Barry is a Senior Economist with the National Center for Policy Analysis, one of the most influential think tanks in America today.
The National Center for Policy Analysis (NCPA) is a nonprofit, nonpartisan public policy research organization, established in 1983. The NCPA's goal is to develop and promote private alternatives to government regulation and control, solving problems by relying on the strength of the competitive, entrepreneurial private sector. Topics include reforms in health care, taxes, Social Security, welfare, criminal justice, education and environmental regulation.
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Daily Policy Digest
Provided courtesy of: http://www.ncpa.org/
Daily Policy Digest
- Calming Fears of Climate Change in Asia
- 27 Aug 2014 07:00:58 CDT -
Many climate studies have focused on South and Southeast Asia, as the region is considered uniquely vulnerable to the projected effects of climate change such as a reduction in crop yields, rising sea levels, flooding, a loss of biodiversity and drought. Many of these Asian countries are islands or are on peninsulas, with highly populated coastal cities; if climate change predictions come true, these countries would be highly vulnerable.
In a paper for the National Center for Policy Analysis, Research Associate Tanner Davis explains that the five cities deemed at the most "extreme risk" for climate change by global risk analysis company Maplecroft are Dhaka, Mumbai, Kolkata, Manila and Bangkok -- all of which are in South or Southeast Asia. According to the Intergovernmental Panel on Climate Change, global warming poses a special risk to these two regions.
But while climate change alarmists have suggested that higher temperatures will increase food insecurity in Asia, food production has been increasing for the last half-century:
- Since the 1990s, food production in Southeast Asia has increased substantially.
- South Asia has kept a stable supply of arable land, and the amount of arable land in Southeast Asia has increased.
- In fact, according to agronomist Craig Idso, increased levels of carbon dioxide in the Earth's atmosphere has increased, not decreased, plant production.
Similarly, while many have raised concerns about sea level rise, there is no consensus on the amount of rise. According to the World Bank, were the sea level to rise by one meter, just 1 to 2 percent of land area, population and farmland in developing countries would be affected, and GDP would fall by 0.5 percent to 2 percent.
Davis distinguishes what he calls "mitigation" from "adaptation." Mitigation, he says, seeks to combat climate change by embarking upon new projects or instituting measures aimed at reducing greenhouse gas emissions in order to curb climate change. Adaptation, on the other hand, consists of strategies to deal with the effects of global warming, such as rehabilitating coral, engaging in water resource management and protecting wildlife.
As climate science is so uncertain and unsettled, writes Davis, adaptation is the more cost-effective approach to climate change.
Source: Tanner Davis, "Calming Fears of Climate Change in South and Southeast Asia," National Center for Policy Analysis, August 27, 2014.
For more on Environment Issues:
- Burger King Looks to Move to Canada, Escape U.S. Taxes
- 27 Aug 2014 07:00:57 CDT -
American fast food chain Burger King surprised many when news arose that the $9.6 billion hamburger joint is in talks to purchase a Canadian donut chain and move its headquarters to Ontario, Canada. Jon Hartley, co-founder of Real Time Macroeconomics LLC, explains in Forbes that the Burger King proposal is a reflection of Canada's more favorable tax environment.
Burger King has proposed a "tax inversion" -- merging with a foreign company (in this case, a popular coffee and donut shop in Canada called Tim Horton's) and reincorporating itself abroad. As long as Tim Horton's shareholders are the owners of at least one-fifth of Burger King's shares after the merger, Burger King will no longer be considered an American company for tax purposes.
Why would Burger King move?
- Canada's corporate tax rate is 26.5 percent -- nearly 10 percentage points below the 35 percent corporate tax rate in the United States.
- According to accounting firm KPMG, Canada has the most business-friendly tax system of all developed countries.
- When compared to what companies must pay in taxes in the United States, taxes in Canada are just 53.6 percent of the U.S. tax burden. (For the U.K., that figure is 66.6 percent and for the Netherlands, 74.5 percent.)
Taxes are not cheap (Burger King paid $88.5 million in taxes in 2013), and the Burger King proposal highlights how a burdensome a tax regime can change corporate behavior.
Source: Jon Hartley, "Burger King's Tax Inversion and Canada's Favorable Corporate Tax Rates," Forbes.com, August 25, 2014.
For more on Tax and Spending Issues:
- Texas Challenges Colleges to Cut Costs
- 27 Aug 2014 07:00:56 CDT -
Why are college tuition costs so high? Because of federal student loan policy, writes Judah Bellin, researcher at the Manhattan Institute. Because the student loan program provides funds based on the price of attendance, schools have little incentive to keep their costs low, knowing that students will receive federal funding, regardless of sky-high tuition prices.
States are responding to the federal government's failure to deal with tuition rise by offering innovative, inexpensive solutions. While some states are looking to follow the lead set by Oregon's "Pay It Forward, Pay It Back," plan, which will make tuition free for resident students attending the state's public universities and community colleges, these plans do little to stem tuition growth, says Bellin.
In 2011, Texas Governor Rick Perry challenged the state's schools to change up their instruction styles, utilize online instruction and cut costs in order to offer bachelor's degree programs for $10,000 or less.
In response, several schools are offering programs for at or around that $10,000 mark. For example:
- At the University of Texas-Permian Basin, STEM students who maintain a sufficient GPA are awarded a scholarship each semester that puts the total bill for their four-year degree under $10,000.
- Texas A&M-San Antonio offers a cyber-security program to students who utilize college credit earned in high school and have completed two years of community college. These students can finish their degree at the university for just slightly over $10,000.
- The Texas Affordable Baccalaureate Program (TABP) is currently offered at two schools: South Texas College and Texas A&M-Commerce. The program, which results in a bachelor's degree in applied science, costs between $13,000 and $15,000 and can be completed in just three years, requiring 90 credit hours of online modules and 30 credit hours of courses in business and management.
- TABP allows students to pay $750 per term and awards credits once a student has mastered a subject, allowing enrollees to proceed at their own pace and maintain control over the cost of their education.
Bellin writes that these state efforts are unique responses to the college cost problem and illustrate the important role of states as "laboratories of American democracy."
Source: Judah Bellin, "Judah Bellin: Slimming the College-Tuition Beast," Orange County Register, August 25, 2014.
For more on Education Issues:
- Schools Set Up New Safety Measures
- 27 Aug 2014 07:00:55 CDT -
Many students heading back to class this fall will see new security measures in place, a response to the 2012 shooting in Newtown, Connecticut, where 20 children and six educators were shot and killed by 20-year-old Adam Lanza.
According to the Wall Street Journal, districts across the country are taking measures to protect students against possible violence:
- In Tampa, Florida, Hillsborough County Public Schools (the eighth-largest school district in the country) have placed 20 armed officers in their elementary schools. Additionally, the school board has hired a safety consultant and given its approval for the installation of fences and buzzers.
- In Idaho, the Coeur d'Alene district's 16 schools are now surrounded by security fencing. Visitors may only enter at one point, and elementary schools will each have two police officers patrolling the halls.
- In the Montpelier Exempted Village Schools district in Ohio, buildings now include bulletproof glass and panic buttons. Additionally, four anonymous employees will carry firearms.
According to the Education Commission of the States, more than 30 states passed legislation to improve their schools' security last year. That includes 10 states that moved to allow school personnel to carry weapons on school property: Utah, Colorado, South Dakota, Oklahoma, Texas, Indiana, Tennessee, Alabama, Georgia and Connecticut.
Source: Caroline Porter, "New Safety Measures Greet Students," Wall Street Journal, August 25, 2014.
For more on Education Issues:
- Should Cities Pass Right-to-Work Laws?
- 27 Aug 2014 07:00:54 CDT -
James Sherk and Andrew Kloster of the Heritage Foundation argue that local governments in states without right-to-work laws should pass their own right-to-work legislation.
While federal law prohibits employers from refusing to hire workers who are not part of a union, unions often negotiate contracts with employers that require employees to pay union dues, even if an employee is not himself a member of a union. These dues generally cost between 1 percent and 2 percent of an employee's wages.
But currently, twenty-four states have right-to-work (RTW) laws, which allow employees to work without paying union dues and prohibit them from being fired on that basis. The idea of RTW legislation is that employees should not be forced to support unions as a condition of employment, especially as unions engage in political campaigning and provide financial support to various causes.
Unions, write Sherk and Kloster, are uniformly opposed to RTW legislation. In states that have passed RTW laws, union membership has fallen. For example, more than 13 percent of workers in Idaho belonged to unions in 1987, the year that Idaho passed RTW legislation. Today, less than 5 percent of Idaho's workers are union members.
The authors explain that RTW laws attract investment, as firms that are not unionized have higher profits, greater investment and create more jobs. They encourage local governments in non-RTW states to pass their own RTW ordinances, writing that companies will otherwise be loathe to move their businesses to that state in the absence of RTW legislation. While there has been confusion over the legal status of RTW ordinances, say Sherk and Kloster, they contend that nothing prohibits local governments from making their municipality a RTW city.
Source: James Sherk and Andrew Kloster, "Local Governments Can Increase Job Growth and Choices by Passing Right-to-Work Laws," Heritage Foundation, August 26, 2014.
For more on Economic Issues:
- Study: Political Competition Leads to Fiscal Irresponsibility
- 26 Aug 2014 07:00:53 CDT -
Stephen Eide, senior fellow at the Manhattan Institute, reports on a new study from Sutirtha Bagchi at the University of Michigan. Bagchi sought to analyze the source of fiscal irresponsibility: is it more likely to arise in blue states or red states? In fact, Bagchi found that the places that were highly competitive at the ballot box were far more likely to have fiscally irresponsible pension plans.
According to Eide, Bagchi's report studied municipalities in Pennsylvania, taking 2,000 pension plans and comparing them with the votes that the political parties received in each locality in state and national races from 1980 to 2009.
What did he find? Communities that were more politically competitive had the least responsible pension plans; they offered high benefits with high discount rates (which clouds actual costs) and had much lower actuarial funding ratios (the ratio of assets compared to liabilities).
Bagchi concluded, "[P]olitical competition systematically alters the behavior of politicians when in office and induces them to make decisions that are sub-optimal for society in the long run." Politicians may offer extensive pension benefits while keeping taxes low in order to curry favor with voters and public employees, for example, but this only keeps pensions underfunded.
Eide notes that the study was only one of local Pennsylvania governments. However, according to Bagchi, the results in Pennsylvania municipalities are also applicable at the state-level. When he analyzed pension plans in Wisconsin over the two decades from 1989 to 2009, Bagchi reports finding that "as the level of political competition in a state goes up, the actuarial funded ratio of plans offered by that state declines."
Source: Steve Eide, "Does democracy cause pension mismanagement?" Public Sector Inc., August 21, 2014.
For more on Tax and Spending Issues:
Health Policy Digest
Provided courtesy of: http://www.ncpa.org/
Consumer Driven Health Care
- Health Care Reform Tax Will Hurt Franchisees
- 04 Oct 2011 12:43:58 GMT - When the employer mandates go into effect in 2014, many franchised businesses will be motivated to reduce the number of locations and move workers from full-time to part-time status...
REAL CLEAR MARKETS
- Saving Jobs from Health Reform's Harmful Regulations
- 04 Oct 2011 12:43:58 GMT - If the rate of health care cost growth had not exceeded general inflation, a typical family would have had $545 more per month in spendable income instead of $95 -- a difference of $5,400 per year...
- Does Health Insurance and Seeing the Doctor Keep You Out of the Hospital?
- 04 Oct 2011 12:43:58 GMT - Gaining health insurance and using more primary care services leads to more hospitalizations as a result of physicians' discretionary decisions regarding aggressive and intensive treatment...
AMERICAN ENTERPRISE INSTITUTE
- The Case for Competition in Medicare
- 04 Oct 2011 12:43:58 GMT - A well-functioning marketplace would set in motion the forces needed to transform American medical care into a model of efficient patient-centered care...
- Potential Effect of Health Care Reform on Emergency Department Utilization Not Clear
- 04 Oct 2011 12:43:58 GMT - In 2010, 71 percent of emergency physicians said that they expected emergency department visits to increase due to the implementation of the Affordable Care Act...
NEW ENGLAND JOURNAL OF MEDICINE
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