Allred’s Transportation Plan: Huh?

I’ve always pledged to be an equal opportunity critic, and I’ve given Butch plenty of hell for ignoring the financial meltdown in the state, so now it’s time to ask Dr. Allred about his transportation stance.

Following the report that showed truckers aren’t paying their fair share of road costs, Allred conceived the following, according to reports in the Statesman:

Democratic gubernatorial candidate Keith Allred aims to cut Idaho’s gas tax by 3 cents and says Gov. C.L. “Butch” Otter’s push to raise more money for roads is misguided.

Allred would cut the tax to 22 cents per gallon, from 25 cents per gallon now, to save drivers $19.2 million annually.

He’d boost fees paid by heavy trucks by an equal amount to make up the difference.

Ok. This is nice populist rhetoric, but here’s the reality. First, there is universal agreement that no drivers are paying their fare share of transportation costs. I.W.H. Parry and K.A. Small argue in a 2005 article in the American Economic Review, i.e., the top journal in the field of economics, that gas taxes in the United States would need to rise to $1.01 per gallon (from around $.40 per gallon today) in order to cover the externalities created by accidents, pollution, and congestion. So reducing fuel taxes, as nice as that sounds, moves us in the opposite direction of optimal policy. Further, it’s totally unsustainable - we cannot finance our infrastructure needs with the current level of taxation - we certainly can’t reduce that rate.

So Allred proposes to raise taxes on truckers. Sounds like a great idea - stick it to the man. Let me just ask all you legislative observers this question: how many people think a bill that raises the gas tax on truckers would ever get out of committee? Exactly.

What we have so far in this governor’s race is no transportation solution from either candidate. Allred’s plan has no chance of becoming reality, and shouldn’t become reality - it moves Idaho away from good policy, not toward it. And after making transportation a centerpiece of his first campaign, the Governor has all but given up, his task force offering a mealy-mouthed plan to increase the gas tax by a penny in order to fund the billions of dollars in maintenance, safety, and infrastructure needs of the transportation system. That isn’t going to work either.

What’s that sound you hear? That would be legislators in Utah, Nevada, and Arizona - three of our regional competitors - getting a good chuckle as they watch themselves pull away in the transportation game.

BLS: 2nd Quarter Estimates Show U.S. Economy Expanding - Kind of

A report this morning by the Bureau of Labor Statistics (BLS) estimates that the U.S. economy grew 2.4% in the second quarter. While that growth shows the nation as a whole is out of the recession, the growth rate was down from the first quarter when real GDP grew 3.7%.

Economists at the BLS gave the following rationale for the slowdown in growth:

The deceleration in real GDP in the second quarter primarily reflected an acceleration in imports and a deceleration in private inventory investment that were partly offset by an upturn in residential fixed investment, an acceleration in nonresidential fixed investment, an upturn in state and local government spending, and an acceleration in federal government spending.

In previous quarters, we had seen that investment by business was driving growth. Now, it appears that the pubic sector is responsible for keeping GDP on the positive side. That is obviously going to be bad news for Idaho, the state that led the nation in reducing state employment, cutting 6.9% of the workforce by the time the fiscal year closed out on June 30.

So if you wonder why your state economy is still floundering as we enter the third quarter, you now have a pretty good idea.

STEM Crisis in Idaho is in Jobs, not Education

In yesterday’s Idaho Statesman we have more hand wringing by the educational establishment about “why more kids don’t choose to follow educational paths in STEM?” For those outside of the system, STEM is Science, Technology, and Medicine. This obsession with STEM education is predictable, and seems quite rational. The thinking goes that if we build a higher quality workforce beginning at the K-12 ranks, then eventually we’ll be able to attract more companies to Idaho that require those types of workers.

Except that Idaho already has a SURPLUS of STEM trained college graduates who can’t find jobs. This was clearly outlined in a report to the State Board of Education in a report titled, EMSI Comparison of Education and Labor Data 2009. The report was privately produced for the Idaho State Board, so it is not available on-line but I am happy to provide a copy if you want one. The report estimates the number of graduates coming out of Idaho Universities with certain degrees, and attempts to connect them to known job openings where that degree would be relevant. Where STEM is concerned, here is the picture for Idaho:

As shown above, Idaho employers had openings for 91 biologists in 2009; Idaho universities graduated 267 students with degrees in biology - so there are 176 shiny new STEM grads in Biology who can’t find jobs in Idaho. It is the same with several of the other physical sciences, as you can see above. Math, Chemistry, and Physics degrees - at least in Idaho - provide no quick path to employment.

So this means a couple of things: 1) there is no STEM crisis in higher education - quite the opposite. Idaho is graduating more STEM workers than we can even employ, and; 2) those workers will leave the state and go take jobs in Colorado, California, Washington, and Oregon where there are jobs for those kinds of graduates.

Now on to myth number two, that there is a crisis in STEM education in Idaho’s K-12 ranks. It just isn’t true. Here is the data from the National Science Foundation’s Science and Engineering Indicators for 2010:

As indicated above, Idaho ranks among the top states in the nation for eighth grade science proficiency! And when you look at our neighboring states against which we compete for jobs - we’re way better off than Utah, Nevada, New Mexico, and Arizona. Our kids here are doing MUCH better.

What about Math? That story is also pretty good:

In eighth grade math proficiency, Idaho ranks in the second quartile of states, and that is better than ALL of the Intermountain West states except Colorado.

So what’s all this mean? Micron gave the University of Idaho a $1.2 million grant to answer the question of: “why some Idaho students don’t do well or pursue careers in science, technology, engineering and math.” And in a short blog post I’ve already answered that. The question isn’t valid - Idaho’s students in K-12 are doing just fine, thank you, in math and science, and Idaho’s universities are graduating A SURPLUS of STEM trained graduates. The real questions here are:

1) Why aren’t we getting out the word that relative to the other Intermountain West states, Idaho’s achievement in K-12 STEM education is very good, and that we have a surplus of trained STEM workers?

2) Will we continue to see this good of performance from our K-12 students with changing state demographics - an influx of Hispanics that may not have English as a first language, and the graying of the workforce and pending retirements of baby-boom era educators? These educators have served us well - can we sustain that?

3) What kind of investment in education would be required to get Idaho into the top quarter of states on math scores?

4) Can we continue to expect these kinds of results as the share of state funding for higher-ed declines, and funding for K-12 relies upon the shitting sands of the sales tax?

And there are lots of other questions that we could come up with that wold enlighten the educational situation in Idaho, but the one that Micron has asked the U of I to study is based upon several false premises and won’t result in any meaningful conclusions as long as this question is the starting point.

A Lesson in History and Economics for my Friends at the Idaho Freedom Foundation

If you’ve been paying attention, there’s all kinds of hysteria out there from the far right (the Idaho Freedom Foundation) and whatever Dave Frazier calls himself, perhaps the lunatic fringe, over municipal power in Idaho.

In an e-mail I got from the Idaho Freedom Foundation, Wayne Hoffman makes a couple of pleas to his base. In short, in his view the City of Boise must be stopped:

The Boise City Council voted 4-1 Tuesday to spend $60,000 to “educate” Idahoans on a constitutional amendment that would take away the right of the people to vote on airport debt projects. I’ll write more on this in a couple of days. But I’m stunned by city officials, who proclaimed it their job to be the official arbiters of the truth when it comes to ballot issues. What’s more troubling are the records we have gathered showing that the city is actively campaigning on the taxpayers’ dime. As I told KTVB-TV, the proper role of the city government is to run the city, not campaign for new laws and constitutional amendments. Period.

The city’s decision on whether to create a new urban renewal district was postponed at Tuesday’s meeting. We believe there is no need to create another urban renewal district. We’re deeply concerned by the expansive use of urban renewal across Idaho, and we’ll continue to work on this issue during the months ahead.

I don’t begrudge anyone their political philosophy; I spent years as a GOP consultant in Washington State, so I am sympathetic to Wayne’s suspicion of government. However, elected officials have the added burden of having to govern. They do not have the pure luxury, as does Wayne, to merely ignore the world around them in deference to their political philosophy (though Idaho electeds are better at most at adhering to rigid philosophical codes). My chief issue with Wayne, and Frazier, in this case, is that their philosophy completely ignores history and economics. Indeed, it is not the CITY as Wayne would have you believe, that is trying to steal power from the electorate. In fact, it is the exact opposite - the STATE of Idaho, like most states, began life as the usurper of power from CITY residents who had already set up their mechanism of self governance. This is the case all over the West - and remember the West in the late 1700s was places like Cincinnati and Lexington.

Early Pioneers platted the City of Boise in July of 1863. By 1864, Boise was established as the territorial capital. And, on January 11, 1866, the City of Boise incorporated as a legal entity with its own charter, system of ordinances, and elected government. The State of Idaho didn’t come to bear until 1890 - more than two decades later.

So you can now predict the direction of this tale. The State, in authoring its Constitution, stripped power away from the 2,311 Boise citizens who had been governing themselves for almost a quarter century. And like many other western cities, this almost immediately resulted in the City having to go to the State and ask for power back that they had previously enjoyed. Under these new state constitutions, cites often struggles with having enough authority (especially financial) to provide basic public health and sanitation services, and also public works and infrastructure.

Unlike Idaho, however, most states realized that hamstringing the cities - which always have been the economic engines - was no way to effectively govern a state. So as it turns out today, while other states in the U.S. devolved power back to the cities, Idaho’s municipalities today have less municipal authority than any state west of the Mississippi.

Fast forward to the present, and we have two important issues before us. One, the City of Boise is considering creating a new urban renewal district around the blighted 30th street corridor, and two, the state legislature (finally) has agreed to post a ballot measure which would give the airport the authority to issue bonds without a vote of the people. That small step brings Idaho finally into the twentieth century. We will have to wait until later to get to the 21st.

But otherwise smart people like Wayne Hoffman and Dave Frazier think these things are a bad idea. Yet - as shown - Boise’s experiment in self governance existed long before the farmers and ranchers from eastern and southern Idaho and their oxymoronic Western conservatism came to dominate state politics.

Lastly, our good friends over at the Idaho Freedom Foundation fail to understand that the free market operates in the public sector too - if it is allowed to do so. Economist Charles Tiebout in 1956 developed what is now known as one of the most cited economic models in history, the Tiebout Model. Very simply, the Tiebout Model predicted that people would vote with their feet where cities were concerned. That is, they would choose a place to live based upon the goods and services a city provided, and the level of taxation that it costs to provide those services. California is a classic example. Many cities incorporated to keep L.A. from swallowing them up, and consequently tax rates are lower and services fewer in those California burbs.

So how about letting the free market work in Idaho? If Boise wants to raise taxes to build a streetcar, use Tax Increment Financing to support a new urban renewal district, and let the airport build parking garages without me going to the polls, why not let them? If you don’t like it, move to Kuna and revel in your freedom from Boise’s taxes and modernity.

At the end of the day, the thing that is missing from these folks on the far end of either spectrum is any sense of history and economics. Now, they stand corrected.

Prediction for Proposed 30th Street Urban Renewal District

Last night the City Council served notice that they intend to hold a series of public hearings as they seek to create an urban renewal district around the 30th and Main corridor. I AM ALL FOR IT! I give big props to City Council person Elaine Clegg who spearheaded the design charrette for this area. Nearly 200 residents from the area participated. In the end input from participants in the charrette informed the creation of a 200 page master plan for this neighborhood that is nothing short of totally run-down. I hope the City and CCDC are successful in creating a new district. It is one of the few tools that government has to actually help spur development. And at least SOMEONE is trying to do that. Our Governor is on trail rides and firing staff members and talking ‘cowboy code.’ Thank Heaven the Mayor and Council are taking their charge seriously.

Anyway - on the prediction. If you saw the usually hysterical Dave Frazer’s blog the other day, he actually wants a constitutional limitation on the activities of redevelopment agencies. That completely defies any sense of the historical development of the United States where most cities predate the existence of the territories and ultimately states in which they reside. As states came to bear, municipal power waned - that is until states realized that cities were their economic engines, and constitutional changes gave municipalities more power to control their own destiny. As it stands today, Idaho’s municipalities have less authority than any state west of the Mississippi. The Governor says - get the government off your back and out of the way - but that presupposes that entities other than the state government have some ability to control their own destinies. In Idaho that isn’t the case.

But as for predictions as I keep promising - Having several years ago worked at City Hall as staff to the Council, I can tell you how many people showed up to the more than one-dozen public meetings on the 2006 budget. Zero. My prediction is that Dave Frazier will piss and moan at the Guardian Blog, and never once show up at a public hearing to give us a rational reason, on the record, why this city should not act to control the blight within its borders. Messr. Frazier wants a pure democracy where citizens get to vote on everything their electeds propose but he wants to do it in cyberspace.

If there is statewide opposition to urban renewal, Mr. Frazier, then bring that tribe down to City Hall. I’d like to see it. 200 neighbors from a neighborhood YOU DON’T LIVE IN asked for a solution to the slum that has become their neighborhood, and the city is granting their wishes. It is time for you to stand down, sir.

JUMPDATE 2010

Yep, you saw it in today’s Statesman. JUMP is back. Now, it’s not a $100 million deal, but a $70 million one. Instead of circling the grounds, it provides a Disneyesque flank on Myrtle, and a lot of open space. I still don’t get the concept, and I don’t think Simplot does either. A tractor museum, combined with two floors of event space, artists studios, a caterer and an ad-hoc cooking school? And foundation offices but no corporate headquarters?

I so, so, so, want to be wrong, but no one would seriously bring a proposal like this to market. How in the world do these people plan to activate this space?

Otter: “When we come out of this recession, Idaho is going to lead us.”

I know you all watched the primary election coverage on FOX 12, but after I got done telling you everything you needed to know about the election, you had to flip over to KTVB to watch the rest of the results. And if you did, you saw Governor Otter give a very strange speech.

In rallying the party faithful, Otter proclaimed “when we come out of this recession, Idaho is going to lead us” and “We’re gonna show the nation in the next four years how it’s done.” As a former political consultant I can only surmise that his communications staff did not tell him to say such things. Here’s why.

First of all, according to the Bureau of Economic Analysis, that is, the agency that keeps official tabs on the economy, the U.S. came out of the recession as early as July 2009. In fact, we have now had three consecutive quarters of positive GDP growth.

Secondly, Idaho did not lead the U.S. out of the recession. Fact is, Most of Idaho is still in a recession and the economic driver of the Idaho economy, the Boise-Nampa MSA which generates 50% of the state’s GDP is one of the worst performing metro areas in the country. This chart from Brookings Mountain West’s Mountain Monitor tells the story:

As you can almost clearly see, of the largest 100 metros in the U.S., Boise is 95th in the country in employment losing 10.7% of the job base since the peak of employment. Boise’s housing market is also nearly the worst in the country among the large metros - ranked 96th - among the 100 largest cities. Brookings has the whole report posted at their website.

The one thing that we know for sure is that bravado is not going to do a darn thing to help us get out of this funk, neither is ignoring it, or pretending it isn’t there. The fact is, the U.S. is out of the recession, and Idaho aint, and someone’s got to do something about it eventually.

Running Government like a Business

We’ve all heard the common quip that “government ought to run like a business.” You’d think that if that was going to happen anywhere, it would be Idaho where the Governor and much of his cabinet (like Mike Gwartney and Richard Armstrong) are former business executives. But I’ve noticed in recent weeks that government policy and private sector behavior in Idaho are taking wildly different paths. Consider:

• The Governor is opting out of the high risk insurance pool.
• Idaho has joined a lawsuit against the United States government challenging the Constitutionality of federal health care reform.
• An utterly bizarre new law authored by Chuck Winder of all people, granting health care providers the right to ignore living wills and other advanced directives. The message: don’t die here.
• $247 million in reduced Medicaid spending in the state.

Meanwhile, here’s what is happening in Idaho’s private sector related to health care:

• Massive new investment by St. Alphonsus in area hospitals and clinics.
• A 36% increase since 2005 in the number of beds in assisted living facilities.
• $5 million in new spending at St. Lukes Mountain States Tumor Institute.

I’m not here to advocate for policy one way or another. I just want to point out that just maybe Idaho’s leaders - ostensibly concerned with economic development and economic recovery - might want to take a look at where the private sector is investing. In Idaho, that’s in health care.

Airport to Get Bonding Power? Some Urban Legislators Balk

Any day now my good friend Dave Frazier will be going ballistic over on the Guardian Blog about HOUSE JOINT RESOLUTION 5, which passed the House 57-12-1, and the Senate 34-1. This resolution which will go to a vote of the people this fall would amend Idaho’s Constitution so that Airports can issue bonds without having to get a vote of the people. This is an idea whose time has come as evidenced by the vote. Good on you Senator Stegner for finally designating some authority to jurisdictions other than the state. With luck, this is the start of a new trend.

But there are those who still don’t see the need to devolve power to local governments and other jursdictions. Idaho’s cities and counties (and airports and public hospitals, etc.) have less authority than do the cities and counties in any state west of the Mississippi (see: D, Krane, Rigos N, and Hill M. Home Rule in America : A Fifty-State Handbook. CQ Press, 2000.). Of the 12 Representatives that voted against this measure, half are from urban areas, the other half rural. Thus, the urban rural divide is still in full effect.

I think it is somewhat amazing that anyone from an urban district would vote against this, thus some of these legislators’ votes deserve special attention. Clifford Bayer (R), Boise casts a vote that puzzles me. His district is part of the economic engine of the Valley. The Boise-Nampa MSA is responsible for 50% of state’s GDP. Voting to hamper the airport is no help to this economy or the citizens in his district.

Representative Hartgen (R), Twin Falls is the other mystery here. His vote is interesting first because his own district struggles with urban problems such as providing public transit - so he should be well aware of the need to start devolving authority to the governmental units that can actually solve his people’s problems. Secondly he is a professional economic development consultant. Voting against the public’s ability to provide infrastructure isn’t in any of the textbooks I had on economic development.

Several of the delegation from the CDA area voted against this measure as well, showing that they too do not yet grasp that their region is an urbanized area and also very much needs to have some flexibility to solve regional issues such as the traffic between CDA and Spokane, and also the border crossing to the north. No longer are CDA and Hayden sleepy little mountain towns on the way to nowhere.

Full details on the bill are available over at the Statesman.

Will Boise Lose Hawks Stadium?

There’s been a lot of hullabaloo surrounding Hawks stadium recently, mostly coming from Meridian. I have to hand it to Mayor DeWeerd and the Meridian Development Corporation: they have a vision, and a mission and they are going after it.

This morning the Boise Hawks unveiled a survey that showed a vast majority (75%+) of the 300 people surveyed, favored construction of a new multi-purpose sports facility somewhere in the Valley. It turns out that a plurality of people also identified MERIDIAN as the favored location for a new sports facility. I am guessing that this will have a few people at the City of Boise upset.

In January 2007, a design charrette for the 30th District Master Plan in Boise, revealed that the 200 people in attendance hoped that a new Hawks stadium would be built in downtown Boise. The photo below appears on page 185 of the 30th Street Master Plan, available on the City’s website.

Hawks Stadium envisioned as part of the 30th Street Neighborhood

So what say you, City of Boise officials? Are you working up a deal to make the stadium a centerpiece of a new 30th Street Neighborhood? The implementation plan for 30th Street says that within 1-3 years Boise City and CCDC will:

Identify where land assembly, land acquisition and/or development partnerships would help implement the development concept for each subdistrict. Initiate conversations with property owners to determine their level of interest in selling property, land assembly and/or development.

Where are we on this project? Granted the plan only went forward in June 2009, but with Meridian breathing down your necks, it might be time to kick this project into high gear - unless you really like the sound of “MERIDIAN HAWKS.”