NPRI: Sandoval misses opportunity to make case for fiscal conservatism

By Geoffrey Lawrence
  • Thursday, January 17, 2013

LAS VEGAS — In response to Gov. Brian Sandoval’s State of the State address Wednesday night, NPRI’s Deputy Policy Director Geoffrey Lawrence released the following comments:

Governor Brian Sandoval’s State of the State speech contained a number of hits and misses. Unfortunately, in terms of effectively addressing our state’s problems, there were more misses than hits.

He again called for extending taxes Nevadans were promised would expire in 2011, for expanding ineffective education programs like pre-K, for providing “free” health care to able-bodied adults above the poverty line and for so-called “economic development” efforts that really just increase bureaucratic interference in the marketplace to pick winners and losers.

Just as notable as what the governor said was what he didn’t say. He failed to address the $40 billion-plus unfunded liability in Nevada’s Public Employees’ Retirement System or to outline desperately needed changes to Nevada’s broken collective bargaining laws.

If enacted, these proposals will have negative consequences in both the short and long terms for all Nevadans: private families and individuals will face higher taxes; money that could be used to pay for more effective education programs will instead be channeled toward early childhood programs that produce only minimal and temporary gains; children and the disabled will have to compete with healthy adults for a limited supply of doctors; and businessmen and women will be forced to subsidize their competitors.

Lawrence noted that repeated analyses of the Head Start program — the largest early-childhood education program in the world — published by the federal Department of Health and Human Services have found that the program fails to produce lasting gains in student achievement. Said Lawrence:

The State of the State message was a missed opportunity to detail how government at all levels has induced and deepened Nevada’s economic and education problems. We can improve core government services — like education and public safety — and save money through empirically proven reforms. They would include school choice, a charter-agency framework, performance auditing, a defined-contribution or hybrid pension system and changes to collective bargaining and prevailing wage.

Lawrence did praise Sandoval for announcing an opportunity scholarship bill that would allow businesses to receive a tax credit for donations to a scholarship-granting organization. An NPRI analysis found a universal version of a similar proposal would save Nevada $1 billion over 10 years. Lawrence added:

Parents know their children best, and that’s why parents should be empowered to pick the school and school type best for their children. School choice programs are raising math and reading scores and graduation rates around the country, and lawmakers should follow Governor Sandoval’s lead in enacting a widespread opportunity scholarship program.

This idea — originally proposed by NPRI in 2009 — would not only create new options for parents and improve educational results, but would also result in a cost savings for Nevada’s public schools.

Encouragingly, the governor also emphasized the importance of pursuing reforms to the state’s public education system designed to improve performance and accountability by ending social promotion and creating a meaningful teacher-evaluation system based on student performance.

It was also good to see him reference the fact that Nevada is fully capable of managing its own lands — something it has a constitutional right to do.

Finally, it’s somewhat encouraging that Governor Sandoval plans to at least temper the financial impact to the state of his decision to endorse Obamacare with a Medicaid expansion. He gave nominal support to the notion of reversing the expansion if the federal match rate changes in future years. He also proposed that Medicaid beneficiaries be subject to small copays, as is done in other states. Copays have been shown to reduce health care costs by discouraging individuals from seeking superfluous care without negatively impacting health care outcomes.

On balance, however, many aspects of Governor Sandoval’s speech were disappointing.  Even if he was trying to fend off even more damaging proposals from the far Left, this self-described conservative governor ultimately threw only a few bones to those who believe government should be limited, responsible and accountable.