Bacon's Rebellion

In my last column, “Hidden Advantage,” I argued that flexible labor markets were one of Virginia’s hidden competitive strengths. But I noted one area of concern: Virginia’s propensity for regulating professional and occupational groups tend to tighten labor supply in their professions and drive up prices for their services.

The current issue of Virginia Business magazine offers a case study of this phenomenon. Over the next 15 years, about 75 percent of the nation’s Certified Public Accountants will approach retirement, reports Editor Robert Powell. At the same time the Sarbanes-Oxley Act, which tightens financial reporting standards for publicly traded companies, has increased the demand for CPAs.

To ensure an adequate supply of CPAs, CPA organizations are increasing scholarships and promoting the profession to students. In Virginia, the number of CPAs licensed has increased 22 percent to 21,310 over the past five years. However, writes Powell:

A temporary kink in the CPA pipeline occurred last year because of new education requirements. Adopting a standard used by many other states, Virginia last year increased the number of earned credit hours required for taking the CPA exam from 120 to 150. As a result, many accounting graduates stayed in school to earn their master’s degree and get the additional credits. The Board of Accountancy licensed only 192 CPAs in 2006, down from 656 the year before. The number of new CPAs is expected to return to a more normal level this year.

All of these actions need to be seen against the backdrop of unprecedented demand and a shortage of CPAs. As the Virginia Society of CPA notes on its home page, “The majority of CPA firms in the United States are having a tough time finding qualified employees at all levels, according to the 2007 Top Management of an Accounting Practice (MAP) Issues Survey.”

Drawing upon the tenets of public choice theory, I would hypothesize that the leaders of the CPA profession would use the legislative process to stack the deck in their economic favor. They would have at least two sets of self-serving considerations. First, they are incentivized to restrict the number of people practicing their profession, thereby creating pressure to raise fees. But that is offset to some degree by a countervailing incentive: The industry leaders are partners in their firms and they share in their firms’ profits. If they restricted access to the profession too much, they would have fewer CPAs to employ and would forego the mark-up charged for their services. In theory, there is a profit-maximizing sweet spot of an ideal number of CPAs, and CPAs, through their collective actions, I suggest, will seek to achieve it.

I don’t know for a fact that CPAs think in such calculating terms. All I’m suggesting is that they have every incentive to think that way, and their actions seem to be consistent with the profession’s economic interests.

The ability to influence the supply of employees entering your occupation is pretty advantageous, if you can pull it off. I’m sure that labor unions representing blue-collar occupations would love to have the same power as the CPAs. In Virginia, however, the regulatory authority to rig labor markets in your favor is largely a white-collar prerogative.

Update: After reading the comments made in response to this post, I’ve concluded that I don’t have any solid evidence to support my hypothesis stated above. For the time being, Virginia CPAs stand absolved of my suspicions — unless new evidence presents itself.

After a series of bizarre confrontations with the Richmond school board, Richmond Mayor L. Douglas Wilder has lost the P.R. battle to bring accountability to the city school system. For those not familiar with the ongoing saga, Wilder evicted the school administration from City Hall late this summer, only to have a circuit court judge order the school officials back in. The incident cost tens of thousands of dollars, soured the public on Wilder and garnered widespread sympathy for the school board.

While Wilder’s heavy-handed tactics may have backfired, he was on to something. Someone has to hold the school board accountable. Richmond city schools spent $13,168 per student in the most recently completed school year — up 6.3 percent from the previous year, report Olympia Meola and Michael Martz with the Times-Dispatch. Spending is climbing even as enrollment is declining.

A city auditor has identified potential savings of up to $20 million a year, but the board has taken no action. It would be one thing if record spending delivered demonstrably superior results, but improvements in student performance, if any, have been marginal. Is there any way to hold the Richmond school administration accountable? Is there any way to stop this runaway train?

JLARC has taken a crack at studying Gov. Timothy M. Kaine’s proposal to expand pre-K in Virginia. A draft report released yesterday draws some conclusions that bear upon the debate:

• Research indicates that a quality preschool experience for “at-risk” four-year-olds helps prepare them for school and can have long-lasting benefits.
• Research suggests quality pre-K can be beneficial for children not at risk, but gains experienced by these children may be more limited. Virginia’s focus on at-risk students appears appropriate.
• Virginia Preschool Initiative students gain in literacy skills during the pre-K year and outperform other kindergarteners. Longer term student-level data are needed to assess VPI’s impact on test scores in later grades.
• Best estimates of annual per-pupil costs for a quality pre-K program in Virginia range from $6,790 to $7,920. Costs will need to be adjusted as compensation levels, support costs, or pupil-to-teacher ratios change.
• The Governor’s proposal for expanding the scope of preschool for at-risk children is unlikely to serve as many children by 2012 as has been stated, particularly if the VPI per-pupil amount is not increased.

Here’s my spin on the bottom line: First, we can document short-term benefits for at-risk children, but the long-term benefits are debatable. Short-term benefits to middle-class children are limited, as the long-term benefits presumably are as well.

Second, as soon as the pre-K program is expanded, it will face cost pressures. Apparently, the $5,700 per child the state allocates currently to the program is deemed less than the $7,000+ it takes to run a quality program. Raising the standards will be the next battle cry.

Thirdly and most importantly, some 5,270 slots are going unfilled currently, indicating that pre-K is not where local school systems prefer to allocate their resources. Many school boards believe there are other areas where the money may be better spent.

Let’s go ahead and expand the Virginia Preschool Initiative to include at-risk kids — and then rigorously measure the long-term impact on individual children to see if the investment does what it’s touted to do. If it does, the program is a keeper. If it doesn’t, there is no justification for expanding it beyond the at-risk population.

What on earth does Emiliano Zapata, a leader of the 1917 Mexican Revolution, have to do with illegal immigration in the United States today?

Step aside, Virginia Tech, there’s a new top dog in the Virginia supercomputing space: the Thomas Jefferson National Accelerator Facility. The “Jefferson Lab,” as it’s known for short, has issued a press release boasting that it now lays claim to the fastest supercomputer in Virginia — and the 95th fastest in the world. Several years ago, Virginia Tech had won brief acclaim as home to the fastest supercomputer in the world. The honorific evidently doesn’t last very long, as universities and research institutions leapfrog each other with great regularity.

I guess not. Here’s the latest: Citing the budget shortfall (yeah, right) Gov. Timothy M. Kaine has cut $275,000 in state matching funds for for abstinence-only sex education programs. Quotes the Washington Post:

“The governor supports abstinence-based education, but the governor wants to see us funding programs that are evidenced-based,” said Skinner, who added that Virginia will now offer “more comprehensive” sex education.

Predictably, conservative legislators are working themselves into a state.

Meanwhile, oil shoots past $90 a barrel, Virginia continues to pour money into a transportation system designed for cheap fuel, schools continue to fail Virginia children, college tuitions continue to soar — as do salaries for college presidents (up 37 percent over five years for private institutions), health care costs are out of control, the dollar is plunging, the sub-prime mortgage debacle gets worse, and nuclear-armed Pakistan is descending into chaos.

The world seems so out of control, and the big problems seem so intractable, that I guess it’s only human nature to fixate on the little problems they have some influence over.

Gooze Views
Peter Galuszka

The devil is certainly in the details. One week ago, I wrote an opinion piece, questioning the figures used in a report by Chesterfield County trying to justify a claim that the county spent more than $2.1 million annually on illegal aliens. The report is a run-up to a hearing Nov. 14 on illegal immigration and whether the county should crack down. Curiously, the report gave no estimate of how many illegal aliens are actually in Chesterfield – the sine qua non for estimating costs on county services.

The report bugged me and a lot of others. Not only did my column generate more than four dozen responses, I got a call from Deputy County Administrator Rebecca Dickson (whose name I had badly misspelled). The county had directed me to her for more detailed explanation of where data in the Aug. 16 report by County Administrator James J.L. Steigmaier came from. I had tried and failed to reach Ms. Dickson, who now wanted to set me straight.

Before getting into specifics, let me say that Ms. Dickson is obviously a public servant trying to do a tough job fairly. She impressed upon me that the county staff is well aware of how racially loaded the issue of illegal immigration is. Counties such as Prince William have adopted strident anti “illegal” measures, but the Chesterfield Board of Supervisors (just shaken up in elections) hasn’t done anything yet.

After reviewing her explanation and tapping other sources, nonetheless, I have come to a few conclusions. First, Chesterfield’s figures are too suspect to justify any kind of crackdown at all. The grand harrumph about illegals is based on bad data, guesses and lots of anecdotes. The more I studied the Chesterfield report and did my own research, I came up with figures and views completely opposite or certainly nowhere as profound.

But that doesn’t solve the massive problems in Stegmaier’s report. For starters, officials in Chesterfield, population about 300,000, estimate that from 17,500 to 21,000 illegal aliens – all of them Hispanics — live in the county. This revelation came during an interview with Dickson and has never been made public, perhaps because the estimate is so flimsy.

The number is important because it is the basis of the $2.1 million cost estimate of the County’s total budget of $336 million. Ms. Dickson says that the cost numbers hold despite the uncertainty as to the total numbers of illegal aliens. To me, that defies logic.

In coming up with its alien guess, the County looked only at Hispanics and no other immigrant group. (Racial profiling, anyone?) The latest 2000 U.S. Census reported that 15,000 county residents checked the box “Hispanic” beside their names. Mind you, these people could be here legally or illegally. All they did was check a box on a chart. To this, Chesterfield officials add another 10,000 to 15,000 Hispanics. This was the brainchild of a “Hispanic cross functional team” that worked in the county two or three years ago, Dickson says. So, we are up to levels of 25,000 to 30,000 of Hispanics who are in the county legally or illegally, by the County’s count.

How do we know how many are here illegally? In Chesterfield, we guess and we come up with a whopping 70 percent, equating to about 17,500 to 20,000 illegals in all. Why 70 percent? According to Ms. Dickson: “Essentially this (aforementioned) team, indicated that anecdotally, they believed that about 70 percent of the Hispanic population was here illegally. That is how we got 70 percent.” The County did a second estimate based on massaging census figures another way and got a lower illegal population of 13,150.

“Ridiculous” is the reaction of Communication Director Jesus Moreno of the Falls Church-based advocacy group, The Hispanic Committee of Virginia. Moreno’s group uses figures from the nationally known Pew Research outfit, which estimates that of the 40 million Hispanics in the U.S., from 10 to 11 million are undocumented. If that ratio is common everywhere, then Chesterfield’s population of illegal Hispanics, assuming the totals are correct, is more like 4,000, or about one fifth of Chesterfield’s guess. Says Moreno: “I guess they knocked on the doors of 10 Hispanics and figured that seven people were illegal.”

To back the county’s methodology, Ms. Dickson directed me to a report by the Joint Legislative Audit and Review Commission, which does studies for the General Assembly. In 2004, JLARC published a report on how “foreign-born” Virginians were faring. “Foreign born” could mean illegal but also could mean naturalized U.S. citizens or ones here with proper documents.

When I checked the report, I couldn’t find much to back Chesterfield’s estimates. In fact, I found just the opposite.

While the number of foreign-born residents increased statewide 83 percent from 1990 to 2000, the total amounted to about 570,279 or a small fraction of the total state population. Most, 41.3 percent, were from Asia with 33.3 percent from Latin America. This is interesting because Chesterfield chose only to study Hispanics, not Koreans, Indians, or Chinese for potential illegal status. And, the JLARC report cited only about 13,523 “foreign born” – legal or illegal of all backgrounds — residents in Chesterfield, which is hard to square with Dickson’s numbers. Even the county’s illegal Hispanic figures are way higher than these. However, from 1990 to 2000, Chesterfield’s “foreign-born” population did double.

To be sure, I called Phil Leone, executive director of JLARC. His group’s 2004 report could not find much negative impact from foreign born Virginians and noted that the report didn’t specifically look at illegals. “There wasn’t a great demand on services,” he said. Rather, he said, “the foreign born contribute immensely to the state economy.” Told of Chesterfield’s estimates of illegal Hispanics, he said, “They didn’t get that from our report. They may have read our report and made their own assumptions.”

Indeed, assumptions are not facts, but they sure play a role in politics. The illegal alien invasion has been an ugly rallying cry by state Republicans as they tried to make up for various failings in the Nov. 6 election. They were only partly successful, losing the Senate to the Democrats. In Northern Virginia, a key battleground, the GOP’s tactic may have worked in outer suburbs of Loudoun and Prince William, but failed in the inner suburbs of Arlington and Fairfax, which are much more diverse and have larger immigrant populations, The Washington Post notes.

Chesterfield is an outer, Republican suburb like Loudoun where many residents in the white majority are not used to diversity. Some are quick to scream “illegal” when confronted with non-English speaking, dark-skinned people.

Unfortunately, come the Nov. 14 hearing, many will probably vent their fears and their ignorance as they have been primed to do by their local GOP leaders. Fanning the flames will be Chesterfield’s badly flawed report. No doubt it will be cited as the Gospel truth by other Virginia localities as they form vigilante squads to fight the supposed alien invasion.

— November 12, 2007

The White Man’s Burden

Some estimated Chesterfield expenses for illegal immigrants:

— Juvenile Court. $3,048 annually handling an estimated 5 Juvenile Court. $3,048 annually handling an estimated 5 cent of all cases that involve illegal immigrant

— Circuit Court. $16,935 annually handling about 80 hours per week handling illegal immigrant cases.

— General District Court: 20 to 25 cases per week involving illegal immigrants totaling $64,300 annually, plus Spanish language services.

— $230,00 annually handling an average of six illegal immigrants in jail. Daily jail population can reach 400.

Data: Chesterfield County.

Peter Galuszka is a veteran journalist living in Chesterfield County.

(Photo credit: Maria Galuszka.)

© Copyright 2007 Bacon’s Rebellion. All rights reserved.

Once again, Virginia descends into intellectual anarchy as Bacon’s Rebellion roils the conventional wisdom and savages complacent assumptions. You can view the latest edition of the e-zine in its original format here and subscribe to the free e-mail here.

Or, if you’re too timid — too devoted to the comfortable, unexamined truths that guide your complacent life — to engage in the insurrectionary act of subscribing to the Rebellion, you can peruse our offering of opinions below:

Hidden Advantage
Flexible labor markets are Virginia’s unappreciated competitive edge. They speed the redeployment of workers from low value-added businesses to high-performance enterprises.
by James A. Bacon

Blow Against the Wind?
The political pros know that running with the numbers is better than running with the issues.
by Doug Koelemay

One More? Two More?
How many more years of political fraud must we endure? Here are some proposals to make the political system more responsive to the needs of a 21st-century polity.
by EM Risse

It Was Closer Than It Looked
The Democrats are crowing after their triumph over General Assembly Republicans. But their margin of victory was a lot closer than the newspaper headlines let on.
by Michael Thompson

Truth in Packaging
The CW says Republicans lost General Assembly seats last week because their candidates were too conservative. But look closely: “Moderates” were evicted, while those who stuck to their principles survived.
by Norm Leahy

The 70 percent solution
Virginians look to local government for solid data on issues like illegal immigration. But there is no evidence supporting Chesterfield County’s estimate that seven of 10 Hispanics in the county are there illegally.
by Peter Galuszka

If He Wasn’t Whining, Would We Notice Him At All?
Tom Davis is living proof that the “big tent” strategy is a loser for Republicans if it means conservatives are filing out the back door.
by John Taylor

Nice & Curious Questions
Weigh Stations in Virginia: Or How Heavy is That 18-Wheeler?
by Edwin S. Clay III and Patricia Bangs

Here is the flier that set emotions aflame at Mary Washington University, according to anonymous comments on my previous post on this topic, “More Racism on Campus. What Am I Missing Here?”

The photograph captures a moment after the 2000 Michigan State University basketball team, showing a jubilant coach Tom Izzo embracing an emotional Mateen Cleaves after winning the NCAA championship. Cleaves was named Most Outstanding Player of the Final Four for his brilliant play. (I know nothing of such matters. If anyone has better information, please correct me.)

The photograph appears to be undoctored. (You can see a copy of it here on the viewimages.com website. And you can view a video here, the final scene of which shows Izzo and a crying Cleaves from a different angle.) Therefore, there shouldn’t be anything offensive or intolerant about the photograph itself. The outcry at Mary Washington, then, must have stemmed from the words used in conjunction with the photograph. What, then, do the words mean?

I interpret the words as drawing an analogy between college/professional sports and the institution of slavery. In the context of the photograph, “Slavery Reinstated” clearly suggests that the institution of slavery has been put back into effect in big money sports. The meaning of “Catch yourself a strong one” is more opaque. By a “strong one,” the author might be referring to a strong athlete/slave. By “catch,” the author might be referring to the act of enslavement.

While equating highly honored and compensated black athletes with slaves seems a stretch to me, politically “progressive” writers have made that very argument. In his book “Forty Million Dollar Slaves: The Rise, Fall, and Redemption of the Black Athlete,” New York Times sports columnist William Rhoden “offers a charged assessment of the state of black athletes in America, using the pervasive metaphor of the plantation to describe a modern sports industry defined by white ownership and black labor,” according to Publishers Weekly.

Likewise, in “The Slave Side of Sunday,” former NFL player Anthony Prior examines the legacy of racism in professional sports. “We are not looked at as leaders, rather, just a labor force where the money is generated,” he writes. “Plantation capitalism is still alive today.”

So, once again, I raise the question, “Where’s the racism? Where’s the intolerance?” The white student who posted the flier appeared to be making a political statement — expressing a “progressive” political sensitivity that has been converted into books by major publishers, has been reviewed in the Mainstream Media and reflects the views of a number of African-Americans.

Am I missing something here?

As part of the ongoing dialogue on Bacon’s Rebellion about illegal immigration, I am perfectly willing to highlight facts and incidents that don’t conform to my “narrative” of the controversy. In past posts and comments, I have objected to those who stereotype the foes of illegal immigration (including myself, on occasion) as motivated by racial/ethnic prejudice, a tactic that I regard as a way to shut down the debate without even discussing the issues. I have asked commentators to show concrete examples of racist or prejudicial behavior, not simply assert it on the basis that the contras (if I’m allowed to use a Spanish word for an Anglo group) are white, middle-class suburbanites. If such behavior could be documented, I promised, I would condemn it.

In that spirit, I now bring to the attention of Bacon’s Rebellion readers an example of what may be indefensible behavior: intimidation of Hispanics, whom we have no reason to assume are not citizens, at the voting booth. Here’s what the Manassas Journal-Messenger reports this morning:

State police are investigating possible voter intimidation of some Hispanic residents that occurred outside a polling place in Gainesville.

Prince William County Registrar Betty Weimer said members of a group outside Stonewall Middle School were threatening to call the police Tuesday on Hispanics entering the polling place.

“There was a group of people out there with a camera yelling at our Hispanic voters that if they were illegal, they were going to be deported,” Weimer said.

In a separate incident, protesters allegedly objected to being given English-language assistance at the voting booth. It is important to remember, of course, that these cases are under investigation, and there are two sides to every story. There is no guarantee the incidents panned out as reported. However, if this report is accurate, the behavior is indefensible. Hispanic citizens have the same rights as every American, and that includes the right to vote free of intimidation. If the story is accurate, Prince William County needs to protect the rights of its Hispanic citizens.

Furthermore, anti-illegal activists should understand that they’re doing their cause no favors. The phenomenon of illegal immigration raises legitimate issues, but it doesn’t help anyone to create an environment of fear. Stereotyping Hispanics on the presumption that they might be illegal only gives ammunition to those who would sweep the illegal-immigration issue under the rug. Stick to the facts, guys. Obey the law. Don’t confirm your foes’ worst suspicions. I, for one, am not going to cover for you.