Providing perspective on Nevada’s education funding

Over the weekend, liberal pundit Jon Ralston decried Nevada’s level of education funding in a post entitled, “Las Vegas Perspective lacks ... perspective.”

Nevertheless, [Jeremy] Aguero praised Gov. Brian Sandoval for “making education a priority.” (To be fair, first lady Kathleen Sandoval spoke after him….)

But has he? Yes, he restored half a billion dollars in 2013. But spending is still well below other states, and many of those in the audience support infusing more money but can’t agree on how to fund it.

This is the typical liberal dichotomy: You either support education by wanting to spend more or you oppose education if you don’t want to dramatically increase spending.

But it’s a false dichotomy, because there is little to no correlation between spending and student achievement.

Cato education scholar Andrew Coulson provides some needed perspective on Nevada’s education funding and how it relates to student achievement.

The question isn’t why hasn’t Nevada dramatically increased education spending, but why is no one being held accountable for Nevada’s dramatic increase in education spending while education outcomes have decreased?

Nevada’s far from alone in failing to turn significant education spending increases into higher student achievement. Here’s Massachusetts, the state with the highest ACT scores in the country.

So if spending more doesn’t work — and it hasn’t for 50 years and for 50 states — what should Nevada do?

Implement school choice. School choice, whether through ESAs, tuition tax credits, opportunity scholarships or vouchers, provides a proven way to increase student achievement.

Twenty-three states and Washington, D.C., have some form of school choice, and students in those states have seen their test scores and graduation rates increase. What’s amazing is that the test scores in public schools have increased after school choice began in these states.

So do conservatives and libertarians have proven solutions to Nevada’s education problems? Yes, we sure do.

And after 50 years of trying it the liberal way, Nevada’s students — your children and mine — need school choice to actually increase their achievement, instead of just spending more.

 

The Silver State’s golden compensation packages

Every week, NPRI President Andy Matthews writes a column for NPRI's week-in-review email. If you are not getting our emails, which contain our latest commentaries and news stories, you can sign up here to receive them.


The Silver State’s golden compensation packages

Whether you’re a current government employee or a retired one, Nevada is the place to be.

That’s because Nevada public employees take a lot from taxpayers — both when they’re working and after they retire.

A quick glance at TransparentNevada.com illustrates this point when it comes to individual employees. But now, new data provides the big-picture perspective on what Nevada is paying for both current and retired public workers.

Last month, Nevada Journal reported on new data from the Bureau of Labor Statistics that shows Nevada’s public-school employees are faring much better financially, compared to their peers in other states, than are Nevadans working in the private sector. Additionally, the American Enterprise Institute just released a study showing that the Silver State has the highest public retiree pension benefits in the country.

Let’s start with Nevada’s education sector. In 2012 — the latest year for which data is available — the average annual income for someone working in Nevada’s K-12 public-school sector was 103.4 percent of the average wage for public-school workers nationally. Meanwhile, Nevadans working in the private sector took in only 86.2 percent of what their counterparts across the nation did.

That 17.2-point gap is the fourth-highest differential in the country.

When compared to their counterparts in neighboring states, Nevada’s public-school employees are doing even better. In Arizona, for example, those working in the private sector brought home 91.9 percent of the national average, while education employees made 83.6 percent of the national average for their sector.

The same is true in California, Idaho and Utah, where those in the private sector fared better compared to their peers than those in the public-school sector.

In retirement, Nevada’s public-sector workers are also living the high life. Andrew Biggs, former principal deputy commissioner of the Social Security Administration and the speaker at NPRI’s November 2011 policy luncheon, authored a study this month that shows Nevada offers the most generous retirement benefits in the entire nation.

On average, Nevada retirees bring in more than $64,000 each year. That means the average public retiree is poised to take home $1.33 million over the course of retirement, not including the value of his or her health care benefits.

Our retirees make so much that their annual income exceeds that of 87 percent of Nevadans who are currently working full-time. The only states for which that percentage is higher are Oregon, North Carolina and West Virginia.

And Biggs’ study doesn’t factor in public-safety retirees, who tend to retire earlier and receive higher pensions than other government workers.

Public-employee unions and supporters would have you believe salaries and pensions are modest. But a quick look at the data shows otherwise.

You know who shouldn’t be modest? The leader in NPRI’s bracket challenge: Joy Juedes.

Thanks for reading and have a great weekend!

Andy Matthews
NPRI President


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Union boss making $192K ready to push North Las Vegas off solvency cliff

For years, NPRI has noted that collective bargaining agreements that give unsustainable increases in pay and benefits to public employees are, well, unsustainable.

When the economy and hence tax revenue goes up and down, Nevada’s collective bargaining law allows local government unions to extract massive pay and benefit increases in the good times, while preventing decreases in the down years. It’s a ratchet effect, and the inevitable end game is playing out right now in the City of North Las Vegas.

Nevada’s economic downturn hit North Las Vegas residents especially hard and consequently tax revenues plummeted. Instead of reducing inflated government employee salaries, the union contracts mandated the city give employees raises. In 2012, the city officials tried to declare a state of emergency to prevent giving $25 million in pay increases to its employees. A judge ruled city officials couldn’t do that and now they’re on the hook for $25 million worth of back pay raises.

The nearly insolvent city offered a $7.7 million settlement to workers. The city’s backup plan is to make 10- to 20-percent across-the-board spending cuts, which will mean layoffs.

Union officials aren’t happy with either option. They want pay increases from the near-bankrupt city and, at this point, the option they’re supporting would try and squeeze it out of taxpayers.

The Las Vegas Review-Journal explains:

Plan C — receivership, the state’s broadly untested alternative to municipal bankruptcy. Under receivership, a team of state-appointed financial experts would have the power to increase property taxes and negotiate future, but not existing, union contracts. Faced with a choice between plans A and B, two of the four city union heads said they would just prefer Plan C — receivership, the state’s broadly untested alternative to municipal bankruptcy. Under receivership, a team of state-appointed financial experts would have the power to increase property taxes and negotiate future, but not existing, union contracts.

“If these are the tactics the city’s going to use, I think it’s time for the state to step in,” North Las Vegas Firefighters Association President Jeff Hurley said. “You’ve heard me before, I’ve gone to bat for the mayor, but right now I’m disappointed. ... There was just no reason to go this far.”

In 2012, Hurley took home $192,414. What could be disappointing about that?

Well maybe he’s upset that 100 of his colleagues had larger compensation packages in 2012, including police lieutenant Anthony M DiMauro, who received a whopping $408,387.82 in 2012.

Six-digit compensation packages are hardly outliers, and the excessive pay isn’t limited to public safety personnel. A total of 850 employees in North Las Vegas made more than $100,000.

Remember, union bosses, like Hurley, are ready to make North Las Vegas insolvent, not to keep their pay steady, but for pay increases!

Yesterday, Geoffrey Lawrence, NPRI’s deputy policy director laid out the short term solution: a special session to allow municipal bankruptcy.

State receivership basically allows the Department of Taxation to appoint a financial overseer to negotiate contracts on the city’s behalf and implement a debt-reduction plan through both tax increases and spending reductions.  Such receivership was last implemented for rural Storey County, but no local government of the size of North Las Vegas has ever undergone the process.  Furthermore, the state overseer lacks authority to suspend or modify existing union contracts or debt obligations.  As one state tax official told the Committee on Local Government Finance, “It’s no guarantee that structural deficits can be overcome.”

Sometimes, however, it is necessary for governments — just like businesses and individuals — to renegotiate their debt and structure it along different terms. This is why federal law allows municipalities to enter into a bankruptcy protection proceeding.  Chapter 9 municipal bankruptcy allows a municipality’s representatives to confront city contractors and creditors and present to court officials their finances so the court can determine what a city can realistically afford to pay and amend the contracts accordingly.

North Las Vegas is about to go under because its unions, not its elected officials, have the most power over its finances.

The long-term solution to that problem is legislation to reform or eliminate Nevada’s local government collective bargaining laws. 

 

Health of NV private sector lags behind public school sector

 

Sour Sixteen

Every week, NPRI President Andy Matthews writes a column for NPRI's week-in-review email. If you are not getting our emails, which contain our latest commentaries and news stories, you can sign up here to receive them.


Sour Sixteen

This weekend, the field of 64 NCAA basketball teams chasing the national title will be narrowed down to The Sweet Sixteen.

Coincidentally, this weekend also marks the fourth anniversary of Obamacare. It’s hard to believe that it’s only been four years since President Obama signed this disastrous bill into law, given all the things that have gone horribly, horribly wrong.

Nevada hasn’t been immune to the Obamacare horrors, whether Sen. Harry Reid wants to believe it or not. This week, the state awarded a $1.5 million contract to a consulting company hired to help Xerox fix the failed Nevada exchange website that has already cost taxpayers nearly $84 million. This comes just two days after the story of 62-year-old Larry Basich — who has been paying into the exchange since November but was left with $407,000 in medical bills because the system didn’t place him with the right insurance company — came to light.

And who could forget the history-making battle between the Obama administration and the Culinary Union, which has recently lambasted Obamacare publicly?

As I mentioned earlier this week, the White House tried to use the NCAA tournament to garner more support for its failing legislation by encouraging people to make their own March Madness picks. But, instead of choosing winning college basketball teams, the White House wants you to choose the “16 sweetest reasons to get covered.”

I tried. I looked through the silly cat memes and the slap-stick GIFs that have absolutely nothing to do with Obamacare. But I just couldn’t see a winner in this terrible law.

So, in celebration of Obamacare’s birthday and its latest marketing gimmick, I decided to create my own version of the ACA bracket. It’s a list of the 16 worst things about Obamacare, and I call it the “Sour Sixteen.”

  1. When PolitiFact named Obama’s promise, “If you like your health care plan, you can keep it,” the Lie of the Year
  2. That time Harry Reid said “all” Obamacare horror stories are untrue
  1. That it has been changed nearly three dozen times, with more than half of those changes coming directly from the administration
  2. That it will cause 2.5 million workers to leave the workforce over the next decade, and that the left said this is a good thing because it frees people from “job-lock”
  3. That it caused more than 6 million Americans to lose their health insurance
  4. That the average Obamacare insurance premium in Nevada will be 179 percent higher than residents’ pre-Obamacare rates
  5. When Harry Reid became the only top congressional leader to exempt some of his staff from the law
  6. When the Nevada man mentioned above was left with a $407,000 hospital bill after the Nevada Obamacare exchange had no record of his coverage, which he had been paying into for months
  7. The rollout
  8. All those times Harry Reid promised America: “If you like the coverage you have, you can keep it”
  9. When Nancy Pelosi justified passing it by saying, “We have to pass the bill so that you can find out what is in it”
  10. How it will increase costs for most small businesses
  11. Predictions that Obamacare premiums will skyrocket in the coming months
  12. How it discourages business growth through a litany of new costs and regulations
  13. The way it expands Medicaid and increases the use of emergency care
  14. How the law encourages adults to embrace child-like dependence #Brosurance #PajamaBoy

Hopefully, my NCAA picks in NPRI’s bracket challenge will turn out to be a little sweeter than the items on that list (though my track record from recent years makes me seriously doubt it).

Speaking of which, congrats to “B Land,” who’s currently leading the field in NPRI’s tournament challenge.

Have a great weekend, and good luck with your picks!

Andy Matthews
NPRI President


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Big Pensions, Big Questions

(Also available as PDF and JPG)

 

Obamacare Madness

Just when you thought Obamacare advertising ploys couldn’t get any more ridiculous (remember Pajama Boy? Colorado’s “Brosurance”?), the White House issued its March Madness challenge.

Unlike the typical NCAA bracket challenges that require participants to choose which Division-1 teams will rise to the top of an already-accomplished group, the president’s March Madness challenge asks users to choose the lesser of evils: their favorite things about Obamacare.

Accompanied by GIFs (including an Elmo doll falling off a store shelf; a woman dancing on, then falling off, a bathroom sink; and a dog running into a hedge), the possible choices for why people should get covered include things like, “It will give your mom peace of mind,” “You only live once,” and “You never know when you’ll take a hard foul.”

Unfortunately, as we’ve seen in the past few months, there’s no real winner when it comes to Obamacare. Hard-working Americans are now facing higher premiums, substandard care and fewer choices.

While we continue to bring you the latest news and analysis of this destructive law, I encourage you to join NPRI’s NCAA bracket challenge.

Unlike Obamacare, our challenge truly is free, and there will be a winner. And the winner of our challenge will receive a free signed copy of Jonah Goldberg’s The Tyranny of Clichés.

So take a few minutes to join our challenge and fill out an NCAA bracket.

By the way, I found picking my Final Four to be much, much easier than picking my favorite things about Obamacare. I’m sure the same will be true for you.

Andy Matthews
NPRI President

 

Join NPRI's bracket challenge, win a signed Jonah Goldberg book

March is one of my favorite times of year. The weather is great, there’s Sunshine Week (a celebration of open government that we’ll be talking about more tomorrow), and — let’s be honest — March Madness is a ton of fun.

I love filling out my bracket — I even picked every game correctly on the first day one year — and I’m sure you do, too.

So this year, we’d like to invite you to join NPRI’s bracket challenge. Simply join our free group here, fill out a bracket, and see if you can out-pick Geoffrey Lawrence, Steven Miller and the rest of our NPRI team.

We’re also offering a free signed copy of Jonah Goldberg’s The Tyranny of Clichés to the winner.

And if you have any friends, family or co-workers who’d be interested in winning a signed copy of The Tyranny of Clichés, please forward this email to them. We’re always looking to expand NPRI’s connections with citizens.

Since we’re a free-market policy shop, you won’t be surprised to learn that the motto of our group is “Private sector picking winners and losers."

While government picking winners and losers in the economy is a terrible idea, private individuals picking winners and losers in an NCAA bracket is a lot of fun. Join us here, and good luck!

Andy Matthews
NPRI President

 

Just passing through the Catalyst Fund

Every week, NPRI President Andy Matthews writes a column for NPRI's week-in-review email. If you are not getting our emails, which contain our latest commentaries and news stories, you can sign up here to receive them.


Just passing through the Catalyst Fund

Last Sunday, the head of the Las Vegas Global Economic Alliance, Tom Skancke, penned a column in the Las Vegas Review-Journal attempting to defend the constitutionality and merit of Nevada’s Catalyst Fund. Just a few weeks ago, NPRI launched a lawsuit challenging the constitutionality of state government picking winners and losers in the economy through Catalyst Fund subsidies.

Let’s focus on the constitutional issue first. Article 8, Sections 9 of Nevada’s constitution says: “The State shall not donate or loan money, or its credit, subscribe to or be, interested in the stock of any company, association, or corporation, except corporations formed for educational or charitable purposes.”

Skancke writes that the Catalyst Fund doesn’t do that because “[l]ocal governments award Catalyst grants to locally approved businesses.”

Left unmentioned are the facts that the Catalyst Fund is funded by state tax dollars, that the Governor’s Office of Economic Development receives and votes on applications, and that GOED and state officials send out press releases bragging about the new companies the program has brought to the state. State officials also hold press conferences touting how many jobs “they” have brought to Nevada.

The only thing the political subdivisions do is take in state money and give it to the private companies as directed by GOED.

You don’t have to take my word for it. The City of Reno itself recognizes that it’s nothing more than a channel by which the state is distributing Catalyst Fund money. This week, a staff report to Reno’s city council on a potential GOED handout says the agreement for the subsidy would “allow the City to pass through the State Catalyst Funding to Garlock Printing.” (Emphasis added.)

The report goes on to say the funding “originates with the State of Nevada.”

Skancke appears to realize this, too, as he included a qualifier in his statement that, “No company receives a direct payment from the State of Nevada.” (Emphasis added.)

The scariest part of Skancke’s column, though, is his claim that “state lawmakers explicitly designed the Catalyst Fund to be constitutional.” What he’s saying is that state lawmakers recognized the constitutional prohibition on state government picking winners and losers in the economy and then actively worked to bypass it.

If a court upholds the precedent that state government can bypass Article 8, Section 9 by routing funds through a subordinate political entity, while retaining full control over how those funds are used, your liberty is not safe. What part of the constitution couldn’t lawmakers bypass if they “explicitly designed” future laws to look like the Catalyst Fund bill?

Skancke’s other argument is that Nevada’s economy needs a boost. We agree, which is a side benefit of our lawsuit.

Government’s job is not to stimulate the economy, but to protect the freedoms that allow individual entrepreneurs and employees to improve their own lives. When politicians and their appointed bureaucrats pick and choose which companies are worthy of public dollars through a program that serves not as a catalyst to economic growth but as a catalyst to crony capitalism, the favored few special interests win and the rest of us, the typical taxpayers and business owners, lose.

When the solar startup Solyndra first received its government handout of $535 million, government officials praised the company and said it would create thousands of jobs. Then-U.S. Secretary of Energy Steven Chu even claimed the handout would “start the second industrial revolution.”

The problem is that by the time most publicly subsidized ventures fail — like the Reno Aces ballpark, Abound Solar, Fiskar and ThromboVision — the politicians who hosted the initial press conference have moved on to another political office, leaving citizens (i.e. taxpayers) to pick up the pieces.

If a company needs a $500,000 or $1 million government handout to open, it often times can only compete with companies that are succeeding entirely on their own by continuing to rely on government handouts.

As NPRI has detailed, the path to sustainable prosperity is to allow businesses to compete with each other under a uniform and low tax and regulatory structure. If Catalyst Fund supporters would like to grow the economy, they should focus their efforts on removing onerous regulations that keep businesses from starting in Nevada and work to ensure that job- and business-killing taxes like the proposed margin tax are never implemented.

And those are actions that are constitutional.

Thanks for reading and have a great weekend.

Andy Matthews
NPRI President


Remember, if you'd like to receive the latest from NPRI, sign-up for our emails here.

 

Reminder

NPRI is thrilled to offer our fourth annual Professor R.S. Nigam & NPRI Freedom Scholarship and excited to once again put a smile on the face of a deserving student. The scholarship is made possible through the generous donation of long-time NPRI member Swadeep Nigam in honor of his father, Professor R.S. Nigam.

This year, the scholarship is $2,500 payable directly to the student.

Eligible students must reside in Clark County and plan to attend college in the fall and pursue a four-year degree in business, economics, political science, public administration or a related field.

To apply, students need to fill out a short application and answer an essay question on government’s role in economic development, which was the subject of a great piece our deputy communications director wrote recently.

I know students love to procrastinate, but the April 5 deadline to apply is fast approaching, so students are encouraged to learn more and apply here as soon as possible.

Until next time,

Andy Matthews
NPRI President

Total Records: 1814

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