Bacon's Rebellion

The New Year has blown in a breath of fresh air: The January 14, 2008, edition of the Bacon’s Rebellion e-zine. If you don’t visit this blog regularly, subscriber for a free subscription to make sure you never miss an issue. Click here.

Here is our line-up of commentary:

Building Human Capital
Human capital is the driving force of prosperity in a globally competitive economy. Soon, regions will vie for it like they compete for investment capital. Will Virginia be prepared?
by James A. Bacon

Gray Matter Migration. A Web chart ranking the 50 states by net in-migration.

Virginia Migration Winners and Losers. A spreadsheet ranking Virginia localities by net in-migration.

Hypercompetition
Here’s the sub-text of Tim Kaine’s state of the commonwealth speech: Invest in Virginia’s economic future. We can afford it. Our economy is still out-performing the nation’s.
by Doug Koelemay

The Road Ahead
As the MainStream Media fails to provide information citizens need to function as voters and consumers, a citizen-driven media will emerge to fill the void. It’s not yet clear what that new media will look like.
by EM Risse

Unleash the Private Sector
Many localities are too financially strapped to execute Tim Kaine’s pre-K initiative for at-risk tots. He could bypass that bottleneck by engaging private daycare providers.
by Chris Braunlich

Rooting for Hillary
Hillary Clinton has friends in strange places. Among the millions of Americans who reveled in her New Hampshire primary comeback, there were quite a few in Virginia’s Republican Party.
by Norm Leahy

Hot Air or Cold Logic?
The Governor’s Commission on Climate Change could guide Virginia’s energy and environmental policy for years to come. One option it needs to consider: geo-engineering.
by David Schnare

Nice & Curious Questions
Birdies, Bogies and the Back Nine: Golfing in the Old Dominion
by Edwin S. Clay III and Patricia Bangs

So, this is what the Civil Rights movement has come to 50 years after Brown v. Board of Education: There’s nothing wrong with Virginia’s failing public school systems that showering them with more money won’t solve. In a nutshell that’s the message conveyed by Oliver Hill, Jr., and Andrew Block in an op-ed piece in today’s Times-Dispatch.

Hill and Block construct a rickety argument that leans upon nearly every prop of liberal thinking about schools in common currency today. They start their column by hijacking the moral authority of the 1960s civil rights movement. “Our political leaders,” they write, “should continue to honor Virginia’s civil rights legacy by funding an educational system that meets the needs of all of our students, including those same children of color for whom so many fought so hard.”

The Standards of Quality, which redistributes billions of dollars in state aid from affluent school districts to poor ones, is not enough to “ensure equality of educational opportunity,” they continue. Neither is the $354 million in “at risk” funding that supports special programs for poor children. Low-income students, they assert, need “additional resources to be successful.”

Nowhere in their column do Hill and Block allude to the fact that many minority-dominated school districts spend significantly more per pupil than neighboring suburban school districts. Nowhere do they mention the scandalous bureaucracy and waste in many of those school districts — a bureaucracy that Mayor L. Douglas Wilder, incidentally, has targeted in his ongoing battle with the Richmond School Board.

The thrust of the Hill-Block column is to absolve minorities from making any financial sacrifice themselves, restructuring educational bureaucracies or altering their own cultural values or attitudes towards education. More money is the solution, and the onus falls squarely upon the taxpayers of Virginia to dig deeper into their pockets — or dishonor the civil rights movement.

This is the same old, minorities-as-victims ideology that has fostered passivity among poor African-Americans and kept them them dependent upon the largesse of whites. While Hill and Block purport to honor the heroes of the Civil Rights movement of 50 years ago, their antiquated thinking keeps poor African-Americans mired in the role of supplicants. Virginia would do far better to emulate the example of those hundreds of thousands of African-Americans who have escaped poverty and joined the economic mainstream of society. What was their secret? How can their success be replicated?

That’s my reaction to the news that Pat Robertson, chairman of the Christian Broadcasting Network, is a potential bidder for the Virginian-Pilot newspaper, which the Batten family has put up for sale. According to an Associated Press story:

“Although the price for The Weather Channel is a little rich for my blood, I am considering a potential bid for The Pilot and have asked my attorneys to look into it,” Robertson said in an e-mail statement provided Friday by his assistant, G.G. Conklin.

As the General Assembly works on its budget, the “rebenchmarking” of the educational Standards of Quality looms large. This Constitutionally mandated process recalculates how much Virginia school districts receive in some $6.2 billion in Direct Aid to Public Education dollars distributed by the state.

As I’ve often observed before, this rebenchmarking process represents one of the greatest inter-regional transfers of wealth in the state. By a complicated process, it punishes municipalities that choose to spend more local tax dollars on tax education. Each time the SOLs are rebenchmarked, the more dramatic the redistribution gets. Accordingly, it is instructive to see what happened when the SOLs were last rebenchmarked, in 2006. Many Virginia cities and counties enjoyed such a windfall of state revenue that they could cut their contributions of local tax dollars.

Chris Braunlich, a Fairfax resident and regular contributor to Bacon’s Rebellion, has documented this perverse effect. You can view the full document here. Here are some highlights:

In 2006, the City of Lexington received $1,139 in additional state funds per pupil — and cut their own contribution by $446 per pupil.

The City of Covington received $796 per pupil more from the state, and cut its local contribution by $644.

My home county, Henrico, an affluent suburban jurisdiction, received $423 more per pupil and cut its local contribution by $53.

Chesterfield County, the fourth most populous jurisdiction in Virginia, received $415 more per pupil and cut its own contribution by $239.

If Northern Virginia taxpayers want to know how they’re getting shafted in Richmond, this is where they ought to be looking. As a Henrico resident, I’m a beneficiary of the funding formula. But that doesn’t make it right. This formula is broken. Lil Tuttle with the Clare Booth Luce Policy Institute has suggested a formula that makes far more sense. If lawmakers sincerely want to fix public education — as opposed to perpetuate the current boondoggle — they could start here.

(Hat tip: The blogger known as Too Many Taxes.)

As a rebel by temperament, I tend to be highly critical of the way we Virginians conduct our business. But it’s OK to remind ourselves occasionally that we do a few things right. In his State of the Commonwealth speech yesterday, Gov. Timothy M. Kaine listed a number of accomplishments that Virginia can be proud of.

As our Department of Health prepares to celebrate its 100th year of service, they have helped Virginia capture one of the highest rankings in the nation for preparedness for public health emergencies.

Virginia was named the best state for business in the nation this year by Forbes.com, CNBC, and other business publications. We have one of the lowest unemployment rates in the nation, our average wages are among the highest, and with your support for the Governor’s Opportunity Fund, we announced the creation of over 15,500 new jobs in 2007. Just yesterday, we started 2008 off with a great economic development victory—RTI will invest $100 million and bring 150 high-paying
titanium processing jobs to the Martinsville/Henry County region.

Virginia’s per capita state and local tax burden as a percent of income ranks 43rd – one of the lowest in the nation – and our per capita income is the 9th highest in America. Our fiscal stewardship has been rewarded with rare Triple A ratings by all three major bonding agencies.

According to Education Week, children born in Virginia have the best chance of life success of any children in the nation. Ten Virginia high schools made Newsweek’s top 100 high schools list, and three of Virginia’s public universities are ranked in US News and World Report’s top 100.

For more information about that $100 million investment in Martinsville, which will create 150 jobs, click here.

Rick Sincere has an excellent post (compete with video!) of the press conference yesterday at which a proposal to create greater budget transparency was introduced.

It’s a good step forward — Virginians deserve to know where their money is being spent and, perhaps, legislators and others will feel a greater degree of responsibility for ensuring that those funds are spend wisely.

Well I can dream, can’t I?

Politically, the measure has an interesting number of supporters. Sens. Cuccinelli and Petersen were on hand to give their backing for it, and they were joined, either in person or by proxy, LTG Bill Bolling, AG Bob McDonnell and a number of Delegates. Where is the Governor in all this? Discussions have taken place with his policy people, so he’s at least being kept in the loop, if not yet on board.

I suggest he does. While transparency alone is no guarantee that the worthies will become better stewards of our money, it does create a means through which (some) taxpayers will be able to track spending, question priorities and perhaps even offer constructive feedback. (I can still dream, right?)

Rick pulled this editorial from the Free Lance-Star, which I think frames the matter extremely well:

A couple of existent programs nibble around the edges of what the senator and his co-patrons hope to accomplish. Virginia Performs, an administration creation, rates the progress of state agencies in pursuing quality-of-life goals. The state Auditor of Public Accounts’ Commonwealth Data Point, a Web site, paints a broad-brush portrait of how state government operates, including in the budgetary realm. But both programs are deficient in the all-important “fine print” category.

Mr. Kaine should support this transparency initiative, not because it would make his life easier operationally–the measure, for example, would expose to the cyberized world the practice of some state agencies to shift funds among program accounts–but because in principle it’s the right and progressive thing to do. The money with which the legislative cardinalate and administration nabobs play government is the people’s money. They should be able to see what becomes of it, quickly and easily, every step of the way.

I think the measure’s backers had an editorial board with the RTD, too. I couldn’t find any mention of it in the online paper today (though Robert Frost manages to get a couple of inches…yeesh).

We can argue in endless circles whether Dominion and other Virginia power companies need to build major new power plants, or whether conservation and renewable energy sources can meet Virginia’s energy needs for the foreseeable future. What is not up for argument is that Virginia can do far more than it currently does to encourage conservation.

All you have to do is look at California. According to today’s Wall Street Journal, California regulators use a carrot-and-stick approach to incentivize power companies to conserve. The regulatory scheme rewards electric utilities cash equal to 12 percent of the costs they avoid if they meet or exceed conservation targets, but punishes them if they fall far short.

Thus incented, PG&E, which serves northern California, has subsidized the sale of 7.6 million compact fluorescent lightbulbs so far, and expects to raise the total to as many as 20 million — enough to fill 10 percent of the light sockets in northern California homes. The CFLs use only a quarter of the electricity of regular bulbs. And the CFL subsidies are just the most visible program. PG&E has some 85 programs in all, employing 462 people, to help customers cut energy use: from helping Safeway Inc. choose more efficient chicken rotisseries to paying computer manufacturers to supply more efficient power-supply units.

PG&E has one big advantage over Dominion in encouraging conservation: It’s electric rates are so much higher that consumers get a much higher payback on their investments in energy efficiency. Dominion can hardly be criticized for keeping its electric rates low. Indeed, I say, thank you very much. But low rates are no excuse for Virginia’s failure so far to put into place regulatory incentives and rate structures that encourage conservation where it makes sense. Give us the option, please. Let us make the decision ourselves.

Update: Dominion has just issued a press release noting that sales of CFL bulbs have reached 558,000 in the first three months of its light bulb initiative. Dominion provides a $1.50 discount on single bulbs and $3 for multi-packs. The company’s goals now are to sell 5 million over three years.

If you thought Virginia’s payday lenders were bad, things could be a lot worse! India, with its growing economy, is experiencing a bank-led consumer lending boom. As in the United States, some borrowers fall behind in their repayments. Even in India, it appears, some people get caught on a treadmill of indebtedness. But in India, banks have a quaint way of collecting their debts: They beat people.

Today’s Wall Street Journal describes the fate that befell Vinod Kumar, a 21-year-old college student who was sitting in a friend’s car listening to the radio. A stranger suddenly pulled him out of the car, beat him with an iron bar and left him with 12 stitches and a 10-day hospital stay. Writes the Journal: “Mr. Kumar’s attacker was a goonda — a thug — working on behalf of one of India’s largest banks.”

India’s lawmakers may well put the goondas out of business. Here in Virginia, we may well give them a new lease on life. If we abolish payday lending in Virginia, where will poor people raise emergency cash? From Rocko and Guido (or their ethnic counterparts here in the Old Dominion) who operate outside the rule of law. Don’t be surprised if Virginia emergency rooms see a sudden rise in patients with broken kneecaps.

(Photo cutline: Poster art from the Hindi movie, “Goonda.” Photo credit: Vendithera Pay Per View.)