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.



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


Bring out your stories

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.

Bring out your stories

As the old adage goes, “If you want less of something, tax it.”

Unfortunately for you, me and every business and employee in Nevada, the teachers union is seeking to reduce economic growth at one of the worst possible times — when tens of thousands of Nevadans are underemployed or unemployed and struggling to support their families.

The union’s latest effort is the margin-tax proposal, and if you’ve followed NPRI’s work over the last three years, you know the deceptively billed “Education Initiative” is nothing more than a thinly veiled attempt to exploit the children of Nevada to further pad the government’s bank account.

The margin tax would impose a 2 percent tax on every business bringing in more than $1 million in annual revenue. That’s less than $2,740 in sales — not profit — a day.

Nevada’s margin-tax proposal is modeled after the margin tax in Texas. After Texas imposed a margin tax in 2007, roughly 20 percent of small businesses reported that they had to lay off employees, and another one-third reported they left jobs unfilled because of the margin tax.

And 3 percent of small-business owners in Texas decided to close their doors completely as a result of their increased tax burden under the margin tax.

These aren’t just numbers; they represent the lives of tens of thousands of individuals who lost their jobs because of the margin tax.

And do you know what’s amazing?

The margin-tax rate in Texas is only 1 percent — and just half a percent for retailers.

Nevada’s tax would be two to four times as high!

So take the job-loss numbers you read above, and be prepared to multiple them by two or four times, to see what the likely impact would be if the margin tax passes here in Nevada.

Over the past few months, I’ve spoken to numerous people in the business community and plenty of others who are trying to get up to speed on this haphazardly drafted initiative. The consensus among them is that the margin tax would be a disaster for them personally, as well as for their competitors and the economy in general if it were to pass.

While numbers like those I’ve shared above are important — and we’ve produced plenty more in our extensive analysis on the margin tax — they aren’t enough.

We need to be able to share the stories, the lives and the faces those numbers represent.

Unfortunately, it’s not easy for a business owner to decide to share, publicly, how much the margin tax would hurt his or her business. Many of those I’ve talked with don’t want to scare their employees or their spouses.

I understand that.

But in order to fully inform the public about what this tax would do, NPRI needs to be able to share its human cost, too. Voters need to know about the mom-and-pop diner owners who will be put out of business, or the single mom who will be laid off.

So I’d like to ask you a favor. If you’re a business owner, would you be willing to let NPRI tell your story, and the story of what the tax would do to your business?

We’d respect whatever level of privacy or anonymity you felt you needed, and you’d be doing a great service to the state and helping to save your employees from the negative consequences of the margin tax.

Stories matter. Will you let us share yours?

Until next time,

Andy Matthews
NPRI President

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


State and local government spending on health insurance grew by twice the national rate for 2012

One of the more alarming data points I have come across while compiling the necessary records for the Transparent California website has been the large sums of money spent on health insurance for public employees. As our site groups together the cost of pension payouts and health insurance in order to present the information in a uniform and understandable manner, the cost of individual health plans was not something we were particularly focusing on.

However, in the course of formatting and uploading the necessary records to TransparentCalifornia.com, several agencies jumped out at me due to their alarmingly expensive health insurance plans. First, it was the $20k+ plans in Corte Madera, Calif. and the Contra Costa Community College District. Then I saw the $30k+ plans in Beverly Hills. Finally, I came across what remains the most expensive plan I have seen to date — a $37,815 health insurance plan for the Water Superintendent of Sierra Madre, Calif.

I suspected this was not a problem isolated to the handful of agencies whose numbers happened to catch my attention but, rather, indicative of a systemic problem likely to be found in many other public agencies. This sets up a situation where taxpayers are effectively taxed twice for these plans — initially, to fund the public employee’s compensation itself and, again, when they find themselves paying an artificially inflated premium for their own health insurance.

Pew Research confirms these suspicions. In 2012, state and local government spending on health care increased by 8 percent; double the amount total U.S. healthcare spending grew during that same time period. The larger trend is terrifying — state and local government spending on health insurance premiums has increased an inflation-adjusted 444% from 1987 to 2012. The agencies above are merely symptoms of a much larger problem.

The farther the distance between consumer and provider, the less reason either has to economize, which is a factor in the out-of-control prices we see nationwide in the health-care sector. When a government is willing to spend $37,815 of your money on one health plan, what financial incentive does an insurance company or anyone in the medical system have to work on lowering prices?

While there are a plethora of factors responsible for the current health-care crisis in this country, the third-party-payer system, especially when that third party is using other people’s money, like a government agency does, is one of the core issues that demands immediate attention.



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.


When you work in the think-tank world, where days are consumed with analyzing policy, keeping tabs on the government and promoting transparency, encounters with 16, 17 and 18 year olds can be rare.

It’s not that we don’t want teens to spend their Friday and Saturday nights reading about outrageous and out-of-control government spending in our Piglet Book, or about our efforts to combat the state’s disregard for its own constitution, or our solutions to Nevada’s economic and educational challenges. We know those things are of value to everyone, whether they be 18 or 80.

But the reality is that high school seniors, particularly this time of year, have a lot of other things to worry about — like getting into college and finding a way to pay for it. For the past three years, we’ve been fortunate enough to help make the latter task a little easier for students in Clark County by offering The Professor R.S. Nigam & NPRI Freedom Scholarship.

Long-time NPRI member Swadeep Nigam graciously funds the scholarship in honor of his father, Professor R.S. Nigam, who was a director of the Delhi School of Economics at the University of Delhi, a visiting professor at the College of Business at the University of Nevada, Las Vegas, and a senior fellow at the University of Wisconsin. Like us, the Nigams understand the benefits of free markets, and they want to not only educate young adults about those benefits, but also to encourage them to begin formulating their own thoughts on the subject.

This year, we’re offering a $2,500 scholarship to a student who plans to pursue a four-year degree in business, economics, political science, public administration or a related field.

Perhaps more important and impactful than the monetary value of the scholarship is the fact that it encourages the leaders of tomorrow to consider free-market principles at the very time they’re becoming adults and forming their own system of beliefs.

In the past, we’ve asked applicants to write essays on how incorporating free-market principles into the state’s education system would improve student achievement; how the country should reduce the national debt; and how raising taxes impacts the economy and unemployment rate.

This year, we’re asking applicants to consider something more specific and extremely timely: whether the Las Vegas City Council should subsidize a downtown sports arena with public funds, and what doing so would mean for the economy.

The question gets to the heart of an issue we’ve already discussed at length this year and will continue to write about in the future: When the government picks winners and losers in the market, it’s bad for taxpayers, it’s bad for business and it’s bad for the economy.

I don’t want to give away too much on the issue of stadium subsidies, just in case any applicants are reading this (but as a tip, we will have something on that very soon). But the idea of the government controlling economic activity by selectively favoring one business or type of business over another is at the heart of the lawsuit we filed last week against the Governor’s Office of Economic Development regarding its Catalyst Fund.

And as I wrote to you Wednesday, our lawsuit is already making a positive impact. Just two days after our Center for Justice and Constitutional Litigation filed the suit in Carson City, Reno Deputy City Attorney Jonathan Shipman asked the Reno City Council to hold off on awarding a $577,500 grant to a company through the Catalyst Fund.

Reno’s pause is a great example of how simply alerting people to the flaws in or unconstitutionality of a policy or law can lead to positive change. My hope is that the youth of today will realize this as they become the adults of tomorrow.

So, if you know any Clark County seniors — whether they be homeschooled or attending private or public school — I hope you’ll encourage them to take some time to consider how detrimental and unjust it is when government involves itself in the market. And I hope you’ll encourage them to apply for the scholarship, which they can do here.


Last week I solicited suggestions on places to go during my trip to Oregon this weekend, and I was amazed by how many of you got back to me with ideas. I’m extremely grateful to those of you who took the time to do so — and flattered by how many of you asked if you could join me!

Common suggestions included Cannon Beach, Coos Bay and the Tillamook Cheese Factory, and all three are on my list of spots to check out.

As it turns out, I’ve actually had to postpone my trip. But not to worry — I’ll be heading up there in a few weeks, so all of your advice will be put to good use.

To those who offered your ideas, I want to extend my sincerest gratitude for your thoughtfulness. And as always, thanks for reading, and for your support for NPRI.

Best regards,

Andy Matthews
NPRI President

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



As I shared with you last week, NPRI’s Center for Justice and Constitutional Litigation has filed a lawsuit challenging the constitutionality of Nevada Catalyst Fund’s use of taxpayer dollars to pick winners and losers in the economy. These subsidies are unconstitutional and, as the examples of Solyndra, Abound Solar and others make clear, an economic loser for taxpayers.

Well, I’m proud to tell you that our lawsuit against the Governor’s Office of Economic Development, which administers the Catalyst Fund, has already made a difference.

Today, the Reno Gazette-Journal reports that, in direct response to our lawsuit, Reno Deputy City Attorney Jonathan Shipman has asked the city council to pull consideration of a Catalyst Fund subsidy from today’s meeting agenda.

From the RGJ story:

“Now that the NPRI case has been filed, we want to circle back with GOED to make sure we are on the same page about how the money flows and whether the money flows,” Shipman said. “We want to make sure we are not writing checks we can't cash.”

Your support is helping us score an important victory for the rule of law and for the tens of thousands of entrepreneurs who have built businesses through their own hard work — not through taxpayer handouts.
Thank you so much for standing with us in this fight. And if you’d like to help us keep it going, I hope you’ll consider donating to this effort today by clicking here.

In the meantime, we’ll continue working to win victories for the cause of accountable, constitutional government here in our Silver State.

Warmest regards,

Andy Matthews
NPRI President


California bureaucrats: avoiding transparency or wastefully incompetent?

Being both an environmentalist and an advocate for government transparency was doubly painful last week. It is quite common for public agencies to stall or attempt to deny public records requests, but some methods are just too bizarre to believe. Two separate California school districts – Duarte Unified School District and Hacienda La Puente Unified School District – decided that instead of providing the requested records in electronic format as requested, they would print out their entire payroll records and mail them, along with an invoice for the cost of production.

California’s Public Records Act makes perfectly clear in § 6253.9(a) that public records are to be provided in their original, electronic format when requested, and I stressed this in the records requests to the school districts. Yet, not only did both agencies feel comfortable defying this part of state law, they thought nothing of wasting the resources associated with mailing a massive print out without even pausing to confirm that I would pay the associated costs of production!

There are two possible ways to view this. The first is that this is an elaborate, wasteful method of denying my public records act request ­in which I stress the importance of electronic format so that, “these records can be uploaded into an online database for easy viewing” by attempting to technically satisfy the request while obstructing its purpose.

The second is that both agencies failed to read the request properly and thought nothing of employing the most environmentally harmful, inefficient, and costly way possible to satisfy this request, all without ever stopping to confirm this assumption with the requestor.

Quite frankly, I’m not sure which one is worse!

Stalling tactics are annoying and wasteful, but I’ve faced worse than this and most agencies — eventually — comply with the law. Just not before wasting their time (and mine) with games like this.

In the meantime, I encourage you to visit www.transparentcalifornia.com to see the 3 million-plus records we have obtained so far, many from agencies that are dedicated to helping, not stalling, public records requests.

And for those inquiring about the inclusion of school districts, do not let these two examples discourage you; we will be adding school districts to the site later this year.


Suing GOED

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.

Suing GOED

This was a big week for NPRI.

On Wednesday, our Center for Justice and Constitutional Litigation challenged the constitutionality of the state government’s efforts to pick winners and losers in the economy through the Catalyst Fund.

Most of the media coverage since we filed the case — and there’s been plenty of it over the past two days — has rightly focused on the relevant legal issue: The Nevada Constitution expressly prohibits the state from giving money to private companies, and that is what the Governor’s Office of Economic Development is doing through the Catalyst Fund.

Joseph Becker, chief legal officer and director of the Center for Justice and Constitutional Litigation, addresses members of the media this week about NPRI’s lawsuit against the Governor’s Office of Economic Development.

That constitutional issue is at the heart of this lawsuit, along with the basic unjustness of making a business subsidize its competition, and I urge you to read Joseph Becker’s detailed explanation of those issues here.

But today, I’d like to discuss another angle to this story, and to dive into the economic problems inherent to the Catalyst Fund’s existence.

Supporters of the Catalyst Fund have promoted it as a needed tool for “economic development.” They tell us that the $10 million account will draw new businesses, jobs and revenue into the state; that Nevada has to compete with other states for companies; and that politicians need this tool to create jobs.

Why is NPRI, a free-market think tank, against something that helps businesses?

Well, I’m glad you asked, because there is an essential distinction to make here. NPRI is pro-market, not pro-business.

In a free market, there will be some very large businesses that thrive by doing an excellent job of meeting the needs of their customers. We’re big fans of those businesses. And in the free market, there will be some small businesses that thrive by doing an excellent job of meeting the needs of their customers. We’re big fans of those businesses, too.

But we don’t applaud those businesses because of their size, the number of jobs they create or even how much they pay in taxes. We applaud them because they create value for their customers through mutually beneficial and free exchanges. Businesses aren’t ends in themselves, but a means individuals use to reach their goals.

Consumers — that’s you and me — are winners in this system. We get products that are of a higher quality, have more features and are often cheaper.

And in a free market, businesses face constant competition from other businesses who think they can earn money by doing a better job of pleasing those customers. It’s exhausting work staying in business and making a profit!

Some businesses, however, want to take a shortcut to profits, so they seek special privileges from the government to protect or guarentee their success.

These privileges — which could include monopoly status, selective regulatory breaks, bailouts, loan guarantees or, yes, subsidies from Nevada’s Catalyst Fund — are often called “pro-business” policies. But they are really just ways for certain businesses to benefit at the expense of others.

What’s amazing is that history shows that government support does not guarantee a business will thrive or even that it will survive. Just look at Solyndra, Abound Solar, Fiskar and ThromboVision. Despite hundreds of millions in taxpayer handouts, they still couldn’t make it.

So how many of the companies that will receive Catalyst Fund subsidies will end up going bankrupt despite taxpayer handouts?

Through our lawsuit, we’re working to make sure we never have to find out.


By the way, I’ll be spending some time next weekend up in Oregon, first in Portland and then driving along the coast. If any of you know the area well and have some favorite spots you’d recommend (restaurants, scenic places, historic sites, etc.), I hope you’ll send those suggestions along. You can reach me at am@npri.org. Any ideas would be much appreciated!

Thanks for reading, and I’ll see you next time.

Andy Matthews
NPRI President

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

Total Records: 1818

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