The Problem with Spending More Money on Education:
The failure of the “Allred Reasoning”
During the last four years under Governor Otter, Superintendent Tom Luna, and the Republican legislature student achievement has improved, test scores are on the rise, and the number of schools reaching AYP have more than doubled. Getting better results with less money
Gubernatorial candidate Keith Allred wants more funding for education without identifying any specific area where the money should go; neither has Allred identified any specific problem that needs to be addressed. Judging by Allred’s statements, the real problem is the budget was reduced. How can an efficient, low cost education system be a problem?
Allred’s vagueness on funding sources is even more troubling. He claims that cuts to education were not necessary; yet, he gives only one indication where the money will come from – the repeal of sales tax exemptions that could raise an additional $1.7 billion or a 73 percent increase in state taxes. How can Allred say this is not an increase in taxes?
If Allred has a solution that will increase funding to education without raising taxes, I want to hear what it is and so would every other Idahoan. I hope he is right. I would love to be wrong. If, however, Allred can’t explain his plan to restore education funding without raising taxes, he should be viewed as a political pretender instead of the smartest man in Idaho.
We have a right to know a few details of his plan. As voters, we have the right to judge his plan before he gets elected. Personally, I don’t want to take on faith the details of a nonexistent plan.
I have done the math. I don’t believe a short term solution to restore funding exists without raising taxes. Long term education funding can be increased without raising taxes by increasing the size of the private sector of the economy. This is exactly what Governor Otter is trying to do.
Monday, September 27, 2010
Friday, September 3, 2010
How will Idaho Fund Public Education?
I have been very concerned about declining tax revenues in Idaho. They have fallen from near $3 billion to $2.3 billion in two short years with the potential of another $200 million shortfall next year. How will the legislature be able to fund public education and the Department of Health and Welfare at current levels?
Some have suggested raising taxes. However, most taxes come from the private sector of the economy which is already struggling. Raising taxes on a sick host may further weaken the economy and even produce less tax revenue not more. It would be similar to taking a pint of blood from a patient that has already lost 2 pints of blood.
Another solution is to increase the size of the private sector of the economy. A $60 billion Idaho economy could raise $2.5 billion with only a 4.1 percent tax rate while a $35 billion economy would require a 7.14 percent tax rate to raise the same $2.5 billion.
The burning question on everyone’s mind is - How does one jump start the economy? I don’t think this question has been answered because the experts have been focusing on consumer spending. Stimulus packages and deficit spending are based upon Keynesian economics theory that says increased government spending will stimulate the economy. I think this a flawed approach and will no longer work. The focus needs to be on basic production rather than consumer spending.
Basic production is the real key to any economy. Basic production creates wealth, jobs, and raises the standard of living. Basic production produces tax revenue while government spending does not create wealth; it consumes wealth and produces little tax revenue.
Think about the Mormon pioneers. When they moved into the Salt Lake Valley, they were experiencing a profound depression. What did they do? Did they spend more money? No. They started working – planting gardens, crops, building houses, etc. No amount of money will stimulate the economy if there is no basic production taking place.
Basic production is mining, logging, agriculture, manufacturing, and energy production. The policy of the United States federal government through high taxes and extreme environmental policies has caused jobs to go oversees and restricted development on public lands. If my theory on the importance of basic production is correct, our current economic downturn will not change until we decrease the tax load on private businesses and reform our environmental laws. The key to public school funding and the funding of social programs depends upon a paradigm shift away from Keynesian economics to basic production.
When the tax base is increased through increasing the size of the private sector of the economy, then and only then, will tax revenues stabilize.
Some have suggested raising taxes. However, most taxes come from the private sector of the economy which is already struggling. Raising taxes on a sick host may further weaken the economy and even produce less tax revenue not more. It would be similar to taking a pint of blood from a patient that has already lost 2 pints of blood.
Another solution is to increase the size of the private sector of the economy. A $60 billion Idaho economy could raise $2.5 billion with only a 4.1 percent tax rate while a $35 billion economy would require a 7.14 percent tax rate to raise the same $2.5 billion.
The burning question on everyone’s mind is - How does one jump start the economy? I don’t think this question has been answered because the experts have been focusing on consumer spending. Stimulus packages and deficit spending are based upon Keynesian economics theory that says increased government spending will stimulate the economy. I think this a flawed approach and will no longer work. The focus needs to be on basic production rather than consumer spending.
Basic production is the real key to any economy. Basic production creates wealth, jobs, and raises the standard of living. Basic production produces tax revenue while government spending does not create wealth; it consumes wealth and produces little tax revenue.
Think about the Mormon pioneers. When they moved into the Salt Lake Valley, they were experiencing a profound depression. What did they do? Did they spend more money? No. They started working – planting gardens, crops, building houses, etc. No amount of money will stimulate the economy if there is no basic production taking place.
Basic production is mining, logging, agriculture, manufacturing, and energy production. The policy of the United States federal government through high taxes and extreme environmental policies has caused jobs to go oversees and restricted development on public lands. If my theory on the importance of basic production is correct, our current economic downturn will not change until we decrease the tax load on private businesses and reform our environmental laws. The key to public school funding and the funding of social programs depends upon a paradigm shift away from Keynesian economics to basic production.
When the tax base is increased through increasing the size of the private sector of the economy, then and only then, will tax revenues stabilize.
Tuesday, August 10, 2010
How Our Current System of Entitlements Harm the Economy
Yesterday, I called for a reform of the American system of entitlements. Today, I want to explain a few reasons how entitlements harm the economy.
The purpose of a stable economy is to provide material goods and services to the individuals within a nation. I assume that wealth is consumed every year (food, fuel) or over multiple years (cars, housing) and must be continually replaced by productive work. A stable economy capable of providing a high standard of living requires several components:
1. Incentives for individuals to work and produce. This means that an individual needs to expect to keep the fruits of his labors. High taxes and lack of private property protection are negative incentives. Thus, taxes must be kept low and private property respected.
2. Producers need a stable money supply in order to make long-term investments in time and effort.
3. A large percent of the population must be engaged in productive work.
The current entitlement system is decreasing our standard of living in two ways:
First: it pays able bodied individuals capable of productive work to not work thus entitlements decreases the number of individuals working. As the number of individuals paid not to work increases, the burden on the few remaining productive workers increases adding stress and reducing profits until profits disappear and production stops. If the number of individuals receiving government handouts continues to increases, America will reach a point where the economy will stall and shrink requiring a reduction in everyone’s standard of living.
Second: increasing the size of entitlement budgets takes resources away from the productive workers in society called capital. Capital is needed to buy equipment such as tractors needed for farming or heavy machinery needed in a factory. Instead of buying a piece of equipment that would produce lumber or computers, government takes this money and buys someone food. Thus, capital is taken away from production and invested poorly in consumption. Entitlements decrease the ability of industry to invest in production which, by itself, reduces everyone’s standard of living over time.
The question is not if people should be helped or taken care of. The question is if the needy should be encouraged or even required to shoulder some of the burden of providing for their own needs. To me it is simple, we reform the entitlement system and encourage more production which will lead to an increase in everyone’s standard of living or continue the present system which will result in an increase in poverty and suffering.
The purpose of a stable economy is to provide material goods and services to the individuals within a nation. I assume that wealth is consumed every year (food, fuel) or over multiple years (cars, housing) and must be continually replaced by productive work. A stable economy capable of providing a high standard of living requires several components:
1. Incentives for individuals to work and produce. This means that an individual needs to expect to keep the fruits of his labors. High taxes and lack of private property protection are negative incentives. Thus, taxes must be kept low and private property respected.
2. Producers need a stable money supply in order to make long-term investments in time and effort.
3. A large percent of the population must be engaged in productive work.
The current entitlement system is decreasing our standard of living in two ways:
First: it pays able bodied individuals capable of productive work to not work thus entitlements decreases the number of individuals working. As the number of individuals paid not to work increases, the burden on the few remaining productive workers increases adding stress and reducing profits until profits disappear and production stops. If the number of individuals receiving government handouts continues to increases, America will reach a point where the economy will stall and shrink requiring a reduction in everyone’s standard of living.
Second: increasing the size of entitlement budgets takes resources away from the productive workers in society called capital. Capital is needed to buy equipment such as tractors needed for farming or heavy machinery needed in a factory. Instead of buying a piece of equipment that would produce lumber or computers, government takes this money and buys someone food. Thus, capital is taken away from production and invested poorly in consumption. Entitlements decrease the ability of industry to invest in production which, by itself, reduces everyone’s standard of living over time.
The question is not if people should be helped or taken care of. The question is if the needy should be encouraged or even required to shoulder some of the burden of providing for their own needs. To me it is simple, we reform the entitlement system and encourage more production which will lead to an increase in everyone’s standard of living or continue the present system which will result in an increase in poverty and suffering.
Monday, August 9, 2010
A Call to Reform the Entitlement System
I believe that America’s economic, social and political problems cannot be solved until after we address and reform our dysfunctional entitlement system (food stamps, welfare, unemployment, etc.).
The current system causes more harm than good. It burdens our economy with high taxes by paying individuals not to work. It is changing our system of limited government into a centralized bureaucratic state. And, it is destroying the traditional two-parent family.
The federal government was never meant to take care of individuals within the individual states. This is a state responsibility. The way to reform entitlements requires a two pronged attack.
1. Transfer responsibility for these programs back to the states without federal regulations. This simple act would reduce overhead costs by 30 percent and go a long way to reducing our federal deficit. (63 percent of the federal budget is consumed by entitlements)
2. Change the nature of most entitlement programs from a dependency, handout system to a system that gives people skills and opportunities to take care of themselves.
To begin this process, I am going to suggest Idaho create a pilot program that uses correct principles of charity with the end in sight of reforming all social programs over the next 10 years. A pilot program is needed to compare and contrast the two approaches to helping the needy. Once the Idaho program is implemented and functioning, it will be easy to compare and contrast the two approaches demonstrating the need to phase out our current dysfunctional system of entitlements.
I am interested in what you think. Is it time to reform entitlements?
The current system causes more harm than good. It burdens our economy with high taxes by paying individuals not to work. It is changing our system of limited government into a centralized bureaucratic state. And, it is destroying the traditional two-parent family.
The federal government was never meant to take care of individuals within the individual states. This is a state responsibility. The way to reform entitlements requires a two pronged attack.
1. Transfer responsibility for these programs back to the states without federal regulations. This simple act would reduce overhead costs by 30 percent and go a long way to reducing our federal deficit. (63 percent of the federal budget is consumed by entitlements)
2. Change the nature of most entitlement programs from a dependency, handout system to a system that gives people skills and opportunities to take care of themselves.
To begin this process, I am going to suggest Idaho create a pilot program that uses correct principles of charity with the end in sight of reforming all social programs over the next 10 years. A pilot program is needed to compare and contrast the two approaches to helping the needy. Once the Idaho program is implemented and functioning, it will be easy to compare and contrast the two approaches demonstrating the need to phase out our current dysfunctional system of entitlements.
I am interested in what you think. Is it time to reform entitlements?
Wednesday, July 7, 2010
Food Stamp Asset Test
I would like to share with you an email I received from a Dept. of Health and Welfare worker. The worker is commenting on my comments on a story about Food Stamps. The DHW recently removed the asset levels from Food Stamp eligibility. Now, a person can qualify for Food Stamps, no matter how much property they own, simply through income levels.
*****************************************************************************
Mr Thayn,
I am writing to express some concern about a comment I read that supposedly was said by you regarding the Asset Test at DHW. Reporter Dustin Hurst quoted you as saying the following
”The reason I believe DHW employees don’t want to deal with the asset test because it means they would have
to work,” said Thayn. ”The whole philosophy behind federal food aid is wrong because we are missing a good opportunity to teach people how to stretch their food dollars are instead teaching people to become reliant on the government for sustenance.” Thayn
Mr Thayne; I sincerely hope you were misquoted. As a "Self Reliance Specialist" I can assure you that I nor any of my fellow eligiblity workers here in the Twin Falls office of the DHW are "afraid to work", in fact I have done 9 interviews today myself and many of my co-workers have done just as many or more. Most days there is literally a line out the door in our office, which consists, I believe of a large percent of people who don't want to be here. Whether or not we have to verify resources for our clients makes no difference to me; what does however is the perception of the work we at DHW are doing. We may sit at a desk all day, but I can assure you that listening to people in crisis day in and day out and trying to give them just a little bit of help is very hard work. If you doubt it, you should try it some time!
Thank you for your time;
Name withheld
*********************************************************************
Dear Name withheld:
Thank you for your communication.
I believe that going out and determining the assets a person has would require more work. Determining income alone is much easier. Am I wrong on this? Second, giving food stamps to people only helps them in the short-term. It does not help them in the long-term. We simply cannot afford to get more and more people dependent upon government programs by paying them not to work.
The wealth of a nation is determined by the productive capacity of the people. As much as your work is supposed to help people, if you look over the last 45 years, the programs of the Great Society have done just the opposite. Until we come to this recognition and reform the system, our nation will continue to decline and experience poverty. If you would like to help me reform the system and modify it to help people become productive and independent, I would like your help.
Rep. Thayn
*****************************************************************************
Mr Thayn,
I am writing to express some concern about a comment I read that supposedly was said by you regarding the Asset Test at DHW. Reporter Dustin Hurst quoted you as saying the following
”The reason I believe DHW employees don’t want to deal with the asset test because it means they would have
to work,” said Thayn. ”The whole philosophy behind federal food aid is wrong because we are missing a good opportunity to teach people how to stretch their food dollars are instead teaching people to become reliant on the government for sustenance.” Thayn
Mr Thayne; I sincerely hope you were misquoted. As a "Self Reliance Specialist" I can assure you that I nor any of my fellow eligiblity workers here in the Twin Falls office of the DHW are "afraid to work", in fact I have done 9 interviews today myself and many of my co-workers have done just as many or more. Most days there is literally a line out the door in our office, which consists, I believe of a large percent of people who don't want to be here. Whether or not we have to verify resources for our clients makes no difference to me; what does however is the perception of the work we at DHW are doing. We may sit at a desk all day, but I can assure you that listening to people in crisis day in and day out and trying to give them just a little bit of help is very hard work. If you doubt it, you should try it some time!
Thank you for your time;
Name withheld
*********************************************************************
Dear Name withheld:
Thank you for your communication.
I believe that going out and determining the assets a person has would require more work. Determining income alone is much easier. Am I wrong on this? Second, giving food stamps to people only helps them in the short-term. It does not help them in the long-term. We simply cannot afford to get more and more people dependent upon government programs by paying them not to work.
The wealth of a nation is determined by the productive capacity of the people. As much as your work is supposed to help people, if you look over the last 45 years, the programs of the Great Society have done just the opposite. Until we come to this recognition and reform the system, our nation will continue to decline and experience poverty. If you would like to help me reform the system and modify it to help people become productive and independent, I would like your help.
Rep. Thayn
Wednesday, June 30, 2010
The Republican Party State Convention: The Good News and the Bad
I fear the conservatives are committing two major mistakes. First, they are impatient and want to move too quickly which will scare the voters. Second, they have little strategy to implement their policies. They have confused principle adoption with policy formation.
For example, the Convention voted to repeal the income tax; yet, had no suggestions on how to reduce spending to make these tax cuts possible. Tax cuts cannot come without spending cuts; yet, no resolution was introduced indicating where spending reductions could or should take place.
With a significant Republican/Conservative shift likely to occur in November, the lack of well thought out Conservative policy initiatives will negate this opportunity. Conservatives have no plan; just principles. The Conservatives in the Republican Party need to formulate policy initiatives to deal with social programs in Health and Welfare that require 20 percent of the State budget and education that requires another 65 percent of the State budget. Until I hear these two issues being addressed, I don’t see any real changes taking place in Idaho or at the federal level.
For example, the Convention voted to repeal the income tax; yet, had no suggestions on how to reduce spending to make these tax cuts possible. Tax cuts cannot come without spending cuts; yet, no resolution was introduced indicating where spending reductions could or should take place.
With a significant Republican/Conservative shift likely to occur in November, the lack of well thought out Conservative policy initiatives will negate this opportunity. Conservatives have no plan; just principles. The Conservatives in the Republican Party need to formulate policy initiatives to deal with social programs in Health and Welfare that require 20 percent of the State budget and education that requires another 65 percent of the State budget. Until I hear these two issues being addressed, I don’t see any real changes taking place in Idaho or at the federal level.
Tuesday, June 8, 2010
Every Student Could Graduate with an Associate Degree from H.S.
Yesterday, I started crunching some numbers to see what a student in the 6th grade had to do in order to graduate from high school with two years of college. The strategy used below is based upon taking all 72 semesters worth of classes required by the public school system for grades 6-12, a 7 period day, and taking two classes every summer from IDLA. It does not include challenging classes that is allowed under Idaho law.
Vallivue school district has a plan in place that allows a high school freshman to finish high school with an associate degree by taking concurrent enrollment classes. This program does not begin until the freshman year which means that by taking summer classes and/or challenging some classes a student could finish high school with an associate degree even sooner. Here is the class schedule.
Total classes needed 72
7th grade 14 during school year 2 summer 56 classes remaining
8th grade 14 during school year 2 summer 40 classes remaining
9th grade 14 during school year 2 summer 24 classes remaining
10th grade 14 during school year 2 summer 8 remaining
11th grade
12th grade
All classes taken during the junior and senior year could count toward an associate degree or a professional technical skill by using concurrent enrollment. Concurrent enrollment is a class that counts both for high school credit and college credit.
If you have any questions please email me at ssthayn@aol.com
Vallivue school district has a plan in place that allows a high school freshman to finish high school with an associate degree by taking concurrent enrollment classes. This program does not begin until the freshman year which means that by taking summer classes and/or challenging some classes a student could finish high school with an associate degree even sooner. Here is the class schedule.
Total classes needed 72
7th grade 14 during school year 2 summer 56 classes remaining
8th grade 14 during school year 2 summer 40 classes remaining
9th grade 14 during school year 2 summer 24 classes remaining
10th grade 14 during school year 2 summer 8 remaining
11th grade
12th grade
All classes taken during the junior and senior year could count toward an associate degree or a professional technical skill by using concurrent enrollment. Concurrent enrollment is a class that counts both for high school credit and college credit.
If you have any questions please email me at ssthayn@aol.com
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