Crazy Uncle Paul: "You're all LIBERALS!"

Crazy Uncle Paul over at the Star-Ledger has been playing a game for some time now that cranky libertarians love: call a conservative who doesn't adhere to your "pure" Randian views a "liberal."

In this post, he actually calls the rabid Christie cheerleader who runs the Save Jersey blog a "liberal." I guess because the guy who runs the blog hates Steve Lonegan almost as much as he hates Sheila Oliver.

For your enjoyment, some "liberal" commentary from this "leftist":

Trenton Democrats, acting as classless as ever, "no-showed" Friday's installment of the special property tax legislative session convened by Governor Christie, Save Jerseyans. God forbid they take the affordability crisisthat they created a little more seriously! 

The GOP Senators in attendance were none too pleased. And justifiably so!

And:

3:44pm: 

 

Governor Christie's speech didn't even last 15 minutes but it was a masterstroke, Save Jerseyans! He announced a willingness to compromise: the Governor would sign a 2.5 statutory cap with far fewer exceptions (no exclusion for pension, benefits, etc). Said the only thing he won't accept is "inaction." The Legislature will now be hard pressed to avoid doing anything. The onus is on the Democrats to act.

This Governor gets it! You can't walk away with a winning compromise by going in with a compromised position. I listened to Joe Cryan's post-speech interview and, if you can believe it, the nastiest of Trenton's Democrat partisans had to scrounge for something nasty to say! Beautiful.

How about:

Sadly, folks, this legislation is just another mini version of the auto industry bailouts. The pattern in unmistakable, Save Jerseyans. Yet again, the feds are stepping in to prop up a system that's failing (public education) because, quite frankly, it doesn't work. Rather then force the corrupted industry to make cost-saving reforms towards improving its marketable product (an educated child), Congress is predictably heeding the distress call of their largest contributor group -- unions -- and running to the rescue armed with the taxpayers' cash. The American people lose, the governors like Chris Christie who are fighting for reform lose but, as always, the union boss fat cats walk away in better shape than ever before.

And, finally:

It's a beautiful morning, folks. I'm happy to report to you that the state budget was adopted without a government shutdown last night, Governor Chris Christie claimed yet another major albeit improbablepolitical victory, the state moves a little bit closer to sound financial footing, and a defeated, dejected and bleary-eyed Democrat caucus heads off to summer school.

Yes, Save Jerseyans. Summer school.

God knows these Democrats needs some tutelage! They can't even sandbag a Republican chief executive like they used to. I certainly spent plenty of time in 2009 detailing for you how Trenton Democrats deliberately booby-trapped this budget with reckless borrowing schemes, quick fix gimmicks, irresponsibly high taxes and runaway public spending. The often underestimated Chris Christie wasn't supposed to find a way to close the $11 billion budget hole these clowns opened without raising taxes and, in the process, breaking a core campaign promise. 

Oops!

Gee, are you sure these quotes didn't come from Daily Kos? 


Mulshine has been at this game for a while; he loves to say that "liberals" supported the Iraqi War. I've called him on it in email exchanges, where he goes off on tangents having to do with Dewey vs. Taft and the Spanish Civil War. Which doesn't do much to explain why none of the Tea Partiers were out with the millions of DFHs marching in 2003 trying to stop the madness, or explain why only one Repub senator (Linc Chaffee, hardly a Ron Paul acolyte) voted against the war resolution while 34 Dems - the closest thing to "liberals" we have - voted no.


But I will give Mulshine credit: he understands that Christie is going down a road doomed to failure. Mulshine gets that Christie isn't a tax cutter in the slightest; he's really just another Republican kleptocrat.


Fine. You don't want to call him a "true" conservative, that's OK with me. I don't care - that's your battle, Uncle Paul, not mine.


But do not presume to define what a liberal is by lumping us in with the likes of Christie and Save Jersey. They have nothing to do with us.

When the Media Gives You Lemons...

I've been meaning to post about this video for a while - pay special attention starting at 2:55, when Brian Donahue interviews the guy in the green t-shirt.

Protesters offer their suggestions to try and close the 13 billion budget gap

Donahue's whole piece is premised on the conservative framework that we need to cut, cut, cut our way out of our fiscal mess, rather than growing the economy. So he's pretty much stymied when this guy on the street, who clearly knows far more about economics than Donahue, gives him a quick lesson in Keynesian theory. Donahue's schtick pretty much stops dead.

Paul Krugman and Digby have both been writing lately about the counterintuitive nature of Keynes's theories: when you're out of money in your household, you cut back, so why shouldn't the government do likewise?

The answer, of course, is that the government is not a household, and that the government should be creating economic activity in the absence of activity in the private sector. And if you're worried about closing deficits, the economic growth you create from smart, targeted government spending will jump start the economy and create more wealth, from which you can draw tax revenues later.

Which is why I think Christie is absolutely right to NOT pay into the teachers' pension fund right now; we NEED to go into debt. Of course, using the savings to give tax cuts to millionaires is a horrible form of stimulus...

This is stuff that the media should at least be putting on the table as a legitimate position to debate.

2% Cap for Schools - How Is This Any Different?

After going through all of the exercise below, I just realized something:

As far as schools go, is this 2% cap really going to change anything?

I mean, we already vote on school budgets anyway. We vote on them no matter what the local tax levy is - above cap, below, it doesn't matter.

OK, there's now an arbitrary target of 2%, but that's just optics. What's really different for schools about a cap if the voters vote on the budget anyway?

The S-L reports that there is an exemption for spikes in school population. So what? The town is still voting on the budget, right? No matter how many kids there are, the voters still need to approve the tax levy.

So I really don't get this now. Other than putting a 2% figure out there, what does this legislation fundamentally change?

More Bad Sports

Via Blue Jersey, the culling of extra-curriculars begins:

Many South Jersey schools have cut back on freshman and junior varsity programs for the 2010-11 school year, eliminating teams and cutting assistant coaching positions.

In the Haddon Township school district, for example, 27 of 54 high school and middle school coaching positions have been eliminated, according to athletic director Alan Carr. In addition, all middle school and freshman athletic programs have been cut, while golf was slashed as a varsity sport.

Atrios was the first blogger I read to point out that newspaper on-line comments are just about the worst places on the internet. Read the comments on this article to get a taste of how petty, mean, and cruel the anti-school crowd is becoming.

A Tale of Two Caps

I'm trying to wrap my head around this 2% cap deal, so I thought I'd play with some numbers and see what issues come up.

From what I read in the press (which, if you've read this blog, you know often can't be trusted) the 2% cap exempts health care, pension benefits, capital expenses, and emergencies.

But part of Christie's "toolkit" (clever term - he's "fixing" things, you see?) is a proposed 2.5% cap on employee salaries.

On it's face, there's a problem: you're letting salaries grow faster than taxes. Yes, because you are exempting the four items, there is a "gap" that allows for salaries and expenses to grow faster for a while. But at some point, the 2.0% growth in taxes won't be able to keep up with the 2.5% growth in salaries, and towns won't have enough money to meet their payrolls. So how much will the exemptions provide an offset? Because, if you can still raise taxes above the cap to meet health care costs, pension costs, etc., that will close some of the gap between the two caps, right?

Hmm... let's work this out with an example:

I'll pick a suburban district: New Providence, in Union County (no, I don't live or teach there, but I do know several staff members and students, and I'm impressed with both how well they do both academically and fiscally). It's a K-12 district with a non-regionalized high school, so all the property tax revenue comes from the same town and is spent on the kids in that town.

They also lost all their state aid last year. Keep this in mind as we work through the problem.

The district has kept up their Powerpoint for last year's budget presentation. The budget was defeated and the town cut another $200K, but the numbers should still serve our purposes. How does the $32 million dollar budget breakdown?

Salaries: 64.1% ($20,590,428)

Benefits (Health/Other): 14.6% ($4,685,570)

Operating/Other Expenses/Capital Outlay: 21.3% ($6,842,432)

Let's assume all of the benefits are exempt from the cap. Let's further be incredibly generous and give 1$ million toward capital expenses. That's around $26.5 million that will be subject to the cap.


Now, the local levy for the district is about $30.5 million. The Powerpoint obviously screws up the ratables for the town (somehow, I very much doubt it's $1 billion...), and we don't really know if or how those will be affected by the cap. But let's again be very generous and say $2.5 million of the local levy in this small town will not be subject to the cap.


So $29 million in revenue is now subject to a 2% cap.  And $26.5 million in expenses cannot be exempted.


Christie has been talking about 2.5% cap on employee salaries and benefits. Would that still be in place if benefits are exempt? One of the many details we are apparently not going to learn about until later, but let's again be very generous and say benefits are not subject to the 2.5% cap, but salaries are.


We're also going to put the increase in operating costs at 2.5% to roughly match CPI over the last decade. This is admittedly very crude. but, again, good enough for our discussion.


Given these very, very rough numbers, how long until New Providence runs out of local tax money to meet their payroll?

Not until Year 20; wow, seems far away. If I run this with a 3% expenses cap, NP can go until Year 11; 4%, until Year 6.


Some immediate thoughts:


- The 2.5% cap on expenses is probably unreasonable; CPI over the last decade is probably little higher, but energy costs are a greater percentage of a schools operating expenses than a consumer. Still, New Prov has close to a 4:1 ration of salaries to expenses, so it's really payroll that's going to drive their total budget.


- If you're a union negotiator sitting down to renew your contract, and you know your BOE can get away with paying a 4% raise for six years before the "cap gap" closes, why wouldn't you push for that if you could?


- Let's say you're one of these evil hypothetical BOE members you always hear about on NJ 101.5, and you're completely in the pocket of the union (hold on, this scenario is so laughable I've got tea coming out of my nose...), and you want to get the maximum amount out of the taxpayers. What incentive do you have to keep capital expenses or health care costs low?


In our example, right out of the gate, New Prov has a $2.5 million difference between the taxes subjected to a  2.0% cap and the expenses subjected to a 2.5% cap. They could take that money and apply it to the non-cap expenses... OR, they could spend it all on extra cappable expenses, tell the taxpayers they are still under the cap, and then raise taxes to cover all of their non-cap spending.


Would a budget like that pass? Hell, no, but our "evil" BOE will probably game things to get the maximum amount out of taxpayers to keep that gap as wide as possible. And isn't that what this is supposed to prevent?


- Which brings up this point: is the non-cap spending still subject to voter approval? I would assume so, but then...


- How will that vote be explained to the voters? "Well, we're asking for a 3.5% increase, but that's really under the 2% cap." How will that make any sense at the polls? Isn't the argument by the anti-school crowd (every town has them) going to be "It's over 2%! You can't separate out health costs!"? Even though you can?


- What incentive under this system does a BOE have to keep health costs and capital expenses low? If it's outside the cap, why not spend as much as you can? Unless, again, those expenses are part of the total budget that gets approved by the voters. But, again, isn't this going to be confusing?


- And finally - state aid. Every dollar in aid that comes to a district is almost certain, under this plan, to go to capped expenses - why spend it on non-cap stuff when you can still go to the taxpayers for the money without worrying about the cap? Which widens the gap between the caps. And if the 2.5% cap on salaries goes through, won't the district then put as much money as they can into operating expenses? Is that going to encourage efficiency?


Hmmmm........

Innumeracy

It runs rampant in the NJ press corps: take Crazy Old Uncle Paul:

Was McKeon aware, I asked, that spending on public schools in California has risen 50 percent in real dollars since Prop 13 was enacted in 1978? He ducked that question as well.

Dear lord, that's dumb: what was the increase in student population during that time?!?

And then he does this:

The per-pupil cost of education in New Jersey is up more than 300 percent in real dollars since 1978. .

So you use per-pupil spending for New Jersey, but total spending for California?!?

Honestly, what kind of an editor lets such a glaring flaw into his or her newspaper? This is the kind of an error that would result in an instant "F" in any Statistics 101 course.

In case you're wondering: statewide enrollment for CA in 1978 was 4.2 million. It was 6.3 in 2008. An almost 50% increase. (It took me about 10 minutes to find this, Paul.)

No wonder our dialog and policies in this state are so screwed up.

UPDATE: One thing that newspapers could do to catch up with the 21st Century would be to force their writers to give sources. Above is a good case in point - where did Mulshine get this data?

Because the more I look at it, the less sense it makes. CA essentially spent the same per pupil over the last 30 years, while NJ spending rose 300%? How could that possibly be right?

Since Mulshine is not required by the modern laws of journalism to give his sources, I went to the NCES to look at historic trends in per-pupil spending:

Current expenditure per pupil in fall enrollment in public elementary and secondary schools, by state or jurisdiction: 

1979-80 - California: 6,072; New Jersey: 7,705 

2006-07 - California: 9,283; New Jersey: 16,762

So CA did increase per-pupil spending by about 50%. But NJ increased it by 120% - not even close to 300%.

Now, we can sit here and have an honest debate about that. What were the outcomes? What about regional economic variations? Tom Kean put forward an initiative to pay teachers more in 1984; what happened then?

But If Mulshine is going to put forth statistics that contradict established sources, he'd better tell us what they are. And he'd better start demanding better of himself when slinging numbers around in his columns.