by Rob Roper

Led by the new Majority Leader, Jill Krowinski (D-Burlington) Vermont Democrats held a press conference calling for a Vermont minimum wage of $15/hr. Keep in mind, they just raised the Vermont minimum wage to $10/hr. on January 1 and it will rise again to $10.50 in 2018. The federal minimum wage is $7.25. That’s also the minimum wage in New Hampshire.

Another priority for the majority party this year is passing mandatory paid family leave. This would amount to a de facto $40-$79 million tax on employers. Where is this money supposed to come from?

Marc Sherman, the owner and operator of a small business, recently wrote an op-ed in which he outlined many of the pressures employers like him are facing:

“In my small retail business, Stowe Mercantile, the pressure to lower prices on our goods is tremendous. As each year goes by, more customers come through with smartphones, comparing prices and availability of our products with other stores and with online businesses…. When sales have been particularly bad, I have forgone my compensation, sometimes for months, so that my staff continues to receive their paychecks every week.” VT Digger, 1/12/17)

Yes, Vermont politicians, when you mandate that some people receive money for no work, you condemn others to work for no money. (Yet you scream bloody murder at the thought of cutting your own salaries or per diems by small fractions.)

Benefits to employees from these policies are also highly questionable as well. As the Washington Post reported on a study of Seattle’s move toward a $15 minimum wage (it had increased to $11 at the time of the study), “The average hourly wage for workers affected by the increase jumped from $9.96 to $11.14, but wages likely would have increased some anyway due to Seattle’s overall economy. Meanwhile, although workers were earning more, fewer of them had a job than would have without an increase. Those who did work had fewer hours than they would have without the wage hike.”

In other words, in response to the mandate employers were simply forced to fire workers and/or cut back their hours to maintain budgets. Let’s hope the new governor has his veto stamp out and inked up.

- Rob Roper is president of the Ethan Allen Institute.

 

 

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by  Rob Roper

A recent article in the Burlington Free Press, Patients struggle with long waits at UVM Medical Center, details the growing problem of patient access to services, particularly those offered by specialists.

Although Peter Shumlin’s “Single Payer” system famously imploded on the launch pad, advocates of the concept in the State House have been using incremental, backdoor approaches to reach essentially the same outcome with UVM Medical Center becoming the single dispenser of healthcare and Blue Cross Blue Shield becoming the single issuer of insurance.

These are the results: “Reiss cited wait times to see specialists at UVM Medical Center of one to seven months for neurology; four to six months for endocrinology; two to four months for rheumatology; two to four months for ear, nose and throat; and up to nine months for dermatology. ‘That’s a long time to wait for even routine appointments.’”

UVMMCs response to this, according to BFP, is that “Vermont has about the right capacity for health care, and argues more access to care would drive up costs through increased utilization by patients.” THIS IS RATIONING! Controlling costs by denying people access to care through long waiting periods. It’s also exactly what some of us predicted would happen as the state moves down this road.

However, there is a solution.  There are many doctors out there who are begging to be allowed to provide more access to services at less cost than UVMMC, but are being denied the ability to do so through our state government and its absurd Certificate of Needs Laws. “CON” laws require anyone wishing to compete with the existing hospital to get permission from the state proving first there is a “need” for whatever it is they want to provide. The politicians tend to listen to the politically powerful hospital.

But, if Vermont were to repeal our CON laws, of which we have more than any other state in the Union, entrepreneurial providers could start providing cheaper, more easily accessible healthcare services with no risk of taxpayer money. It’s an easy solution and a good one.

- Rob Roper is president of the Ethan Allen Institute. 

 

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by John McClaughry

The gun control people are back again in Montpelier, with their annual bill to make people believe they’re doing something to counter gun violence.

This year’s offering is Senate bill 6. Its six sponsors are Senators Phil Baruth, Debbie Ingram, Chris Pearson, and Michael Sirotkin, all of Burlington, plus Dick McCormack and Alison Clarkson from Windsor County. All are either Progs or Democrats.

This year’s version requires that Uncle Bob, who wants to gift his old .22 to nephew Jimmy for his birthday, must go to a Federal Firearms Licensed dealer and undergo a National background check, for which he’ll pay $40 or $50.

By contrast, gangbangers and drug dealers will not get anywhere near a federal firearms dealer when they need more lethal hardware. They can’t pass the background check, and they know that even an attempt to pass it is another felony offense. They find what they need on the street, and they get it by cash, drugs, or larceny.

The problem with the universal background check is not so much that it won’t do any good, especially in Vermont, but that when it’s clear that it didn’t do any good, the anti-gun people, financed by Michael Bloomberg’s inexhaustible millions, will show up to demand that all firearms be registered, and then they would be a giant step closer to their ultimate goal of allowing guns only to people licensed by the government.

- John McClaughry is vice president of the Ethan Allen Institute

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by John McClaughry

We’ve all heard ad nauseum that 97% of a carefully selected group of scientists agree with Bill McKibben, Al Gore and VPIRG that the planet is racing toward heat death because of carbon dioxide emissions, and to deny that is to deny science.

The website No Tricks Zone set out to see how many peer reviewed scientific papers they could find, published in 2016, disputing one or more claims made by the anthropogenic global warmers idolized by the McKibbens, Gores and VPIRGs of the world.

Guess what? They found over five hundred “supporting a skeptical position on anthropogenic climate change alarm.”

132 papers indicated that solar activity plays a significant role in weather and climate activity. Ninety  link other natural factors like ocean current shifts, cloud formation, and volcanic activity to climate changes. Eleven papers specifically indicated at worst humans have a weak influence on climate, while 17 papers indicate current climate changes likely reflect natural variability.

Concerning the potential effects of climate change, 34 papers show no effect of increasing carbon dioxide on sea level rise, 15 argue that recent warming has led to less extreme, more stable weather patterns, three papers demonstrate there has been no increase in the intensity or frequency of hurricanes and seven find there has not been any increase in intensity or frequency of floods.

Clearly the science of climate change is highly unsettled. Somebody needs to tell McKibben, Gore and VPIRG .

- John McClaughry is vice president of the Ethan Allen Institute.

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by John McClaughryJohn McClaughry

Six years ago a Democratic Congress and President enacted ObamaCare. Whatever one may have thought about its merits, after six years it is unmistakably clear that it cannot continue without heroic, disruptive interventions in 2017, costing many billions of dollars.

Congressional Democrats, who have taken serious beatings at the polls for championing the act, argue that its salvation consists of creating the government-run “public option” health insurance company. President Obama rejected that idea in 2009, telling Congress that “My guiding principle is, and always has been, that consumers do better when there is choice and competition.”

The Democrats  also want billions of new tax dollars for larger premium subsidies and more  multibillion dollar insurance industry bailouts. Their too-clever new slogan is that the Republicans will “make America Sick Again”. None of that will fly.

Republicans now have the serious task of laying off their ritual denunciations of Obamacare, and producing their own replacement. The President-elect announced last Tuesday that the replacement plan would be unveiled very soon after his Secretary of Health and Human Services, Dr. Tom Price, is confirmed.

The replacement plan will pass the House but face serious obstacles in the Senate. There, the Republican majority can repeal ObamaCare tax and spending provisions by a majority vote, but changing much of the rest of the act will require enough votes to overcome fierce Democratic opposition.

By the numbers, it will take eight Democratic votes,  plus the 52 Republicans, to overcome a Democratic filibuster. If the Republican plan can’t surmount the filibuster, they will clean up half of the mess and face the other half indefinitely, while the insurance markets collapse. The Congressional Budget Office estimates that 22 million people could be left without affordable insurance. Not good.

The House-passed bill will probably repeal the medical equipment and “Cadillac policy” taxes, the individual and employer penalty taxes for not buying insurance, the Obama Medicare tax, and the cost-sharing tax credits to subsidize premiums. It will also maintain some form of coverage for preexisting conditions and continue the requirement that children can stay on their family plans to age 26.

Without painful tax penalties, younger healthier people will simply stay out of high priced insurance pools top-loaded with older, sicker people. That is already creating the “death spiral” of ever-increasing premiums and deductibles, and eventually carrier exit from the market.

Republicans should attempt to deal with this by cutting back on ObamaCare’s costly benefit requirements, allowing  premium pricing that honestly reflects the insured’s age and medical history, repealing guaranteed issue (whereby the uninsured can sign up when they get sick), financing state high risk pools for the uninsurable (that 35 states had before ObamaCare undermined them), dramatically expanding the use of Health Savings Accounts to allow both individuals and employers to buy health insurance with pre-tax dollars, and continued premium credits, coupled with catastrophic coverage policies.

The Republican bill should also expand opportunities for insurance purchasing associations and cooperatives, encourage faith-based and other health mutual aid societies, foster increasing use of rapidly developing technology for cost-effective primary care, expand cost and outcome transparency to enable informed patient choice among medical providers, stimulate more patient attention to lifestyle, nutrition and preventive care, and offer Federal incentives to states to convert acute-care Medicaid into a Healthy Indiana model, with beneficiary-managed  Power Accounts.

It should also take steps to reduce medical provider tort liability, relax FDA regulation of access to pharmaceutical products and devices (called “Right to Try”), and stiffen antitrust enforcement against cost-inflating regional monopolies (like the Vermont Care Organization  proposed by the Shumlin-Scott All Payer plan).

The result of all this would be a dramatically reformed health system built upon Obama’s principle of “choice and competition”. It would be driven by better informed and more responsible consumers, not government-managed or coerced. It would promise, and likely achieve, high quality health care at lower cost.

- John McClaughry is vice president of the Ethan Allen Institute (ethanallen.org).

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by Rob Roper

The Vermont legislature will once again be debating how to expand taxpayer funded Pre-K services. A ubiquitously cited reason why we should do this is that, “Every dollar spent on high-quality early care and learning programs yields a return on investment that ranges from $4 – $9.” (Blue Ribbon Commission for Affordable Child Care). This is, in the vernacular of the day, Fake News.

The Blue Ribbon study making this claim (as well as everybody else) cites in a footnote the Center on the Developing Child (2009), which in turn cites three original studies: The High Scope/Perry Preschool Project, the Abecedarian Project, and the Nurse Family Partnership. Here’s the chart from that report…

Cost-Benefit-analyses

But here’s the catch: These studies have absolutely zero relationship to the programs being proposed in Vermont, nor did they serve populations even remotely similar to those that Vermont’s programs serve. To state or imply that Vermont pre-k programs would yield similar results is flat out dishonest.

For example, the Perry Preschool Project only involved 123 (just 58 of whom received services, 65 were in the control group) African American kids from economically disadvantaged households, at “high risk for school failure,” with IQs between 70 and 85. It is dishonest to imply that mainstream Vermont kids in a less intensive, universal program like the one we have in Vermont would respond in the same way.

Similarly, the Abecedarian study was limited to 111 kids, 57 of whom received services. Again, these were all kids identified as being “high risk” based on family income, etc. and the program was birth to five, 6-8 hours a day five days a week with a child teacher ratio of 1:3 to 1:6 – nothing remotely resembling the universal, 10 hour a week program for 3-4 year olds we have in Vermont!

The Nurse Family Partnership isn’t even an early childhood education program, it’s home healthcare program.

As the High Scope website specifically cautions: “The findings of the High/Scope Perry Preschool study and similar studies would apply ONLY [emphasis added] to children served by these programs who are reasonably similar to children living in poverty or otherwise at risk of school failure. (Pg.13) Therefore, when our politicians, advocates and educators use these studies to justify investment universal early education programs for a majority of mainstream kids – and when our media reports these claims without challenge – they are all, at best, misleading the public.

Meanwhile, relevant studies of programs of similar size and scope to those Vermont is implementing do not show meaningful benefit, and one even indicates possible harm.

  • Vanderbilt University study of Tennessee’s Pre-K program (3000+ subjects) finds that students who attended the state’s pre-k program did worse by third grade than students who had been lotteried out.
  • Head Start Impact Study (5000 subjects) finds… “the advantages children gained during their Head Start and age 4 years yielded only a few statistically significant differences in outcomes at the end of first grade.

- Rob Roper is president of the Ethan Allen Institute. 

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by John McClaughry

One of the first acts of the new Republican Congress will be – hopefully – to start using the Congressional Review Act of 1996 to put the brakes on extralegal acts of a President, in this case, President Obama.

The CRA establishes a process for Congress to overturn executive rules that in the opinion of Congress go beyond the powers delegated by Congress to the Executive branch. One example is known as WOTUS –  waters of the United States – where the Environmental Protection Agency is trying to seize control of every piddling brook and drainage ditch in the country, instead of confining itself to “navigable waterways”. There are many, many more Obama rules that Congress needs to roll back.

Strangely, CRA law has never been tested in the courts. The legislation says that any rule which is rescinded under the CRA “may not be reissued in substantially the same form, and a new rule that is substantially the same as such a rule may not be issued, unless the reissued or new rule is specifically authorized by a law enacted after the date of the joint resolution disapproving the original rule.”

This means that a rule once blocked by Congress is not likely to be even attempted again for many years, until a new rule is constructed that is arguably so different, or based on new legislation, that it can pass muster. This kind of legislative review is essential to constitutional government. It’s too bad we don’t have one in Vermont (which I was unable to sell during my four years in the Senate).

- John McClaughry is vice president of the Ethan Allen Institute.

 

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Should the new Legislature embark on an $850 million expansion of Vermont’s taxpayer screen-shot-2016-12-13-at-1-55-39-pmsubsidized Pre-Kindergarten (birth through 5) program?

Yes, our public school system will invest the money effectively and efficiently.

No, property taxpayers can’t afford this.

Click HERE to make your voice heard! 

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by Rob Roper

The Carbon Tax Warriors in the Vermont State House aren’t going away (at least not the ones who weren’t voted out last November). The latest trumpet call to battle came from Rep. Molly Burke (D-Brattleboro) in a WKVT interview (around the 22 minute mark) in which she promises to “absolutely” fight for passage of the Carbon Tax.

However, 2017 has seen a pretty dramatic shake up in Montpelier with a new Governor, Lieutenant Governor, Speaker of the House, Senate President Pro Tem, as well as several committee chairs. Though the new Speaker of the House, Mitzi Johnson (D-S. Hero) sounds a lot like defeated gubernatorial candidate Sue Minter when speaking of the Carbon Tax by refusing to say if she would support it or not, we can try to read the tea leaves through her actions thus far.

During the last biennium the bulk of the advocacy and work for a Carbon Tax took place in the House Natural Resources & Energy Committee. That no longer exists, changed and split into a new Energy & Technology Committee and an expanded Fish, Wildlife & Natural Resources Committee.

Johnson put Rep. Steve Carr (D-Brandon) in charge of the new Energy Committee, replacing retiring Tony Klein as Chair, which can only be a good thing. No one was more zealous than Klein about passing a Carbon Tax. Also gone from that committee are Carbon Tax sponsors Reps. Kesha Ram (failed bid for Lt. Governor) and lead sponsor Mary Sullivan (D-Burlington), whom Johnson moved to the new Fish, Wildlife and Natural Resources committee. Moving onto the Energy Committee is Rep. Corey Parent (R-St. Albans) who ran as a staunch opponent of the Carbon Tax in 2016, trouncing his opponent on the issue. This is generally positive as any Carbon Tax legislation would certainly have to pass through a committee with “energy” in it’s title.

However, Johnson did end up putting both lead sponsors of the Carbon Tax , Sullivan and David Deen (D-Westminister) together on the new Fish, Wildlife & Natural Resources Committee, where who knows what mischief they can concoct.

Changes on the Senate side are not so benign. Newly minted Senator Chris Pearson (P/D-Chittenden), who led the House Climate Caucus as a representative, will join Chris Bray (D-Addison), Brian Campion (D-Bennington), and Mark MacDonald (D-Orange), and John Rogers (D-Essex) on the Senate Natural Resources & Energy Committee. All but Rogers are reliable climate warriors , though MacDonald indicated some skittishness about the Carbon Tax after incumbents in his Orange County district, Reps. Patsy French, Sarah Buxton, Susan Hatch-Davis, all lost re-election bids largely over the Carbon Tax issue.

In conclusion, the Carbon Tax issue is not going away, but efforts to promote it will likely shift from the house to the senate, and, with a Scott veto threat lurking, strategies will shift from short term to longer term passage.

We’ll keep watching closely!

Rob Roper is president of the Ethan Allen Institute

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The following is the concluding section of the EAI comments on the Comprehensive Energy Plan update of 2015, offered by the Public Service Department. The earlier sections analyzed the practicality of achieving Gov. Shumlin’s mandates of “75% of electric energy renewable by 2032”, and the overall “90% of all energy renewable by 2050”

As our frequently-ignored Constitution aptly observes, “previous to any law being made to raise a tax, the purpose for which it is to be raised ought to appear evident to the Legislature to be of more service to [the] community than the money would be if not collected.” (Ch I Art 9th).

In the past decade the passion for “renewables” has produced a long list of costly incentives, notably

  • Feed In Tariffs (standard offers), which require the utilities to buy up to 50 Mw of renewable power at prices from three to five times the current market price.
  • Clean Energy Development Fund, funded until 2012 by imposing special taxes on the state’s one nuclear plant, to distribute tax credits – and later, up front cash – to subsidize renewable energy installations, notably those stimulated by one of the Fund’s original board members.
  • RESET, the Renewable Portfolio Standard legislation (2015) that mandates utilities to purchase increasing percentages of renewable electricity

There is no question but what a state can achieve the decreed “90% by 2050”– if its political leaders can persuade its taxpayers and ratepayers to provide the enormous subsidies, and submit to the ever increasing mandates, that reaching that goal will require.

Whether the taxpayers and ratepayers could do more good for the people and economy of this state by making their own decisions on how to spend their own money (see Ch I Art 9th above) is an important question, which of course the Plan, like the 2011 CEP, will assiduously avoid.

In short, the CEP’s – and certainly the new Plan’s – vision of a state with 90% of its total energy produced by renewables by 2050 can only be achieved by heroic, costly government intervention into the energy market, over the growing protests of taxpayers and ratepayers called upon to finance the ever expanding renewable industrial complex.

It is significant that the “90% renewable energy by 2050” goal is not state law. It was simply decreed by Gov. Shumlin. It does not appear in 30 VSA 8001 as one of the goals of the state’s electricity policy. The “90% by 2050” goal was mentioned in Sec. 13 of Act 170 of 2014, but the fact remains that our elected representatives have never been called to vote on it. Because of the potentially enormous costs of achieving that goal, and the flood of taxes, mandates and regulations being put in place to achieve it, we recommend that the general assembly be asked to give this decree democratic legitimacy by a record vote in each chamber.

The CEP was rightly enthusiastic about distributed generation, as preferable to large central power stations and long transmission lines. What the Plan conspicuously refused to consider is a fleet of 100-200Mw factory-built modular nuclear plants, making use of new failsafe Generation 4 technology, on a dozen sites around the state. Such plants aren’t likely to be on the market before 2020 (unless the Chinese produce an exportable package before then), but a few states will be ready for them, and Vermont ought to among them.

Recommendations: the 2011 CEP included some useful proposals, including more net metering, ride sharing, local energy committees, state building efficiency improvements, smart grid investments, the voluntary local Property Assessed Clean Energy program, and maintaining an effective energy information clearing house.

But overall the CEP resolutely headed off in the wrong direction, anticipating enormous taxpayer and ratepayer costs, ever growing bureaucracies, and ever more extensive controls over the choices of the ordinary Vermonter, all to send Vermonters galloping after a wrong-headed goal of “90% renewable energy by 2050”.

Here are our 19 specific policy recommendations for the successor Plan.

  1. Abandon the “vision” of this Plan that state government must use its coercive powers to see that Vermont gets 90% of its energy from renewable sources by 2050 or any other date – at least until the General Assembly votes on the record to make themselves accountable to the voters who will bear the burdens.
  2. Replace that vision with this: “to set Vermont on a path to assure safe, reliable and competitively priced energy that will make possible a strong, competitive and growing economic base, both for creation of new wealth and income for the people of the state, and for expanded tax revenues to enable the state to meet its fiscal obligations.”
  3. Repeal the requirement that Vermonters be forced to reduce their greenhouse gas emissions to 50% below the 1990 baseline by 2028, or any other year. (Act 168 of 2006).
  4. Repeal the state’s “climate action plan”, inasmuch as nothing the people of Vermont can do, even at crippling economic cost, will ever have any detectable effect on any metric of “climate change” (formerly “global warming”).
  5. Repeal the RESET mandate that utilities meet a fraction of their demand with high priced renewables.
  6. Repeal the Feed In Tariff (Standard Offer) mandate that requires ratepayers to pay far above market prices to the producers of government-favored renewable electricity.
  7. Repeal the small business solar tax credit.
  8. Stop looking for inventive new ways to suck money into the Clean Energy Development Fund, such as a “compliance fee” levied on non-renewable energy (heating oil, truck and auto fuel, propane, natural gas etc.). When its current subsidy commitments are exhausted, abolish the Fund.
  9. Abandon the idea of authorizing issuance of Qualified Energy Conservation Bonds unless the entire risk of default rests with the enterprise favored by the financing (in which case the issue probably can’t be sold.).
  10. Repeal the ratepayer-financed PSB energy efficiency program, and let businesses and homes that wisely invest in energy conservation recover their costs from their own savings, instead of sending the tab to other ratepayers.
  11. Abandon the idea of instituting a carbon tax – a “climate pollution tax” to its backers. Such a tax, levied on gasoline, diesel, natural gas, home heating oil and propane, would, its backers say, include a rebate of 90% of the proceeds to people and businesses burdened by the tax; the remaining 10% would finance more renewable adventures like the CEDF. Opening an (eventual) $700 million a year revenue source would be an irresistible temptation to legislators to solve their chronic budget problems, not their constituents’ energy cost burdens.
  12. Abandon any temptation to subsidize any form of passenger rail in Vermont, especially after Gov. Dean’s $28 million Champlain Flyer boondoggle.
  13. Abandon any notion of requiring buildings to be “net zero” (100% energy self-sufficient) by 2030.
  14. Abandon any notion of restricting or taxing single occupancy vehicles (SOVs) driven by Vermonters.
  15. Abandon any notion of using land use controls to force Vermonters into downtown centers or other government-favored locations in the name of energy efficiency.
  16. Assess electric vehicle owners, who pay no fuel tax, a charge for using the state’s highways, instead of making gasoline and diesel fueled vehicles absorb all the costs. Require that publicly installed EV charging stations charge EV owners enough to at least cover the energy they are drawing.
  17. Continue to require utilities to purchase electricity offered through net metering connections, up to the point that grid stability becomes a problem; but set the rate of kwhr credit for net metering vendors so that they do their part in covering the fixed cost of maintaining power grid service.
  18. Consistently remind yourself that markets work, and that ordinary people usually turn out to make better use of their resources than what is prescribed for them by the experts who prepare “comprehensive energy plans.”
  19. Read Ch. I Art. 9th of our Constitution again, and post it in plain view at PSD headquarters. (Send copies over to the State House and the Governor’s office.)

Thank you for this opportunity to comment on the draft Comprehensive Energy Plan.

- Submitted by  John McClaughry, vice president of the Ethan Allen Institute. John served as a member of the Senate Natural Resources and Energy Committee and Joint Committee on Energy, 1989-92. A.B. (physics), Miami U.; M.S. (nuclear engineering) Columbia U.

 

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