Tag Archives: Choice and Competition

Republicans introduce new federal legislation to expand school choice

If I were giving advice to the Republican party about how to win in 2020, I would advise them to focus on three priorities. Lowering unemployment, reforming the criminal justice system, and expanding school choice. They should also paint the Democrats as the party of infanticide, Green New Deal and elimination of private health insurance.

So far, Trump has done an excellent job of encouraging private sector job creators to create millions of new jobs. Unemployment is at a record low, and that’s important for persuading Black and Hispanic voters to vote for smart policies instead of tribal identity and envy. I don’t agree with with reforming criminal justice to favor criminals, but that will help with minority voters as well. But what we really need to do is provide Black and Hispanic voters with a way to get their children out of failing public schools. Public schools are filled with lazy, unionized Democrat teachers and administrators who care more about indoctrinating kids with Democrat propaganda than teaching them job skills that will make them independent, self-sufficient adults.

The Republican party knows that school choice is a win for them, and they are doing something about it.

Here’s the latest from the American Enterprise Institute, a think tank that promotes fiscally conservative policies:

Today, Secretary of Education Betsy DeVos joined Senator Ted Cruz (R-TX), and Rep. Bradley Byrne (R-Ala.), to announce new federal legislation that would establish a federal tax-credit expanding school choice. The proposal would give dollar-for-dollar tax credits to individuals and corporations who donate to state designated scholarship granting organizations (SGOs). While its particulars bear scrutiny, the “Education Freedom Scholarship” (EFS) proposal’s overall design is a solid attempt to walk a tightrope of backing state efforts at school choice while protecting against federal meddling now and in the future. Unfortunately, a number of critics on the right are too quick to react on their fears, and too slow in remembering what is holding back school choice.

Some conservatives and libertarians worry that solving the problem of underforming schools from the top down is a political overreach, but the AEI policy analyst writing the article says that the Republican bill doesn’t have that problem:

As I wrote back in 2017, backing state developed tax-credit scholarships is the best, and probably only, way the federal government could support state efforts without overreaching.  It would not be a federal program, but a tax credit that supports programs where states are explicitly responsible for policy particulars.

[…]No doubt, the bill would need to be explicitly structured to ensure the states’ primary role, and durably prevent federal overreach; fortunately defending states’ role is a paramount feature of the bill’s design.

School choice is a nice issue for Republicans, because it allows them to point out the hypocritical nature of Democrat politicians. Democrat politicians are essentially hypocritical. They want to ban guns for you, but they have armed security to protect themselves. It’s the same thing for education. They want to ban private schools for your children, but their own children all attend private schools.

Top Political Contributors in 2016 election cycle
The top Political Contributors in 2016 election cycle includes two teacher unions

Democrats are obligated by teacher unions, (e.g. – the National Education Association and the American Federation of Teachers), to vote against parents who want their children to get a better education. That’s because teacher unions are some of the biggest Democrat donors. Teacher unions just want more salary and bigger benefits, despite the evidence that clearly shows that more education spending doesn’t produce better student achievement.

Education spending has tripled since 1970
Education spending has tripled since 1970

Here’s a study from 2012 published in the journal “Education and Urban Society“. It says:

The possibility is examined that school choice programs could be a means to reducing the achievement gap. Data based on meta-analytic research and the examination of nationwide data sets suggest that school choice programs that include private schools could reduce the achievement gap by 25%. The propounding of this possibility is based on research indicating that the achievement gap in faith-based schools is generally 25% narrower than one finds in public schools. Results of these studies suggest that both the racial achievement gap and the socioeconomic achievement gap are reduced by the same degree (25%). The significance of these results is discussed, especially as it pertains to the attitudes that people frequently have toward school choice.

Not only do children do better in non-public schools, but the competition forces public schools to focus less on leftist indoctrination, and more on reading, writing and math.

This study from the on-partisan National Bureau of Economic Research (NBER) explains why.

It says:

A school that is more productive is one that produces higher achievement in its pupils for each dollar it spends. In this paper, I comprehensively review how school choice might affect productivity. I begin by describing the importance of school productivity, then explain the economic logic that suggests that choice will affect productivity, and finish by presenting much of the available evidence on school choice and school productivity. The most intriguing evidence comes from three important, recent choice reforms: vouchers in Milwaukee, charter schools in Michigan, and charter schools in Arizona. I show that public school students’ achievement rose significantly and rapidly in response to competition, under each of the three reforms. Public school spending was unaffected, so the productivity of public schools rose, dramatically in the case in Milwaukee.

School choice makes public schools perform better because competition between providers always lowers the cost and increases the quality of services and products being provided to the consumers. Consumers always suffer when there is a monopoly. This is why people are more satisfied purchasing goods from Amazon and Netflix than they are lining up at the post office or the department of motor vehicles. The free market serves the consumer.

I was raised in a poor background, and I am a visible minority. If Republicans want to get the votes of people in my community, it makes sense to put in place policies that allow people like me to get a good education so we can get good jobs and do better than our parents did. Republicans should be all about equipping people to be independent and self-sufficient. These are conservative goals.

Conservative legislators introduce new consumer-focused replacement for Obamacare

Obamacare premium growth, 2015-2016
Obamacare insurers are dropping out, which raises premiums higher, 2015-2016

I have your Thursday good news ready to go – from the Daily Signal.

This is how you reform health care:

Sen. Rand Paul, R-Ky., and Rep. Mark Sanford, R-S.C., introduced a bill to replace Obamacare on Wednesday, increasing the pressure on GOP leaders who continue to discuss moving the law’s replacement at the same time as its repeal.

The legislation already has the full support of the House Freedom Caucus, a group of roughly 40 of the lower chamber’s conservative members. Conservatives in both the House and Senate have said they want to see repeal efforts move faster, and the lawmakers are hoping that the legislation is a turning point in the repeal-and-replace debate.

“We’re excited about the fact that it will finally be able to address many of the concerns that we’re hearing, whether it’s at town halls or personal calls from our constituents about pre-existing conditions, about how to empower the consumer in terms of their health care choice, and ultimately drive down the price of health care,” House Freedom Caucus Chairman Mark Meadows, R-N.C., said Wednesday.

Called the Obamacare Replacement Act, the legislation shares the hallmarks of other GOP replacement plans, and Paul said it was a “consensus bill” that pulled aspects of other proposals together.

[…]Paul and Sanford’s bill focuses heavily on the expansion of health savings accounts (HSAs), which are medical savings accounts. Their legislation allows consumers to contribute an unlimited amount annually to HSAs. Currently, consumers can contribute a maximum of $3,400 per year.

The Obamacare Replacement Act also creates a $5,000 tax credit for those who contribute to a HSA, and prohibits consumers from using the money in their accounts to pay for elective abortions.

Under Paul and Sanford’s bill, consumers who don’t receive insurance through their employers can deduct the cost of premiums from their taxable incomes, which serves to equalize the tax treatment for individuals and employers.

Additionally, the legislation allows individuals and small businesses to band together through membership in an Association Health Plan to buy health insurance. Paul and Sanford said these pooling mechanisms will decrease costs for consumers.

The bill also allows insurance companies to sell policies across state lines and eliminates Obamacare’s essential health benefits mandate, which is a list of services insurance plans are required to cover without cost-sharing.

If you want to drive down the cost of health care, you let people get covered for only what they need – no abortions, sex changes, IVF, acupuncture, drug rehabilitation, breast enlargements, fertility treatments, etc. Allowing people to buy plans across state lines will mean that consumers in blue states like California and Massachusetts won’t be forced to buy in-state plans that cover all kinds of progressive garbage that they don’t even want.

Look how Obamacare is falling apart:

At the Future of Healthcare event put on by the Wall Street Journal, Aetna CEO Mark Bertolini said that Obamacare was only “getting worse” because there weren’t enough young, healthy enrollees to pay for the sick people covered by the Obamacare exchanges. Bertolini said it was due to “how poorly structured the funding mechanism and premium model is,” as premiums keep increasing with the death spiral, causing less people to sign up, and thus resulting in even higher premiums.

“I think you will see a lot more withdrawals this year of plans,” Bertolini said.

On Wednesday, Humana–which came to a mutual agreement with Aetna not to merge–announcedthat it was withdrawing from Obamacare altogether. In 2016, UnitedHealth also announced that they would be pulling out of the Obamacare exchanges, and Aetna itself said they would only stay in four Obamacare exchanges.

Bertolini stated at the event that the company has not decided if it will remain in these Obamacare exchanges.

“There isn’t any risk sharing going on in Nebraska,” Bertolini said, pointing to the fact that Aetna was the only insurer left in that exchange. “It will cost us a lot of money.”

Now is the time to replace it!

The problem with Obamacare is that it didn’t do anything to leverage the strengths of the free enterprise system. Instead of turning health care purchasing into competitive online e-commerce (i.e. – Amazon), they turned it into the DMV and the post office. What else would you expect from clowns who were born rich, and never held private sector jobs in their entire lives? You don’t expect the people who run the single-payer VA health system that is killing people on waiting lists to do a good job of reforming health care, do you? Let the free market solve it. Choice and competition means lower prices.

International tests show US children lagging despite record spending on education

Jay Richards tweeted this article from the Wall Street Journal.

Excerpt:

Since 1998, the Program for International Student Assessment, or Pisa, has ranked 15-year-old kids around the world on common reading, math and science tests. The U.S. brings up the middle—again—among 65 education systems that make up fourth-fifths of the global economy. The triennial Pisa report also shows—again—that East Asian countries like Hong Kong, Japan and South Korea produce the best outcomes.

U.S. performance hasn’t budged in a decade. For 2012, U.S. students placed 26th in mathematics, a bit below the Organization for Economic Cooperation and Development average, and 17th in reading and 21st in science, close to the average. The U.S. slipped in all categories compared to international competitors, plunging from 11th in reading as recently as 2009.

American teenagers seem especially weak in core academic subjects with high cognitive demands, such as translating concepts into solutions for real-world problems. A quarter never become proficient in math. In Shanghai and Korea, the comparable figure is 10% or fewer. Some 7% of U.S. students reached the top two scientific performance levels, compared with 17% in Finland and an amazing 27% in Shanghai. Is it tiger moms or tiger schools, or maybe both?

The U.S. is way out front in one measure: per-student spending. Only Austria, Luxembourg, Norway and Switzerland spend more. Despite laying out $115,000 per head, the U.S. did no better than the Slovak Republic, which spends $53,000.

Perhaps most depressingly, the data show no statistically significant U.S. achievement improvement over time. None. In an era when it pays to be thankful for small mercies, at least we’re not getting worse, but America’s relative standing is falling as other countries improve.

[…]Massachusetts has been running public schools since 1635 and today is home to some of the best performers in the nation. The state entered Pisa as if it was its own country—but students of the same age in Shanghai performed as if they had two more years of math instruction than those in the Bay State.

[…]Pisa also adds another count to the bill of indictment for the Democrats who block reform to serve their teachers union patrons. Education Secretary Arne Duncan called the report “a picture of educational stagnation,” but liberals are major impediments to more accountability, merit-based compensation and school-choice competition. The Justice Department has even gone so far as to sue Louisiana to block its modest voucher program, which is a moral crime against the students consigned to failing schools.

There are a few areas of economics that I think that Christians really ought to understand, and education is one of them. We definitely need to be concerned about policies that make it harder for poor, minority students to get ahead. We keep throwing money at the unionized public school system, and we get no results. We need to think about making education more like online shopping. What makes online shopping great is choice and competition. If schools were allowed to compete with one another, then the customer would be assured of getting more quality for less money. The public school system is a monopoly, and it serves the teachers and the education bureaucrats – not the children.

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