Brian Gongol: June 2009 Archives
Iowa is a good place because of its people. But like all places, it could be even better. This is a set of ten suggestions for making that happen. Each idea is rooted in a combination of principles:
This book is an attempt to highlight ten important ways in which we can improve. You will probably agree with some of these ideas and disagree with others, but in all probability, you will have heard very little about any of them. These ten ideas aren't necessarily answers to the ten most critical problems we have; they are instead answers to ten big issues that many of us can agree upon, no matter our political persuasion or lot in life.
- Most Iowans are good people
- Iowans want to improve their own lives and the lives of their families
- Prosperity is the best toolbox with which to make Iowans' lives better
This book is an attempt to highlight ten important ways in which we can improve. You will probably agree with some of these ideas and disagree with others, but in all probability, you will have heard very little about any of them. These ten ideas aren't necessarily answers to the ten most critical problems we have; they are instead answers to ten big issues that many of us can agree upon, no matter our political persuasion or lot in life.
Iowa has long had a reputation for running a great educational system, but only about 90% of adults here have graduated from high school. In 1900, that would have been a miracle; in 2007, it should be a disappointment. An eighth-grade education may have been enough in the time of Teddy Roosevelt, but today a high school diploma is a minimum entry requirement for most legitimate jobs. We'll never reach a 100% graduation rate, but we should be intent upon pushing that figure into the high nineties, just as a minimum functional standard.
According to the Census Bureau, those with high school diplomas earn, on average, about 50% more per year than those who don't. Those with college degrees earn, on average, almost twice as much as those who stopped with high school.
The relationship between education and income is one of the most iron-clad in all of our economic world today. That's why getting as many Iowans as possible into and through post-secondary education, whether it's an associate's degree or a bachelor's degree or beyond, is probably the most important step that we can take to make Iowans more prosperous. The only barrier to any Iowan's completion of a two- or four-year college degree should be his or her own motivation -- not finances, distance, or willingness on the part of the state to serve every taxpayer.
We ought to be realistic without being condescending: Not everyone wants -- or even needs -- to get a four-year college degree. But education is a peculiar thing: It's easiest to get it when you're young -- which is when you're least likely to appreciate it. Once people exit their early 20's, it's difficult to return to school. So, in general, it's best to encourage as many young people as possible to get post-secondary education while they're still young and aren't passing up other opportunities in order to get it.
That's why we need to apply a dose of imagination to the way in which we deliver education here. First, we ought to see to it that as many Iowa kids as possible at least stick through two years of post-secondary schooling. Rapidly-rising tuition rates have made it difficult for many Iowans to afford their degrees, and the expected family contribution calculated by the Federal student-aid formula is oftentimes far more than a family budget can reasonably sustain. In an ideal world, parents would save enough to send their kids to college, squirreling away money from the child's birth on. But investments can be unpredictable, expenses along the way are often unforeseen, and tuition rates can be an erratic target around which to plan.
But what is the cost if students aren't able to obtain the post-secondary education they need? More than anything, the costs come from lost and missed opportunities -- and these accumulate to society. We've experienced endless grandstanding by politicians who take credit for "creating jobs" -- which they simply aren't capable of doing. The market creates jobs, just as the market destroys them. Fundamentally, the gas lamplighter of 1875 lost his job for the same reason that the ethanol-plant worker of 2005 gained hers: The market needed something different from what it had before, and labor demands changed.
Government doesn't have the power to create jobs any more than it has the power to make the sun shine. But it does have a unique capacity to ensure things like universal access to post-secondary education, and in so doing, government can help to ensure that the workers whose jobs are created and destroyed by the market can adjust quickly to make themselves more valuable and more adaptable to a changing marketplace. Today, that marketplace clearly rewards education beyond the high school diploma.
Yet, even today, huge portions of the state are more than 120 miles (about two hours' drive) away from one of Iowa's three state universities, making it difficult for residents living there to have the same access to college education as those living in east-central Iowa. Combined with the challenge of rapidly-rising tuition rates, this geographic isolation has put further educational opportunity too far out of reach for many Iowans.
State leadership has been willing to risk millions of taxpayer dollars on "economic development" incentives based on vague promises that have on several occasions turned out to be disastrous failures -- but those same leaders have been stingy about insisting on better access to undergraduate degrees, where the same scale of investment would be certain to deliver returns.
Iowa State University is on a $135 million drive to raise funds for new athletic facilities. There's nothing necessarily wrong with that. But if we can raise $135 million to improve athletic facilities, we ought to be able to put comparable levels of energy into raising $135 million to put more Iowans through school -- especially those students for whom Iowa, Iowa State, and UNI are distant road trips, and especially those prospective students who didn't complete degrees when they were in their early 20s.
We need to use our community college facilities to make the two-year degree the new standard. We need to use technology to help deliver collegiate-level education everywhere in the state, not just in three campus towns. We need to re-evaluate what it is we're really charging students for their schooling.
Some people object to spending money on higher education because well-educated workers are highly mobile -- so it's possible that we as a state can subsidize growth for other states. But why is that fear so often overheated? Are we so afraid that Iowa is unattractive to educated workers that we think anyone with a degree will catch the first bus out of town? Of course some people will leave -- just as people move away from idyllic places like Hawaii and Southern California every day. People will always move away from wherever they know as home. Worrying about what we're spending to educate Iowans who might move away is the wrong concern. Our focus should be on making Iowa so attractive that we can abandon the language of "keeping people in Iowa" and adopt the language of a confident place.
Improved access doesn't require that the state build a new university, nor even that that state actually provide the service. It may be quite efficient to contract out the actual delivery of the educational services to private educators. What's most important is that we use our ingenuity to ensure that no one in Iowa fails to get a post-secondary education for reasons of cost or access.
If we can wage war via unmanned aircraft and explore the surface of Mars by remote control, then surely we have the knowledge and tools necessary to deliver college degrees online. MIT has already pioneered the use of the Internet to deliver college coursework with its OpenCourseWare project. If MIT is unafraid of making its educational content available to the public -- for free, even -- then Iowa's state colleges and universities need to be equally open to developing programs that would allow Iowans to obtain their two- and four-year degrees through flexible, online-based programs. The schools presently offer extremely limited choices for these kinds of programs, and that fails the very taxpayers who help to fund those institutions.
The traditional college experience isn't going to disappear -- and it's within reach for most young people graduating from high school, if they're willing to front the necessary effort. Educating these prospective students is and ought to remain a priority. But just as important is reaching the adults who, for whatever reasons, have been unable to pursue post-secondary education -- especially the bachelor's degree. Some opportunities are available for these adults, but we have not yet reached the "no-brainer" point: The stage at which the only reason one might not have completed such a degree is because he or she hasn't tried.
When we think of non-traditional students, we have to consider the hurdles they may need to overcome: Finances may be limited because they're trying to raise children or pay for medical care, travel may be difficult because they live far from population centers, or time may be in short supply because they work the third shift and sleep during the day in order to have some family time in the evenings.
We have some limited programs already in place to redeem this shortcoming: The Iowa Tuition Tax Credit, for instance. But being able to pay for something isn't the same as being able to get it. Passengers aboard the Titanic may have been wealthy, but their wealth was worthless when they were kept out of the lifeboats. We need to think not just in terms of the direct expense of attending college, but also of the physical access people have to the educational system itself.
According to the Census Bureau, those with high school diplomas earn, on average, about 50% more per year than those who don't. Those with college degrees earn, on average, almost twice as much as those who stopped with high school.
The relationship between education and income is one of the most iron-clad in all of our economic world today. That's why getting as many Iowans as possible into and through post-secondary education, whether it's an associate's degree or a bachelor's degree or beyond, is probably the most important step that we can take to make Iowans more prosperous. The only barrier to any Iowan's completion of a two- or four-year college degree should be his or her own motivation -- not finances, distance, or willingness on the part of the state to serve every taxpayer.
We ought to be realistic without being condescending: Not everyone wants -- or even needs -- to get a four-year college degree. But education is a peculiar thing: It's easiest to get it when you're young -- which is when you're least likely to appreciate it. Once people exit their early 20's, it's difficult to return to school. So, in general, it's best to encourage as many young people as possible to get post-secondary education while they're still young and aren't passing up other opportunities in order to get it.
That's why we need to apply a dose of imagination to the way in which we deliver education here. First, we ought to see to it that as many Iowa kids as possible at least stick through two years of post-secondary schooling. Rapidly-rising tuition rates have made it difficult for many Iowans to afford their degrees, and the expected family contribution calculated by the Federal student-aid formula is oftentimes far more than a family budget can reasonably sustain. In an ideal world, parents would save enough to send their kids to college, squirreling away money from the child's birth on. But investments can be unpredictable, expenses along the way are often unforeseen, and tuition rates can be an erratic target around which to plan.
But what is the cost if students aren't able to obtain the post-secondary education they need? More than anything, the costs come from lost and missed opportunities -- and these accumulate to society. We've experienced endless grandstanding by politicians who take credit for "creating jobs" -- which they simply aren't capable of doing. The market creates jobs, just as the market destroys them. Fundamentally, the gas lamplighter of 1875 lost his job for the same reason that the ethanol-plant worker of 2005 gained hers: The market needed something different from what it had before, and labor demands changed.
Government doesn't have the power to create jobs any more than it has the power to make the sun shine. But it does have a unique capacity to ensure things like universal access to post-secondary education, and in so doing, government can help to ensure that the workers whose jobs are created and destroyed by the market can adjust quickly to make themselves more valuable and more adaptable to a changing marketplace. Today, that marketplace clearly rewards education beyond the high school diploma.
Yet, even today, huge portions of the state are more than 120 miles (about two hours' drive) away from one of Iowa's three state universities, making it difficult for residents living there to have the same access to college education as those living in east-central Iowa. Combined with the challenge of rapidly-rising tuition rates, this geographic isolation has put further educational opportunity too far out of reach for many Iowans.
State leadership has been willing to risk millions of taxpayer dollars on "economic development" incentives based on vague promises that have on several occasions turned out to be disastrous failures -- but those same leaders have been stingy about insisting on better access to undergraduate degrees, where the same scale of investment would be certain to deliver returns.
Iowa State University is on a $135 million drive to raise funds for new athletic facilities. There's nothing necessarily wrong with that. But if we can raise $135 million to improve athletic facilities, we ought to be able to put comparable levels of energy into raising $135 million to put more Iowans through school -- especially those students for whom Iowa, Iowa State, and UNI are distant road trips, and especially those prospective students who didn't complete degrees when they were in their early 20s.
We need to use our community college facilities to make the two-year degree the new standard. We need to use technology to help deliver collegiate-level education everywhere in the state, not just in three campus towns. We need to re-evaluate what it is we're really charging students for their schooling.
Some people object to spending money on higher education because well-educated workers are highly mobile -- so it's possible that we as a state can subsidize growth for other states. But why is that fear so often overheated? Are we so afraid that Iowa is unattractive to educated workers that we think anyone with a degree will catch the first bus out of town? Of course some people will leave -- just as people move away from idyllic places like Hawaii and Southern California every day. People will always move away from wherever they know as home. Worrying about what we're spending to educate Iowans who might move away is the wrong concern. Our focus should be on making Iowa so attractive that we can abandon the language of "keeping people in Iowa" and adopt the language of a confident place.
Improved access doesn't require that the state build a new university, nor even that that state actually provide the service. It may be quite efficient to contract out the actual delivery of the educational services to private educators. What's most important is that we use our ingenuity to ensure that no one in Iowa fails to get a post-secondary education for reasons of cost or access.
If we can wage war via unmanned aircraft and explore the surface of Mars by remote control, then surely we have the knowledge and tools necessary to deliver college degrees online. MIT has already pioneered the use of the Internet to deliver college coursework with its OpenCourseWare project. If MIT is unafraid of making its educational content available to the public -- for free, even -- then Iowa's state colleges and universities need to be equally open to developing programs that would allow Iowans to obtain their two- and four-year degrees through flexible, online-based programs. The schools presently offer extremely limited choices for these kinds of programs, and that fails the very taxpayers who help to fund those institutions.
The traditional college experience isn't going to disappear -- and it's within reach for most young people graduating from high school, if they're willing to front the necessary effort. Educating these prospective students is and ought to remain a priority. But just as important is reaching the adults who, for whatever reasons, have been unable to pursue post-secondary education -- especially the bachelor's degree. Some opportunities are available for these adults, but we have not yet reached the "no-brainer" point: The stage at which the only reason one might not have completed such a degree is because he or she hasn't tried.
When we think of non-traditional students, we have to consider the hurdles they may need to overcome: Finances may be limited because they're trying to raise children or pay for medical care, travel may be difficult because they live far from population centers, or time may be in short supply because they work the third shift and sleep during the day in order to have some family time in the evenings.
We have some limited programs already in place to redeem this shortcoming: The Iowa Tuition Tax Credit, for instance. But being able to pay for something isn't the same as being able to get it. Passengers aboard the Titanic may have been wealthy, but their wealth was worthless when they were kept out of the lifeboats. We need to think not just in terms of the direct expense of attending college, but also of the physical access people have to the educational system itself.
- *** HOW MANY COLLEGE GRADUATES STAY, AND HOW MANY ACTUALLY LEAVE? ***
- *** HOW MANY START 4-YEAR DEGREES BUT DROP OUT? ***
- Correlation with health-care costs
- What government should do:
- What individuals should do:
The existing system discourages people from earning degrees while they're still working. That's terribly inefficient, since it keeps a lot of potential candidates from earning advanced degrees. It also keeps those advanced-degree programs from getting the two-way knowledge transfer back in. Advanced education isn't just a one-way street from professor to student, it's a dialogue.
Higher education is perpetually accused of having an "ivory tower" isolation from the rest of the world. Institutional inertia won't allow the universities to change from within, but we're the ones paying the bills.
Iowa could break the mold and reclaim its status as the "education state" by putting more of its own people through advanced degrees than any other state. The difficulty is in breaking down artificial barriers within higher education.
Right now, our biggest shortages are in important scientific and technical fields like engineering
Higher education is perpetually accused of having an "ivory tower" isolation from the rest of the world. Institutional inertia won't allow the universities to change from within, but we're the ones paying the bills.
Iowa could break the mold and reclaim its status as the "education state" by putting more of its own people through advanced degrees than any other state. The difficulty is in breaking down artificial barriers within higher education.
Right now, our biggest shortages are in important scientific and technical fields like engineering
- Percent of high school, college graduates in 1900 vs. 2000
- The next logical step
- Literacy
- College entrance exam scores
- Engineering
- Business
- Teaching
- Health care
- Science
- What government should do:
- What individuals should do:
Imagine a parallel universe where every student lives within a 25-minute drive of a 4A school; it should be possible for virtually any one of them to open-enroll into a large school
Communities don't have to be huge to attract the kinds of things people want most -- good stores and restaurants. 40,000 to 50,000 seems to be about enough to sustain a vibrant and diverse local retail culture. That means having stores like Target, Hy-Vee, and Best Buy, but also a mix of local retailers and restaurants.
We're already committed to a huge and enduring investment in just keeping up the basic infrastructure of the state: Roads, highways, and civil works. Instead of viewing them as a burden to be borne by urban taxpayers, we should be able to use them as tools of sustained development.
It's possible to maintain a community ethos up to a certain limit -- but only a couple of Iowa cities even pretend to test that upper limit. What we fail at much more often is in failing to have the critical mass to attract attention
No one in Des Moines or Omaha says on a Friday night, "Let's go to that little place we love in Atlantic" -- and they should be able to. A one-hour drive in Iowa can get you a quarter of the way across the state, while it's a completely normal travel time to get from place to place in Chicago or the Twin Cities. We should use our freedom of travel to experience a bigger span of our own state, but the basic attractions -- restaurants and stores -- aren't going to emerge because of some government program.
How can you keep them down on the farm when they've seen gay Paree?
But with every conceivable tax rate (personal income tax, business income tax, sales tax, property tax, and so on) higher than a folk singer at Woodstock, it's no wonder there's been so little to build upon. Economically, the state is a ship whose hull is popping rivets all around while the captain is passed out in the tiki lounge.
In 1920, Sioux City was larger than Phoenix, Albuquerque, and Las Vegas -- each much larger than Sioux City today -- and it was about the same size as Tulsa. Des Moines at the same time was bigger than Nashville, Fort Worth, or El Paso, and about the same size as Houston.
That other cities have since grown much faster than Des Moines and Sioux City doesn't mean that they're better than Iowa towns. What it does reveal is that a lot can change in less than a hundred years. The 100-year time horizon shouldn't be beyond our imagination. A child born today is expected to live for almost 80 years, so thinking ahead for a full 100 years should be no difficult task.
Communities don't have to be huge to attract the kinds of things people want most -- good stores and restaurants. 40,000 to 50,000 seems to be about enough to sustain a vibrant and diverse local retail culture. That means having stores like Target, Hy-Vee, and Best Buy, but also a mix of local retailers and restaurants.
We're already committed to a huge and enduring investment in just keeping up the basic infrastructure of the state: Roads, highways, and civil works. Instead of viewing them as a burden to be borne by urban taxpayers, we should be able to use them as tools of sustained development.
It's possible to maintain a community ethos up to a certain limit -- but only a couple of Iowa cities even pretend to test that upper limit. What we fail at much more often is in failing to have the critical mass to attract attention
No one in Des Moines or Omaha says on a Friday night, "Let's go to that little place we love in Atlantic" -- and they should be able to. A one-hour drive in Iowa can get you a quarter of the way across the state, while it's a completely normal travel time to get from place to place in Chicago or the Twin Cities. We should use our freedom of travel to experience a bigger span of our own state, but the basic attractions -- restaurants and stores -- aren't going to emerge because of some government program.
How can you keep them down on the farm when they've seen gay Paree?
But with every conceivable tax rate (personal income tax, business income tax, sales tax, property tax, and so on) higher than a folk singer at Woodstock, it's no wonder there's been so little to build upon. Economically, the state is a ship whose hull is popping rivets all around while the captain is passed out in the tiki lounge.
In 1920, Sioux City was larger than Phoenix, Albuquerque, and Las Vegas -- each much larger than Sioux City today -- and it was about the same size as Tulsa. Des Moines at the same time was bigger than Nashville, Fort Worth, or El Paso, and about the same size as Houston.
That other cities have since grown much faster than Des Moines and Sioux City doesn't mean that they're better than Iowa towns. What it does reveal is that a lot can change in less than a hundred years. The 100-year time horizon shouldn't be beyond our imagination. A child born today is expected to live for almost 80 years, so thinking ahead for a full 100 years should be no difficult task.
- *** IDENTIFY THE MAIN TOWNS BETWEEN 5,000 AND 20,000 ***
- What government should do:
- What individuals should do:
The Federal government is in dire financial straits, and we can't count on it not to make dramatic cuts to funding that Iowa requires. The states rely on Federal funding for an average of 29% of their annual budgets.
We are at special peril because we will probably lose a seat in Congress before the next decade is out of diapers, going from five Representatives to four. That could be a serious threat to our fiscal standing in Washington. There are as many members of the House representing metro Atlanta as delegates from the entire state of Iowa. It's reckless of us as a state to count on the Federal government for critical budget needs.
Over-promised liabilities for Medicare and Social Security will drop a hammer on the Federal government's long-term budgets. When push comes to shove, battles over discretionary spending will be fought between state governments seeking public-works assistance and AARP as it lobbies for more government benefits for senior citizens. Other battles will be fought between small states needing loans for infrastructure and large states seeking support for entitlement programs. In each case, the smart money is on the side with the biggest constituency, and in neither case does Iowa emerge victorious.
We have to prepare for a future with fewer votes in Congress and less money in the public till. At the same time, we'll be taking care of more and more retired Iowans who will be putting less money back into the state through their income taxes.
Many small communities have declining revenue bases for property tax collections, making it necessary to raise tax rates, which further aggravates the decline of the revenue base.
We are not high on the radar screens of other parts of the country: Aside from the Presidential caucus season, how often is Iowa even mentioned in the news from Chicago? Almost never; and yet, we're neighbors. North Carolina and Oregon care even less. Attention means funding in Congress, and when you don't get that attention, you have to fight for table scraps at the Federal level.
The state has been borrowing from trust funds for too long and pretending as though it has "balanced" the budget. State Auditor David Vaudt has raised the red flag more than once, but he's a lonely voice in the wilderness. Little has been done.
Future liabilities in the form of state and public employee pensions alone could be huge. But we have immediate expenses, too, in transportation, environmental quality, and health care.
The state's trust funds -- for highways, senior care, and the like -- must be bulletproof, not used to cover for our fiscal irresponsibility from year to year
If the state's existing rainy-day fund isn't enough to carry us through a rough year or two under a 99% spending limit, then it needs to be bigger.
We can achieve much of our needed fiscal responsibility either through personnel cuts or reductions in services, but we also shouldn't overlook the potential of contracting out some government services for private delivery. The Des Moines suburbs haven't gone to the wolves just because their communities have contracted out for garbage pickup.
Many states are severely over-stretched
We are at special peril because we will probably lose a seat in Congress before the next decade is out of diapers, going from five Representatives to four. That could be a serious threat to our fiscal standing in Washington. There are as many members of the House representing metro Atlanta as delegates from the entire state of Iowa. It's reckless of us as a state to count on the Federal government for critical budget needs.
Over-promised liabilities for Medicare and Social Security will drop a hammer on the Federal government's long-term budgets. When push comes to shove, battles over discretionary spending will be fought between state governments seeking public-works assistance and AARP as it lobbies for more government benefits for senior citizens. Other battles will be fought between small states needing loans for infrastructure and large states seeking support for entitlement programs. In each case, the smart money is on the side with the biggest constituency, and in neither case does Iowa emerge victorious.
We have to prepare for a future with fewer votes in Congress and less money in the public till. At the same time, we'll be taking care of more and more retired Iowans who will be putting less money back into the state through their income taxes.
Many small communities have declining revenue bases for property tax collections, making it necessary to raise tax rates, which further aggravates the decline of the revenue base.
We are not high on the radar screens of other parts of the country: Aside from the Presidential caucus season, how often is Iowa even mentioned in the news from Chicago? Almost never; and yet, we're neighbors. North Carolina and Oregon care even less. Attention means funding in Congress, and when you don't get that attention, you have to fight for table scraps at the Federal level.
The state has been borrowing from trust funds for too long and pretending as though it has "balanced" the budget. State Auditor David Vaudt has raised the red flag more than once, but he's a lonely voice in the wilderness. Little has been done.
Future liabilities in the form of state and public employee pensions alone could be huge. But we have immediate expenses, too, in transportation, environmental quality, and health care.
The state's trust funds -- for highways, senior care, and the like -- must be bulletproof, not used to cover for our fiscal irresponsibility from year to year
If the state's existing rainy-day fund isn't enough to carry us through a rough year or two under a 99% spending limit, then it needs to be bigger.
We can achieve much of our needed fiscal responsibility either through personnel cuts or reductions in services, but we also shouldn't overlook the potential of contracting out some government services for private delivery. The Des Moines suburbs haven't gone to the wolves just because their communities have contracted out for garbage pickup.
Many states are severely over-stretched
- What government should do:
- What individuals should do:
The "economic development" game, as it is played today, is expensive and unproductive
What happens when Maytag leaves Newton or Blue Bird leaves Mount Pleasant? We have too many one-company towns, and the development-incentives game actually makes that problem worse. While there's always lots of talk about "spin-off" companies and secondary effects of any new plant or project, the people trumpeting those figures are master salespeople. It's their job to sell a blue-sky promise.
Iowa has an aging population, which means that we'll face rising costs in the long term for things like health care. Why not use public money for truly public goods -- like cancer research?
If we perpetually hope that someone else will pursue and fund the answers, then how do we answer the question, "If not now, when? If not us, who?"
Investing in scientific research is different from subsidizing manufacturing plants. If a manufacturer closes down, the jobs evaporate, and the plant and equipment inside are liquidated. But scientific gains are different -- they're kept no matter what, and don't just disappear because an experiment fails. All failures lead to knowing what isn't the answer, which helps isolate what the answer is. Think of the hundreds of failures it took for Edison to develop a reliable light bulb.
By aggressively pursuing medical research, we may be able to gain benefits from some spin-offs (just like in the Research Triangle in North Carolina), but we shouldn't count on them. Texas invests much more in trying to gain "spin-off" benefits from its universities, and it hasn't gotten a great return. We should invest in basic research because it's a useful public good. If other economic development results, so much the better. But just like you shouldn't buy $20 worth of things you don't need just to take advantage of a 10% off coupon, we shouldn't kid ourselves about the benefits of economic-development incentives.
At least if those dollars went into cancer research, everyone would stand a nearly equal chance of collecting on the rewards.
A state gambling its economic future on picking a handful of businesses or even industries is like the speculator who enters the stock market and invests in a bunch of "hot picks" without regard to the fundamental value of those businesses. Sure, once in a while that speculator is rewarded -- but more often than not, speculation is punished by lower-than-average returns.
Note, for instance, the investment industry's ability to select and hire the best talent in stock-picking. Yet almost all mutual funds perform worse than their market averages. There are two culprits:
Iowa is not now, nor will it ever be, an entertainment Mecca.
The phrase goes, "It's a nice place to visit, but I wouldn't want to live there." Iowa is a place for living, not a place for visiting.
To waste precious tax dollars on efforts to make Iowa a place to visit is to be stunningly ignorant of some basic rules of competition: You fare best when you do something that others can't do as well or as cheaply as you. In that regard, Iowa will never have a competitive advantage in entertainment or tourism -- we simply don't have beaches like Florida or Hawaii, sun like Arizona, or mountains like Colorado.
What happens when Maytag leaves Newton or Blue Bird leaves Mount Pleasant? We have too many one-company towns, and the development-incentives game actually makes that problem worse. While there's always lots of talk about "spin-off" companies and secondary effects of any new plant or project, the people trumpeting those figures are master salespeople. It's their job to sell a blue-sky promise.
Iowa has an aging population, which means that we'll face rising costs in the long term for things like health care. Why not use public money for truly public goods -- like cancer research?
If we perpetually hope that someone else will pursue and fund the answers, then how do we answer the question, "If not now, when? If not us, who?"
Investing in scientific research is different from subsidizing manufacturing plants. If a manufacturer closes down, the jobs evaporate, and the plant and equipment inside are liquidated. But scientific gains are different -- they're kept no matter what, and don't just disappear because an experiment fails. All failures lead to knowing what isn't the answer, which helps isolate what the answer is. Think of the hundreds of failures it took for Edison to develop a reliable light bulb.
By aggressively pursuing medical research, we may be able to gain benefits from some spin-offs (just like in the Research Triangle in North Carolina), but we shouldn't count on them. Texas invests much more in trying to gain "spin-off" benefits from its universities, and it hasn't gotten a great return. We should invest in basic research because it's a useful public good. If other economic development results, so much the better. But just like you shouldn't buy $20 worth of things you don't need just to take advantage of a 10% off coupon, we shouldn't kid ourselves about the benefits of economic-development incentives.
At least if those dollars went into cancer research, everyone would stand a nearly equal chance of collecting on the rewards.
A state gambling its economic future on picking a handful of businesses or even industries is like the speculator who enters the stock market and invests in a bunch of "hot picks" without regard to the fundamental value of those businesses. Sure, once in a while that speculator is rewarded -- but more often than not, speculation is punished by lower-than-average returns.
Note, for instance, the investment industry's ability to select and hire the best talent in stock-picking. Yet almost all mutual funds perform worse than their market averages. There are two culprits:
- Excessive expenses involved in trying to find the best
- Quixotic nature of speculative gambling
Iowa is not now, nor will it ever be, an entertainment Mecca.
The phrase goes, "It's a nice place to visit, but I wouldn't want to live there." Iowa is a place for living, not a place for visiting.
To waste precious tax dollars on efforts to make Iowa a place to visit is to be stunningly ignorant of some basic rules of competition: You fare best when you do something that others can't do as well or as cheaply as you. In that regard, Iowa will never have a competitive advantage in entertainment or tourism -- we simply don't have beaches like Florida or Hawaii, sun like Arizona, or mountains like Colorado.
- What government should do:
- What individuals should do:
Social Security reform is desperately needed, but because it's the "third rail" of American politics, no national-level official wants to touch it. No one is likely to show the real guts necessary to deal with the problem until a crisis is inevitable.
Reform probably won't happen on the Federal level, since there's too much risk involved for any individual politician with very little reward.
But the states are the "laboratories of democracy," and it's within our reach to take up an experiment in private accounts in Iowa.
IPERS has been very rewarding for public employees
Let's follow the model by expanding it
We already have an aging population, which will dramatically increase our public liabilities over the long term
Iowa can become a laboratory for Social Security reform, showing how private accounts don't have to be implicit subsidies for the Fortune 500. By experimenting at the state level, we can demonstrate how investment flexibility can make for better pension funding without unfairly enriching the already-rich.
Prove the value of compound interest.
Also valuable as a work incentive. The state could match contributions for some low-income workers.
It's unpleasant that government should even be involved in retirement security in the first place, but that ship has long ago sailed. Unfortunately, retirment savings is a form of delayed gratification and we humans don't seem to be wired at doing that for the forty or more years most people will spend working.
So if we're going to end up footing the bill for retirement anyway, it's best if we conduct that transfer from ourselves to our future selves, rather than from grandchildren to grandparents. The point of a state system should be to demonstrate that a private-account system can work and that the Federal model (balancing state and national powers, as prescribed by the Constitution) can work to fix Social Security.
Reform probably won't happen on the Federal level, since there's too much risk involved for any individual politician with very little reward.
But the states are the "laboratories of democracy," and it's within our reach to take up an experiment in private accounts in Iowa.
IPERS has been very rewarding for public employees
Let's follow the model by expanding it
We already have an aging population, which will dramatically increase our public liabilities over the long term
Iowa can become a laboratory for Social Security reform, showing how private accounts don't have to be implicit subsidies for the Fortune 500. By experimenting at the state level, we can demonstrate how investment flexibility can make for better pension funding without unfairly enriching the already-rich.
Prove the value of compound interest.
Also valuable as a work incentive. The state could match contributions for some low-income workers.
It's unpleasant that government should even be involved in retirement security in the first place, but that ship has long ago sailed. Unfortunately, retirment savings is a form of delayed gratification and we humans don't seem to be wired at doing that for the forty or more years most people will spend working.
So if we're going to end up footing the bill for retirement anyway, it's best if we conduct that transfer from ourselves to our future selves, rather than from grandchildren to grandparents. The point of a state system should be to demonstrate that a private-account system can work and that the Federal model (balancing state and national powers, as prescribed by the Constitution) can work to fix Social Security.
- What government should do:
- What individuals should do:
Let people put their money where their mouths are -- instead of volunteering others to foot the bill for public improvements
If you really believe that EarthPark is going to be a tremendous success, then put your own money behind it
The Des Moines Civic Center was a privately-funded project, but there's no playbook or template for replicating that success today
To the contrary, Governor Tom Vilsack touted as some of his greatest achievements as governor the Iowa Values Fund and other subsidy projects
Formalize a set of conditions that make it possible for people to turn to this private investment first, rather than pushing for tax hikes
We're nickel-and-diming ourselves to death with lots of good intentions that don't pay for themselves
Some say it's only a matter of a few dollars per taxpayer, but more than half of American households have less than $55,000 in net worth -- including the value of their homes. Every dollar matters.
We face a continuum of choices: Some things must be paid out of the public purse. Some things must be run by the private sector. Yet there are quasi-public institutions and goods in between, and right now, government tries to fill too much of that gap with taxpayers' dollars involuntarily. Community investment trusts would create the option to hold the line. They assume that some institutions may not be highly profitable, but would represent goods in which people may wish to take part. Should they become necessary, tax deductions, write-offs, or even some special privileges can be accorded those who take part.
Most of these investment are a far cry from essential public purpose -- they're things we want, not things we need. It's tragic for a city like Des Moines, which has notoriously had trouble even keeping the streetlights on and the police department fully staffed, turn around and plan to speculate on projects like downtown hotels using taxpayers' dollars.
When taxes are low and essential government services handled efficiently, people have more money with which to invest voluntarily in projects that they really believe in
As government support has been reduced for public television and radio, those organizations have pursued donors aggressively and recognized them as "Friends"
Why do rich people donate to anything? We ought to have a system that enables us to donate to our own public good.
You can't solve problems just by constructing buildings. You could put an empty 100,000 square foot building in the middle of Chicago and still have homelessness. Problems are solved by people taking action.
Most of these investments are a far cry from essential public purposes: They're things we want, not things we really need. It's tragic to see a city like Des Moines, which has notoriously had trouble keeping the streetlights on and the police department fully staffed, turn around and plan to speculate on projects like hotels using tax dollars.
Lower your taxes and people will have more money to invest voluntarily in their own communities.
Public TV and radio stations have "Friends" groups recognizing voluntary donors.
Social capitalism and market philanthropy: Acumen Fund
Why do rich people donate to anything? Ought to have a system for doing it for our own good.
If you really believe that EarthPark is going to be a tremendous success, then put your own money behind it
The Des Moines Civic Center was a privately-funded project, but there's no playbook or template for replicating that success today
To the contrary, Governor Tom Vilsack touted as some of his greatest achievements as governor the Iowa Values Fund and other subsidy projects
Formalize a set of conditions that make it possible for people to turn to this private investment first, rather than pushing for tax hikes
We're nickel-and-diming ourselves to death with lots of good intentions that don't pay for themselves
Some say it's only a matter of a few dollars per taxpayer, but more than half of American households have less than $55,000 in net worth -- including the value of their homes. Every dollar matters.
We face a continuum of choices: Some things must be paid out of the public purse. Some things must be run by the private sector. Yet there are quasi-public institutions and goods in between, and right now, government tries to fill too much of that gap with taxpayers' dollars involuntarily. Community investment trusts would create the option to hold the line. They assume that some institutions may not be highly profitable, but would represent goods in which people may wish to take part. Should they become necessary, tax deductions, write-offs, or even some special privileges can be accorded those who take part.
Most of these investment are a far cry from essential public purpose -- they're things we want, not things we need. It's tragic for a city like Des Moines, which has notoriously had trouble even keeping the streetlights on and the police department fully staffed, turn around and plan to speculate on projects like downtown hotels using taxpayers' dollars.
When taxes are low and essential government services handled efficiently, people have more money with which to invest voluntarily in projects that they really believe in
As government support has been reduced for public television and radio, those organizations have pursued donors aggressively and recognized them as "Friends"
Why do rich people donate to anything? We ought to have a system that enables us to donate to our own public good.
You can't solve problems just by constructing buildings. You could put an empty 100,000 square foot building in the middle of Chicago and still have homelessness. Problems are solved by people taking action.
Most of these investments are a far cry from essential public purposes: They're things we want, not things we really need. It's tragic to see a city like Des Moines, which has notoriously had trouble keeping the streetlights on and the police department fully staffed, turn around and plan to speculate on projects like hotels using tax dollars.
Lower your taxes and people will have more money to invest voluntarily in their own communities.
Public TV and radio stations have "Friends" groups recognizing voluntary donors.
Social capitalism and market philanthropy: Acumen Fund
Why do rich people donate to anything? Ought to have a system for doing it for our own good.
- *** GET DATA ON THE DUBUQUE RIVER DEVELOPMENT AND PRAIRIE MEADOWS AS EXAMPLES ***
- Social capital
- Market philanthropy
- Acumen Fund
- What government should do:
- What individuals should do:
A doctor writes a prescription not forever, but for a set period of time. After that time, the prescription can be renewed or it can expire. Clothing is the same way -- you may be the same individual the whole time, but the same clothes aren't appropriate when you're four and when you're 40. As conditions change and evolve, so do the responses to those conditions. But law is built in part upon its stability -- but that stability can too easily become ossification, which is the slow death of a vibrant market.
If it really has to be permanent, it should be in the state Constitution
Everything else should be subject to review. The time horizons may vary: 10 years, 20 years, 50 years, 100 years, or 200 years. But the very act of thinking about how long a law is expected to endure forces one to think about those laws differently.
Legislators should be accountable not only for what they actively do, but for what they passively condone
Milk goes bad, visitors need to leave after three days, and Presidents have term limits -- it's not as though we aren't familiar with the concept of expiration dates . Will it make more work for state lawmakers? Absolutely. And don't we deserve representatives who caer enough to review the laws they set? A doctor who never keeps up on current medical research and literature is professionally negligent; our government is the same if it is not forever cleaning up its old work.
If it really has to be permanent, it should be in the state Constitution
Everything else should be subject to review. The time horizons may vary: 10 years, 20 years, 50 years, 100 years, or 200 years. But the very act of thinking about how long a law is expected to endure forces one to think about those laws differently.
Legislators should be accountable not only for what they actively do, but for what they passively condone
Milk goes bad, visitors need to leave after three days, and Presidents have term limits -- it's not as though we aren't familiar with the concept of expiration dates . Will it make more work for state lawmakers? Absolutely. And don't we deserve representatives who caer enough to review the laws they set? A doctor who never keeps up on current medical research and literature is professionally negligent; our government is the same if it is not forever cleaning up its old work.
- What government should do:
- What individuals should do:
People love buying things online because it cuts down on the hassle of the transaction. Online shopping is especially popular with people who have corporate or government credit cards, because it's much easier to buy with those cards than to go through formal purchasing processes. What's quick and easy attracts new business.
We're competing against ourselves
Sales tax paperwork alone is ludicrous
Less paperwork would be better for business because there would be less deadweight
Whatever it is now, it could be half that. It can always be cut in half if you're really dedicated to the idea.
There's always some form of paperwork that can be reduced. If you can't find a way to do your work more efficiently, you're probably not trying very hard.
Cutting paperwork would cut the public payroll, contributing to our fiscal discipline -- more money for cancer research
A lighter paperwork burden would improve the climate for entrepreneurial-minded individuals to start and grow their own businesses, which is the best kind of economic growth
The less time business owners have to spend doing paperwork, the more time they have to grow their businesses and improve their communities by actually creating revenue and jobs
Iowa is in competition with every other US state, and we don't have endowments like the oil wealth of Alaska or the massive pension accumulations of the snowbirds living in Arizona and Florida. What we do have to offer is, as the old state slogan went, "A place to grow." We probably can't bribe people with super-low taxes, so we have to do our best to make the regulatory climate as easy as possible in order to compensate.
It's not just a matter of how much we have compared to other states, either -- it's the message we send by cutting what paperwork we have. You should never have to give the same government the same information twice in a year; if credit-card companies and mortgage lenders can handle all of the necessary information to make our transactions seamless, so can the state.
Anyone who's ever driven through rural Iowa in the fall has seen farmers working to harvest their crops -- from early morning until late in the night. That's because there's not a moment to waste at harvest time: The weather can turn at any moment, so they have to maximize the time spent in order to stay afloat. For business, every season is harvest season. Real estate is hot in the summer, retail sales in the run-up to Christmas. Auto body shops are busy with wintertime car wrecks, roof repairers in the springtime hail season. For every business, the busy season (and really every season) is like harvest time to farmers. The job may not be as obvious as a half-harvested field of corn, but the imperative to get the job done nonetheless is high. Time spent on "other" things -- like regulations and taxes -- is a distraction from the harvest.
We're competing against ourselves
Sales tax paperwork alone is ludicrous
Less paperwork would be better for business because there would be less deadweight
Whatever it is now, it could be half that. It can always be cut in half if you're really dedicated to the idea.
There's always some form of paperwork that can be reduced. If you can't find a way to do your work more efficiently, you're probably not trying very hard.
Cutting paperwork would cut the public payroll, contributing to our fiscal discipline -- more money for cancer research
A lighter paperwork burden would improve the climate for entrepreneurial-minded individuals to start and grow their own businesses, which is the best kind of economic growth
The less time business owners have to spend doing paperwork, the more time they have to grow their businesses and improve their communities by actually creating revenue and jobs
Iowa is in competition with every other US state, and we don't have endowments like the oil wealth of Alaska or the massive pension accumulations of the snowbirds living in Arizona and Florida. What we do have to offer is, as the old state slogan went, "A place to grow." We probably can't bribe people with super-low taxes, so we have to do our best to make the regulatory climate as easy as possible in order to compensate.
It's not just a matter of how much we have compared to other states, either -- it's the message we send by cutting what paperwork we have. You should never have to give the same government the same information twice in a year; if credit-card companies and mortgage lenders can handle all of the necessary information to make our transactions seamless, so can the state.
Anyone who's ever driven through rural Iowa in the fall has seen farmers working to harvest their crops -- from early morning until late in the night. That's because there's not a moment to waste at harvest time: The weather can turn at any moment, so they have to maximize the time spent in order to stay afloat. For business, every season is harvest season. Real estate is hot in the summer, retail sales in the run-up to Christmas. Auto body shops are busy with wintertime car wrecks, roof repairers in the springtime hail season. For every business, the busy season (and really every season) is like harvest time to farmers. The job may not be as obvious as a half-harvested field of corn, but the imperative to get the job done nonetheless is high. Time spent on "other" things -- like regulations and taxes -- is a distraction from the harvest.
- What government should do:
- What individuals should do:
Who are the community-builders in Dubuque? Do they know their counterparts in Des Moines, or Burlington, or Fort Dodge, or Council Bluffs?
For a small state, we are sometimes surprisingly disconnected from one another. Yet despite our provincial approach to what goes on inside our own borders, the people living here are assuredly a hundred times more engaged with the global community than we were before the advent of the Internet. How can it be that we still know so little -- and profess to care even less -- about what's happening thoughout the land between the two rivers?
We simply need to start getting our heads together once in a while with our own neighbors at least a fraction as often as we explore Internet chat rooms.
It's a matter of sharing ideas outside the formal networks and rules of government. No government investment is necessary. Iowans need to refresh their identities -- both on a local basis and as a state.
Waiting for one's own party to win every two, four, or six years (depending on the office) is a hugely inefficient way to get the state that we want -- especially when, even if "our team" does win, we're still just hoping that our priorities will be theirs as well. Every party has its times in and out of power, but there are lots of ideas that need action, not votes.
We can't bridge the gap between what we have and what we want just by showing up to vote in November. Even city councils are usually too formal to get things done. Money isn't always the missing input; more often, it's will or imagination. By stimulating those with private clubs, we can activate what we really want.
This ties into helping the state grow more outside the major metro areas: We don't need more paid consultants telling the state how to improve, we just need more local boosters cheerleading their own communities because that's where their bread is buttered. When your future is invested, you're going to be much more persuasive and enthusiastic.
This isn't a matter of getting more dues-paying members to show up for the Chamber of Commerce Ball. It's getting the Bull Moose Club or the 20/30 Society in Des Moines to start talking to their counterparts in Cedar Rapids or the Quad Cities or Marshalltown or Burlington. It's about attracting new members through action and branching out to revive the grand old tradition of fraternal and civic societies, which are in disrepair at best.
Iowans need a quick and snappy response to the question, "Why do you like it there?" A good start: "I enjoy having a five-minute commute to work, living in a neighborhood of $150,000 suburban starter homes, with schools putting out the top ACT scores in the nation."
Those aren't the kinds of snappy retorts that we'll get from an IDED brochure at the State Fair. Those come from civic engagement and community pride. You can't just subsidize or legislate those into effect.
For a small state, we are sometimes surprisingly disconnected from one another. Yet despite our provincial approach to what goes on inside our own borders, the people living here are assuredly a hundred times more engaged with the global community than we were before the advent of the Internet. How can it be that we still know so little -- and profess to care even less -- about what's happening thoughout the land between the two rivers?
We simply need to start getting our heads together once in a while with our own neighbors at least a fraction as often as we explore Internet chat rooms.
It's a matter of sharing ideas outside the formal networks and rules of government. No government investment is necessary. Iowans need to refresh their identities -- both on a local basis and as a state.
Waiting for one's own party to win every two, four, or six years (depending on the office) is a hugely inefficient way to get the state that we want -- especially when, even if "our team" does win, we're still just hoping that our priorities will be theirs as well. Every party has its times in and out of power, but there are lots of ideas that need action, not votes.
We can't bridge the gap between what we have and what we want just by showing up to vote in November. Even city councils are usually too formal to get things done. Money isn't always the missing input; more often, it's will or imagination. By stimulating those with private clubs, we can activate what we really want.
This ties into helping the state grow more outside the major metro areas: We don't need more paid consultants telling the state how to improve, we just need more local boosters cheerleading their own communities because that's where their bread is buttered. When your future is invested, you're going to be much more persuasive and enthusiastic.
This isn't a matter of getting more dues-paying members to show up for the Chamber of Commerce Ball. It's getting the Bull Moose Club or the 20/30 Society in Des Moines to start talking to their counterparts in Cedar Rapids or the Quad Cities or Marshalltown or Burlington. It's about attracting new members through action and branching out to revive the grand old tradition of fraternal and civic societies, which are in disrepair at best.
Iowans need a quick and snappy response to the question, "Why do you like it there?" A good start: "I enjoy having a five-minute commute to work, living in a neighborhood of $150,000 suburban starter homes, with schools putting out the top ACT scores in the nation."
Those aren't the kinds of snappy retorts that we'll get from an IDED brochure at the State Fair. Those come from civic engagement and community pride. You can't just subsidize or legislate those into effect.
- What government should do:
- What individuals should do:
