Columnist has a strange view of how editorial boards work

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In his op-ed column in today’s Las Vegas newspaper, Steve Sebelius uses the term majority a dozen times to refer to a “majority” of the paper’s editorial board and the decision to publish an editorial this past Sunday opposing the margin tax for education, Question 3 on the November ballot. He, of course, endorses the tax and I happen to agree with the editorial stance.

“Sunday’s editorial made the case against The Education Initiative, saying it would be economically destructive across a wide variety of businesses, and that, in fact, ‘it does guarantee a much worse economy.’ In these contentions, I believe the majority is simply wrong,” Sebelius writes.

The column leaves the distinct impression that a newspaper’s editorials are determined democratically by a “majority” of the editorial board members. At all the papers I’ve worked at since the early 1970s, that has not been the case.

People would ask me, when I was editor of the Review-Journal, how editorial decisions were made and I would explain that the editorial board would discuss the various aspects of an issue, the board would vote, and the publisher always won — a majority of one.

There is a tagline at the bottom of the editorial column that reads: “The views expressed above are those of the Las Vegas Review-Journal. All other opinions expressed on the Opinion and Commentary pages are those of the individual artist or author indicated.”

Unless things have changed far more than I could imagine at the R-J, the term “majority” is a misnomer.

In fact, in my current incarnation as a free-lance columnist and editorialist for a string of rural newspapers owned by the R-J’s former publisher Sherman Frederick, this distinction has in fact arisen.

Back in December I penned a column pointing out a better way to reduce the caseload of the Nevada Supreme Court than creating an appeals court, which is Question 1 on the ballot.

But the publisher wanted to endorse Question 1. I told him an editorialist is like a gunslinger or a hooker. Who do you want shot or screwed? The price is the same. (Borrowed from a description a lawyer once used for his profession, but it works in this case as well.)

By the time I finished the editorial I may have convinced myself to vote for the appeals court, since the better solution is not on the ballot and the current situation is untenable.

That’s how it really works at the vast majority of newspapers. It’s hardly a democracy.

(By the way, at this year’s Nevada Press Association contest my columns and editorials won first places in the community newspaper division. I also had first places in both categories while at the R-J. Both of those were deservedly captured this year by Glenn Cook.)

Candidate Bilbray: Rob from Peter to pay Paul and we improve the economy!!!

Congressional candidate Erin Bilbray-Kohn, who is running against Rep. Joe Heck, has revealed an astounding level of naiveté and economic illiteracy by coming out in favor of raising the minimum wage to $15 an hour from the current $7.25.

“I think we need a minimum wage where people can have a decent lifestyle,” Bilbray told the Las Vegas newspaper.

Erin Bilbray (R-J photo)

Asked by a reporter whether she thought that could cause the loss of jobs because businesses would cut workers to save money, Bilbray replied in the negative, insisting higher wages could lead to more spending, pumping money back into the economy.

“I believe this will help the economy and make it stronger,” she claimed. “I think when you give the middle class money it helps us all.”

She seems oblivious to the fact that raising the minimum wage merely takes money from one pocket and places it in another, doing nothing to increase productivity or wealth. Its called redistributionism.

Neither does she take into account the ramifications for those who would go from $7.25 an hour to zero and what that would do to the cost of welfare payouts.

The CBO estimates that a half a million workers would become unemployed if the minimum wage were raised to only $10.10 a hour, less than $3 and not $7.75.

Nor does Bilbray have any concept of just how much money would be “pumped” into the economy.

James Sherk, a senior policy analyst in labor economics at the Heritage Foundation, told Congress a year ago that every dollar increase in minimum wage really only raises take-home pay by 20 cents once welfare benefits are reduced and taxes are increased. Thus that $7.75 hour works out to $1.55.

Sherk told a Senate panel:

The minimum wage raises the pay of many workers at the cost of some jobs. A lot of advocates for minimum wage increases consider this a good trade-off. They argue that the gains for the workers who benefit far outweigh the costs to those who lose out. For example, raising the minimum wage by 40 percent – from $7.25 an hour to $10.10 an hour – would cost roughly 8 percent of heavily affected worker groups their jobs (although losses would be larger among the most disadvantaged workers). At first glance this may seem like a good deal.

However, this analysis ignores the way American tax and welfare programs claw back wage gains made by low-income workers. Congress has created many overlapping means-tested benefit programs: the supplemental nutrition assistance program (SNAP, formerly called food stamps), temporary assistance for needy families (TANF), the Earned Income Tax Credit (EITC), child-care subsidies, housing vouchers, and Women, Infants, and Children (WIC) benefits. The government also provides extensive in-kind health care benefits: Medicaid, SCHIP, and the soon to be operating health care exchange subsidies.

These benefits phase out at different rates as income rises. Earning an additional dollar of income reduces SNAP benefits by 24 cents. Workers in the EITC phase-out range lose 21 cents for each additional dollar they earn. Housing vouchers phase out at a 30 percent rate. Low-income workers must also pay payroll (15 percent) and income taxes (10-15 percent) on each additional dollar of income. Medicaid operates with a cliff: when workers’ incomes exceed a certain threshold, they lose all benefits.

Congress did not coordinate these benefit phase-outs across programs. Consequently low-income workers can face very high effective tax rates as they lose benefits from multiple programs. Consider workers both losing SNAP benefits and landing in the EITC phase out range. For each additional dollar they earn they pay 15 cents in additional payroll taxes, 15 cents in income taxes, an average of 5 cents in state income taxes, as well as losing 21 cents of their EITC benefit and forgoing 24 cents of SNAP benefits – an effective marginal tax rate of 80 percent. Each extra dollar earned increases their net income by only 20 cents. Not even millionaires pay such high tax rates.

The Congressional Budget Office studied this issue in a report released last year. It found that a single parent with one child earning between $15,000 to $25,000 experiences almost no financial benefit from working additional hours or getting a raise. What they gain in market income they lose in reduced benefits, leaving them no better off.

And that doesn’t take into account the ObamaCare subsidies that would be cut due to higher pay, perhaps wiping out even that 20 cents on the dollar.

Bilbray also ignores the effect raising the minimum wage would have on the rest of us, especially those on fixed income.

Mark Wilson, writing a policy analysis for Cato Institute, reports that a “comprehensive review of more than 20 minimum wage studies looking at price effects found that a 10 percent increase in the U.S. minimum wage raises food prices by up to 4 percent and overall prices by up to 0.4 percent.”

So, a few would get a little pay hike but others would have to pay 40 percent more for food.

Why not raise the minimum wage to $50 an hour? That would pump a lot of money into the economy. What not just print a couple trillion in money and leave duffel bags full of it on every doorstep?

 

Voter must weigh pros and cons of creating an appeals court in Nevada

Between now and the November election you likely will hear this phrase repeated frequently: “Justice delayed is justice denied.”

This pithy little aphorism is usually attributed to 19th century British Prime Minister William Gladstone and argues that legal redress not delivered in a timely fashion is tantamount to no redress at all — such as some court cases here in Nevada that are still pending, though most of the original parties have long since died.

It is the favorite argument proffered by advocates for setting up an appeals court in Nevada, even though voters rejected similar proposals in 2010 and 1992.

Actually, that is not the strongest argument for ballot Question No. 1. You see, in order to keep up with its truly monumental caseload, the Nevada Supreme Court has over the past years resorted to disposing of most cases with non-precedential memorandum, or what are called unpublished opinion, since these can be prepared quicker and more easily than a full blown opinion. The case is settled but the ruling sets no precedent for similar cases, and thus offers no guidance for the courts, attorneys and parties. The same legal ground gets plowed over and over, wasting time and money for litigants and taxpayers.

Kris Pickering addresses Nevada Legislature (AP file photo)

“The published opinions that establish guidance on unsettled questions of Nevada law, as a percentage of the number of total dispositions, has declined over the years to where it now hovers between 3 and 4 percent,” the court reported in its fiscal year 2013 annual report.

The Nevada Supreme Court handles everything from appeals for driver’s license revocations to appeals in family law, foreclosure mediation, business, and death penalty cases.

At the urging of the justices, the 2013 Nevada Legislature passed SJR14, which would, if approved, create the Court of Appeals. But it would not be just another layer of judicial bureaucracy between the 171 district court judges and the seven-member Supreme Court. It would be a push-down court.
All appeals would go straight to the Supreme Court, but about a third of all cases, estimated to be about 700 a year, would be sent to the three-justice appeals court — such as timely cases involving child custody and criminal convictions.

The Nevada Constitution requires mandatory review of all cases, but the appellate court would allow discretionary review. The few cases anticipated to be appealed from the intermediate court would have been thoroughly reviewed and the high court could make short work of those cases.

The 2013 Annual Report of the Nevada Judiciary indeed shows the state’s high court carrying a huge caseload. Of the 10 states that do not have an appellate court, the report showed Nevada had the highest caseload by far — 2,333 cases compared to the second highest of 1,524 in West Virginia and 910 in third highest New Hampshire. That caseload means there are 333 cases for each of the seven Nevada justices. The American Bar Association recommends no more than 100 cases.

In a comment to the 2013 Legislature, Chief Justice Kris Pickering said, “In 2012, filings exceeded the dispositions and will likely continue to do so. Delayed dispositions and lack of precedent by which citizens can predict outcomes and regulate themselves are the result. This hurts not only citizens whose cases are delayed but Nevada’s nascent economic recovery as well.”

If approved by the voters, the appeals court would be housed in the Regional Justice Center in Las Vegas, closer to the vast majority of parties in legal disputes and thus saving time and money.

The cost of implementing the Court of Appeals is estimated to be $1.5 million a year to pay for the three judicial positions as well as staff — one executive legal assistant and two law clerks per judge. Since the Supreme Court is expected to spend less due to this intermediate court the total increased cost to taxpayers should be less than $1.5 million.

Nevadans are not getting the timely justice they deserve and are having to spin their wheels making the same legal arguments time and again. This time we believe the justices and lawyers supporting this measure have made a better case for an appellate court.

On the other hand, it might be cheaper to just change the state constitution so that the Supreme Court would hear only the most significant cases — discretionary review.

Nevada is one of the few states that allow high court review of darned near any case for any reason or no reason — other than one party not liking the outcome at the lower court level. Most states, like the U.S. Supreme Court, allow discretionary review. Only cases deemed worthy for some stated reason are taken up by the highest state court.

If you look at the stats from 2012, you’ll find the Nevada Supreme Court handled 2,248 appeals. Out of all those cases, the high court reversed only 10 cases and reversed/remanded only 95 cases. The vast majority were affirmed, denied or dismissed.

So, does the state of Nevada need to amend its Constitution to add another court at a cost of $1.5 million or should it amend the Constitution to make appeals discretionary? The justices argue the appeals would essentially be a discretionary review process.

study conducted 30 years ago found that in only a couple of years after creating appeals courts the number of opinions written by the state court of last resort was nearly the same as before the creation of the appeals court.

The voters have only the option of yes or no to an appeals court.

 

 

Newspaper column: Why we should repeal the 17th Amendment

We managed to repeal the 18th Amendment, which created Prohibition. It is time to repeal the 17th.

What? You have no idea what the 17th Amendment is? Well, it is the one that effectively ended federalism by taking the power to appoint U.S. senators from state legislatures and having the citizens directly elect them, as they had always done with the House of Representatives.

We may not get better senators, but it is likely they would not try dictate to the states what they should do — as they did when they set the national speed limit at 55 mph and the drinking age at 21, under threat of losing highway funding. No Child Left Behind dictates education standards under threat of losing funding. The Motor Voter Law told states how to register voters, as recounted in this week’s newspaper column available online at The Ely Times and the Elko Daily Free Press.

ObamaCare threatened federal funding if states did not expand Medicaid and set up exchanges, until the Supreme Court decided that was too onerous.

James Madison said during debate over the Bill of Rights, “The state legislatures will jealously and closely watch the operations of Government, and be able to resist with more effect every assumption of power, than any other power on earth can do; and the greatest opponents to a Federal government admit the State Legislatures to be sure guardians of people’s liberty.”

There was a grand design to balance power, but that was broken in 1913 with the passage of the 17th Amendment.

George Mason warned when the Constitution was being drafted in Philadelphia that the Senate had to represent the states lest the federal government “swallow up the state legislatures.”

Mason argued to the delegation, “(W)e have agreed that the national Legislature shall have a negative on the State Legislatures — the Danger is that the national, will swallow up the State Legislatures — what will be a reasonable guard agt. this Danger, and operate in favor of the State authorities — The answer seems to me to be this, let the State Legislatures appoint the Senate …”

The delegates backed him unanimously.

Justice Antonin Scalia in 2010 at Texas Tech University Law School was asked what he would change about the Constitution.

“There’s very little that I would change,” he said. “I would change it back to what they wrote, in some respects. The 17th Amendment has changed things enormously.”

Scalia added, “We changed that in a burst of progressivism in 1913, and you can trace the decline of so-called states’ rights throughout the rest of the 20th century. So, don’t mess with the Constitution.”

That’s how we got FDR’s New Deal.

Then there is the argument put forward by Nevada’s own Jay Bybee, former William Boyd Law School constitutional law professor at UNLV and now judge on the 9th U.S. Circuit Court of Appeals on the recommendation of Nevada’s senior senator, Harry Reid.

In 1997 Bybee penned an article for the Northwestern University Law Review titled “Ulysses at the Mast: Democracy, Federalism, and the Siren’s Song.” In Greek mythology, beautiful sirens lured sailors with their music and voices to shipwreck on the rocky coast of their island.

Bybee wrote of the passage of the 17th Amendment with a rhetorical flourish:

“Mason wished to provide some mechanism for states to defend themselves against ‘encroachment’ by a national government that everyone recognized would have significantly more power than any American sovereign since July 3, 1776. A senate appointed by state legislatures would be a near-complete defense to national encroachment because the senate controlled one-half of Congress. …

Sirens

“The Senate’s slide to popular democracy unyoked states and the national government in a way that has left the states nearly powerless to defend their position as other legitimate representatives of the people. As the United States moved into the Twentieth Century, it was inevitable that Congress would aggressively exercise power over matters such as commerce and spending for the general welfare in ways that no constitutional prophet would have foreseen. The lack of foresight of the circumstances under which Congress would exercise its powers did not excuse our failure to maintain those constitutional structures that assure the tempered, essential use of such powers. When we loosed ourselves from the mast to answer the Sirens’ call, we unleashed consequences only Circe could have foreseen.”

If the state Legislature of Nevada appointed the state’s two senators, do you think Reid would be calling them cowards for not voting to outlaw brothels in rural counties as he demanded in a speech at the Legislature in 2011?

The audacity of such power.

This is the proper response to the resignation of Eric Holder

Everybody is commenting on Attorney General Eric Holder resigning. Sen. Harry Reid had a comment. Rep. Steven Horsford had a comment.

But I like Rep. Mark Amodei’s the best:

RENO, Nev. – After learning that U.S. Attorney General Eric Holder will resign, Congressman Mark Amodei (NV-2) released the following statement:

“Thank you.”

Will this break those Tesla eggs in Nevada’s economic basket?

So, Tesla thinks it can cut the cost of lithium-ion batteries for its electric cars in half and make the cars affordable?

That’s why it plans to build a battery plant in Nevada and why Nevada offered $1.3 billion in tax give-aways.

According to Forbes, the Tesla hopes to cut the cost from $500 per kWh to $250, but a company has announced that it plans to produce batteries that cost $100 per kWh.

This the crux of the piece:

Musk is betting big on traditional lithium-ion technology. And he may be right. One risk, however, is that some other technology may achieve through engineering what he’s trying to do through sheer volume. And that’s where Sakti3 comes in with its new solid-state battery. Tesla’s batteries, which are made by Panasonic, currently cost around $500 a kilowatt-hour. Vishal Sapru, the energy and power systems research manager at research firm Frost & Sullivan, believes that Tesla at best can get that down to $250 by the end of the decade. Sakti3 claims that its batteries will reach $100 a kWh.

Nevada knows boom or bust. Will that $100 million road lead to a ghost town?

Newspaper column: Tesla tax deal fails on principle, economic viability

The deal the governor and the state Legislature cut with Tesla Motors to lure its proposed $5 billion lithium-ion battery plant to Nevada trammels the fundamental principles on which this nation was founded and is economically naïve.

The deal would allow the battery manufacturing facility to operate tax-free for a decade if it invests $3.5 billion here, eventually amounting to tax exemptions and credits totaling $1.3 billion. The state also agreed to spend $100 million to build a highway linking the site to U.S. Highway 50 in Lyon County.

Nevada was in a bidding war with Texas, California, New Mexico and Arizona for the plant, though Tesla had already built the earthen pad for a plant in the Tahoe Reno Industrial Center, as recounted in this week’s newspaper column, available online at The Ely Times, the Elko Daily Free Press and the Mesquite Local News.

Governor shows off new state name. (Getty Images via KNPR)

The governor claims the deal will bring in some $100 billion to Nevada’s economy and employ 6,500 directly in the factory, and result in thousands of indirect jobs.

Is that so or has Nevada been hoaxed?

In a Washington Post article in July, Nathan Jensen, a political science professor at George Washington University, said of such bidding wars for companies:  “It’s a zero-sum game.”

If Tesla is successful and hires 6,500 workers to build electric car batteries, might a gasoline refiner lay off 6,500?

Simply shifting companies from one state to the next does nothing to create new jobs, Jensen said, but still states and municipalities across the country are encouraging companies to relocate, at a cost of about $70 billion a year in taxes taken from one pocket and placed in another.

Jensen has compared job creation by companies in Kansas that were attracted to open there with huge tax incentives to similar firms that got no handouts. He found that six years after incentives were awarded, “the firms who received incentives actually generated slightly fewer jobs than those that didn’t receive incentives.”

In December 2012, The New York Times published a lengthy article about all the tax incentives given to companies and reached the same conclusion: That incentives generally amount to a zero sum game.

General Motors had gotten lucrative tax breaks from states and communities for years. But the company closed 50 facilities and walked away, only to be bailed out by federal tax dollars.

Richard Florida, director of the Martin Prosperity Institute at the University of Toronto and Global Research Professor at NYU, recently wrote of the Tesla incentive package, “But no matter how you slice it, the deal makes utterly no sense. It is just one more example of a government giveaway for a factory that would have been built anyway. As I’ve argued before, there is virtually no association between economic development incentives and any measure of economic performance. And it’s not just me. I spoke with several experts in economic development incentives and advanced manufacturing and the consensus was the same: this deal was overblown and unnecessary.”

He argues that companies are just gaming government officials. He calculated that when a realistic number of actual Tesla jobs to be created is used that the tax incentives would amount to $385,000 per job.

The proponents argue that it is OK to let Tesla come to Nevada tax-free because it would not have gotten any taxes anyway if it built elsewhere and its workers will pay taxes. If workers pay a sufficient amount of taxes to cover the services provided by the state, why levy a tax on any business?

The Nevada Constitution takes a very principled stance on taxation, dictating, “The Legislature shall provide by law for a uniform and equal rate of assessment and taxation …”

But then in 1982 on the heels of the fuel crisis of the 1970s the Constitution was amended to add a loophole big enough to drive a $100,000 Tesla sports car through: “The Legislature may exempt by law property used for municipal, educational, literary, scientific or other charitable purposes, or to encourage the conservation of energy or the substitution of other sources for fossil sources of energy.” Electric car batteries might fit the bill.

But the Constitution also says, “In enacting an exemption from any ad valorem tax on property or excise tax on the sale, storage, use or consumption of tangible personal property sold at retail, the Legislature shall: Ensure that the requirements for claiming the exemption are as similar as practicable for similar classes of taxpayers …”

A lot of companies would like a similar deal, but can’t reach the $3.5 billion threshold.

Then there is that 14th Amendment to the U.S. Constitution that says neither the United States nor any state may “deny to any person within its jurisdiction the equal protection of the laws.”

If one entity must pay taxes and another does not, that is hardly “equal protection.”

Here are other comments on this topic: John L. Smith, Sherman FrederickJohn KerrSteve Sebelius, Richard Florida, WSJ editorial, R-J editorial, Chuck Muth, Jon Ralston, Fox Business News, NNPR,  Michael Chamberlain, another Michael Chamberlain, NPRI, John Lee, Brian Greenspun, Harry Reid, Dean Heller, LA Times.

Some are better than others.