New Carolina Journal Online features

Dan Way reports for Carolina Journal Online on new Duke research that suggests North Carolina could save billions of dollars by loosening restrictions on nurses.

John Hood’s Daily Journal explains why Gov. Pat McCrory’s proposed statewide transportation and infrastructure bond packages are too large.

Williamson defends Trans-Pacific Partnership against free trade’s critics

Kevin Williamson of National Review Online explains his support for a proposed trade deal involving the United States and primarily Asian partners.

The TPP is mainly an agreement among rich nations — the United States, Canada, Australia, New Zealand, Brunei, Singapore, Malaysia, Chile, etc. — along with Vietnam and Peru, both of which are looking to continue bettering their economic positions through trade. Free (or more nearly free) trade may or may not help GM sell a few more Buicks in Asia, but the case for liberalization goes far beyond the interests of trade-oriented American firms and price-conscious American consumers: From national security to humanitarian concerns, the United States has good reasons to be invested in the advancement of the TPP countries. And given that the United States has a high-wage, capital-intensive economy that exports mainly high-end goods, our own economic advancement is contingent upon the ability of U.S. firms to connect with high-income buyers in markets around the world. Poor people do not buy a great deal of what Americans make. …

… Rhetoric from the age of “Yellow Peril” panic was, at its root, not radically different from what one hears from Democrats today: The problem with Asians, this school of thought goes, is that there’s just so damned many of them, and they’re so poor and accustomed to low standards of living that no white man could be expected to compete. The belief that American workers are being undercut by poor Asians lives on even as the supply of desperately poor Asians runs low — Singapore, one of the TPP countries, has a per-capita GDP that is 50 percent larger than our own. But the scheming Oriental looms large in the xenophobic imagination, and so we have Senator Stabenow et al. preparing to derail an important trade pact over the specter of Chinese currency manipulation — which is to say, a non-issue relating to a non-signatory.

Forbes publisher pushes for different types of ‘diversity’

Rich Karlgaard of Forbes values workplace diversity, though his opinions won’t necessarily jibe with those held by people who like to keep score on a racial, ethnic, or gender basis.

LET’S NOT MINCE WORDS about workplace diversity. It’s tough to get it right. On the one hand, your greatest chance to create a successful, productive team today involves a diverse membership. On the other hand, the more diverse that membership becomes, the worse the odds are that the team will survive long enough to produce those results. That’s diversity’s paradox and challenge.

After exploring diversity for our forthcoming book, Team Genius, my coauthor, Mike Malone, researcher, Faaiza Rashid, and I believe that most companies are blind to the big picture and make a common mistake: They view ethnic and gender diversity as simple, legal boxes to check off. That’s fine as far as it goes. But ethnicity and gender balance shouldn’t be the end point of your diversity campaign. They should be the starting point. Most of your gains–and your chance to soar in the global economy–will come from taking a larger view of diversity.

Let’s consider three more kinds of diversity.

Cognitive diversity. People think differently from one another. We all know that. But few of us give it much consideration–sometimes to our regret–when we assemble teams. As a result, ethnic and gender diversity can look good on paper, especially when everyone gets along well. Yet in action, your team still doesn’t work. …

… –Age/experience diversity. Experienced people are the backbone of successful companies–except when they fall into the habit of saying “been there, done that” to every new idea. Conversely, the young and inexperienced have no boundaries. Which balance is right for you? …

… –Proximity diversity. In this age of global work teams and remote collaboration, proximity is no longer supposed to matter. Except that it stubbornly does. Physical proximity of teams, in fact, is an important predictor of success.

Global economist Malpass diagnoses the causes of sluggish growth

David Malpass‘ latest column for Forbes magazine takes aim at conventional wisdom in economic thought.

ESTABLISHMENT ECONOMICS should be having a complete nervous breakdown. It claimed that growth and fairness could be created through government spending, zero or negative interest rates and central bank bond-buying. Applied massively, those policies are working in reverse, causing repeated downward revisions to growth expectations and channeling gains to the wealthy but keeping average wages down.

The result in the U.S. since 2009 has been average real GDP growth of only 2.3% and average underemployment of 23 million. The establishment rationalized this as the “new normal” caused by the 2008 financial crisis, an untenable claim after six long years of slow growth.

Rather than undoing the policies, governments have doubled down. They like to expand and have low expectations for the private sector. Even though U.S. median income crashed during the big-government programs of 2009-10 and stayed at rock bottom from 2011 to 2014, the Obama Administration maintained spending at elevated levels, paid two years of unemployment benefits, advocated repeated tax hikes and allowed the zero-rate, low-growth Federal Reserve to launch Operation Twist, QE and then unlimited QE3. …

… The path to growth and higher median income goes in the opposite direction. Governments need to practice austerity rather than dispense it, but government negotiators won’t move in that direction. Germany’s powerful chancellor, Angela Merkel, could guide the issue; instead she’s been agnostic regarding government size, letting government experts negotiate the reform programs, despite the bad political and economic results.

The force driving the establishment in developed countries since 2008 has been to use the post-Lehman Bros. financial crisis to make governments more powerful. Governments won’t give up their own grandeur, decrease tax rates or sell their favorite assets. Instead, establishment economics wants to spend more, buy bonds and increase taxation and government control. This has caused a misallocation of capital and a decline in private sector investment and hiring. It’s reversible, but for now the system is rigged to defend the status quo.

Forbes lauds Illinois’ governor

Steve Forbes devotes space in the latest issue of Forbes magazine to the man now occupying the top job in Illinois state government.

The Land of Lincoln is indeed the most fiscally dysfunctional state in the nation and has the worst credit rating among the 50 states. Its public employee pension systems are wracked with abuses (at last count there were more than 11,000 retirees who each draw more than $100,000 a year) and are proportionally the country’s most underfunded. The state’s budget deficit this fiscal year is running at $1.6 billion; next year it’s projected to be $6.2 billion. In addition, the state is sitting on unpaid bills in excess of $6 billion. Its unemployment and worker compensation programs are both a mess, which is especially hurtful to small businesses. Illinois is arguably our most corrupt state: Four of its nine previous governors have gone to the slammer. Not surprisingly, the state has the worst job creation in the Midwest.

Roaring into this massive morass as Illinois’ new chief executive is a former venture capitalist turned radical reformer, Bruce Rauner. That a Republican could win the governorship in Barack Obama’s deep blue state is testament to the state’s distress. Democrats may still hold supermajorities in both houses of the legislature, but, with the force of a Paul Bunyan, Rauner is acting as if the opposite were true. He is vigorously and unapologetically pushing forward with changes on every front.

Upon taking the oath of office Rauner signed an executive order ending mandatory union dues for those state workers who don’t want to join a union or support its political agenda. His new budget includes big spending cuts, such as reductions in state aid to localities and outlays for Medicaid. (There’s one exception: Money for K-12 would go up $300 million.) He also wants to cut taxes, freeze property taxes (and ultimately have local voters approve them), bar public employee unions from making political contributions, and allow local jurisdictions to adopt right-to-work laws in order to help attract businesses.

This weekend on Carolina Journal Radio

As N.C. lawmakers work to build on positive benefits tied to their 2013 tax reform package, they would be wise to build up state reserve funds in preparation for the next recession. That’s the advice Roy Cordato shares in the next edition of Carolina Journal Radio.

Katherine Restrepo discusses lessons this state’s Medicaid reformers could learn from states such as Kansas, Florida, and Louisiana. Sticking with health-related news, you’ll hear highlights from U.S. Sen. Ted Cruz‘s recent John Locke Foundation Headliner speech focusing on replacing Obamacare.

Economist Richard Vedder explains why markets work better than government in addressing most public policy problems, and you’ll learn about state legislation designed to help lower electricity rates in some eastern N.C. cities.

New Carolina Journal Online features

This week’s Carolina Journal Online Friday interview features Ashbrook Center executive director Roger Beckett’s insights about the importance of studying original historical documents.

Jon Sanders’ Daily Journal explains North Carolina’s renewable energy debate is not designed for the faint of heart.

Low Cost Reliable Energy – where do you stand?

You should know where JLF stands on N.C.’s mandate and subsidies for renewable energy and subsidies. We’ve written extensively about North Carolina’s renewable energy portfolio standards and what a bad deal it is here and here and here and here and here and here — all with additional links to even further information and studies.

There was a vote yesterday in the House Public Utilities Committee on HB 681 that would have capped, sunset, and repealed the renewable energy mandate and eliminated special tax credits and set up a study of important energy issues, setting priorities and finding cost saving measures for you. Unfortunately, five Republicans joined with 11 Democrats to defeat the bill. My colleague Jon Sanders re-capped the significance of the defeat of HB 681.  What are we left with? Every residential customer’s bill will increase on July 1 when the surcharge for RPS TRIPLES. Your tax money will continue to subsidize a solar industry that will never be able to survive on its own and you will have to support forever (using money that instead could go to teachers, police officers, or improving our roads). The vote was 14-16.

Where do you stand? You know where the John Locke Foundation stands. This letter will tell you where some other folks stand.

Where does your legislator stand?  Here’s who voted how in the committee yesterday:

Who voted yes, supporting lost cost reliable energy?

Republicans:

Jeff Collins (Nash)

Harry Warren (Rowan)

Mike Hager (Rutherford)

John Bell (Wayne)

Dan Bishop (Mecklenburg)

Hugh Blackwell (Burke)

Brian Brown (Pitt)

Dana Bumgardner (Gaston)

Rick Catlin (New Hanover)

Debra Conrad (Forsyth)

Jeff Elmore (Alleghany)

Susan Martin (Nash)

Chris Millis (Pender)

Dennis Riddell (Alamance)

Who voted no, ensuring an increase in residential customers’  energy bills July 1 and continued subsidies to special interests?

Republicans:

Sam Watford (Davidson)

Nelson Dollar (Wake)

Kelly Hastings (Gaston)

Chris Malone (Wake)

John Bradford (Mecklenburg)

Democrats:

Carla Cunningham (Mecklenburg)

Ed Hanes (Forsyth)

Kelly Alexander (Mecklenburg)

Beverly Earle (Mecklenburg)

Duane Hall (Wake)

Pricey Harrison (Guilford)

Ralph Johnson (Guilford)

Paul Luebke (Durham)

Graig Meyer (Orange)

Rodney Moore (Mecklenburg)

Michael Wray (Halifax)

Who did not vote?

Dean Arp (R-Union)

Linda Johnson (R-Cabarrus)

These are the members of the Public Utilities Committee. The 16 members who voted no have killed the bill, preventing it from going any further. For now. If your representative is one who voted no, you might ask them why.  If they voted yes, you might want to thank them. If your representative is not on the House Public Utilities Committee, their name is not on this list, but you might ask them where they stand if given an opportunity to vote on this issue later.

Energy costs matter. When the cost of energy goes up, the cost of everything goes up, killing jobs, slowing the economy and hurting North Carolina families. Who does your representative stand with?