, Chief Counsel of the ACLJ. “Nearly 30 percent of the U.S. House has joined with us—as well as more than 100,000 Americans—in urging the Supreme Court to declare this deeply flawed health care law unconstitutional. The fact is the unconstitutional individual mandate is the essential element of the health care law, and the balance of ObamaCare cannot function independently without it. You can’t have one without the other. We’re urging the high court to declare the entire health care law invalid, since the unconstitutional individual mandate cannot be severed from ObamaCare.”

If you prefer the legalese, here’s a link to the Senate amicus brief, and a separate link to the House version (PDF).

You know, I tried to sex up this post with that exclamation point in the headline, to maybe make the news a little more exciting, but anytime the words “amicus brief” appear in a headline you just know it’s gonna be a tough slog.

Republican Senators Urge SCOTUS to Nullify Health Care Law (Roll Call)