Category Archives: Politics

Here, Piggy Piggy Piggy!

pork_barrel

Woo hoo! GO Virginia!

by James A. Bacon

Any time business leaders, university presidents and legislators agree on a great new spending initiative, I put my hand on my pants pocket to make sure my wallet is still there. When their brilliant idea slides through the General Assembly without a dissenting voice, or even a word of skepticism from the news media, I take out my wallet to make sure my cash hasn’t disappeared. The GO Virginia initiative — $36 million allocated over two years to incentivize regional cooperation in economic development — inspires that reaction.

I don’t adamantly oppose GO Virginia — I don’t know enough to form a strong opinion. What worries me is that the proposal has been subjected to so little critical analysis.

Thankfully, Attorney General Mark R. Herring issued a legal opinion yesterday finding that the Virginia Growth and Opportunity Act faces a “significant risk” of being found unconstitutional on the grounds that it violates the separation-of-powers doctrine by giving the General Assembly the power to appoint a majority of the board’s 22 members as well as a legislative veto over its grants. (See the Richmond Times-Dispatch reporting here.) Gov. Terry McAuliffe has until Sunday to amend or veto the legislation, which he originally supported.

It’s nice to see that someone has taken a serious look at the bill. Herring raises a critical point. If anyone needs an example of what can happen when legislators insert themselves into the executive function, one need look no further than the shenanigans of the Tobacco Indemnification and Community Revitalization Commission.

According to the GOVirginia website, the project was the brainchild of the Virginia Business Higher Education Council (VBHEC) and the Council on Virginia’s Future “to foster private-sector growth and job creation through state incentives for regional collaboration by business, education, and government.”

Why is the program needed? Backers argue the following:

Because Virginia is a large and diverse state, the opportunities for private-sector growth vary significantly from one part of our state to another, requiring collaborative innovation among employers, entrepreneurs, investors, researchers, educators, governments, and other leaders in each region. Too often this cooperation has been lacking, causing Virginia to lag behind other states.

State government can solve the problem:

The State can and must do more to encourage strategic, job-focused collaboration in each region. Significant state funds currently flow to localities, schools, and higher education institutions; the Commonwealth should use such resources to promote joint efforts on economic and workforce development and to encourage collaboration that can improve performance and reduce costs.

The original concept behind GOVirginia was to fund the program through “use of growth revenues, re-purposed dollars, and efficiency savings” — not new taxes, mandates or layers of government. Somewhere along the way, the initiative morphed into a program supported by $36 million in state funds over the two-year budget. The concept may well have morphed in other ways beyond its original formulation, although, judging from Travis Fain’s reporting for this Daily Press article, the legislative package of four bills has stayed fairly true to the original vision.

Here is how the money would be distributed:

The plan includes $5.5 million a year for the first two years to stand up the regional councils, vet project proposals and study various aspects of regional economies, particularly the gaps in education and skills training needed to support desired industries.

Beyond that, $15 million would be up for grabs, with regional councils competing to get the state board to fund their projects. The remaining $12.4 million would also go toward project-specific grants, but it would be broken down between the regions based on population.

Bacon’s bottom line: It’s a little late in the game, I’ll concede, but let’s get the conversation going. Is this a worthwhile expenditure of $18 million a year?

Let’s start by looking at the new overhead created: $11 million, or 30% of the funds allocated, would go to setting up the administrative structure for the program. That’s pretty much a waste. Don’t higher-ed institutions have mechanisms for discerning the job-training needs of local industry already? What can these new studies possibly add?

Then consider the how the money is distributed geographically. Funds will be distributed amongst a number of regional councils reflecting the diversity of the state’s economy. Let’s assume that roughly $15 million a year would be made available for actual grants. How would the sum be divvied up? By the merits of the projects? What if all the high-ROI projects were located in, say, Northern Virginia? Would the other councils feel short-changed? Conversely, what if the money were distributed evenly between regions, would some high-ROI projects be denied funding?

Next, consider the pork barrel aspects. Fain quotes House Majority Leader Kirk Cox, R-Colonial Heights, a local project – the Aviation Academy at Denbigh High School – as a good example of projects that would get funding.

The Newport News school system runs the school at the Newport News/ Williamsburg International Airport. It would get $100,000 a year under Gov. Terry McAuliffe’s proposed budget, but Del. David Yancey, R-Newport News, wants another $2 million next year and $1.5 million the year after that to expand the school.

Yancey will go before the House Appropriations Committee to ask for that funding, but with limited time during session to vet these proposals, Cox said he’d rather see projects like this bubble up through the regional councils.

Pork by any other name still smells like pork.

There is a vast gap between the airy and idealistic justification of GOVirginia and the ugly implementation guided by legislators toward their pet projects. If the Newport News project is a good example of what would get funding, I hate to see a bad example. I foresee GOVirginia funding projects that couldn’t raise the money from either the private sector or existing government programs, thus creating new programs of marginal value that will be dependent upon government for funding, and creating new constituents that lobby for government hand-outs year after year.

To some degree, I’m playing devil’s advocate — filling a role that no one else has seen fit to play. I’m open to arguments in favor of the program. But so far, I haven’t seen anything that persuades me and a lot to make me keep checking my wallet.

VLDS Big Data Just Got Bigger

big_databy James A. Bacon

This blog post is geeky, but it’s important — so stick with me! If you favor public policy based on what works as opposed to public policy based on ideology or political muscle, then you should be very encouraged by the progress made by the Virginia Longitudinal Data Survey (VLDS) in incorporating new government data sets.

The VLDS started as a master database of mainly educational and employment data. Now it is adding poverty-related data from the SNAP (food stamp), TANF (Temporary Assistance for Needy Families) and VIEW (Virginia Initiative for Employment not Welfare) programs from 2005 to 2014. Coming up: data sets for foster care, child care, child protective services.

Combining all this data will allow researchers to provide more authoritative answers to a host of public policy questions.

For example, writes Jeff Price in a recent VLDS blog post, “We have never been able to evaluate the impact food security, as provided by the SNAP program, has on the academic success of young children. Do children whose family receives food stamps miss fewer days of school and do better on standardized tests than children from other low income families that do not participate in the SNAP program?”

Previously, it was a bureaucratic nightmare for researchers to obtain this data. VLDS eliminates many of the obstacles by anonymizing the data, that is, stripping out personal identifiers. Price continues:

We now have the opportunity to describe the entire population of citizens we serve in ways we never could before. This will provide insight into patterns and relationships we either knew existed but couldn’t quantify, or never knew existed.  It will allow agencies to better evaluate their program policies and the approaches and strategies used in the past to determine what works best.  In some cases current assumptions will be confirmed.  In others prevailing assumptions will be shown to be incorrect.

The value of the VLDS cannot be overstated. For population studies it is a game changer.

Bacon’s bottom line: VLDS has enormous potential. My only beef is that the research conducted so far has addressed extremely narrow-bore topics, and I have yet to see any eye-opening findings. (Click here and scroll down to “VLDS Research” to view the research projects based on VLDS data.)  Hopefully, that will change as new data sets are added and researchers are able to address an ever wider array of questions.

A Book Review for an Election Year

Along with income inequality, one of the most-discussed issues in the Presidential election year is the role of money in political campaigns.  Following the Roberts Court’s ruling in the Citizens United Case, which basically equated money with free speech, large numbers of Political Action Committees masquerading as charities, such as the Americans for Progress, were supported by wealthy donors to funnel money to selected candidates.  These so-called super-PACs could raise unlimited amounts as long as they were not “coordinated” with the candidate’s campaign.  This process and it after-math are the heart of Jane Mayer’s new book, “Dark Money.”

According to the book, Ed Gillespie, currently the front-runner for the Republican nomination for Governor of Virginia, was one of the first political operatives to realize the potential surrounding the Supreme Court’s decision, and began to organize attacks on regulation having to do with environmental protection and tax policy.

The perception that business is under attack and a response must be begun dates back to the early 1970’s.  Lewis Powell, a Richmond lawyer who served as a distinguished member of the Supreme Court, outlined a type of response that included an organized to roll back regulations and other government policies that, he perceived, were undermining the American private Enterprise System. (see reclaim democracy.org). Powell served on many corporate boards including tobacco giant Phillip Morris.  His ideas were taken up by several individuals of significant wealth.

The book indicates that those who found the dark side of American politics are mindful in operations that have significant impact on the environment.

The Olin Corporation is an example.  Olin was a significant polluter.  It was the largest manufacturer of DDT, which was eventual banned by the government in 1972.  In the town of Saltville, Va., Olin’s Chlorine production spilled significant amount of mercury into the Holston River.  The company ceased operations shortly after it was reported from Japan that large exposure to mercury in water caused birth defects.  Members of the Olin family are significant contributors to conservative think tanks such as the Heritage Foundation and the American Enterprise Institute

The most significant of the “dirty money” fraternity are the Koch brothers (No relation to former mayor of NY Ed Koch).  Their oil refining and pipeline business if one of the largest privately-held pipeline companies in the United States.  The family has a very interesting history. Earlier generations did business with both Nazi Germany and Stalinist Russia. Family members were members of the John Birch Society. This is the same group that believed that President Eisenhower was a Communist.

In her research, Jane Mayer discusses many legal problems that Koch industries has had under the current leadership of Davis and Charles Koch, some involving outright theft of oil from Native Americans’ reservations, significant instances of pollution. One particularly disturbing case involved the death of an employee named Donald Carson who died of Leukemia in 1997.  Doctors believe that his cancer was the result of exposure to benzene, a chemical involved in refining crude oil. The Kochs refused to pay him Workmen’s Compensation even though a company-sponsored blood test indicated five years before his death that his blood was poisoned. The employee was subsequently terminated from the company.  Charles Koch believes that government regulations are “socialistic.” Employees within the company that brought up potential health issues to OSHA were fired. In one case, involving a pipeline explosion, resulting in the death of an employee, a jury found that the Koch’s not only negligent but malicious, ordering them to pay a settlement three times the hundred million Dollars that was originally requested.

Ms. Mayer does acknowledge that the Koch Brothers have given significantly to “real charities” such as Lincoln Center in New York and several medical research institutes. According to the author, these contributions served to soften their image and make their political activities seem less threatening and less self-serving.

Following the plan, laid out many years ago by Lewis Powell, American Universities are the fountainhead of anti-business attitudes in the United States. The theories of the Austrian school of economics was believed to provide an intellectual basis for the type of free-for-all capitalism advocated by the Koch brothers.  In 1981, the Mercatus Center was established at the George Mason University in George Mason University.  The Center claimed that it “bridged the gap between academic ideas and real world problems.”  Records obtained by Jane Myer indicate that the brothers have contributed $30 million to the Institute. One historian on the faculty describes the institute as a “lobbying group for corporate interests.”

Whether you agree with the author,  Jane Mayer, the current rise of “outsider politicians” in both parties shows that much of the public perceives that the system is rigged in favor of the ultra wealthy.

— D. Leslie Schreiber

Gas Worse Carbon Polluter than Coal, Says Sierra Club

global_warmingby James A. Bacon

The Sierra Club has attacked the idea of natural gas as a “clean fuel” in a new broadside against the proposed construction of the Atlantic Coast Pipeline (ACP) and the Mountain Valley Pipeline (MVP) through Virginia. When viewed over the “natural gas fuel cycle” — including production, transportation and combustion — natural gas would be a bigger contributor to climate change than the existing electric generating fleet, including coal-fired plants, the environmental organization charged late last week.

“Natural gas only seems like a cheap and easy fix for climate change,” said Glen Besa, director of the Sierra Club Virginia Chapter, in a statement accompanying the white paper. “In reality, methane pollution is a serious problem that makes natural gas a dead-end solution. We have to stop kidding ourselves. Virginia should be investing in wind and solar and energy efficiency, not expanding infrastructure for more fossil fuel burning.”

The Sierra Club issued the report as the Virginia Department of Environmental Quality makes important decisions about how the state should implement the federally imposed Clean Power Plan, which calls for a massive reduction in carbon-dioxide emissions from Virginia power plants by 2030. The Sierra Club and other environmental groups have called for the most aggressive options, which would require more solar and wind and less natural gas than proposed by Dominion Virginia Power. Backers of the ACP and MVP pipelines have justified the projects on the grounds that they will supply gas-fired power plants in Virginia and North Carolina with cheap shale gas from West Virginia and Ohio.

“The overwhelming consensus of state and federal policymakers – which the Virginia chapter of the Sierra Club ignores – is the increased use of natural gas for electric generation is essential to meeting the Clean Power Plan,” responded Jim Norvelle, director-media relations for Dominion Energy, the managing partner of the ACP.

“This is the view of President Obama and elected officials from states across the country,” he said. “It is also the clear guidance of the [Environmental Protection Agency], which identified increased use of natural gas generation as one of three key building blocks for meeting the goals of the Clean Power Plan.”

Because the combustion of natural gas releases less CO2 per unit of heat than the combustion of coal, it is commonly argued that a switch to gas, while less helpful than a shift to solar and wind in reducing CO2, does make a significant contribution as a “bridge” fuel in the fight against global warming. But the Sierra Club argues that such a combustion-only analysis excludes the impact of the release of gas during fracking operations and pipeline leaks. Summarizes the Sierra Club statement:

In addition to emitting large amounts of CO2 when burned, natural gas is a major contributor to climate change in the extraction and transmission stages, where significant amounts of methane escape from wells and pipeline leaks. Methane is a much more powerful greenhouse gas than CO2, and these “fugitive emissions” of methane have emerged as an area of serious concern that undercuts the case for natural gas as a cleaner substitute for coal. …

Greenhouse gas emissions for Atlantic Coast Pipeline would be more than five times the annual emissions from Dominion’s Chesterfield Power Station, the largest coal fired plant in Virginia, and equal to more than 80% of the total carbon pollution from all 177 stationary sources in the EPA’s 2014 inventory of GHG emissions in Virginia, states the Sierra Club.  The impact of the Mountain Valley Pipeline would be even greater.

Critics of renewable fuels counter that solar and wind farms produce electricity only  when the sun is shining and the wind is blowing, not when there is a demand for electricity. Natural gas generation can be dialed up and down quickly as electricity demand changes. That flexibility is particularly critical if electric utilities are to adopt “demand-response” rate structures that encourage users to conserve energy during periods of peak demand. Gas advocates also note that the gas infrastructure has less impact on the landscape. Solar and wind requires far more land to generate comparable amounts of electricity; wind turbines and vast expanses of solar panels also are more visually intrusive than buried pipelines.

Virginia’s Pet Rock

nelsonite

A delegation from Piedmont Virginia Community College brought a sample of Nelsonite for legislators to view.

As if we needed any more proof that Virginia is tragically behind the times, here it is: The Commonwealth is one of only four states in the nation that has not designated an official “state rock, mineral or gemstone,” writes Sen. Creigh Deeds, D-Bath in his most recent constituent newsletter.

Fortunately, Deeds has submitted legislation recognizing Nelsonite as the state rock. Nelsonite, first discovered in Nelson County, is a billion-year-old mineral comprised of apatite and ilmenite…. whatever they are. It was mined over 70 years to extract titanium for use in house paint.

Deeds’ bill, as originally submitted, qualifies as one of the shortest pieces of legislation ever written. It consisted of two words, “Rock — Nelsonite,” inserted into a list of official emblems and designations. The only legislation I can imagine that might have been shorter, by one letter, would have been a bill listing “Beverage — Milk.” A great virtue of Deed’s economically phrased bill is that no one can say, as Nancy Pelosi famously declared of Obamacare, that we’ll have to pass the bill in order to know what’s in it.

Nelsonite joins such other quintessentially Virginia phenomena as the official state bat (the Virginia big-eared bat), state dog (American foxhound), state fleet (replicas of the Susan Constant, Godspeed, and Discovery), state dance (square dancing), state insect (Tiger Swallowtail Butterfly), and state shell (oyster).

The designation of the state rock is not as contentious as the selection of a state song last year, but the passage through the Senate was something of a rocky road. Five senators voted against the bill. The bill was amended to reinsert mentions of the state bird (the cardinal) and the state tree (the dogwood), which had been omitted somewhere along the way. But according to the Richmond Times-Dispatch,”Sen. John A. Cosgrove Jr., R-Chesapeake, expressed mock indignation that the American dogwood is Virginia’s state tree, noting that its scientific name is Cornus florida.”

Sparks Will Fly

gridby James A. Bacon

Step aside Medicaid expansion. The big uproar in the General Assembly this year is over who gets the final say over the shape of Virginia’s Clean Power Plan: General Assembly Republicans or Democratic Governor Terry McAuliffe.

At stake is the future of Virginia’s electric grid. Democrats and their allies are pushing for 30% renewable energy by 2030 compared to 2005 levels. Republicans and their constituencies fear that excessive investment in intermittent energy sources like solar and wind would saddle rate payers with billions of dollars in unnecessary costs.

In a straight party-line vote earlier this week, the House of Delegates passed House Bill 2, which would require both the House and the Senate to approve any plan developed by Department of Environmental Quality (DEQ) to regulate carbon-dioxide emissions from electric power sources before submitting it to the Environmental Protection Agency.

After the bill’s passage, House Speaker William J. Howell, R-Stafford, said the energy plan will have a “devastating impact” on Virginia’s economy, according to the Richmond Times-Dispatch. “It is critical that the people have a say in the energy policy of the commonwealth through their elected representatives, not by unelected bureaucrats in Washington and Richmond.”

The bill likely faces a veto by McAuliffe, who has said that he would combat any effort to limit the state’s ability to respond to climate change and sea level rise.

The state faces two strategic decisions on how to reach Clean Power Plan emission goals.

The first decision is whether to go with an “emission standards” plan or a “state measures” plan. An “emission standards” plan would apply EPA standards to coal- and gas-fired power plants in the state. A “state measures” plan would include a mix of measures, not just focusing on power plant emissions but allowing other elements such as renewable energy standards and residential energy efficiency. A stakeholders group advising the DEQ reached a consensus, according to the meeting minutes, “that the emission standard approach was preferred.”

The second decision is whether to adopt a “mass”-based approach or a “rate”-based approach for reducing CO2 emissions. A mass-based approach sets targets based on the absolute volume of CO2 emissions by electricity producers within a state. A rate-based approach sets targets based on CO2 emissions per kilowatt hour of electricity generated. The stakeholders group started tackling this issue in December and will resume the discussion in its February meeting.

Meanwhile, in an open letter to McAuliffe, 50 Virginia environmentalists and progressives pushed for an aggressive implementation of the Clean Power Plan. States the letter: “Virginia can and should reduce its total carbon pollution from power plants at least 30% by the year 2030, by applying the same emissions limit to all plants (existing and new) and increasing our use of energy efficiency and renewable energy. With this strategy, Virginia’s Clean Power Plan will reduce electricity bills and grow our economy, while helping to meet our obligation to future generations.”

PolitiFact Claim Based on Faulty Assumption

politifactby James A. Bacon

In a recent survey asking people if they supported or opposed Medicaid expansion in Virginia, Del. R. Steven Landes, R-Weyers Cave, made what PolitiFactVirginia reporter Sean Gorman regarded as a fallacious statement:

While expansion would enroll up to 400,000 currently uninsured Virginians in Medicaid, it could cost the Commonwealth of Virginia over $1 billion per year, forcing cuts to other key services like education, mental health and public safety.

Landes’ estimate rests on the “eye-popping” supposition that the federal government might one day renege on its commitment to pay 90% of the cost of expansion, as provided in the Affordable Care Act, wrote Gorman Monday. “But this is pure speculation on his part. There’s no effort in Congress now to cut the federal share at all, let alone by the proportion Landes suggests.”

The burden of proof rests on Landes to back up his statement with facts, Gorman says, “and he comes up short. We rate his claim False.”

Incredibly, Gorman failed to notice that Republicans in Congress succeeded in passing a bill that would have repealed the Affordable Care Act, which President Obama salvaged with a veto Friday. Here’s what House Speaker Paul Ryan had to say:

The idea that Obamacare is the law of the land for good is a myth. This law will collapse under its own weight, or it will be repealed. Because all those rules and procedures Senate Democrats have used to block us from doing this? That’s all history. We have now shown that there is a clear path to repealing Obamacare without 60 votes in the Senate. So, next year, if we’re sending this bill to a Republican president, it will get signed into law.

What would happen if Virginia enacted Medicaid expansion and a Republican administration and Congress then repealed it, thus eliminating federal funding for the program? Virginia would face the choice of either abandoning the program it had just enacted, throwing the health care market into turmoil, or continuing to fund the expansion itself.

Please note that Landes did not say that Medicaid expansion “will” increase state funding by $1 billion a year, he said that it “could.” Who will win the 2016 presidential election? While Las Vegas odds give Hillary Clinton the edge, they concede that a Republican has a solid shot at making it to the White House. The scenario that I just laid out — and very possibly the one that Landes was thinking about — very well could happen, and it would be reckless to ignore the possibility.

There are logical reasons for supporting Medicaid expansion — hundreds of thousands of Virginians still lack health coverage, we’re already paying for the expansion through other taxes under the Affordable Care Act, even if Virginia doesn’t take advantage of the opportunity, so why not? — but those are separate issues that must be considered on their own merits.

As for proclaiming Landes’s statement outright false, Gorman was seriously remiss in ignoring the political reality that the Republican Party remains ferociously opposed to Obamacare and likely will repeal it if it takes power in Washington next year. His analysis comes up short. I rate his claim False.