Cato Unbound – There Ain’t No Such Thing As Free Parking
This month at Cato Unbound we’re discussing a practical, everyday issue — parking!
Yes, Cato Unbound is supposed to cover big ideas, deep thoughts, and the like, but parking policy is both important in its own right and also points to what I consider a very interesting problem: Given a theoretical or abstract commitment to free markets, well, how do we get there in the real world? What would a free-market policy look like in this or that issue area?
The answer isn’t always obvious, and the map isn’t the territory. Parking is interesting in this respect and possibly helpful. Parking is all around us, most of us deal with it every day, and the unintended consequences of parking policy are I think maybe easier to see than the unintended consequences in other fields. Parking affects how we live, how we shop, and how we work. It touches our cities, our family life, our environment, and even our health. Learning to look for such unintended consequences is part of developing a political culture that values economic insights and puts them to work.
That’s why this month we’ve invited four urban economists, each of whom can fairly be said to value the free market. Still, there will be a few disagreements among them — as I said, the map isn’t the territory. Donald Shoup leads the issue with his essay “Free Parking or Free Markets?” — arguing that our expectation of abundant free parking is both bad for our communities and the product of anti-market planning.
The conversation will continue throughout the month, with contributions from Professor Sanford Ikeda, Dr. Clifford Winston of the Brookings Institution, and Cato’s own Randal O’Toole. Be sure to stop by throughout the month, or else subscribe via RSS.
Those Non-Meddling Kids
For once, a new poll on the political attitudes of young Americans brings some good news. The poll, “D.C.’s New Guard: What Does the Next Generation of American Leaders Think?”[.pdf] is from the Brookings Institution, and it’s the subject of my Washington Examiner column this week:
“It’s a survey of the type of kids who run for student government and choose to spend their summer vacations working in Washington,” the authors explain, “youth who already have the ‘Washington bug’ and have set themselves towards a career in politics and policy.” In other words … creeps!
If you’re the rare bird who favors limited government at home and abroad, you can hardly expect good news from a poll of this generation’s Tracy Flicks*. After all, aren’t these just the sort of model U.N. types who’ve always wanted to run the world?
Maybe not: The Brookings study contains some surprisingly encouraging findings about the attitudes of our future policy elites.
When given a list of possible foreign policy actions and asked to prioritize them, our precocious politicos put “build a stronger military force to ensure deterrence” near the bottom. Moreover, nearly 58 percent of these “young leaders” agreed with the statement that “the U.S. is too involved in global affairs and should focus on more issues at home.”
Only 10 percent “thought that the United States should be more globally proactive.”
I’ve read a lot of polling data on the Millennials’ politics, and, from a libertarian perspective, they’re a mixed bag. On the plus side, they’re socially liberal, and totally uninterested in culture-war politics. On the minus, they exhibit higher levels of faith in government than do older generations, leading the Center for American Progress to call them “The Progressive Generation.”
But if, as the Brookings survey suggests, even GenY’s model-UN types don’t want to run the world, then the future looks less bright for neoconservatives than it does for libertarians.
* reference is to the Greatest Political Movie of All Time, 1999′s “Election”:
Plowing Through the Defenses of National Education Standards
Arguably the most troubling aspect of the push for national education standards has been the failure — maybe intentional, maybe not — of standards supporters to be up front about what they want and openly debate the pros and cons of their plans. Unfortunately, as Pioneer Institute Executive Director Jim Stergios laments today, supporters are using the same stealthy approach to implement their plans on an unsuspecting public.
Standing in stark contrast to most of his national-standards brethren is the Fordham Institute’s Mike Petrilli, who graciously came to Cato last week to debate national standards and is now in a terrific blog exchange with the University of Arkansas’s Jay Greene. Petrilli deserves a lot of credit for at least trying to answer such crucial questions as whether adopting the standards is truly voluntary, and if there are superior alternatives to national standards. You can read Jay’s initial post here, Mike’s subsequent response here, and Jay’s most recent reply right here.
I’m not going to leap into most of Jay and Mike’s debate , though it covers a lot of the same ground we hit in our forum last week, which you can check out here. I do want to note two things, though: (1) While I truly do appreciate Mike’s openly grappling with objections to what might be Fordham’s biggest reform push ever, I think his arguments don’t stand up to Jay’s, and (2) I think Mike’s identifying national media scrutiny as what will prevent special-interest capture of national standards is about as encouraging as BP telling Gulf-staters ”we’ve got a plan!”
Let’s delve into #2.
For starters, how much scrutiny does the national media give to legislating generally? Reporters might hit the big stuff and whatever is highly contentious, but even then how much of the important details do they offer? Think about the huge health care debate that just dominated the nation’s attention. How many details on the various bills debated did anybody get through the major media? How much clarity? Heck, sometimes legislators were debating bills that even they hadn’t seen, much less reporters. Of course, the health care bill was much bigger than, say, the No Child Left Behind Act, but remember how long after passage of NCLB it was before the Department of Education, much less the media, was able to nail down all of its important parts?
Which brings us to a whole different layer of policy making, one major media wade into even less often than legislating: writing regulations. How many stories have you read, or watched on TV news, about the writing of regulations for implementing anything, education or otherwise? I’d imagine precious few, yet this is where often vaguely written statutes are transformed into on-the-ground operations. It’s also where the special interests are almost always represented — after all, they’re the ones who will be regulated — but average taxpayers and citizens? Don’t go looking for them.
School Choice, Realpolitik, & Brookings
Jay Greene has responded to my review of the new Brookings Institution school choice report which he co-authored, raising a crucial issue for the education policy and research communities. Jay points out that the report is a work of realpolitik rather than scholarship, and as such contends that it must find a compromise between the policies best supported by the evidence and those that have a real chance of being implemented. He makes the related argument that incrementalism is the only realistic path to success.
I agree with Jay that it’s good for analysts to find ways of improving current policy even when the ideal policies are not politically feasible. But these realpolitik recommendations must be clearly distinguished from the ideal policies themselves. Analysts should report both viable compromise reforms AND ideal policies, explaining to policymakers the likely costs and risks associated with the compromises–the reasons why they are inferior. Failing to do this leads to two serious problems:
First, presenting only the compromises robs the public and its elected representatives of crucial information, making it more difficult to build support for the ideal policies and leading to guilt by association when the compromise policies prove disappointing for reasons that should have been — but were not — clearly laid out in advance.
Second, when analysts don’t present their ideal policies and the evidence (if any) on which they are based, there is no way for the public or policymakers to judge the wisdom of their realpolitik compromise recommendations. This is particularly problematic when the analysts’ recommendations conflict with what the available evidence shows to be ideal policy.
As to the need for incrementalism in U.S. policy reform, the evidence is not entirely one-sided. The Emancipation Proclamation did not give slaves a 50 percent share in themselves, rising gradually to 100 percent over time. When women won the franchise, it was not at a discounted rate — one female vote equal to 1/3 or 1/2 of a male vote. They won the right to vote outright. Prohibition was not undone gradually, with beverage categories being re-legalized in order of alcohol content. I’m sure we could think of other major policy shifts in U.S. history that were not incremental.
In all of the above cases, major social movements were necessary to win the day, and if scholars and advocates who knew better had championed only half-measures instead of the policies they knew to be right, it surely would have delayed the eventual victories. Scholars who know what kind of school choice is necessary to best serve children should clearly advocate such policies, especially in any context in which they also offer any interim recommendations they deem more politically feasible.
And even if we grant, for the sake of argument, that all school choice policies must be incremental, there are incremental policies already in existence that are highly consistent with ideal policy. Existing scholarship donation tax credits such as those in PA, FL, RI, etc., and personal use education tax credits such as those of Illinois and Iowa, are expanding organically over time. Eventually, as that expansion continues, they could be combined and thus ensure universal access to the education marketplace without needing to impose regulations on private schools that the research shows to be intrusive and counterproductive. By contrast, it is hard to see how introducing federal regulation of virtual schools (a Brookings Report recommendation) moves us close in the direction of the minimally regulated parent-driven markets supported by the evidence.
So, yes, let’s be realistic in our policy recommendations, but let’s also be clear about the ideal policies indicated by the empirical evidence, so that policymakers and the public hear a consistent message about where we need to go.
Thoughts on the New Brookings School Choice Report
A new Brookings Institution report suggests ways for the federal government to promote school choice. On the eve of its release, I voiced some practical and constitutional objections to the idea. Now that the report is out, contributing author Jay Greene asks if I’m still apprehensive. The short answer is yes.
Brookings assembled an impressive group of scholars to write the report, and their education policy recommendations deserve serious consideration. Their goal of ensuring more and better access to more and better educational choices is one that I share, and I hope the following comments will help advance that goal.
Good policy, like good science, is grounded in concrete evidence. Only where evidence is lacking is it wise to fall back on theory. The Brookings report relies on theory in a couple of important areas where extensive evidence is available to show us the way. In particular, the authors acknowledge that U.S. experience with alternative school systems is minimal, but (with a single exception — see below) they do not discuss the vast wealth of evidence from other nations that have more extensive and longer-running experience with school choice systems.
Some have argued that we can learn little about school governance from other nations because cultural and economic factors affect educational outcomes too greatly. This criticism does not apply to within-country comparisons of alternative school systems — and virtually all of the literature comparing alternative school systems is within-country. A comparison of government-run, government-funded private, and parent-funded private schools within India, for instance, is not muddied by cultural or economic differences between India and the United States.
School Choice Advocates: Beware Washington
The Brookings Institution will release a new school choice policy guide on February 2nd, and from the sound of it, children, parents, taxpayers, and the authors themselves should be concerned. The guide will provide:
a series of practical and novel recommendations for reauthorization of the Elementary and Secondary Education Act, including national chartering of virtual education providers; expanding the types of information collected on school performance; providing incentives for low-performing school districts to increase choice and competition; and creating independent school choice portals to aid parents in choosing between schools.
The goals these recommendations are meant to achieve are entirely laudable, but there are three reasons for serious concern:
1) The Constitution delegates to the federal government no power to provide or regulate education services, except in the execution of its explicitly enumerated powers. So the Supreme Court can ensure that state education programs abide by the Fourteenth Amendment, for example, but Congress cannot “charter virtual education providers.” Of course the federal government has been transgressing the limits on its education powers for more than half a century, but no one who supports the rule of law can condone that transgression, much less its expansion.
2) From a regulatory standpoint, Washington is the worst level of government at which to implement an education program. National education programs impose a single set of rules on every participating provider in the country. Get those rules wrong — either up front or down the road — and you not only hobble the effectiveness of every single provider, but you eliminate the possibility of comparing outcomes between providers operating under different sets of rules. In essence you lose the ability to distinguish between different “treatments” — to determine what helps and what is harmful to the service’s overall success.
3) We have ample evidence about the quality of education programs implemented by the federal government. For example, after 45 years and $166 billion, Head Start has just been proven entirely ineffective. (See also the NCLB paper linked to in “1)”, above). Once again, this problem is exacerbated by the all-encompassing nature of federal programs. Get them wrong and you get them wrong for every participating student, everywhere in the country. With variation in programs among states, by contrast, we not only have the ability to compare the merits of alternative approaches, we have powerful incentives for states to get their programs right. Just as tax competition drives businesses from one state or nation to another, so, too, can education policy competition. States with better policies will attract businesses and more mobile residents from states with worse ones, eventually compelling the inferior policy states to redress their errors. We’re just beginning to see the prospects for this now, as school choice programs proliferate and grow at the state level, and introducing national programs that might well interfere with this process would be a disastrous mistake.
I hope that school choice advocates, including those who have contributed to the forthcoming Brookings report, will weigh these concerns.
Is Keynesian Stimulus Working?
In his Brookings Institution speech yesterday, President Obama called for more Keynesian-style spending stimulus for the economy, including increased investment on government projects and expanded subsidy payments to the unemployed and state governments. The package might cost $150 billion or more.
The president said that we’ve had to “spend our way out of this recession.” We’ve certainly had massive spending, but it doesn’t seem to have helped the economy, as the 10 percent unemployment rate attests to.
It’s not just that the Obama “stimulus” package from February has apparently failed. The total Keynesian stimulus is not measured by the spending in that bill only, but by the total size of federal government deficits.
The chart shows that while the federal deficit (the total ”stimulus” amount) has skyrocketed over the last three years, the unemployment rate has more than doubled. (The unemployment rate is the fiscal year average. Two months are included for FY2010.)
The total Keynesian stimulus of recent years has included the Bush stimulus bill in early 2008, TARP, large increases in regular appropriations, soaring entitlement spending, the Obama stimulus package from February, rising unemployment benefits, and falling revenues, which are “automatic stabilizers” according to Keynesian theory.
The deficit-fueled Keynesian approach to recovery is not working. The time is long overdue for the Democrats in Congress and advisers in the White House to reconsider their Keynesian beliefs and to start entertaining some market-oriented policies to get the economy moving again.
GOP 99% Socialist
As I note in my New York Post op-ed today, Republicans are fond of implying that President Obama is a big-spending socialist. But the House GOP recently offered a spending cut plan that was able to find savings worth less than one percent of Obama’s budget.
As Tad DeHaven and Brian Riedl have also pointed out, the GOP spending reform effort is rather pathetic. It proposed specific annual budget cuts of about $14 billion per year.
Consider that the center-left budget wonks at the Brookings Institution put their heads together a few years ago and came up with a “smaller government plan” that proposed about $342 billion in annual spending cuts (by 2014). The Brookings authors note:
These cuts are achieved by reducing government subsidies to commercial activities ($138 billion); by returning responsibility for education, housing, training, environmental, and law enforcement programs to the states ($123 billion) . . . by cutting entitlements such as Medicaid, Social Security, and Medicare ($74 billion); and by eliminating some wasteful spending in these entitlement programs ($7 billion).
Thus, the Brooking’s scholars found cuts more than twenty times larger than the House GOP leadership cuts, and Brookings proposed its plan back when the deficit was about one-fifth of the size it is today. (Note that both the Brookings and GOP plans would also put a cap on overall nondefense discretionary spending, in addition to these specific cuts).
My point in the New York Post piece is that the GOP needs to challenge Obama’s big spending agenda at a more fundamental level. They need to do some careful research, pick out some big spending targets, and go on the offense. Why not propose to eliminate the Departments of Education and Housing and Urban Development? Why not sell off federal assets, such as the Tennessee Valley Authority, in order to help pay down the federal debt? Why not open up the U.S. Postal Service to competition?
Obama won’t agree to these reforms at this point, but they would hopefully open a serious national debate about reforming our massive and sprawling federal government. Ronald Reagan in 1980 and the congressional Republicans in 1994 didn’t win by splitting hairs with the Democrats over 1% of spending. They offered a more fundamental critique.
At least, GOP leaders need to offer up spending reforms as bold as those of the Brookings Institution.
Cato on Facebook
Cato on Twitter
Cato on Google+
Cato on YouTube
