Voice For Liberty

Tag: Kathleen Sebelius

  • Happy Fiscal New Year, Kansas (not)

    Happy Fiscal New Year, Kansas (not)

    A Kansas public policy group celebrates tax increases. But it isn’t enough, and more reform is required.

    Kansas Center for Economic Growth has promoted higher taxes in Kansas for many years, and this year it got its wish. Here are a few remarks based on its self-congratulatory article titled “Happy Fiscal New Year, Kansas.”

    KCEG wrote: “Kansas is now better positioned to provide great schools”
    Wait a moment. I thought Kansas already has great schools. That’s what the Kansas public school establishment tells us.

    And I think that the author made a mistake here. Instead of writing about “public schools,” the author mentions — simply — “schools.” Usually the Kansas public school establishment is careful to qualify their plea for more school spending with “public.” To them, spending on private schools or charter schools is money wasted, money that should have gone to public schools. Fortunately, and amazingly, the tax credit scholarship program, a program limited to students currently in low-performing schools, was expanded slightly. 1

    If KCEG really wanted to promote great schools in Kansas, it would embrace school programs such as charter schools.

    KCEG: “vibrant communities”
    Here, KCEG believes that taking more money from the private sector through taxation and letting government spend it is “vibrant.” But how does government work? In a democracy, a majority forces its will on the minority. Or, special interest groups intensely lobby for benefits at the expense of everyone else. Or, a form of the precautionary principle tamps down sparks of innovation in government bureaucracies, like public schools. Government is the opposite of “vibrant,” which the dictionary defines as “full of energy and enthusiasm.”

    KCEG: “It also phases in the restoration of an important tax credit and three deductions that were eliminated in 2012 to pay for tax breaks for the wealthy.”
    In 2012 everyone’s taxes were cut. Aside from that, we don’t pay for tax cuts. We pay for the cost of government.

    When someone says we must pay for tax cuts, it presumes that tax cuts have a cost. The only way this makes sense is if we believe that the state has first claim on our incomes. The state takes what it says it needs, and we get to keep the rest. If the government is ever persuaded to reduce its claim on our incomes, that has a cost that must be paid in some way.

    But for those who believe in self-ownership, this is nonsense. It’s the people who “give” tax money to the government, not the government who “gives” it back in the form of tax cuts. If the government cuts taxes, the government gives us nothing. It simply takes less of what is ours in the first place.

    But the attitude of many government officials is the opposite. In 2006 Kansas cut taxes on business equipment and machinery. At the time, the Wichita Eagle reported: “Gov. Kathleen Sebelius, a Democrat, who first proposed the business machinery tax cut, agreed. ‘We’re not giving away money for the sake of giving it away,’ she said. ‘I’m hoping that the economic growth will actually help fund the school plan that we just passed.’” (emphasis added)

    (By the way, this sounds like Sebelius was planning for tax cuts to pay for themselves.)

    KCEG: “This means looking beyond income tax reforms and rebalancing Kansas’ ‘three-legged stool’ by addressing problems with the state’s sales tax and property tax.”
    The three-legged stool is one of the most inappropriate analogies ever coined. If the state of Kansas were to develop an additional source of tax revenue, say by slapping a tariff on Budweiser imported from Missouri or Coors imported from Colorado, we’d hear spending advocates like KCEG speaking of the virtue of a stable four-legged chair. Many states thrive without one of our three legs, the income tax. And if we’re looking for stability, as Hineman mentions, income taxes are quite volatile compared to the other legs. 2

    KCEG: “To pay for the Governor’s irresponsible and steep income tax cuts”
    Again, we don’t have to pay for tax cuts. But there was irresponsible behavior, that being to continue to spend and avoid serious attempts at spending reform.

    KCEG: “In response to the ongoing budget crisis, the sales tax was increased in 2015 to offset lagging state revenue. This affected every Kansan in every county, but especially hurt low-income residents.”
    Here, KCEG is correct. The state should not have raised the sales tax, and the state needs to work on lowering the sales tax rate on groceries. For more on this topic, see Wichita sales tax hike would hit low income families hardest and Kansas sales tax has disproportionate harmful effects.

    (Actually, KCEG is not totally correct. The sentence should have ended with “… to continue to pay for wasteful state spending because the governor and legislature would not seriously consider spending reform.”)

    KCEG: “And because of the gamble with income tax cuts”
    There was no gamble with income tax cuts, the governor’s boastful claims notwithstanding. 3 The tax cuts did what tax cuts should do: Leave more money in the hands of the people it belongs to.

    KCEG: “As a result, property taxes shot up as communities struggled to keep up with the demand for basic services.”
    If taxation was shifted from the state level to local levels, that in itself is not bad. In fact, it keeps taxing and spending more closely controlled at the local level, without communities having to fight in Topeka for a share of the state budget pie.

    KCEG: “If we want to fully recover from the past five years, tax reform must address sales and property tax problems in addition to income tax issues.”
    KCEG doesn’t say what are the problems with sales and property taxes. But I think I know what they believe: These two forms of taxation are too low. They don’t raise enough money from the right people.

    —
    Notes

    1. “On and after July 1, 2018, the bill amends the definition of “public school” within the TCLISS Program Act to mean a school identified by KSBE as one of the lowest 100 performing schools with respect to student achievement. It also amends the definition of “qualified school” to require accreditation on and after July 1, 2020. Accreditation must be by KSBE or a KSBE-recognized national or regional accrediting agency. Additionally, the bill expands eligibility for the tax credit to individuals and places an annual cap of $500,000 on contributions.” Kansas Legislature. SB 19: Creating the Kansas school equity and enhancement act, summary. Available at http://www.kslegislature.org/li/b2017_18/measures/sb19/. ↩
    2. Federal Reserve Bank of St. Louis, Gary C. Cornia & Ray D. Nelson. State Tax Revenue Growth and Volatility. 6 Regional Economic Development, 23-58 (2010). Available at https://files.stlouisfed.org/files/htdocs/publications/red/2010/01/Cornia.pdf. ↩
    3. Weeks, Bob. The yardstick for the Kansas experiment. Available at https://wichitaliberty.org/kansas-government/yardstick-kansas-experiment/. ↩
  • Which Kansas governor?

    Which Kansas governor?

    In Kansas, a governor is proud of savings and efficiencies.

    Can you guess which Kansas governor and administration did these things?

    • Looked for future highway projects “where it seemed the amount of money set aside exceeded the need, or where the scope of individual projects had changed,” and took credit for $278 million in savings.

    • Took credit for saving $67 million by adjusting the inflation rates used in estimating future project costs.

    • Took credit for $306 million in savings by spending reserve funds, deciding that money wasn’t needed just “sitting in the bank.”

    • Refinanced bonds so that payments would be lower for a few years, but higher afterwards.

    If you guessed Kathleen Sebelius, you’re correct.

    Sources are: Hanna, John. $1 billion claim falls on KDOT — Analysis: Governors’ savings often readjustments. Topeka Capital-Journal, January 30, 2006. Available at http://cjonline.com/stories/013006/kan_onebil.shtml#.WP4Z__krLWW.
    Moon, Chris. New ad claims huge savings — $1 billion a focal point of Sebelius’ re-election bid despite skeptics. Topeka Capital-Journal, August 07, 2006. Available at http://cjonline.com/stories/080706/leg_govad.shtml#.WP4bvvkrLWU.

  • Year in Review: 2016

    Year in Review: 2016

    Here are highlights from Voice for Liberty for 2016. Was it a good year for the principles of individual liberty, limited government, economic freedom, and free markets in Wichita and Kansas?

    Also be sure to view the programs on WichitaLiberty.TV for guests like journalist, novelist, and blogger Bud Norman; Radio talk show host Joseph Ashby; David Bobb, President of Bill of Rights Institute; Heritage Foundation trade expert Bryan Riley; Radio talk show host Andy Hooser; Keen Umbehr; John Chisholm on entrepreneurship; James Rosebush, author of “True Reagan,” Jonathan Williams of American Legislative Exchange Council (ALEC); Gidget Southway, or Danedri Herbert; Lawrence W. Reed, president of the Foundation for Economic Education; and Congressman Mike Pompeo.

    January

    Kansas legislative resources. Citizens who want to be informed of the happenings of the Kansas Legislature have these resources available.

    School choice in Kansas: The haves and have-nots. Kansas non-profit executives work to deny low-income families the school choice opportunities that executive salaries can afford.

    Kansas efficiency study released. An interim version of a report presents possibilities of saving the state $2 billion over five years.

    Wichita Eagle Publisher Roy Heatherly. Wichita Eagle Publisher Roy Heatherly spoke to the Wichita Pachyderm Club on January 15, 2016. This is an audio presentation.

    Pupil-teacher ratios in the states. Kansas ranks near the top of the states in having a low pupil-teacher ratio.

    Kansas highway conditions. Has continually “robbing the bank of KDOT” harmed Kansas highways?

    Property rights in Wichita: Your roof. The Wichita City Council will attempt to settle a dispute concerning whether a new roof should be allowed to have a vertical appearance rather than the horizontal appearance of the old.

    Must it be public schools? A joint statement released by Kansas Association of School Boards, United School Administrators of Kansas, Kansas School Superintendents’ Association, and Kansas National Education Association exposes the attitudes of the Kansas public school establishment.

    Kansas schools and other states. A joint statement released by Kansas Association of School Boards, United School Administrators of Kansas, Kansas School Superintendents’ Association, and Kansas National Education Association makes claims about Kansas public schools that aren’t factual.

    After years of low standards, Kansas schools adopt truthful standards. In a refreshing change, Kansas schools have adopted realistic standards for students, but only after many years of evaluating students using low standards.

    Brownback and Obama stimulus plans. There are useful lessons we can learn from the criticism of Kansas Governor Sam Brownback, including how easy it is to ignore inconvenient lessons of history.

    February

    Spending and taxing in Kansas. Difficulty balancing the Kansas budget is different from, and has not caused, widespread spending cuts.

    In Sedgwick County, choosing your own benchmarks. The Sedgwick County Commission makes a bid for accountability with an economic development agency, but will likely fall short of anything meaningful.

    This is why we must eliminate defined-benefit public pensions. Actions considered by the Kansas Legislature demonstrate — again — that governments are not capable of managing defined-benefit pension plans.

    Kansas transportation bonds economics worse than told. The economic details of a semi-secret sale of bonds by the State of Kansas are worse than what’s been reported.

    Massage business regulations likely to be ineffective, but will be onerous. The Wichita City Council is likely to create a new regulatory regime for massage businesses in response to a problem that is already addressed by strict laws.

    Inspector General evaluates Obamacare website. The HHS Inspector General has released an evaluation of the Obamacare website HealthCare.gov, shedding light on the performance of former Kansas Governor Kathleen Sebelius.

    Kansas highway spending. An op-ed by an advocate for more highway spending in Kansas needs context and correction.

    Brookings Metro Monitor and Wichita. A research project by The Brookings Institution illustrates the poor performance of the Wichita-area economy.

    March

    Wichita: A conversation for a positive community and city agenda. Wichita City Manager Robert Layton held a discussion titled “What are Wichita’s Strengths and Weaknesses: A Conversation for a Positive Community and City Agenda” at the February 26, 2016 luncheon of the Wichita Pachyderm Club.

    In Kansas, teachers unions should stand for retention. A bill requiring teachers unions to stand for retention elections each year would be good for teachers, students, and taxpayers.

    In Kansas, doctors may “learn” just by doing their jobs. A proposed bill in Kansas should make us question the rationale of continuing medical education requirements for physicians.

    Power of Kansas cities to take property may be expanded. A bill working its way through the Kansas Legislature will give cities additional means to seize property.

    Wichita TIF district disbands; taxpayers on the hook. A real estate development in College Hill was not successful. What does this mean for city taxpayers?

    Kansas and Colorado, compared. News that a Wichita-based company is moving to Colorado sparked a round of Kansas-bashing, most not based on facts.

    In Wichita, the phased approach to water supply can save a bundle. In 2014 the City of Wichita recommended voters spend $250 million on a new water supply. But since voters rejected the tax to support that spending, the cost of providing adequate water has dropped, and dropped a lot.

    Wichita Eagle, where are you? The state’s largest newspaper has no good reason to avoid reporting and editorializing on an important issue. But that’s what the Wichita Eagle has done.

    April

    Wichita on verge of new regulatory regime. The Wichita City Council is likely to create a new regulatory regime for massage businesses in response to a problem that is already addressed by strict laws.

    Wichita economic development and capacity. An expansion fueled by incentives is welcome, but illustrates a larger problem with Wichita-area economic development.

    Rich States, Poor States, 2106 edition. In Rich States, Poor States, Kansas continues with middle-of-the-pack performance, and fell sharply in the forward-looking forecast.

    In Wichita, revealing discussion of property rights. Reaction to the veto of a bill in Kansas reveals the instincts of many government officials, which is to grab more power whenever possible.

    ‘Trump, Trump, Trump’ … oops! An event in Wichita that made national headlines has so far turned out to be not the story news media enthusiastically promoted.

    Wichita doesn’t have this. A small Kansas city provides an example of what Wichita should do.

    Kansas continues to snub school choice reform that helps the most vulnerable schoolchildren. Charter schools benefit minority and poor children, yet Kansas does not leverage their benefits, despite having a pressing need to boost the prospects of these children.

    Wichita property tax rate: Up again. The City of Wichita says it hasn’t raised its property mill levy in many years. But data shows the mill levy has risen, and its use has shifted from debt service to current consumption.

    AFP Foundation wins a battle for free speech for everyone. Americans for Prosperity Foundation achieves a victory for free speech and free association.

    Kansas Center for Economic Growth. Kansas Center for Economic Growth, often cited as an authority by Kansas news media and politicians, is not the independent and unbiased source it claims to be.

    Under Goossen, Left’s favorite expert, Kansas was admonished by Securities and Exchange Commission. The State of Kansas was ordered to take remedial action to correct material omissions in the state’s financial statements prepared under the leadership of Duane Goossen.

    May

    Spirit Aerosystems tax relief. Wichita’s largest employer asks to avoid paying millions in taxes, which increases the cost of government for everyone else, including young companies struggling to break through.

    Wichita mayor’s counterfactual op-ed. Wichita’s mayor pens an op-ed that is counter to facts that he knows, or should know.

    Electioneering in Kansas?. An op-ed written under the banner of a non-profit organization appears to violate the ban on electioneering.

    Wichita city council campaign finance reform. Some citizen activists and Wichita city council members believe that a single $500 campaign contribution from a corporation has a corrupting influence. But stacking dozens of the same $500 contributions from executives and spouses of the same corporation? Not a problem.

    In Wichita, more sales tax hypocrisy. Another Wichita company that paid to persuade you to vote for higher taxes now seeks to avoid paying those taxes.

    Wichita student/teacher ratios. Despite years of purported budget cuts, the Wichita public school district has been able to improve its student/teacher ratios.

    June

    KPERS payments and Kansas schools. There is a claim that a recent change in the handling of KPERS payments falsely inflates school spending. The Kansas State Department of Education says otherwise.

    Regulation in Wichita, a ‘labyrinth of city processes’. Wichita offers special regulatory treatment for special circumstances, widening the gulf between the haves and have-nots.

    They really are government schools. What’s wrong with the term “government schools?”

    July

    Kansas City Star as critic, or apologist. An editorial in the Kansas City Star criticizes a Kansas free-market think tank.

    State and local government employee and payroll. Considering all state and local government employees in proportion to population, Kansas has many, compared to other states, and especially so in education.

    Kansas government ‘hollowed-out’. Considering all state and local government employees in proportion to population, Kansas has many, compared to other states, and especially so in education.

    In Wichita, Meitzner, Clendenin sow seeds of distrust. Comments by two Wichita city council members give citizens more reasons to be cynical and distrusting of politicians.

    David Dennis, gleeful regulatory revisionist. David Dennis, candidate for Sedgwick County Commission, rewrites his history of service on the Kansas State Board of Education.

    Say no to Kansas taxpayer-funded campaigning. Kansas taxpayers should know their tax dollars are helping staff campaigns for political office.

    Roger Marshall campaign setting new standards. Attacks on Tim Huelskamp reveal the worst in political campaigning.

    Wichita Metro Chamber of Commerce on the campaign trail. We want to believe that The Wichita Metro Chamber of Commerce and its PAC are a force for good. Why does the PAC need to be deceptive and untruthful?

    August

    Which Kansas Governor made these proposals?. Cutting spending for higher education, holding K through 12 public school spending steady, sweeping highway money to the general fund, reducing aid to local governments, spending down state reserves, and a huge projected budget gap. Who and when is the following newspaper report referencing?

    Wichita Business Journal editorial missed the news on the Wichita economy. A Wichita business newspaper’s editorial ignores the history of our local economy. Even the history that it reported in its own pages.

    Sedgwick County Health Department: Services provided. Sedgwick County government trimmed spending on health. What has been the result so far?

    School staffing and students. Trends for the nation and each state in teachers, administrators, and students, presented in an interactive visualization.

    Intrust Bank Arena loss for 2015 is $4.1 million. The depreciation expense of Intrust Bank Arena in downtown Wichita recognizes and accounts for the sacrifices of the people of Sedgwick County and its visitors to pay for the arena.

    School spending in the states. School spending in the states, presented in an interactive visualization.

    September

    Kansas construction employment. Tip to the Wichita Eagle editorial board: When a lobbying group feeds you statistics, try to learn what they really mean.

    Wichita has no city sales tax, except for these. There is no Wichita city retail sales tax, but the city collects tax revenue from citizens when they buy utilities, just like a sales tax.

    CID and other incentives approved in downtown Wichita. The Wichita City Council approves economic development incentives, but citizens should not be proud of the discussion and deliberation.

    Cost per visitor to Wichita cultural attractions. Wichitans might be surprised to learn the cost of cultural attractions.

    GetTheFactsKansas launched. From Kansas Policy Institute and the Kansas Chamber of Commerce, a new website with facts about the Kansas budget, economy, and schools.

    The nation’s report card and charter schools.
    * An interactive table of NAEP scores for the states and races, broken down by charter school and traditional public school.
    * Some states have few or no charter schools.
    * In many states, minority students perform better on the NAEP test when in charter schools.

    School choice and funding. Opponents of school choice programs argue the programs harm traditional public schools, both financially and in their ability to serve their remaining students. Evidence does not support this position.

    October

    Public school experts. Do only those within the Kansas public schooling community have a say?

    Kansas and Arizona schools. Arizona shows that Kansas is missing out on an opportunity to provide better education at lower cost.

    Video in the Kansas Senate. A plan to increase visibility of the Kansas Senate is a good start, and needs to go just one or two steps farther.

    Kansas, a frugal state?. Is Kansas a frugal state, compared to others?

    Topeka Capital-Journal falls for a story. The editorial boards of two large Kansas newspapers have shown how little effort goes into forming the opinions they foist upon our state.

    Kansas revenue estimates. Kansas revenue estimates are frequently in the news and have become a political issue. Here’s a look at them over the past decades.

    Kansas school fund balances.
    * Kansas school fund balances rose significantly this year, in both absolute dollars and dollars per pupil.
    * Kansans might wonder why schools did not spend some of these funds to offset cuts they have contended were necessary.
    * The interactive visualization holds data for each district since 2008.

    In Wichita, developer welfare under a cloud. A downtown Wichita project receives a small benefit from the city, with no mention of the really big money.

    Wichita, give back the Hyatt proceeds. Instead of spending the proceeds of the Hyatt hotel sale, the city should honor those who paid for the hotel — the city’s taxpayers.

    Kansas Democrats: They don’t add it up — or they don’t tell us. Kansas Democrats (and some Republicans) are campaigning on some very expensive programs, and they’re aren’t adding it up for us.

    November

    How would higher Kansas taxes help?. Candidates in Kansas who promise more spending ought to explain just how higher taxes will — purportedly — help the Kansas economy.

    Decoding the Kansas teachers union. Explaining to Kansans what the teachers union really means in its public communications.

    Kansas school spending: Visualization. An interactive visualization of revenue and spending data for Kansas school districts.

    Decoding Duane Goossen. The writing of Duane Goossen, a former Kansas budget director, requires decoding and explanation. This time, his vehicle is “Rise Up, Kansas.”

    Decoding the Kansas teachers union. Decoding and deconstructing communications from KNEA, the Kansas teachers union, lets us discover the true purpose of the union.

    Government schools’ entitlement mentality. If the Kansas personal income grows, should school spending also rise?

    December

    Wichita bridges, well memorialized. Drivers on East Twenty-First Street in Wichita are happy that the work on a small bridge is complete, but may not be pleased with one aspect of the project.

    Gary Sherrer and Kansas Policy Institute. A former Kansas government official criticizes Kansas Policy Institute.

    Wichita to grant property and sales tax relief. Several large employers in Wichita ask to avoid paying millions in taxes, which increases the cost of government for everyone else, including young companies struggling to break through.

    Economic development incentives at the margin. The evaluation of economic development incentives in Wichita and Kansas requires thinking at the margin, not the entirety.

    The Wichita economy, according to Milken Institute. The performance of the Wichita-area economy, compared to other large cities, is on a downward trend.

    State pension cronyism. A new report details the way state pension funds harm workers and taxpayers through cronyism.

    In Wichita, converting a hotel into street repairs. In Wichita, it turns out we have to sell a hotel in order to fix our streets.

    In Wichita, we’ll not know how this tax money is spent. Despite claims to the contrary, the attitude of the City of Wichita towards citizens’ right to know is poor, and its attitude will likely be reaffirmed this week.

  • Gary Sherrer and Kansas Policy Institute

    Gary Sherrer and Kansas Policy Institute

    A former Kansas government official criticizes Kansas Policy Institute.

    I wouldn’t normally use a Facebook comment in a public way, but the comment was left in public, to a post on my Facebook profile. Plus, the writer is a former Kansas government official. He’s Gary Sherrer, who has been Lieutenant Governor, Secretary of Commerce, and Chair of the Kansas Board of Regents.

    From the author's Facebook profile, starting December 2, 2016. Click for larger.
    From the author’s Facebook profile, starting December 2, 2016. Click for larger.
    Sherrer had criticized the truthfulness of Kansas Policy Institute, claiming he “could write an essay” on his criticism of KPI. Upon my suggestion for him to do so, he offered two criticisms.

    First, Sherrer wrote this: “They count KAPERS payments that in the past were direct state payments. Now they send them to the school districts and within hours transfer them back to the state yet it shows as increased revenue in the local budget. Same $s just an accounting trick.”

    This is a standard argument of Kansas public school spending advocates, which is that because of a change in the way teacher retirement funds (KPERS contributions) are handled, it looks like the state is spending more on schools, when in fact it is not.

    In response, Kansas Policy Institute noted this: “According to Dale Dennis, KPERS funding was last sent directly to KPERS in 2004; it has since been sent directly to school districts included in reported school funding totals.”1

    Dale Dennis is Deputy Commissioner at Kansas State Department of Education and head of Fiscal and Administrative Services.

    Wichita Public Schools, State Revenue by Source, KPERS ContributionsEven though Dennis is the state’s top education finance official, we don’t have to rely solely on him to illustrate changes in KPERS payment accounting. Information from the Wichita public school district2 shows the same. Here I’ve plotted the funding sent by the state of Kansas to USD 259 for KPERS contributions. As Dennis indicated, in 2005 the Wichita school district started receiving money from the state for KPERS. Prior to that year it received none.

    So if anyone wants to claim that KPERS payment accounting has been changed in order to be deceptive, why don’t we ask former governor Kathleen Sebelius why it happened under her watch?

    Additionally, the argument that the KPERS funds are held by school districts for just hours or minutes is trivial. If the state allowed school districts to hold the funds for two days, two weeks, two months — would that make any meaningful difference? Instead, school districts ought to be thankful that the taxpayers of the state of Kansas cover part of employee retirement costs. But we don’t hear those thanks, just complaints.

    Sherrer is correct on one thing: There are people in government who may be touting increased KPERS payments as increased school spending. Two things: KPERS spending is school spending. If not that, what is it? Second, these people are not Kansas Policy Institute. KPT takes efforts to separate KPERS spending from other school spending.3

    Here’s something else from Sherrer: “Anther example- local property taxes collected for schools was always sent directly to the school district- after all it is local not state tax $s. Now the local sends it to the state, then it is sent to school districts. Again, same dollars but trick accounting to make it look like increased state spending.”

    I’ve never seen KPI make the claim that Sherrer makes. Others may make it, but KPI takes steps to adjust figures for this change.4

    Finally, Sherrer writes: “When is Kansas Policy going do do research on the financial disaster called the Kansas budget?” Well, KPI has done this, providing a detailed roadmap. In my reporting on KPI’s plan, I wrote:

    The State of Kansas has implemented tax reform that reduces the tax burden for Kansans. A remaining challenge that has not yet been tackled is spending reform, that is, aligning Kansas state government spending with a smaller stream of tax revenue. Critics of tax reform say the Kansas budget is a mess or a train wreck, pointing to projections of large deficits before long. Tax increases or service cuts will be required to balance the budget, contend critics.

    In a policy brief released today, Kansas Policy Institute presented a plan for bringing the budget in balance while retaining low tax rates (and future reductions) and accommodating projected future spending needs for Medicare and schools.

    You can more about the plan at For Kansas budget, balance is attainable.

    —
    Notes

    1. Trabert, Dave. State school board member should practice what he preaches. https://kansaspolicy.org/state-school-board-member-practice-preaches/. ↩
    2. USD 259 Comprehensive Annual Financial Report for 2015, State Revenue by Source, Governmental Funds, and USD 259 Comprehensive Annual Financial Report for 2007, State Revenue by Source, Governmental Funds. ↩
    3. For example, see Dorsey, David. Non-KPERS funding sets another per-pupil record in 2015-16. https://kansaspolicy.org/non-kpers-funding-sets-another-per-pupil-record-in-2015-16/. ↩
    4. For example, see Parkes, Patrick. State school funding ranks high in Kansas. https://kansaspolicy.org/state-school-funding-ranks-high-in-kansas/. ↩
  • Kansas government ‘hollowed-out’

    Kansas government ‘hollowed-out’

    Is Kansas government “hollowed-out” even though spending is rising?

    In the Wichita Eagle, Burdett Loomis writes: “In 2011, Gov. Sam Brownback and a far-right Kansas House of Representatives began to hollow out state government, all in the name of smaller, more efficient, more private administration.”1

    Loomis doesn’t define what he means by “hollow out” but the measure of the size of government is spending. Not taxation, but spending, because if government spends without taxing by the same amount, someone has to pay, eventually. Or, in the case of Kansas, we spent funds saved from years when Kansas collected more than it spent. (Yes, Kansans were over-taxed.) Then, we raised taxes.

    Kansas General Fund. Click for larger version.
    Kansas General Fund. Click for larger version.
    In recent history Kansas general fund spending hasn’t fallen, except for one year, and that doesn’t “hollow out” government. Tax revenue declined, but what did Kansas do in response? Instead of cutting spending, the state engaged in deficit spending. For two years in a row, Kansas spent over $300 million each year from its savings in order to support (mostly) increasing spending. When that savings ran out, the state raised taxes rather than cutting spending.2

    Charts at the end of this article show Kansas government spending, from general fund and all funds spending. One chart shows total dollars spent, and one shows per-capita spending. Both are adjusted for inflation. On these charts it’s difficult to see where total spending has been cut or slashed in recent years. All funds spending continues its upward trend, with a few exceptions. General fund spending remains level or trending slightly upwards.

    Loomis: “But the value of a stable, reliable state government that delivers core programs in education, transportation, health and social services remains a bedrock element of most successful American states.”

    An example from the visualization. This shows statewide spending, per pupil, adjusted for inflation. Click for larger version.
    An example from the visualization. This shows statewide spending, per pupil, adjusted for inflation. Click for larger version.
    Education spending in Kansas is not falling.3 Tables at Kansas State Department of Education have the numbers.4 Now we hear that the increases in spending are “all KPERS,” meaning contributions to the state retirement fund for teachers, and the state has recently changed to method of reporting KPERS contributions in a way that artificially inflates school spending. But Kansas State Department of Education says the method of reporting KPERS has not changed for ten years.5 Maybe we should ask former governor Kathleen Sebelius why she changed the method of reporting KPERS contributions in a way that (purportedly) artificially inflates school spending.

    Kansas students compared to national. Click for larger.
    Kansas students compared to national. Click for larger.
    By the way, when writing about “reliable” state services, I wish Loomis would take notice of the huge gaps in achievement in our state’s schools between white students and minority students. For Kansas white students, 42 percent are proficient in reading at grade 4. For Kansas black students, only 15 percent are proficient, and 20 percent of Kansas Hispanic students. Similar gaps appear in reading at grade 8, and in math at grades 4 and 8.6 The sad fact is that this gap is reliable, occurring year after year.

    KDOT spending on major road programs. Click for larger version.
    KDOT spending on major road programs. Click for larger version.
    As for transportation, there have been transfers from the state’s transportation fund to the general fund. This has been going on for a long time. But look at actual spending on roads. KDOT’s Comprehensive Annual Financial Report shows spending in the categories “Preservation” and “Expansion and Enhancement” has grown rapidly over the past five years. Spending in the category “Maintenance” has been level, while spending on “Modernization” has declined. For these four categories — which represent the major share of KDOT spending on roads — spending in fiscal 2015 totaled $932,666 million, up from a low of $698,770 in fiscal 2010. This is actual spending on roads without regard to transfers in or out of the highway fund.7

    Transfers from Sales Tax to KDOT. Click for larger.
    Transfers from Sales Tax to KDOT. Click for larger.
    And while critics of the current administration focus on transfers from the highway fund, look at transfers to the fund. Nearby is a chart showing how many sales tax dollars were transferred to the highway fund. In 2006 the transfer was $98,914 million, and by 2015 it had grown to $511,586 million, an increase of 417 percent. Inflation rose by 18 percent over the same period.8

    I’ll leave it to someone else to research spending on health and social services.

    Near the end of the article, Loomis writes: “Over the past few years, much of the political discourse has focused on shrinking revenues from tax cuts.” But we should really be looking at the level of spending.

    Now: Could it be possible that even with rising state spending that services are, in fact, being “hollowed out?” Yes. Absolutely. It is, after all, government providing these services.

    Kansas Spending Adjusted for CPI 2016-01

    Kansas Spending, Per Capita, Adjusted for CPI 2016-01

    Notes for charts:
    Data is from Kansas Fiscal Facts 2015
    2015 through 2017 are approved figures, not actual spending
    2015 and beyond population are my estimates
    CPI is Consumer Price Index – All Urban Consumers, CUUR0000AA0

    —
    Notes

    1. Loomis, Burdett. Kansas is becoming a hollowed-out state. Wichita Eagle, July 9, 2016. Available at www.kansas.com/opinion/opn-columns-blogs/article88555862.html. ↩
    2. Kansas has been borrowing, however. See: Weeks, Bob. Kansas transportation bonds economics worse than told. Available at wichitaliberty.org/kansas-government/kansas-transportation-bonds-economics-worse-than-told/. ↩
    3. Weeks, Bob. Kansas school spending: Visualization. Available at wichitaliberty.org/wichita-kansas-schools/kansas-school-spending-visualization/. ↩
    4. Kansas State Department of Education. Total Expenditures by District. Available at www.ksde.org/Agency/Fiscal-and-Administrative-Services/School-Finance/Budget-Information/Total-Expenditures-by-District. ↩
    5. Weeks, Bob. KPERS payments and Kansas schools. Available at wichitaliberty.org/wichita-kansas-schools/kpers-payments-kansas-schools/. ↩
    6. Weeks, Bob. ‘Game on’ makes excuses for Kansas public schools. Available at wichitaliberty.org/tag/wichita-and-kansas-schools/. ↩
    7. Weeks, Bob. Kansas highway spending. Available at wichitaliberty.org/kansas-government/kansas-highway-spending/. ↩
    8. Weeks, Bob. Sales tax revenue and the Kansas highway fund. Available at wichitaliberty.org/kansas-government/sales-tax-revenue-kansas-highway-fund/. ↩
  • Inspector General evaluates Obamacare website

    Inspector General evaluates Obamacare website

    The HHS Inspector General has released an evaluation of the Obamacare website HealthCare.gov, shedding light on the performance of former Kansas Governor Kathleen Sebelius.

    The Office of Inspector General for the Department of Health and Human Services has released a report titled HealthCare.gov: Case Study of CMS Management of the Federal Marketplace. An excerpt from the executive summary holds the main points:

    What We Found

    The development of HealthCare.gov faced a high risk of failure, given the technical complexity required, the fixed deadline, and a high degree of uncertainty about mission, scope, and funding. Still, we found that HHS and CMS made many missteps throughout development and implementation that led to the poor launch. Most critical was the absence of clear leadership, which caused delays in decisionmaking, lack of clarity in project tasks, and the inability of CMS to recognize the magnitude of problems as the project deteriorated. Additional HHS and CMS missteps included devoting too much time to developing policy, which left too little time for developing the website; making poor technical decisions; and failing to properly manage its key website development contract. CMS’s organizational structure and culture also hampered progress, including poor coordination between policy and technical work, resistance to communicating and heeding warnings of “bad news,” and reluctance to alter plans in the face of problems. CMS continued on a failing path to developing HealthCare.gov despite signs of trouble, making rushed corrections shortly before the launch that proved insufficient. These structural, cultural, and tactical deficiencies were particularly problematic for HealthCare.gov given the significant challenges of implementing a new program involving multiple stakeholders and a large technology build.

    The problems are not solved. Challenges remain, the report says, including “contract oversight, the accuracy of payments and eligibility determinations, and information security controls.”

    Who is responsible for the debacle? In a hearing before Congress, HHS Secretary and former Kansas Governor Kathleen Sebelius said “hold me accountable.” View a video clip below, or click here to view at C-SPAN.

  • The Kansas revenue problem in perspective

    The Kansas revenue problem in perspective

    If we take the budgetary advice of a former Kansas state budget official, we need to be ready to accept the economic stagnation that accompanied his boss’s tenure.

    Writing in his blog, former Kansas budget director Duane Goossen offers his advice for fixing the Kansas budget: “The state has a revenue problem that will not fix itself. Lawmakers have to face up to the fact that they must make revenue match expenditures. Unaffordable income tax cuts caused the problem. That’s the place to look for a correction.” (Lawmakers Make It Clear: Kansas Has A Revenue Problem)

    Goossen has one thing correct: revenue and expenditures must be equal, over any long period of time. The preference for Goossen, as we see, is to raise revenue to support more spending. We can’t afford tax cuts, he writes.

    But this is a backwards way of looking at the relationship between government and its subjects. When someone says we can’t afford tax cuts, that presumes a few things. First, it presumes that the previous level of taxation was better than the current level.

    Second, it presumes that tax cuts have a cost that can’t be afforded. The only way this is true is if we believe that the state has first claim on our incomes. The state takes what it believes it needs, and we get to keep the rest. Then if, somehow, the government is persuaded to give any of that claim back to us, this “gift” has to be paid for.

    But for those who believe in self-ownership, this is nonsense. It’s the people who “give” tax money to the government, not the government who “gives” it back in the form of tax cuts. If the government cuts taxes, the government gives us nothing. It simply takes less of what is ours in the first place.

    Growth of jobs in Kansas and nearby states. Click for larger version.
    Growth of jobs in Kansas and nearby states. Click for larger version.
    But the attitude of many government officials is the opposite. In 2006 Kansas cut taxes on business equipment and machinery. At the time, the Wichita Eagle reported: “Gov. Kathleen Sebelius, a Democrat, who first proposed the business machinery tax cut, agreed. ‘We’re not giving away money for the sake of giving it away,’ she said. ‘I’m hoping that the economic growth will actually help fund the school plan that we just passed.’” (emphasis added) (Lawmakers hope for growth)

    Growth of gross domestic product in Kansas and nearby states. Click for larger version.
    Growth of gross domestic product in Kansas and nearby states. Click for larger version.
    For the former governor of Kansas, letting business firms keep a little more of the money they earn means the state is “giving it away.” By the way, Duane Goossen — who now believes the only solution for the Kansas budget is to raise taxes — was the state’s budget director when Sebelius said the state is going to “give away money” in the form of tax cuts.

    If take Goossen’s advice and return to the tax rates of the Sebelius and Graves eras, let’s make sure we understand the economic growth Kansas experienced during those years. Nearby is a snapshot of Kansas job growth starting when Bill Graves became governor, along with growth in some nearby states. A chart of GDP growth starts in 1997, two years into the Graves administration. We don’t want to return to these levels of growth.

    If you’d like to use the interactive visualizations of this employment and GDP data, click here for employment, and click here for GDP.

  • As lawmakers, Kansas judges should be selected democratically

    As lawmakers, Kansas judges should be selected democratically

    Kansas Judicial Center in snowWhile many believe that judges should not “legislate from the bench,” that is, make law themselves, the reality is that lawmaking is a judicial function. In a democracy, lawmakers should be elected under the principle of “one person, one vote.” But Kansas, which uses the Missouri Plan for judicial selection to its highest court, violates this principle.

    A 2012 paper by Kansas University School of Law Professor Stephen J. Ware explains the problem with the judicial selection process in Kansas. The paper is titled Originalism, Balanced Legal Realism and Judicial Selection: A Case Study and may be downloaded at no charge. The Kansas court that uses the method of judicial selection described in the paper — the Missouri Plan — is the Kansas Supreme Court. (Prior to July 1, 2103, the Kansas Court of Appeals also used the Missouri Plan for judicial selection.)

    At issue is whether judges are simply arbitrators of the law, or do they actually participate in the lawmaking process. Ware explains: “This realist view that statutory interpretation often involves ‘substantial judicial discretion’ and therefore constitutes ‘judicial lawmaking, not lawfinding,’ had by the 1950s, ‘become deeply rooted.’”

    A “‘balanced realism,’ to use Brian Tamanaha’s appealing label, recognizes both that judges’ policy preferences have little or no influence on many judicial decisions and that judges’ policy preferences have a significant influence on other judicial decisions. Empirical studies tend to support this balanced view.” In other words, there is some role for ideology in making judicial decisions. Politics, therefore, is involved. Ware quotes Charles Gardner Geyh: “In a post-realist age, the ideological orientation of judicial aspirants matters.” And the higher the court, the more this matters.

    Since judges function as lawmakers, they ought to be selected by a democratic process. In the Kansas version of the Missouri Plan, a nominating commission dominated by lawyers selects three candidates to fill an opening on the Kansas Supreme Court. The governor then selects one of the three, and the process is over. A new judge is selected. This process gives members of the state’s bar tremendous power in selecting judges.

    In the paper, Ware presents eleven examples of judges on the two highest Kansas courts engaging in lawmaking. In one, a workers’ compensation case, the employee would lose his appeal if the “clear” precedent was followed. Justice Carol A. Beier wrote the opinion. Ware explains:

    But this is not, in fact, what Justice Beier and her colleagues on the Kansas Supreme Court did. Rather they did what Kansas Judges Greene and Russell say never happens. Justice Beier and her colleagues engaged in lawmaking. They changed the legal rule from one contrary to their ideologies to one consistent with their ideologies.

    Justice Beier’s opinion doing this started by criticizing the old rule, while acknowledging that it was, in fact, the rule prior to her opinion by which the Supreme Court made new law. Here again is the above quote from Coleman, but now with the formerly omitted words restored and italicized: “The rule is clear, if a bit decrepit and unpopular: An injury from horseplay does not arise out of employment and is not compensable unless the employer was aware of the activity or it had become a habit at the workplace.”

    Who decided that this rule is “decrepit and unpopular” and so should be changed? Was it the Kansas Legislature? No, it was the Kansas Supreme Court. It was judges, not legislators, who decided that this legal rule was bad policy. It was judges, not legislators, who changed the law to bring it in line with what the lawmaking judges thought was good policy.

    Beier wrote in her opinion: “We are clearly convinced here that our old rule should be abandoned. Although appropriate for the time in which it arose, we are persuaded by the overwhelming weight of contrary authority in our sister states and current legal commentary.”

    The result: New Kansas law, made by people selected through an undemocratic process.

    In conclusion, Ware writes:

    Non-lawyers who believe in the principle that lawmakers should be selected democratically need to know that judicial selection is lawmaker selection to be troubled by the Missouri Plan’s violation of this principle. Non-lawyers who do not know that judges inevitably make law may believe that the role of a judge consists only of its professional/technical side and, therefore, believe that judges should be selected entirely on their professional competence and ethics and that assessments of these factors are best left to lawyers. In short, a lawyer who omits lawmaking from a published statement about the judicial role is furthering a misimpression that helps empower lawyers at the expense of non-lawyers, in violation of basic democratic equality, the principle of one-person, one-vote.

    Prospects for Kansas

    In Kansas, the process for selecting judges to the Kansas Court of Appeals is governed by statute, and can be changed by the legislature and governor. In 2012 the House of Representatives passed a bill to reform the process, but it was blocked by Senate Judiciary Chair Tim Owens. He said “I think this is the first time I did not hear a bill because I thought it was so bad. This is a terrible, terrible bill that’s hated by the courts; it’s an attempt to take over control of the courts.”

    Owens, who ranked as the least friendly senator to economic freedom in the 2012 edition of the Kansas Economic Freedom Index, lost his bid for re-election in the August primary election. Many of the other moderate Republicans who voted against reform also lost their primary election contest.

    Owens, it should be noted, is an attorney, and is, therefore, a member of the privileged class that has outsize power in selecting judges.

    Sometimes legislators are simply uninformed or misinformed on judicial selection. An example is Jean Schodorf, who lost a re-election bid in August. In an interview, she was quoted as saying “We thwarted changes to judicial selection that would have allowed the governor to have the final say in all judicial selections.”

    Contrary to Schodorf, the bill that the senate voted on, and the one that Owens killed the year before, called for Court of Appeals judges to be appointed by the governor, with the consent of the senate. It’s actually the senate that has the final say.

    Newspaper editorial writers across Kansas are mostly opposed to judicial selection reform. An example is Rhonda Holman of the Wichita Eagle, who in 2010 wrote: “Some critics may have a beef with past court decisions, perhaps even a legitimate one — which is no surprise, given that judicial decisions pick winners and losers. But they also may be motivated by politics — which is a problem, given that the judiciary is supposed to be fair, impartial and independent. In the absence of a strong case for change, Kansas should stick with what works.”

    With the change in the composition of the Kansas Senate, the climate became favorable for reform of the way judges are selected for the Kansas Court of Appeals. In 2013 legislation reforming judicial selection for this court was passed and signed into law, taking effect on July 1, 2013. Now these justices are selected by appointment of the governor with confirmation by the senate. The law governing how judges for the Kansas Supreme Court are selected is part of the Kansas Constitution, and would require an amendment to alter the process. That requires a two-thirds vote in both chambers of the Kansas Legislature, and then a simple majority vote of the people.

    By the way: For those who criticize the support for judicial selection reform as pure power politics, since Kansas has a conservative governor, remember this: When Professor Ware sounded the need for reform and convinced me of the need, our governor was the liberal Kathleen Sebelius. There was also a liberal senate at that time, one which would undoubtedly have rubberstamped any nominee Sebelius might have sent for confirmation.

    Originalism, Balanced Legal Realism and Judicial Selection: A Case Study
    By Stephen J. Ware

    Abstract: The “balanced realist” view that judging inevitably involves lawmaking is widely accepted, even among originalists, such as Justice Scalia, Randy Barnett and Steven Calabresi. Yet many lawyers are still reluctant to acknowledge publicly the inevitability of judicial lawmaking. This reluctance is especially common in debates over the Missouri Plan, a method of judicial selection that divides the power to appoint judges between the governor and the bar.

    The Missouri Plan is one of three widely-used methods of selecting state court judges. The other two are: (1) direct election of judges by the citizenry, and (2) appointment of judges by democratically elected officials, typically the governor and legislature, with little or no role for the bar. Each of these two methods of judicial selection respects a democratic society’s basic equality among citizens — the principle of one-person, one-vote. In contrast, the Missouri Plan violates this principle by making a lawyer’s vote worth more than another citizen’s vote.

    This Article provides a case study of the clash between the inevitability of judicial lawmaking and the reluctance of lawyers to acknowledge this inevitability while defending their disproportionate power under the Missouri Plan. The Article documents efforts by lawyers in one state, Kansas, to defend their version of the Missouri Plan by attempting to conceal from the public the fact that Kansas judges, like judges in the other 49 states, inevitably make law. The case study then shows examples of Kansas judges making law. The Article concludes that honesty requires lawyers participating in the debate over judicial selection in the United States to forthrightly acknowledge that judges make law. Lawyers who seek to defend the power advantage the Missouri Plan gives them over other citizens can honestly acknowledge that this is a power advantage in the selection of lawmakers and then explain why they believe a departure from the principle of one-person, one-vote is justified in the selection of these particular lawmakers.

    The complete paper may be downloaded at no charge here.

  • Kansas personal income grows

    Kansas personal income grows

    A recent spurt of growth of personal income in Kansas is welcome, considering the history of Kansas in this regard.

    Kansas personal income grew in the quarter ending in June, with the Wichita Business Journal reporting “Kansas ranked 14th among states for second-quarter personal income growth.” The article also noted “According to data released Tuesday by the Bureau of Economic Analysis, personal income grew by 1.7 percent in the second quarter of 2014, faster than the national growth rate of 1.5 percent.”

    Strong growth in personal income is good. But strong growth is not the norm for Kansas. The nearby chart shows cumulative growth of personal income in the states since 1990, with Kansas highlighted. Total growth for Kansas is 190 percent. For the entire county, it is 198 percent. For Plains states, 196 percent.

    This is relevant to the decision Kansans will make in November when deciding their vote for governor. Progressive voices urge a return to the policies of Kathleen Sebelius and her successor (2003-2011), and Bill Graves (1995-2003). Sebelius, a Democrat, and Graves, a Republican, are seen by Progressives as paragons of “moderate,” “common-sense” leadership that is now — they say — missing.

    An interactive visualization of personal income data is available for use here. You may select different time periods and any grouping of states. One of more states may be highlighted. There are similar charts in the visualization that show change in personal income year-over-year, and change from previous quarter.

    Personal Income Growth in the States, Kansas highlighted. Click for larger version.
    Personal Income Growth in the States, Kansas highlighted. Click for larger version.