Sunday, November 14, 2010

A Growth Agenda for the New Congress

By Arthur Laffer
The Wall Street Journal
November 12, 2010

Since its cyclical zenith in December 2007, U.S. economic production has been on its worst trajectory since the Great Depression. Massive stimulus spending and unprecedented monetary easing haven't helped, and yet the Obama administration and the Federal Reserve still cling to the book of Keynes. It's an approach ill-suited to solving the growth problem that the United States has today.

The solution can be found in the price theory section of any economics textbook. It's basic supply and demand. Employment is low because the incentives for workers to work are too small, and the incentives not to work too high. Workers' net wages are down, so the supply of labor is limited. Meanwhile, demand for labor is also down since employers consider the costs of employing new workers—wages, health care and more—to be greater today than the benefits.

Firms choose whether to hire based on the total cost of employing workers, including all federal, state and local income taxes; all payroll, sales and property taxes; regulatory costs; record-keeping costs; the costs of maintaining health and safety standards; and the costs of insurance for health care, class action lawsuits, and workers compensation. In addition, gross wages are often inflated by the power of unions and legislative restrictions such as "buy American" provisions and the minimum wage. Gross wages also include all future benefits to workers in the form of retirement plans.

For a worker to be attractive, that worker must be productive enough to cover all those costs plus leave room for some profit and the costs of running an enterprise. Being in business isn't easy, and today not enough workers qualify to be hired.

But workers don't focus on how much it costs a firm to employ them. Workers care about how much they receive and can spend after taxes. For them, the question is how the wages they'd receive for working compare to what they'd receive (from the government) if they didn't work, plus the value of their leisure from not working.

The problem is that the government has driven a massive wedge between the wages paid by firms and the wages received by workers. To make work and employment attractive again, this government wedge has to shrink. This can happen over the next two years, even with a Democratic majority in the Senate and President Obama in the White House, through the following measures:

1) The full extension of the Bush tax cuts. The Republican-controlled House of Representatives can write legislation extending all the tax cuts in perpetuity. Of particular importance for employment is keeping the highest personal income tax rate at 35%, the capital gains tax rate at 15% and the dividend tax rate at 15%, while eliminating the estate tax permanently. If the Senate blocks this legislation or Mr. Obama refuses to sign it, House Republicans should hold firm and let voters decide in 2012. (My guess is that he'll sign it or have his veto overridden.)

2) The full repeal of ObamaCare, which allows individuals to pay only five cents for each dollar of health care. Who do you think pays the other 95 cents? As former Sen. Phil Gramm notes, if he had to pay only five cents for each dollar of groceries he bought, he would eat really well—and so would his dog. No single bill is more antithetical to growth than ObamaCare.

Repeal could take the form of Michele Bachmann's Legislative Repeal Act, and if it is blocked in the Senate or by a veto Republicans should continue bringing it up every six months. Come 2012 the public will have a clear view of what congressional candidates stand for. The end game for U.S. prosperity is the election in 2012.

3) The cancellation of all spending that punishes those who produce and rewards those who don't. This is really the distinction between demand-side economics and supply-side economics. Stimulus spending and quantitative easing don't make it more rewarding to work an extra hour. If the government pays people not to work and taxes people who do work, is it really so difficult to see why employment is so low?

So the government should sell its stakes in public companies acquired via TARP, sell government-run enterprises that lose money (e.g., Amtrak and the Postal Service), end farm subsidies that pay people not to farm, cancel the rest of the stimulus and return all spending programs to their pre-stimulus levels. Congress should also continually examine spending in Afghanistan and Iraq. And it should return the duration of unemployment benefits to the standard 26 weeks, from the current 99 weeks.

4) The enactment of stalled free trade agreements with South Korea, Colombia and Panama.

These changes would spur recovery, but they are just the start. Elected officials should offer longer-term measures that voters can judge in 2012, when 33 senators—including 21 Democrats, two independents who caucus with the Democrats, and 10 Republicans—as well as the entire House and President Obama are up for re-election.

Beyond 2012, the ideal growth agenda would include:

1) A true flat tax, a la Jerry Brown's proposal in 1992. Congress should replace all federal taxes (except sin taxes) with two flat-rate taxes, one on personal income and one on net business sales. The personal income tax would be on all forms of income: wage income, dividends, inheritance (as proposed by Democratic Rep. Jared Polis), and all capital gains. This tax code would remove loopholes and almost all deductions, and the static revenue rate would be around 11.5%.

2) Price stability. Congress should revise the Federal Reserve's mandate, making it serve only the goal of price stability (and not also full employment). In addition, the Fed should follow a monetary rule, targeting either the quantity of money or the price level. There can be no prosperity without price stability.

3) Passage of a balanced budget amendment, without raising taxes. This would prevent government from being able to balance its budget by unbalancing the budgets of its citizens. And it would force politicians to make difficult decisions about what spending is worthwhile, just like the rest of us.

4) Finally, saving the best for last, the mother of all supply-side reforms is incentive pay for politicians (which the comedian Jackie Mason called "putting the politicians on commission"). Politicians must be held personally responsible for their actions. In business, firms align the incentives of decision makers with the incentives of shareholders to ensure that they take the best course of action. Washington must begin doing the same by creating an incentive structure that pays elected officials according to factors such as stock market performance and economic growth.

Mr. Laffer is the chairman of Laffer Associates and co-author of "Return to Prosperity: How America Can Regain Its Economic Superpower Status" (Threshold, 2010).

Monday, September 6, 2010

Housing Woes Bring a New Cry: Let the Market Fall

By David Streitfeld
New York Times
September 5, 2010

The unexpectedly deep plunge in home sales this summer is likely to force the Obama administration to choose between future homeowners and current ones, a predicament officials had been eager to avoid.

Over the last 18 months, the administration has rolled out just about every program it could think of to prop up the ailing housing market, using tax credits, mortgage modification programs, low interest rates, government-backed loans and other assistance intended to keep values up and delinquent borrowers out of foreclosure. The goal was to stabilize the market until a resurgent economy created new households that demanded places to live.

As the economy again sputters and potential buyers flee — July housing sales sank 26 percent from July 2009 — there is a growing sense of exhaustion with government intervention. Some economists and analysts are now urging a dose of shock therapy that would greatly shift the benefits to future homeowners: Let the housing market crash.

When prices are lower, these experts argue, buyers will pour in, creating the elusive stability the government has spent billions upon billions trying to achieve.

“Housing needs to go back to reasonable levels,” said Anthony B. Sanders, a professor of real estate finance at George Mason University. “If we keep trying to stimulate the market, that’s the definition of insanity.”

The further the market descends, however, the more miserable one group — important both politically and economically — will be: the tens of millions of homeowners who have already seen their home values drop an average of 30 percent.

The poorer these owners feel, the less likely they will indulge in the sort of consumer spending the economy needs to recover. If they see an identical house down the street going for half what they owe, the temptation to default might be irresistible. That could make the market’s current malaise seem minor.
Caught in the middle is an administration that gambled on a recovery that is not happening.

“The administration made a bet that a rising economy would solve the housing problem and now they are out of chips,” said Howard Glaser, a former Clinton administration housing official with close ties to policy makers in the administration. “They are deeply worried and don’t really know what to do.”
That was clear last week, when the secretary of housing and urban development, Shaun donovan, appeared to side with current homeowners, telling CNN the administration would “go everywhere we can” to make sure the slumping market recovers.

Mr. Donovan even opened the door to another housing tax credit like the one that expired last spring, which paid first-time buyers as much as $8,000 and buyers who were moving up $6,500. The cost to taxpayers was in the neighborhood of $30 billion, much of which went to people who would have bought anyway.

Administration press officers quickly backpedaled from Mr. Donovan’s comment, saying a revived credit was either highly unlikely or flat-out impossible. Mr. Donovan declined to be interviewed for this article. In a statement, a White House spokeswoman responded to questions about possible new stimulus measures by pointing to those already in the works.

“In the weeks ahead, we will focus on successfully getting off the ground programs we have recently announced,” the spokeswoman, Amy Brundage, said.
Among those initiatives are $3 billion to keep the unemployed from losing their homes and a refinancing program that will try to cut the mortgage balances of owners who owe more than their property is worth. A previous program with similar goals had limited success.

If last year’s tax credit was supposed to be a bridge over a rough patch, it ended with a glimpse of the abyss. The average home now takes more than a year to sell. Add in the homes that are foreclosed but not yet for sale and the total is greater still.

Builders are in even worse shape. Sales of new homes are lower than in the depths of the recession of the early 1980s, when mortgage rates were double what they are now, unemployment was pervasive and the gloom was at least as thick.

The deteriorating circumstances have given a new voice to the “do nothing” chorus, whose members think the era of trying to buy stability while hoping the market will catch fire — called “extend and pretend” or “delay and pray” — has run its course.

“We have had enough artificial support and need to let the free market do its thing,” said the housing analyst Ivy Zelman.

Michael L. Moskowitz, president of Equity Now, a direct mortgage lender that operates in New York and seven other states, also advocates letting the market fall. “Prices are still artificially high,” he said. “The government is discriminating against the renters who are able to buy at $200,000 but can’t at $250,000.”

A small decline in home prices might not make too much of a difference to a slack economy. But an unchecked drop of 10 percent or more might prove entirely discouraging to the millions of owners just hanging on, especially those who bought in the last few years under the impression that a turnaround had already begun.

The government is on the hook for many of these mortgages, another reason policy makers have been aggressively seeking stability. What helped support the market last year could now cause it to crumble.

Since 2006, the Federal Housing Administration has insured millions of low down payment loans. During the first two years, officials concede, the credit quality of the borrowers was too low.

With little at stake and a queasy economy, buyers bailed: nearly 12 percent were delinquent after a year. Last fall, F.H.A. cash reserves fell below the Congressionally mandated minimum, and the agency had to shore up its finances.

Government-backed loans in 2009 went to buyers with higher credit scores. Yet the percentage of first-year defaults was still 5 percent, according to data from the research firm CoreLogic.

“These are at-risk buyers,” said Sam Khater, a CoreLogic economist. “They have very little equity, and that’s the largest predictor of default.”

This is the risk policy makers face. “If home prices begin to fall again with any serious velocity, borrowers may stay away in such numbers that the market never recovers,” said Mr. Glaser, a consultant whose clients include the National Association of Realtors.

Those sorts of worries have a few people from the world of finance suggesting that the administration should do much more, not less.

Willaim H. Gross, managing director at Pimco, a giant manager of bond funds, has proposed the government refinance at lower rates millions of mortgages it owns or insures. Such a bold action, Mr. Gross said in a recent speech, would “provide a crucial stimulus of $50 to $60 billion in consumption,” as well as increase housing prices.

The idea has gained little traction. Instead, there is a sense that, even with much more modest notions, government intervention is not the answer. The National Association of Realtors, the driving force behind the credit last year, is not calling for a new round of stimulus.

Some members of the National Association of Home Builders say a new credit of $25,000 would raise demand but their chances of getting this through Congress are nonexistent.

“Our members are saying that if we can’t get a very large tax credit — one that really brings people off the bench — why use our political capital at all?” said David Crowe, the chief economist for the home builders.

That might give the Obama administration permission to take the risk of doing nothing.

Sunday, August 15, 2010

Obama is a Victim of Bush's Failed Promises

By Chuck Green

Aurora Sentinal

Februrary 7, 2010

Barack Obama
is setting a record-setting number of records during his first year in office.

Largest budget ever. Largest deficit ever. Largest number of broken promises ever. Most self-serving speeches ever. Largest number of agenda-setting failures ever. Fastest dive in popularity ever.

Wow. Talk about change.

Just one year ago, fresh from his inauguration celebrations, President Obama was flying high. After one of the nation’s most inspiring political campaigns, the election of America ’s first black president had captured the hopes and dreams of millions. To his devout followers, it was inconceivable that a year later his administration would be gripped in self-imposed crisis.

Of course, they don’t see it as self imposed. It’s all
George Bush’s fault.

George Bush, who doesn’t have a vote in Congress and who no longer occupies the
White House, is to blame for it all.

He broke Obama’s promise to put all bills on the White House web site for five days before signing them.

He broke Obama’s promise to have the
congressional health care negotiations broadcast live on C-SPAN.

He broke Obama’s promise to end earmarks.

He broke Obama’s promise to keep unemployment from rising above 8 percent.

He broke Obama’s promise to close the detention center at
Guantanamo in the first year.

He broke Obama’s promise to make peace with direct, no pre-condition talks with America ’s most hate-filled enemies during his first year in office, ushering in a new era of global cooperation.

He broke Obama’s promise to end the hiring of former lobbyists into high White House jobs.

He broke Obama’s promise to end no-compete contracts with the government.

He broke Obama’s promise to disclose the names of all attendees at closed White House meetings.

He broke Obama’s promise for a new era of bipartisan cooperation in all matters.

He broke Obama’s promise to have chosen a home church to attend Sunday services with his family by Easter of last year.

Yes, it’s all George Bush’s fault. President Obama is nothing more than a puppet in the never-ending, failed
Bush administration.

If only George Bush wasn’t still in charge, all of President Obama’s problems would be solved. His promises would have been kept, the economy would be back on track,
Iran would have stopped its work on developing a nuclear bomb and would be negotiating a peace treaty with Israel , North Korea would have ended its tyrannical regime, and integrity would have been restored to the federal government.

Oh, and did I mention what it would be like if the Democrats, under the leadership of
Nancy Pelosiand Harry Reid, didn’t have the heavy yoke of George Bush around their necks. There would be no earmarks, no closed-door drafting of bills, no increase in deficit spending, no special-interest influence (unions), no vote buying ( Nebraska , Louisiana ).

If only George Bush wasn’t still in charge, we’d have real change by now.

All the broken promises, all the failed legislation and delay (
health care reform, immigration reform) is not President Obama’s fault or the fault of the Democrat-controlled Congress. It’s all George Bush’s fault.

Take for example the decision of Eric Holder, the president’s attorney general, to hold terrorists’ trials in
New York City . Or his decision to try the Christmas Day underpants bomber as a civilian.

Two disastrous decisions.

Certainly those were bad judgments based on poor advice from George Bush.

Need more proof?

You might recall that when Scott Brown won last month’s election to the U.S. Senate from Massachusetts , capturing “the
Ted Kennedy seat,” President Obama said that Brown’s victory was the result of the same voter anger that propelled Obama into office in 2008. People were still angry about George Bush and the policies of the past 10 years, and they wanted change.

Yes, according to the president, the voter rebellion in Massachusetts last month was George Bush’s fault.

Therefore, in retaliation, they elected a Republican to the Ted Kennedy seat, ending a half-century of domination by Democrats.

It is all George Bush’s fault.

Will the failed administration of George Bush ever end, and the time for hope and change ever arrive?

Will President Obama ever accept responsibility for something — anything?

Chuck Green, veteran Colorado journalist and former editor-in-chief of The Denver Post, syndicates a statewide column

Thursday, July 15, 2010

Are Overdue Reports Concealing ObamaCare Impact On Medicare?
By: Peter Ferrara
July 6, 2010

Every year, the Annual Report of the Social Security Board of Trustees comes out between mid-April and mid-May. Now it's July, and there's no sign of this year's report. What is the Obama administration hiding?

The annual report includes detailed information about Social Security and its financing over the next 75 years, produced by the Office of the Actuary of the Social Security Administration.

The Congressional Budget Office reported last week in its Long Term Budget Outlook that Social Security was already running a deficit this year. According to last year's Social Security Trustees Report, that was not supposed to happen until 2015, with the trust fund to run out completely by 2037.

With the disastrous Obama economy, the great Social Security surplus that started in the Reagan administration is gone completely.

Every year, the federal government has been raiding the Social Security trust funds to take that annual surplus and spend it on the rest of the federal government's runaway spending, leaving the trust funds only with IOUs backed by nothing but politicians' promise to pay it back when it's needed. Now even that annual surplus is gone. How soon will the trust funds run out completely now?

President Obama keeps telling us a fairy tale that he saved us from another Great Depression. But he is actually leading us into another Depression.

The National Bureau of Economic Research scores the recession as officially starting in December 2007. Thirty-one months later, with unemployment still near 10% and the work force still declining, the NBER says it still cannot determine an official end to the recession.

The longest recession since World War II previously was 16 months, with the average being 10 months. By next month, it will be twice as long as the previous postwar record since the latest recession started. The markets echoed by many pundits are now suggesting a renewed double-dip downturn may be starting, with the comprehensive Obama tax rate increases next year poised to pour napalm on this developing bonfire.

How soon will the trust funds run out with this utter failure of 1930s-style Obamanomics?

The implications for Social Security aren't what the Obama administration is hiding by delaying the annual trustees reports. Those annual reports also include information regarding Medicare over the next 75 years. What the administration is trying to hide are sweeping draconian cuts to Medicare resulting from the ObamaCare legislation, which the annual report will document.

The administration is trying to delay the report until mid-August, when it's hoping the country will be on vacation and won't notice. Or maybe the delay is because the White House is trying to bludgeon the chief actuaries for Medicare and Social Security into fudging the numbers.

Those chief actuaries are dedicated, career professionals who have worked their way up the bureaucracy over decades.

During the Reagan administration, the congressional Democrat majorities and the New York Times made clear to us that tampering with the work of the government's career professionals, let alone the career number crunchers, would be grounds for impeachment.

I'm not certain the rule of law applies to this administration, where the Justice Department cites "payback time" as its reason for not prosecuting Black Panther Voting Rights Act violations.

The CBO confessed to $500 billion in Medicare cuts in the first 10 years of Obama-Care alone. Based on those calculations, the minority staff of the Senate Budget Committee estimated the Medicare cuts as $800 billion in the first 10 years of implementation and $2.9 trillion over the first 20 years of ObamaCare. Truthful annual trustees reports would further document these cuts.

These draconian Medicare cuts are primarily how the president got his claims that ObamaCare would reduce the deficit by over $100 billion over the first 10 years, and a trillion dollars over the next 10 years. The cuts involve slashing payments to doctors and hospitals for the medical care they provide to seniors, and decimating the private option Medicare Advantage program that close to one-fourth of seniors have chosen for their coverage because it gives them a better deal.

Such Medicare cuts would create havoc and chaos in health care for seniors. Doctors, hospitals, surgeons and specialists providing critical care to the elderly will shut down and disappear in much of the country, and others would stop serving Medicare patients. If the government is not going to pay, seniors are not going to get the medical treatment they expect.

Yes, Medicare is more than bankrupt over the long run and needs a fundamental overhaul. But the answer is not to tell seniors their guaranteed benefits will not be cut while the government refuses to pay doctors and hospitals for their care.
Nor is it to decimate Medicare Advantage, which instead should be expanded to all of Medicare. Nor is it to trash Medicare and use the money for a whole new entitlement instead, which is what ObamaCare does.

Ferrara is director of entitlement and budget policy for the Institute for Policy Innovation, general counsel of the American Civil Rights Union and a senior policy adviser on health care to the Heartland Institute.

Wednesday, July 14, 2010

Journalism Needs Government Help

Wall Street Journal
By: Lee Bollinger
July 14, 2010

Media budgets have been decimated as the Internet facilitates a communications revolution. More public funding for news-gathering is the answer.

We have entered a momentous period in the history of the American press. The invention of new communications technologies—especially the Internet—is transforming the human capacity to speak, perhaps as monumentally as the invention of the printing press in the 15th century. This is facilitating the largest and fastest expansion of global economic growth in human history. Free speech and a free press are essential to a dynamic economy.

At the same time, however, the financial viability of the U.S. press has been shaken to its core. The proliferation of communications outlets has fractured the base of advertising and readers. Newsrooms have shrunk dramatically and foreign bureaus have been decimated. My best estimate is that there are presently only a few dozen full-time foreign correspondents from the U.S. covering all of China, despite the critical importance of that nation to our future.

Both the Federal Communications Commission and the Federal Trade Commission are undertaking studies of ways to ensure the steep economic decline faced by newspapers and broadcast news does not deprive Americans of the essential information they need as citizens. One idea under consideration is enhanced public funding for journalism.

The idea of public funding for the press stirs deep unease in American culture. To many it seems inconsistent with our strong commitment, embodied in the First Amendment, to having a free press capable of speaking truth to power and to all of us. This press is a kind of public trust, a fourth branch of government. Can it be trusted when the state helps pay for it?

American journalism is not just the product of the free market, but of a hybrid system of private enterprise and public support. By the middle of the last century, daily newspapers were becoming natural monopolies in cities and communities across the country. Publishers and editors drew on the revenue to develop highly specialized expertise that enhanced coverage of economics, law, architecture, medicine, science and technology, foreign affairs and many other fields.

Meanwhile, the broadcast news industry was deliberately designed to have private owners operating within an elaborate system of public regulation, including requirements that stations cover public issues and expand the range of voices that could be heard. The Supreme Court unanimously upheld this system in the 1969 Red Lion decision as constitutional, even though it would have been entirely possible to limit government involvement simply to auctioning off the airwaves and letting the market dictate the news. In the 1960s, our network of public broadcasting was launched with direct public grants and a mission to produce high quality journalism free of government propaganda or censorship.

The institutions of the press we have inherited are the result of a mixed system of public and private cooperation. Trusting the market alone to provide all the news coverage we need would mean venturing into the unknown—a risky proposition with a vital public institution hanging in the balance.

Ironically, we already depend to some extent on publicly funded foreign news media for much of our international news—especially through broadcasts of the BBC and BBC World Service on PBS and NPR. Such news comes to us courtesy of British citizens who pay a TV license fee to support the BBC and taxes to support the World Service. The reliable public funding structure, as well as a set of professional norms that protect editorial freedom, has yielded a highly respected and globally powerful journalistic institution.

There are examples of other institutions in the U.S. where state support does not translate into official control. The most compelling are our public universities and our federal programs for dispensing billions of dollars annually for research. Those of us in public and private research universities care every bit as much about academic freedom as journalists care about a free press.

Yet—through a carefully designed system with peer review of grant-making, a strong culture of independence, and the protections afforded by the First Amendment—there have been strikingly few instances of government abuse. Indeed, the most problematic funding issues in academic research come from alliances with the corporate sector. This reinforces the point that all media systems, whether advertiser-based or governmental, come with potential editorial risks.

To take a very current example, we trust our great newspapers to collect millions of dollars in advertising from BP while reporting without fear or favor on the company's environmental record only because of a professional culture that insulates revenue from news judgment.

Or consider another area where we have well established mechanisms of government support for even the most oppositional views: defense counsel in our courts, where government-paid lawyers (including those in uniform military courts) will do their utmost to undermine cases brought by the government itself. Playing the role of calling our government to account is an accepted ethic of the legal profession despite the political hostility it can sometimes generate.

We should think about American journalism as a mixed system, where the mission is to get the balance right.

To me a key priority is to strengthen our public broadcasting role in the global arena. In today's rapidly globalizing and interconnected world, other countries are developing a strong media presence. In addition to the BBC, there is China's CCTV and Xinhua news, as well as Qatar's Al Jazeera. The U.S. government's international broadcasters, like Voice of America and Radio Free Europe, were developed during the Cold War as tools of our anticommunist foreign policy. In a sign of how anachronistic our system is in a digital age, these broadcasters are legally forbidden from airing within the U.S.

This system needs to be revised and its resources consolidated and augmented with those of NPR and PBS to create an American World Service that can compete with the BBC and other global broadcasters. The goal would be an American broadcasting system with full journalistic independence that can provide the news we need. Let's demonstrate great journalism's essential role in a free and dynamic society.

Mr. Bollinger is president of Columbia University and author of "Uninhibited, Robust, and Wide-Open: A Free Press for a New Century" (Oxford, 2010).

Monday, July 5, 2010

Gas Taxes Give Us a Break at the Pump

By Dennis Cauchon
July 2, 2010

When drivers hit the road in large numbers for the Fourth of July holiday, they will have something extra to celebrate — the lowest gasoline taxes since the early days of the automobile.

Holiday drivers will pay less than ever at the pump for upkeep of the nation's roads — just $19 in gas taxes for every 1,000 miles driven, a USA TODAY analysis finds. That's a new low in inflation-adjusted dollars, half what drivers paid in 1975.

Another measure of the trend: Americans spent just 46 cents on gas taxes for every $100 of income in the first quarter of 2010. That's the lowest rate since the government began keeping track in 1929. By comparison, Americans spent $1.18 in 1970 on gas taxes out of every $100 earned.

Although the federal gas tax — 18.4 cents per gallon — hasn't changed since 1993, tax collections are down because today's vehicles go farther on a gallon of gas, cutting tax collections while increasing wear and tear on highways. Inflation since 1993 has eroded the value of the tax to maintain roads.

"The gas tax isn't going to work as the user fee to finance the highway system in the 21st century," says Robert Poole, transportation policy director at the free-market Reason Foundation.

Drivers are on track to spend $55.7 billion on federal, state and local gas taxes in 2010's first quarter, the Bureau of Economic Analysis reports. That's down from $68.5 billion in 2000 after adjusting for inflation — even though Americans drive 7% more miles annually.

The American Trucking Associations, motorist club AAA and others favor higher gas taxes to reduce congestion and a backlog of road repairs.

The chance of that happening? "Outlook not good," says Jill Ingrassia, director of government relations at AAA.

Polls show the gas tax is one of the least popular levies. Only 23% support a 10-cent-per-gallon gas tax hike, according to a June survey by the Mineta Transportation Institute at San Jose State University.

"The money you pay at the pump doesn't always find its way to potholes," says gas tax opponent Pete Sepp of the National Taxpayers Union.
State and local gas taxes average 30 cents per gallon and have changed little during the recession.

The nation's roads are increasingly financed by other taxes and borrowing. The federal stimulus plan set aside $26.7 billion for roads, most of which will be spent by year's end.

Mullen: Debt, a Security Threat

The American Conservatism of Thurgood Marshall

By Juan Williams
The Wall Street Journal
July3, 2010

Was Thurgood Marshall a conservative? J. Edgar Hoover, an indisputably right-wing voice, certainly thought so: The FBI chief sent Marshall a note congratulating him on his nomination to the high court. So did Malcolm X, who branded the first black Supreme Court justice a "fool" because he didn't embrace mass protest or excuse riots.

But at last week's confirmation hearings for Elena Kagan, the reality of Marshall's record was eclipsed by the myth of the late justice as a wild-eyed, left-wing activist. Several Republican senators expressed concern that Ms. Kagan, a former Marshall clerk, might replicate his approach to applying the law.

"Justice Marshall's judicial philosophy . . . is not what I would consider mainstream," said Sen. Jon Kyl (R., Ariz). The senator depicted Marshall, who sat on the court from 1967 to 1991, as a "results oriented" justice who interpreted the law to fit his political aims and had no regard for a strict reading of the Constitution.

Sen. Jeff Sessions (R., Ala.) piled on, claiming that Marshall's record as an "activist" judge constituted a violation of a responsible jurist's oath to apply the law without political favor. Such judging, added Sen. Chuck Grassley (R., Iowa), "does not comport with the proper role of a judge or judicial method."

Thankfully, Ms. Kagan appears to have escaped any damage from these attempts to paint her as the second coming of this devilish caricature of her former mentor. But the justice's own legacy took some hits, and the truth about his record needs to be set straight before this distortion becomes fixed in the public mind.

First, there are the hard numbers. As a lawyer, Marshall argued 32 cases before the Supreme Court and won 29. That's hardly the record of a man operating outside of the legal mainstream. Marshall's rulings on the Second Circuit Court of Appeals were never overturned by the Supreme Court, and in most of his appellate opinions he joined with the majority of what was then viewed as a conservative circuit. As solicitor general of the U.S. he lost only five of the 14 cases he argued before the Supreme Court.

Even on the high court, Marshall always tailored his opinions to adhere to constitutional principles—not political ideology. For example, in making the case for affirmative action, Marshall did not try to discard constitutional protections for individual rights. In his dissent in the 1978 Regent of California v. Bakke affirmative action case, Marshall wrote: "It must be remembered that during most of the past 200 years, the Constitution as interpreted by this court did not prohibit the most ingenious and pervasive forms of discrimination against the Negro. Now when a state acts to remedy the effects of that legacy of discrimination, I cannot believe that this same Constitution stands as a barrier . . . "

What's at the heart of any charge of judicial activism is Marshall's work as a lawyer. As lead counsel for the NAACP Legal Defense and Education Fund from 1938 to 1961, Marshall won Brown v. Board of Education—the case that ended school segregation by overturning the 1896 case, Plessy v. Ferguson. His argument was that the law must be applied without any distinction based on color or class.

The Supreme Court's unanimous ruling in that 1954 decision required courage, given that segregation, either by law or in fact, had become the norm in much of the nation. If one argues that Marshall encouraged judicial "activism" by seeking to have this overturned, that means Plessy was correctly decided, and racial segregation should have been protected under the Constitution. History has long ruled that is not a winning argument.

Marshall's fidelity to the Constitution was evident outside the court as well. He is a man who bravely stood before crowds of militant black people in the 1950s and '60s to rebut calls for black solidarity in boycotts and protest marches. "Let's stop drawing the line [between] colored and white," he told one group. "Let's draw the line on who wants democracy for all Americans." For this outlook, Nation of Islam leader Elijah Muhammad wrote a newspaper column condemning Marshall. "He is in love with the white race," Muhammad wrote.

Ms. Kagan clerked for Marshall at the end of his time on the Supreme Court when he gave a speech saying the Constitution was "defective from the start," because it allowed slavery while denying women the right to vote. He said the Civil War and the constitutional amendments that followed had saved the Constitution and the nation.
That is not a rant from a crazed liberal with no regard for the rule of law. It is a clear-eyed ruling from a judge who by the measure of fellow civil rights activists, as well as fellow lawyers and judges, believed in a very conservative principle: liberty and justice for all.

Mr. Williams, a political analyst for National Public Radio and Fox News, is the author of several books, including "Thurgood Marshall: American Revolutionary" (Three Rivers Press, 2000).

Tuesday, February 9, 2010

Paschal High School


by Bud Kennedy, Star Telegram Writer

PASCHAL High School, Fort Worth’s oldest, is now ranked in Newsweek as one of America’s best. Great. So how long will Fort Worth put up with having only one national-caliber high school?

Paschal's winning academic record is remarkable. This year’s seniors on Forest Park Boulevard included 11 National Merit Scholarship semifinalists. Based on advanced placement tests, Newsweek ranked PASCHAL No. 3 regionally, No. 12 in Texas and No. 200 nationally.

Among nearby schools, only Colleyville, Heritage and Grapevine ranked higher. Carroll in Southlake is the only other local school among 804 on the list. Isn’t it time other cities and neighborhoods expected better schools?

Money is no excuse. On average, Arlington Heights, Southwest, Western Hills and most suburban schools serve wealthier families than PASCHAL. Their children have more resources. The nine other Fort Worth high schools serve families with less money than PASCHAL. Yet those children also need the most attention – because their education and training will decide the future wealth or poverty of Fort Worth.

Almost 20 years after a PASCHAL math teacher set out to build the district’s best Honors program, other schools are closer to competing. Arlington Heights, on the West side, had the city’s second-best SAT scores last year, although nearly 70 points behind PASCHAL. The PASCHAL Honors students – almost half the senior class - average a 1310 score!!

Dunbar, in east Fort Worth, is second in Merit Scholar semifinalists. Western Hills in Benbrook consistently ranks high. Trimble Technical, near downtown, earned an “exemplary” state rating for a high passing rate on the state achievement test. In a more comprehensive rating last fall, Texas Monthly ranked Tech and Southwest as the district’s most effective high schools for students at all achievement levels. (PASCHAL fell to 10th of 13 and also trailed suburban schools at the same income level, including Brewer, Springtown and Haltom.)

Yet no other city school and almost no Texas public school can come close to PASCHAL’s success rate with the very smartest students. At the recent “Radio Shack Scholars Dinner” rewarding Fort Worth’s best students citywide, close to one third were students from PASCHAL. The cheers of 389 Panthers overwhelmed any for the other 12 high schools represented at the Amon G. Carter Jr. Exhibits Hall.

PASCHAL is not one of the district’s “special interest” schools marketed to draw transfer students – formerly called “magnet” schools. It is simply a school with an academic championship history that is attractive to both transfer students and selective homebuyers. About a third of Paschal's top honor students chose to transfer from their neighborhood schools.

John Hamilton, the 40-year math teacher who launched Paschal’s intensified program in 1984 to compete with magnet schools, is the academic version of Dunbar’s Hall of Fame boys’ basketball coach, Robert Hughes. He said Paschal’s success with high achievers is no secret. “It takes continuity,” he said this week, preparing to teach another summer of SAT preparation classes – sort of an academic summer camp for competitive scholars. “Most of all, it takes a pro-academics attitude in the building and in the entire community. What makes my day is the academic success of PASCHAL students…..Some schools don’t have the same person pushing hard year after year. You have to really value academic success. It’s the reason we have school.”

Ultimately, that’s the reason we need to strengthen all our public schools in Fort Worth and Texas -- to teach the next generation and to build a more successful community, city, and state.

A sociology professor at Texas A&M University has the official title of Texas’ “state demographer.” His is the loudest voice warning that Texans must improve the academic performance of all public schools now – particularly for the growing numbers of minority and low-income children. “It’s a question of what we want for the future of Texas,” Steve Murdock said by phone Friday from a conference in Austin. “It’s the difference between having a state of well-educated, productive citizens – or of less well-educated citizens. The difference statewide will be billions of dollars in socioeconomic needs, billions of dollars in total income, billions of dollars in tax revenue.”

The future of Fort Worth and Texas depends on how well we educate all our children. This city needs more than one showcase high school.