Bacon's Rebellion

How Health Care Reform Will Benefit Small Business Employees
Urban Institute
Despite widespread fears to the contrary, Obamacare will have “generally positive” effects on small businesses and their employees.

Addressing the Uneven Geography of Opportunity
Urban Institute
Recognizing that out-of-school factors impact educational achievement, planners, community developers and educators need to bust out of their silos and collaborate to create “trajectories of opportunity” for disadvantaged kids.

When Qataris Tackle Educational Reform, They Don’t Mess Around
Rand Corporation
A decade ago, the Emir of Qatar reformed the country’s top-down, bureaucratic school system with a decentralized model built on charter schools and the tracking of results. The country has made significant progress but challenges remain.

Millions of Poor, Elderly Adults Face “Food Insecurity”
Government Accountability Office
Millions of older, low-income Americans experience food insecurity, but redundant and overlapping federal nutritional programs don’t reach them all.

From the Brookings Institution MetroMonitor: The Washington metropolitan area has ranked among the 20 strongest-performing regions among the nation’s largest 100 since the beginning of the economic recovery. The Richmond and Hampton Roads metro areas ranked in the middle 20. The MetroMonitor tracks employment growth, change in unemployment rate, change in gross metropolitan product, and change in the House Price Index.foreclosures. (Click on map for more legible image.)

EMR will be noting the stupendous mismatch between Chinese infrastructure and citizens Mobility and Access needs and the gross overbuild in ‘new city development’ in Chapter 2 of ENOUGH?.

In the mean time go to “New Satellite Pictures of China’s Ghost Cities” and check out the incredible 29 photos of empty projects. There were 64 million new but unoccupied dwellings that no one can afford, according to a recent report.

A picture is worth a thousand words.

The Australians seems to be doing a better job of reporting on the coming building bubble Collapse than the US media.

EMR

Note: I took the liberty of inserting one of the satellite photos into this blog post to show the enormity of the overbuilding. Click on the photo for a more legible image. — JAB

Last week, I had an unpleasant surprise.

So, I explored the situation and was surprised to learn that the fix had been in for a decade or so and few knew about it. Here’s the my commentary about it in Richmond’s alternative publication Style Weekly, where I work part-time as a contributing editor.

Peter Galuszka

Virginia Rates A- in P&C Insurance
Heartland Institute
In marked contrast to the miserable performance of its schools (see previous post), Virginia rates an A- in the Heartland Institute’s ranking of the states by the freedom of its property and casualty insurance markets.

Hawai’i’s P-3 Initiative: A First-Year Evaluation
Rand Corporation
Hawai’i’s P-3 initiative in two demonstration schools hopes to have all children reading by third grade. But the program is beset by lack of clarity about who does what and a lack of rewards for success or punishments for failure.

State-Consumer Partnerships for Health Care
National Academy for Health Policy
The Southern Health Partners initiative, which includes Virginia, calls for closer ties between state officials and consumer advocates in devising state-level health care policy, especially in the creation of state health exchanges.

Examining the Excise Tax
Mercatus Center
Excise taxes account for roughly 15% of states’ revenue. Virginia has relatively low excise taxes. The big revenue earner in the Old Dominion is the tax on gasoline, followed by insurance, alcohol, tobacco, public utilities and pari-mutuel betting.

For the most part, Virginians are satisfied with their schools. There are pockets of excellence (the Thomas Jefferson School for Science and Technology in Fairfax County) and pockets of dysfunction (Petersburg city schools), but overall we do pretty well. Our educational achievements aren’t stellar, but they’re better than the national average. There is no groundswell for radically restructuring the educational system in the Old Dominion and there are few problems the political class believes that a little more money couldn’t solve.

Now comes the 2010 State School Report Card published by the Heartland Institute, which should serve as a wake-up call. Nay, it should serve as a banging cowbell in our ears.

Virginia didn’t merely rank below average in the analysis, which combined learning progress, fiscal efficiency and academic standards. It didn’t just rank in the bottom quintile. The Old Dominion tied with Arkansas for the bottom spot… dead last. Every member of the General Assembly, every school board member and every parent needs to read this report and then start raising holy hell.

The abysmal performance of the Virginia educational system may not be readily apparent. After all, Virginia students outperform their peers nationally. But it is widely acknowledged that educational achievement is highly correlated to socioeconomic status, and Virginia ranks among the Top 10 states by income and among the bottom states by poverty. Given the demographic characteristics of the population, we would expect Virginia to out-perform other states by a wide margin. The real issue is what are the schools doing with the raw material handed them? What is (to borrow a phrase from a recent post), the schools’ educational value added?

American students’ achievement scores on international test scores have stagnated even while the United States has pumped more money into education. Per-pupil spending has increased by more than 65% over the past 25 years in inflation-adjusted dollars. Meanwhile, achievement and money spent per pupil varies widely between the states. The purpose of this report is to identify the states that are achieving the most per dollar spent in the hope that other states might replicate whatever it is that they are doing right.

Here is a synopsis of how the index is compiled.

Learning. This sub-index is based on gains or loss in National Assessment of Educational Progress (NAEP) test scores for mathematics and reading between 2005 and 2009, measuring the progress of 4th graders in their march to 8th grade, or what the Institute calls time gain. The Institute also calculates a grade gain, which compares math and reading competency of 4th graders and 8th graders during the same year.

Efficiency. This sub-index measures how much each state spends per student, adjusted for the state cost of living. The study examines cost per graduate, cost per student, cost per unit of learning gain over time, the cost of learning gain between grades, and the ratio of teachers to staff.

Standards. This component incorporates a rating on how state proficiency scores compare to NAEP scores. “To the extent that a state claimed higher proficiency levels than the national test score results reveal,” the authors explain, “the state’s standard is taken as commensurately lower.” This index also includes a score based on a different methodology for calculating the rigor and content of a state’s math, reading and science standards.

So, here’s how Virginia stacks up:

Learning achievement … 43rd in the country

Efficiency … 48th

Standards … 32nd

Overall .. 50th (tied with Arkansas)

Unfortunately, say the authors, there is little empirical data to suggest why some states do well (Arizona scored first in the country) while others do badly. But they point to an index last updated in 2001 — the Education Freedom Index — for possible answers. This index measured the extent to which educational choice existed in a state, taking into account charter school options, subsidies for private-school choice, school choice within public school districts, and the regulatory environment for home schooling. By this measure a decade ago, Virginia ranked 44th in the country. (Interestingly, Arizona ranked No. 1.)

In looking to explain Virginia’s dismal performance, consider: We have the fewest number of charter schools of any state in the country. We have zero vouchers. We have a highly centralized school system in which the state educational bureaucracy in Richmond dictates policies to local school boards. The only Educational Freedom measure by which we fare well, I believe, is the considerable latitude we give to home schooling. In other words, the Virginia school system is about as far removed from a market-based school system as anyone in the United States has managed to devise. It is less accountable to parents and more insulated from its failures. It is more hidebound, more rigid and more resistant to change than almost any other.

The vast majority of widely touted educational “reform” initiatives in Virginia do no more than tinker at the margins. Our public dialog is bankrupt. Both the public and the politicians are in denial. There is no sign of meaningful change on the horizon. Fear for future generations.

Energy Star another Greenwashing Program?
Government Accountability Office
Undercover GAO investigators submit 15 phony products making outrageous energy efficiency claims, including “gasoline-powered alarm clock,” for certification. Most are approved. Conclusion, the program is ripe for fraud and abuse.

Medicaid Expansion and the Physician Shortage
National Bureau of Economic Research
What happens when we expand Medicaid during a doctor shortage? Doctors spend less time with Medicaid patients.

Virginia is a surprisingly diverse state — not diverse in the multi-cultural sense, although that is increasingly true, but in the sense of having eight distinct regions. To provide a more accurate picture of how Virginia is changing, the Weldon Cooper Center for Public Service has published eight regional profiles based on the 2010 Census and American Community Survey. The researchers draw no broad conclusions, but the data makes interesting reading for public policy junkies. The eight regions include:

Northern … 2,595,000 (32.4%)
Hampton Roads … 1,641,000 (20.1%)
Richmond … 1,167,000 (14.6%)
Valley … 784,000 (9.8%)
Central … 588,000 (7.3%)
Southwest … 580,000 (7.2%)
Southside … 505,000 (6.3%)
Eastern … 141,000 (1.8%)

Northern Virginia continued to dominate population growth during the 2000s, not only experiencing massive in-migration from other regions but undergoing a baby boom of sorts. Statewide, nearly six in every 10 births took place in Northern Virginia. The region gained more than half a million people, accounting for half the state’s growth.

Hampton Roads, the state’s second largest metro area, was a mixed story demographically. The region gained 90,000 people during the decade but that was due only to its surplus of births over deaths. The region actually lost 25,000 people due to net out-migration.

Richmond, the third largest metro area, gained 150,000 people during the decade, about one-third from births and two-thirds from net in-migration. The region saw significant percentage increases in its Asian and Hispanic populations, although whites and blacks still predominate.

The Valley, which stretches from Roanoke to Winchester, experienced moderate population growth, about 75,000 people. Eighty percent came from in-migration, clustering mainly in the urban areas. Highland County, already the state’s least populated county, lost 200 people, or 8% of its population, during the decade.

Central Virginia, which encompasses the central piedmont, gained 80,000 people over the decade, more than four-fifths of which was due to in-migration. Growth was concentrated around Lynchburg and Charlottesville.

Southwest Virginia, which enjoys the distinction of being the “whitest” region demographically, added only 16,000 people during the 2000s. What’s remarkable is that the population grew at all, as the region had 3,500 more deaths than births. In-migration accounted for the difference. My hunch is that the bulk of the newcomers landed in Montgomery County, home to Virginia Tech.

Southside Virginia also experienced a stagnant population. Deaths outnumbered births by 3,510, offset by modest in-migration for a net gain of 7,000 people. Given the economic hardships the region has experienced, it is remarkable that the region grew at all.

Eastern Virginia, which includes the Eastern Shore, Middle Peninsula and Northern Neck, experienced negligible growth, about 500 people, during the decade. A trickle of in-migration (mostly retirees looking for Chesapeake Bay frontage, I’m guessing) offset the natural decrease of deaths over births.

As California’s political class continues to demolish the Golden State’s business climate, private businesses are fleeing in record numbers. Virginia is one of the primary beneficiaries.

Blogging as the “Business Relocation Coach,” Irvine, California-based Joseph Vranich has built a comprehensive database of corporate investment decisions based on public domain information, closure notices to the state and other sources. Last week he wrote that California was experiencing “the fastest rate of disinvestment events” since he put his tracking system into place three year ago.

So far in 2011, through June 16, he had recorded 129 disinvestment events, compared to 51 during a comparable period last year. “Based on the legislature’s recent rejection of business-friendly legislation and Sacramento’s implementation of additional regulations, signs are that California’s hostility towards business will only worsen,”Vranich writes.

He continues: “California is such fertile ground that representatives for economic development agencies are visiting companies to dissect our high taxes, extreme regulatory environment and other expenses to show annual savings of 20 and 40 percent after an out-of-state-move.”

The top destinations of California businesses: (1) Texas, (2) Arizona, (3) Colorado, (4) Nevada and Utah tied, and (5) Virginia and North Carolina tied.

I have written repeatedly over the years that Virginia should not build its economic development efforts on the platform of industrial recruitment alone — we need to develop our capacity to launch and grow home-grown enterprises. California’s fabled ability to nurture start-up companies will replace many of the businesses that are fleeing. The state can bleed for a long time without dying. But outside of privileged pockets like Silicon Valley and Hollywood, which have so much wealth and talent that they may be indestructible, state policies are laying waste to the economy. Virginia will happily welcome California’s refugees.

Speaking of the Rail-to-Dulles project, it’s nice to see that I’m not alone in focusing on the Project Labor Agreement (PLA) that would require the prime contractor of Phase 2 to hire a union workforce, or the role of Dennis Martire, vice president of the Laborers’ International Union of America (LiUNA) in shepherding the requirement through the Metropolitan Washington Airports Authority (MWAA).

Del. Tim Hugo, R-Fairfax, wonders if Martire violated the MWAA board of directors’ code of ethics by voting on a resolution that would likely benefit his labor union, reports the Reston Patch. Hugo has asked Attorney General Ken Cuccinelli to investigate whether his vote violated the code.

Reporter Dan Telvock also interviewed Judy Nadler, a senior fellow in government ethics at Santa Clara University. She did not opine on whether Martire’s vote constituted a conflict of interest, but she did say that “a reasonable person” could argue that it was. “The perception of impropriety is as damaging as an actual impropriety.”

Here’s a terrifying idea: Make the Rail-to-Dulles heavy rail project cheaper to finance by letting the Commonwealth of Virginia issue its bonds. With its AAA credit rating, the commonwealth recently paid 4% interest rates on transportation bonds that it issued earlier this year. That’s a lot cheaper than the 7% to 7.5% the Metropolitan Washington Airports Authority (MWAA) would pay with its BBB rating.

Issuing state bonds would save hundreds of million of dollars in interest payments and significantly reduce the money that would have to be raised from travelers along the Dulles Toll Road, argues John B. Wood, CEO of Telos Corporation in Ashburn and chairman of Loudoun County’s economic development commission. (Read his column in Leesburg Today.) “While Virginia does not have a legal obligation to back the MWAA’s bonds for rail development, it does have a moral obligation to do so-which in some ways is stronger.”

Just one little problem. Issuing some $3 billion in bonds to pay for Rail-to-Dulles, a regional project, would crowd out Virginia’s ability to issue bonds for statewide priorities — schools, higher ed, parks, general transportation — without jeopardizing that very same AAA credit rating. We’re skating pretty close to our maximum borrowing capacity as it is.

As for the state’s “moral obligation” to the project, my reaction is, “What moral obligation?” The question is very simple: Who pays for Rail-to-Dulles? The parties that benefit directly from the heavy rail line or the general public? Before we put the citizens of the commonwealth on the hook for the project, let’s (1) re-think the $300 million decision to build an underground station at Dulles airport, (2) drop the requirement for a union workforce, which potentially could cost another $300 million, (3) slap tolls on the toll-free Dulles Access Road, (4) get MWAA to pony up its fair share of the project, and (5) extract a reasonable share of the value created for property owners whose is located adjacent to the proposed Metro stops.

If the parties that benefit the most from Rail-to-Dulles aren’t willing to curtail their appetites and pay for the project, how dare they assert that anyone else has a “moral authority” to pay for it?

Schools Trying to Create a Health Environment but Have Long Way to Go
Robert Wood Johnson Foundation
Schools have gotten the message they need to provide better nutrition to their pupils, but most kids still have access to pizza, fries, soft drinks and other junk food.

Transportation in an Age of Fiscal Austerity
Bipartisan Policy Center
How federal transportation policy can subsist on $40 billion a year: set smarter priorities, consolidate programs, leverage state and private funds.

Coordinating Child Services
National Academy for State Health Policy
A five-state collaborative is testing new models for coordinating social services targeting children across departmental silos. The goal: Reduce delays and avoid duplication of services.

Causes of Civic Ignorance
American Enterprise Institute
Everybody bemoans the civic ignorance of American youth but no one agrees about what schools need to emphasize. There are sharp divides between Republicans and Democrats, and between teachers and citizens at large.

Virginia Uranium Inc., a tiny Chatham-based firm that wants to mine uranium in south central Virginia near Gretna, is flying more than a dozen state legislators to France to drum up momentum to end the state’s ban on uranium mining in next year’s General Assembly.

Virginia Transportation Secretary Sean Connaughton is popping up everywhere. He has successfully pushed a plan to add $3 billion in road construction money that he just borrowed on the capital markets. He’s in Sunday’s Washington Post telling us how his boss, Gov. Robert McDonnell, really has passenger rail at heart even if he won’t go after federal money to boost that prospect. And, he’s pushing along with public-private plans for a new U.S. 460 linking Interstate 95 to Tidewater and for the Coalfield Expressway near Kentucky and West Virginia.

Now this gets my attention! As a follow-up to my recent post, “The Brutal Facts Facing Southside and Southwest Virginia,” let me bring to your attention today’s press release from the governor’s office announcing the creation of a Center for Applied High Performance Computing in Danville.

Noblis, a non-profit scientific organization, and Cray, Inc., a manufacturer of supercomputers, will invest $2.5 million to establish the center. The mission will be to promote development of high-performance applications to solve “problems of national importance,” help small businesses innovate using high-performance computing applications, and train the next generation of developers, among other goals.

At least for a time, the Center will be the only non-federal lab or university to house a next-generation Cray XMT. “This kind of high-performance technology research center is truly transformational for the City of Danville and the Commonwealth of Virginia,” said Gov. Bob McDonnell.

On the plus side, this is exactly the kind of transformational initiative Southside Virginia needs to pole vault out of its manufacturing-centric mill town economy to a Knowledge Economy economic base. So, congratulations to Danville.

On the other hand, one cannot help but question the economics of this initiative. The $2.5 million in private investment will be matched by $4 million in public investment — $1 million from the Governor’s Opportunity Fund and $3 million from the Virginia Tobacco Indemnification and Community Revitalization Fund. When $1 of public investment leverages less than $1 in private investment, the state is not getting much of a return on its investment.

A question: Who will staff this center? Is anyone in Southside Virginia trained to operate the Cray XMT supercomputer? Does anyone have the know-how to write the equations and functions required to solve “complex national problems”? Or will that talent have to be imported from outside the region? Assuming that the Center is to serve as the nucleus of a growing industry, does Danville have what it takes to recruit and retain high-caliber IT talent?

I worry that this initiative may never become self supporting and will require a steady transfusion of outside funding. I hope I’m wrong. There’s nothing I would like more to see than Danville defying the odds and transforming itself into a mini-technology center.