Voice For Liberty

Tag: Rhonda Holman

  • Government funds promoting downtown Wichita arena

    … it is our opinion that public funds may not be used to promote or advocate the position of a governing body on a matter which is before the electorate. However, this does not mean that public funds may not be expended to educate and inform the electorate.

    That’s the opinion of the Kansas Attorney General Robert Stephan from 1993. In this opinion, the Attorney General cited this court opinion:

    It would be establishing a dangerous and untenable precedent to permit the government or any agency thereof, to use public funds to disseminate propaganda in favor of or against any issue or candidate. This may be done by totalitarian, dictatorial, or autocratic governments but it cannot be tolerated, directly or indirectly, in these democratic United States of America. This is true even if the position advocated is believed to be in the best interest of our country. To educate, inform, to advocate or promote voting on any issue may be undertaken, provided it is not to persuade nor to convey favoritism, partisanship, partiality, approval or disapproval . . . of any issue, worthy as it may be.

    Now, look back at the actions of our elected government leaders in the months leading up to the November 2004 election.

    Were they presenting educational material about the benefits of a new arena? Were they promoting an open and honest debate of a new arena’s merits?

    Or were they cheerleading and advocating for the arena, using their offices and government resources?

    I submit that our local governments, our elected officials, and their quasi-governmental surrogates were working in full force for the passage of the arena and its tax.

    That’s not just my opinion. Others noticed it too.

    An editorial by Phillip Brownlee, published in the Wichita Eagle on September 5, 2004, read in part: “If the plan is to pass, city and county elected officials — supported by business leaders — must continue their strong leadership and high-profile support for the arena.”

    After the election, another Wichita Eagle editorial by Rhonda Holman published on November 4, 2004 stated in part: “What made the difference this time, in addition to the effective marketing campaign and all those pennant yard signs, was the unified show of political will on the part of Wichita and Sedgwick County officials. Their willingness to declare the need for such a facility, then argue for raising taxes to meet that need, helped attract necessary support from the businesses that backed the campaign, and finally from voters asked to pay for the arena with a 30-month, 1-percent sales-tax increase.”

    The Wichita Downtown Development Corporation, led by its president Ed Wolverton, was a prominent booster for the arena. Do you know where this organization receives its funds? It is funded through property taxes and its contract with the City of Wichita. Other taxpayer funded institutions, such as the Greater Wichita Convention & Visitors Bureau, the Greater Wichita Area Sports Commission, the Hyatt Regency Wichita, and even the Kansas Turnpike Authority contributed money or in-kind resources to the pro-arena Vote Yea campaign, and most of these institutions campaigned for the arena, too.

    In a television story about Wichita city manager George Kolb, the reporter said: “Some things Kolb says he filled the council in on were … helping get the downtown arena passed.” The clear meaning of this is that city manager Kolb was proud of how he and the Wichita city council worked to help pass the downtown arena tax. Now if Mr. Kolb had talked about how he helped educate the electorate on the issues surrounding the arena tax ballot measure, that would be acceptable. Instead, he and other government leaders are proud of how they worked to ensure passage of the arena tax. That behavior is contrary to how the Kansas Attorney General said they should act.

    I asked our District Attorney to look into this issue of government advocacy for the arena. That office decided, even in light of all this and more evidence, that there was no wrongdoing by our leaders.

    Does this seem a correct conclusion by the district attorney, in light of these facts about the behavior of our local government officials?

    Were local government officials, especially the Sedgwick County Commission, presenting educational material, or were they campaigning for the arena?

    I believe the only conclusion we can make is that they were all campaigning — and campaigning vigorously — for the arena, in spite of what Kansas Attorney General Opinion 93-125 says is acceptable behavior for government officials and the expenditure of public funds.

  • Rhonda, markets are the answer

    Writing from New Orleans, Louisiana

    An editorial in the October 13, 2006 Wichita Eagle by Rhonda Holman expresses disgust with the Kansas State Board of Education, and praises Kansas Governor Kathleen Sebelius’s criticism of the board.

    (I am a little ashamed to admit that I am in New Orleans, but still reading The Wichita Eagle.)

    Now it is no secret that Ms. Holman disagrees with some of the actions the board has taken the past few years. I am quite certain that if she agreed with what the board has done, she would have not written this editorial, and the governor would have not criticized the board. After all, both are in favor of expansion of government, as long as they agree with what the government is doing.

    That illustrates the problem with government-mandated solutions: everyone has to accept what government decides to provide, or pay doubly to decide in favor of something else. Few families can afford to do that when it comes to the education of their children.

    Ms. Holman, if we were to reduce the government’s role in the supplying of education, we wouldn’t have to worry about what the Kansas Board of Education is doing, as there would be no such board, or their power and influence would be greatly diminished. Instead of everyone accepting what politicians and government bureaucrats decide we should have, everyone would be free to choose the type of education they want for their children. No matter how specialized your requirements or uncommon your preferences, market-based provision of education would almost certainly supply what you desire.

    Wouldn’t that be a wonderful! No more fretting about what the Board of Education is doing, as people would be free of its power over their lives.

    Similarly — and most refreshing — we would be free from Kathleen Sebelius’s authority and Rhonda Holman’s influence. But that’s something I don’t think they want.

  • What to do with others’ money

    Writing from Pittsburgh, Pennsylvania

    In a June 20, 2006 Wichita Eagle editorial, Rhonda Holman writes about the WaterWalk project in Wichita.

    Evidently there is controversy over the public not knowing the name of the “destination restaurant” that is being courted and favored with a gift of $1 million. To me, the controversy is not the identify of the restaurant or when and how the city should conduct its negotiations, but that we are paying for a restaurant to be built.

    We are not lacking for fine restaurants in Wichita. On both the east and west sides of town (and other parts, too), many excellent restaurants have been opened recently, and more are being built as I write. The Eagle has even reported on their astonishment at how many there are.

    The problem is, I believe, that these restaurants were not built where Ms. Holman and our local government leaders feel they should have been built. But that’s not a problem, except to her and them.

    The people who built these restaurants did so by investing their own money, or the money that others entrusted to them. These people did so voluntarily. They presumably built their restaurants where they thought they could earn the best return on their investment. And having invested several million dollars of their own money in the restaurant, they have a strong incentive to make the restaurant a success.

    But that’s not good enough for Ms. Holman. Evidently she does not appreciate the sacrifice that people have made in order to accumulate the funds needed to make these spectacular investments. She may not be aware of — or maybe she does not respect or value — the tremendous effort and work it takes to run a successful restaurant.

    Just because these people did not build their restaurants where she (and our local government leaders) thought they should have been built, she wants to tax them — and the rest of us, too — and give the proceeds of that tax to a new competitor.

    Is this the type of behavior by our local government and our town’s leading newspaper that is likely to lead to other new private investment?

    Ms. Holman’s editorial stance, along with the actions of our local government leaders, constitute a slap in the fact for those who have been foolish enough (we can now conclude this) to invest money in any industry in which the government is likely to set up their competitor.

    This harmful attitude is summarized in this plea to get the WaterWalk project moving faster, “… so that citizens not only can see where their money is going but also soon start enjoying more of their investment.”

    Making an investment, I might remind Ms. Holman, is something that people do voluntarily because they believe it is in their interest.

    The WaterWalk project and the new downtown restaurant are being paid for by taxes. The expenditure is being made to serve the interests of politicians, subsidized developers, and people like Ms. Holman who believe they know best what to do with others’ money. There is a tremendous difference between the two.

  • The AirTran subsidy and its unseen effects

    Writing from Natchez, Mississippi

    In a June 16, 2006 column, Wichita Eagle editorial writer Rhonda Holman again congratulates local and state government for its success in renewing the AirTran subsidy, and for getting the entire state of Kansas to help for it.

    We should take a moment to understand, however, that while the allure of the subsidy is undeniable, it may eventually extract a high price on Wichita. Currently, the legacy airlines provide service to Wichita and other small markets partly because they feel a duty to provide comprehensive, nationwide service. But that may be changing. In an article titled “Major Airlines Fuel a Recovery By Grounding Unprofitable Flights” from the June 5, 2006 Wall Street Journal, we learn that this may change:

    The big carriers, which for decades have doggedly pursued market share at any cost, now are focusing just as aggressively on the profitability of each route and flight.

    The so-called legacy carriers — those like American Airlines and Delta Air Lines, with big pension and other obligations that predate the industry’s deregulation in 1978 — have abandoned many of the tactics that have led to their cyclical weakness. They are increasingly unwilling to fly half-empty aircraft to stay competitive on a given route just for the sake of feeding their nationwide networks.

    As I have written before, if AirTran — one of the newer airlines without the baggage of high costs that plague the legacy airlines — can’t earn a profit on its service to Wichita, it may be that other airlines are not, either. This article tells us that we may be in danger of losing the service of the legacy airlines. And, as I have written earlier, there are a great many destinations you can’t get to on AirTran.

    (The same article also tells us that during much of the time of the subsidy, airfares were falling nationwide anyway: “… the Air Travel Price Index, a quarterly measure of changes in airfares, rose 9.1% in the fourth quarter of last year from a five-year low a year earlier.” So we might have had lower fares even without the subsidy. Of course, we can’t know that, just as subsidy advocates can’t know how much we’ve saved from the subsidy, no matter what they may say.)

    Our local government leaders simply do not have the knowledge needed to successfully run a planned economy, which, in essence, is what they are doing when they apply price controls to the airfare market in Wichita. That’s right. The subsidy is a form of price controls. After all, if the subsidy didn’t serve to reduce the price of airfare, what would be its reason for existence?

    No government has ever been able successfully impose price controls without the people suffering harmful consequences. As economist Thomas Sowell wrote in a 2005 column:

    Prices are perhaps the most misunderstood thing in economics. Whenever prices are “too high” — whether these are prices of medicines or of gasoline or all sorts of other things — many people think the answer is for the government to force those prices down.

    It so happens there is a history of price controls and their consequences in countries around the world, going back literally thousands of years. But most people who advocate price controls are as unaware of, and uninterested in, that history as I was in the law of gravity.

    Prices are not just arbitrary numbers plucked out of the air or numbers dependent on whether sellers are “greedy” or not. In the competition of the marketplace, prices are signals that convey underlying realities about relative scarcities and relative costs of production.

    Those underlying realities are not changed in the slightest by price controls. You might as well try to deal with someone’s fever by putting the thermometer in cold water to lower the reading.

    Municipal transit used to be privately owned in many cities, until local politicians’ control of fares kept those fares too low to buy and maintain buses and trolleys, and replace them as they wore out. The costs of doing these things were not reduced in the slightest by refusing to let the fares cover those costs.

    All that happened was that municipal transit services deteriorated and taxpayers ended up paying through the nose as city governments took over from transit companies that they had driven out of business — and government usually did a worse job.

    The immediate effect of the subsidy is a drop in airfares. The long-term effects, the effects that we can’t really see right now (even though the number of daily flights to and from Wichita has decreased in the last year) are unknown, but are likely to be quite bad for our town. These unseen effects of a policy are important, and, being unseen, are hard to spot, even if you’re looking. Frederic Bastiat, in his pamphlet titled “That Which is Seen, and That Which is Not Seen” http://bastiat.org/en/twisatwins.html said this:

    Between a good and a bad economist this cons
    titutes the whole difference — the one takes account of the visible effect; the other takes account both of the effects which are seen, and also of those which it is necessary to foresee. Now this difference is enormous, for it almost always happens that when the immediate consequence is favourable, the ultimate consequences are fatal, and the converse. Hence it follows that the bad economist pursues a small present good, which will be followed by a great evil to come, while the true economist pursues a great good to come, — at the risk of a small present evil.

    Henry Hazlitt writes of the fallacy of unseen effects, but realizes they are often obfuscated by “the special pleading of selfish interests.”

    Economics is haunted by more fallacies than any other study known to man. This is no accident. The inherent difficulties of the subject would be great enough in any case, but they are multiplied a thousandfold by a factor that is insignificant in, say, physics, mathematics or medicine — the special pleading of selfish interests. While every group has certain economic interests identical with those of all groups, every group has also, as we shall see, interests antagonistic to those of all other groups. While certain public policies would in the long run benefit everybody, other policies would benefit one group only at the expense of all other groups. The group that would benefit by such policies, having such a direct interest in them, will argue for then plausibly and persistently. It will hire the best buyable minds to devote their whole time to presenting its case. And it will finally either convince the general public that its case is sound, or so befuddle it that clear thinking on the subject becomes next to impossible.

    In addition to these endless pleadings of self-interest, there is a second main factor that spawns new economic fallacies every day. This is the persistent tendency of men to see only the immediate effects of a given policy, or its effects only on a special group, and to neglect to inquire what the long-run effects of that policy will be not only on that special group but on all groups. It is the fallacy of overlooking secondary consequences.

    We must hope that the legacy airlines choose to continue their service to and from Wichita, in spite of our government’s action.

  • Arts funding in Wichita produces controversy

    As local government tries to decide which arts and cultural institutions are to receive government funds, controversy arises. A June 8, 2006 Wichita Eagle article titled “Arts panel biases alleged” tells how some funding applicants are upset that some of the members of the funding committee have ties to organizations that also applied for funds. In an editorial titled “Let Arts Funding Work” published in the June 10, 2006 Wichita Eagle, Rhonda Holman writes “The process may not be perfect, but it’s a precious opportunity for public dollars to be invested in the arts and attractions in a merit-based way that’s fair, open and accountable.”

    Later Ms. Holman makes the case that it is desirable to have experts decide how to allocate taxpayer funds amongst the various organizations that have applied. The old method, she writes, had no “scrutiny or oversight.” She pleads for the public not to lose faith in this new system of deciding who gets what.

    As I wrote in the past (Let Markets Fund Arts and Culture, How to Decide Arts Funding) there is a very simple way to decide which arts and cultural organizations are worthy of receiving funds: simply stop government funding. Let the people freely decide, though the mechanism of markets rather than government decree, which organizations they prefer.

    When people spend their own money on arts and culture there is no controversy. There can be no allegations of bias. But government spending always creates controversy. Someone is upset that they didn’t get as much as someone else. People who don’t or can’t use what the government-supported organizations provide are upset they have to pay for it. Much misguided effort goes into making the funding decisions. Instead of working to create and refine their product, arts organizations have to lobby politicians and commissions for funds.

    In the end, the public gets what the commission decrees, instead of what they really want.

    If arts and cultural organizations forgo government funding, they will learn very quickly if they are producing a product the public really wants. If they aren’t, they will have a powerful motivating factor to change.

    It may turn out that what people really want for arts and culture, as expressed by their selections made in a free market, might be different from what a commission decides we should have. That freedom to choose, it seems to me, is something that our Wichita City Council, Arts Council, and Wichita Eagle editorial writers believe the public isn’t informed or responsible enough to enjoy.