Wednesday, December 27, 2006

A new tactic for the "Think Globally, Act Locally" crowd

Latest blog post by Jim Fedako.

The Chicago Tribune and The Columbus Dispatch are reporting a Washington Post story on the federal push to make the polar bear the first mammal to be listed as in-risk of extinction due to global warming. According to the reports, "The Bush administration has decided to propose listing the polar bear as threatened under the Endangered Species Act, putting the U.S. government on record as saying that global warming could drive one of the world's most recognizable animals out of existence."

OK, now that the feds are willing to consider the global impact of a supposed warming Earth on the polar bear population, it's time to work out the local implications. No longer is some local forest or stream the habitat of legal restraint as "putting polar bears on the endangered species list raises the legal question of whether the government would be required to compel U.S. industries to curb their carbon-dioxide output."

According to this logic, cars made in the US contribute to global warming, which in turn affects the greater habitat of the polar bear. It's a beautiful strategy, extend the habitat of an animal to encompass the whole Earth in order to control the actions of all acting humans.

The snail darter and spotted owl were amateur attempts at Green socialism compared to the polar bear.

Proud to pay taxes?

Here's the legal gift for those who like to puff their chests and declare, "I proudly pay my taxes." Simply ask your state legislators to sponsor a Tax Me More Fund bill in your statehouse. This will allow anyone who is so disposed to pay extra on their returns. Americans for Tax Reform has sample legislation available on their website.

See how many self-declared, tax-flagellating fools really opt to tax themselves at a higher rate. You know who I'm talking about: Those who claim that since it is all for the public good, they should be taxed more.

Let them give to their heart's content if they so wish, but leave me out of their deluded world of tax benefits. I am much happier in the reality of coerced taxes wasted on unconstitutional interventions and transfers. At least I can fight and argue against additional taxes, the deluded salivate like a Pavlovian dog at the sound of proposed additional tax legislation. Classical conditioning indeed!

But, hurry up! Six states already have similar legislation, and you don't want to have your state behind the curve on this issue.

Friday, December 22, 2006

Value-added or value-maybe

I have a variation on an old saying that reads, "If you have to join 'em, beat 'em."

Ohio is currently rolling out its value-added system. For years, many in education feared the concept of value-added. They feared a system that purported to be able to analyze test results and see if teachers and schools were able to add value during the previous school year. The standard for added value is the oft-used phrase, a year for a year: Did the student gain a year of knowledge during the most recent school year?

The year for a year has its own set of issues; such as, what is a year of growth in absolute terms, not defined by historical gains from similarly-situated students? For this discussion, I am going to ignore such issues and concentrate solely on the whitewash being used to spin lagging results into congratulatory press releases.

In logic, something is either A or not-A; there is no gray separating the two. In addition, saying something is not-not-A implies that the thing is A; the nots cancel. But in statistics, the nots don't cancel. So, not-not-A does not imply A.

A closer look: My district uses the standard value-added definition for not achieving a year of growth; performance two or more standard deviations [1] below the expected result. The reason for this range is that the statistics used in value-added analysis cannot provide exact figures. No one can state with certainty that a child achieved growth of, say, 1.23 standard deviations from the expected growth.

We can state with great confidence that the child who achieved at 2.24 standard deviations below expectations did not grow an academic year. Because of the inexactness of the statistics used in value-added analysis, it would not be fair to designate a teacher, school, or district as a poor performer unless the students achieved below the level of confidence; two standard deviations below expectation.

I can accept that. Statistics - an inexact science subject to noise - has to allow for a range of gray before making a positive statement. But the range covered by possible outcomes above the two-standard-deviations-below-expectation mark accounts for over 97% of all possible outcomes. Or, put differently, a score in the 3rd percentile is considered as not-not-A; the level which is now defined as A, the expected result of a year for a year.

The sleight of hand: The Olentangy School District has reported to our community that its students are gaining a year for a year simply because they are achieving above the 3rd percentile. The statement that district students saw a year of growth simply means that the students did not see the not a year of growth. But that does not mean that district students saw a year of growth. Yet the not-not-A has becomes A due to a sleight of hand. What is true in logic is not true in statistics, but is good PR nonetheless.

As a recent board member (resigned three months ago), I saw the data from two years ago - poor performance - but was never able to get copies of last year's data (the latest reported data) since the administration was concerned about the results. Don't know for certain, but in my experience possible good results were easy to obtain while possible poor results were always a struggle, unless the results were bound for public release through the state or local press.

Now when I say that two years ago the district showed poor performance, I really mean that most combinations of school, grade-level, and subject, revealed achievement below expectations, but few below the two standard error mark of failure.

The system that feared value-added has simply spun its value into that which tells a story worthy of congratulations. The 3rd percentile, a very low standard indeed. But the new standard nonetheless.

"If you have to join 'em, beat 'em". They won!


[1] It's actually two standard errors, but, for a population of one, the standard error is the same as the standard deviation. Remember, the district is stating that all students will grow one academic year per school year. That means that the focus is on individual students, not some aggregate class, school, etc.

That said, the district may be using two standard errors of measurement as stated at the board meeting. If that is indeed the case, the district has created its own system, one different from the now-standard Sanders value-added analysis. Sanders uses two standard errors not standard errors of measurement.

The district's system would mean that they are at the 25th percentile, give or take, depending on the test. Still a very low standard of achievement.

Thursday, December 21, 2006

Is High School Football a Public Good?

My latest article

Is High School Football a Public Good?
By Jim Fedako
Posted on 12/21/2006

Most of us would never think of asking our neighbors to foot a personal bill. We accept responsibility for car and roof repairs as ours alone. In addition, we don't bang on the door across the street in order to demand a contribution towards our children's figure skating lessons, taekwondo classes, etc. That which is consumed or used by our families is to be paid from our pockets — the definition of personal responsibility..

Now let's change the situation slightly. Instead of a figure skating lesson — the realm of the private good, consider the local public high school football team — the realm of the supposed public good.[1] The technical definition of a public good — a good that is nonexcludable, nonrivalrous, subject to free riders, and hence will only be provided by government through coerced tax dollars — has been corrupted in the modern lexicon to mean anything that is perceived to benefit society in general, no matter how specious the benefit argument.

Based on the technical definition, football is not a public good as teams are excludable and rivalrous since each team is limited to 11 players on the field without penalty. But no one really applies the technical definition to derive public goods. For if they did, the concept of public goods would disappear from economic textbooks and from debates over the need for government interventions in the market.

Instead, the collectivist definition — the vacuous, yet now standard, definition — applies the general welfare argument to elevate football from a private activity to that of a public good. The argument goes something along these lines: football is beneficial because it prepares boys for adulthood, keeps them off the streets after school, and provides them with a place where they can excel.

continue reading ...

Sunday, December 17, 2006

The market: The solution

Listserve response to a gentleman who likes to make the following statement:

Was Churchill off base when he declared that the best argument AGAINST democracy is a 3-minute "conversation" with the average voter? [1]

You have a tendency to include this quote in your emails. Exactly what are you implying by it?

The Public Choice school of thought has explained why it is not an economizing behavior for voters to understand all that is debated and decided in DC, state capitals, county seats, townhalls, school boardrooms, etc., since the time spent understanding issues completely is never rewarded by having the deciding vote on the issue(s) at hand.

Don't ever expect the average voter to grasp every issue, just as I don't expect you to understand the finer points of the current trade negotiations between the US and China. Frankly, you'd be wasting your scarce time delving into this and most other issues.

So, the rational choice for individual action is to ignore most of what is debated and decided by governing authorities. But, as you imply, that solution is unsatisfying to you, and, as I would argue, ill advised. The better solution is always the same: Reduced government and the free market.

Moving the decision-making from a centralized body back to the individual will satisfy the concern about the unknowledgeable voter, and put the power in the hands of those who truly benefit from the decisions; the consumer. Why have bureaucrats decide trade rules with China when it is the individual consumers who benefit from such trade?

We tend to believe that a government official can create an agreement that will satisfy all 300 million Americans involved in some form of trade with China. Let those agreements be resolved by the individual, not the official who serves his own purpose.

The same with education, let the consumer choose the product and either benefit or suffer from the result. The present structure of government-run schools leads to decisions being made by those who never quite seem to suffer the consequences - other than when their decisions are outside of the current political fashion.

We have a habit of falling on the sword of collectivism, even when we cheer the latest pronouncements of the successful businessman or businesswoman. Every CEO and manager has grand ideas, ideas that are not so different from those of the life-long bureaucrat, or you and me for that matter. The difference is that those in business are forced to listen to the consumer and the financial market.

Produce products that no one wants and your days are numbered. Conceive of plans that have cannot garner financial backing and retirement and days golfing are your future.

Yet, once freed of such realities, the CEO-turned-government-official has no problem advocating for the products and plans that the market wouldn't allow.

In addition, why trust the captains of industry to use government for benign purposes? They are simply looking out for their own interests. Does that make them evil? No, but it shows the inherent evil of a system of blue-ribbon commissions leading to government mandates. Once again, advocate for the free market, and the requisite reduction in government interventions.

Erich asks, "What is a good vocational educational model?" The answer: Whatever suite of models the market produces. Looking for the correct approach is similar to looking for correct way to run a business. Each business runs on a different model, some only slightly different than others, yet different nonetheless. An imposed model would sink the US economy to something equivalent to that of the Soviet Union.

An aside: My local Career Center spends over $30,000 per pupil per year. $30,000! That's certainly one model worth ignoring.

So John, what does Churchill's statement mean to you? To me it says that we need to reduce government to its intended role: The protector of Life, Liberty, and the Pursuit of Happiness; in education, and in everything. Otherwise you will be fighting against the rational voter who, if we are true to ourselves, does not need to be able to recite the names of US Supreme Court justices and cabinet officials, or to quote NAFTA, chapter and verse.

Though along with a reduced level of interventions, citizens would need to understand the Declaration, Constitution, and Bill of Rights - solely to understand when government has exceeded its constitutionally-imposed limits. With a reduced government, there would be so much less to memorize, as citizens would only have to remember the names of the heads of the four original cabinet departments. The added benefit is that the talking-heads would be back on AM radio discussing the latest baseball scores and UFO sightings.

There exists a lifecycle of thought regarding government adoption of activities previously supported by the market. First there is disbelief that government can produce the same quality outcome. This disbelief is replaced over time with the belief that only government can provide the activity, as the past is forgotten by subsequent generations.

Education is such an activity. The market can produce education as easily as it can produce peanut butter. Alternatively, we spiral downward as each blue-ribbon commission imposes the next supposed solution; a solution that is, of course, doomed to fail.

Finally: There was a time when being a Patriot meant risking everything to fight against government intrusions into Life, Liberty, and the Pursuit of Happiness. Through generations of government-run schools, the term Patriot has been perverted to mean someone who advocates for a government solution. Times certainly have changed.


[1]The actual quote attributed to Winston Churchill is: The best argument against democracy is a five-minute conversation with the average voter.

Thursday, December 14, 2006

Saving "the taxpayer"

Olentangy Superintendent Davis believes that new operating millage is needed in November 2007 even though the district's own documents filed with the Ohio Department of Education show otherwise. The latest ploy is for Davis to imply that waiting to until 2008 may "be more costly to the taxpayers."

More costly than what? Than the Davis solution of increasing the tax burden of the average taxpayer a year or two early by an additional $700 per year? I'm not following any of the logic behind this supposed tax savings.

OK, just the facts. Based on the current rate of increasing expenses, the district will have to take a short-term loan in FY09 in order to meet a cash-flow shortfall during that year. The loan is required since the first payment on a 2008 levy would not be received by the district until April of 2009. [1]

Hypothetically, taking a loan could have an adverse effect on the district's bond rating. But, the district took a $10 million dollar loan in FY05 and saw no reduction in its bond rating. Yes, it is true, a bond rating reduction may occur, but history shows otherwise.

That said, we know that a new levy will raise taxes; there is no hypothetical may here.

Once again, Davis is not discussing cost savings he claims to have found. The administration commissioned a study - which I mentioned in a previous post - that found close to $20 million per year in possible reductions if the district were to reduce costs by only offering the state minimum requirements. Now, I am not suggesting that the district make such drastic cuts, though some of the identified reductions in expenditures could be implemented without reducing opportunities for students. But first, the study needs to be reported to the board and community, and discussed publicly. [2]

The report is intriguing because it does not glaze over areas where the district is spending higher than peer districts. It plainly shows those areas where Olentangy needs to reduce costs.

My fear is that the administration will withhold the report long enough that they can claim it has lost relevance due to age. A great strategy for the district, but not for the taxpayer.

Back to levies, loans, and dollars. Should Davis implement his supposedly identified reductions, the district would not face a cash-crunch in FY09 as they would not need a levy until Spring 2009. So, this spin of loans and hypothetical costs appears to be nothing less than hogwash.


[1] A very similar situation occurred in FY05, where the loan also allowed for a reduction in millage.

[2] I will be uploading pages from a draft version of the report from time-to-time; it's big. You can request a copy from the district through a simple public records request. Keep in mind that current law allows anyone to obtain a copy of public documents without signing a form or presenting ID. Simply pay the per sheet cost and the report is yours. Or, read it here.

Tuesday, December 12, 2006

Daily quote from

FFF, The Future of Freedom Foundation, has established the following as its mission: The mission of The Future of Freedom Foundation is to advance freedom by providing an uncompromising moral and economic case for individual liberty, free markets, private property, and limited government.

The quote below came from their fantastic Daily Update:

Remember, FDA employees are serious about fear. We pay these people to panic about an iota of rodent hair in our chili, even when the recipe calls for it. FDA employees are first-class agonizers, world champions at losing sleep. When Meryl Streep got hysterical about Alar, they actually checked the apples instead of Meryl's head.

— P.J. O'Rourke, All the Trouble in the World [1994] is a great resource for Libertarian thought. Subscribe to their Daily update and enjoy.

Monday, December 11, 2006

The value of an experienced teacher

I have previously written about the concept of a fair wage for teachers. After comparing public school teacher salaries with those for teachers working at private schools it becomes quite obvious that public school teachers are overpaid. But it goes beyond even that since there is no market for experienced teachers within the public school system. You will not find local school districts recruiting experienced teachers from other districts. You will find that occurring in private industry. Why?

In private industry, many experienced workers produce more than inexperienced ones. So businesses are willing to pay a premium for such expertise. In public schools, teachers typically reach peak performance somewhere between years 5 and 10. Afterwards, they add no additional productivity. And, as class sizes do not vary with experience, the teacher at the top of the salary scale teaches the same size class - 20 students - as the new teacher straight out of college. Both the experienced teacher and the one with a 5+ years under his belt produce the same product; one year of education for 20 students.

There is no demand from other districts for teachers making $86,000 a year or more, yet we are told that these teachers are worth that salary. You will hear district employees and board members speak of the market wage for experienced teachers. Strange, both the private and public sides of education don't act as if they agree.

One other interesting observation. Students are told to behave during class time, respect others, etc. Wait until the next teacher negotiations to see if such behaviors are requisite for the unionized teacher looking for a tax-funded raise.

Sunday, December 10, 2006

Painting an average statistical picture

There are always a number of ways to slice data in order to obtain the statistics that paint the picture you want to sell. The Olentangy District announced with pride that its latest Third Grade Reading Achievement Test scores indicate growth. Based on what? Based on the district beating the average score of its state-selected group of similar districts. Thanks goodness for the few very poor performing districts in that group - it kept the average down for once.

Instead of picking the average of some arbitrary grouping of schools, look at absolute rank across the state based on the Performance Index(PI). The PI is a state statistic that gives a district credit for advanced and accelerated proficiency test scores, and dings a district for scores less than proficient. The PI is the best way to compare districts, that's why it's printed on the annual state report card of district achievement.

So, what does the PI show? Olentangy is ranked 100th out of the state on this indicator of student outcome. Olentangy is also ranked 15th in its group of 21 similar schools (20 schools plus Olentangy). I have always asked: How do you take a district with top demographics, achieve mediocre results, and still find means to celebrate?

For Olentangy, it's certainly a good thing that there are some really poor performing districts. But how do comparisons against the average maximize learning and prepare students for competitive admissions to colleges and universities? Well, they don't.

Go ahead and celebrate mediocrity, it's all we seem to get from the local school system.

Thursday, December 07, 2006

Random thoughts

Olentangy School District
Olentangy superintendent sees the need for an operating levy in calendar year 2007 while the district's own documents show no such need. He forgets to mention that a November levy has the same effect on the taxpayers and the district as a May levy. Both raise tax collections starting in 2008 and provide the same revenue stream. So, if you don't need a levy in May, you still don't need one in November. Also, the claim that waiting until 2008 will adversely effect district operations is specious. A levy in 2008 along with a loan against future tax revenue will easily satisfy the current, and high, level of operational expenditures. And, if the superintendent finally proposes and enacts the cost reductions he claims to have found, no loan will be needed in 2008 as no levy will be needed until 2009.

In addition, let's not forget the reductions noted in the elusive State Standard Analysis, a report that was prepared for the district at the administration's recommendation, and funded by tax dollars. Though his report was delivered to the district nine months ago, it has never seen the glare of sunshine. A report so revealing that it hasn't been shared with the public, or the even with the board in a public meeting. If the public was able to read the report, they may reach the conclusion that a levy is not needed until 2009.[1]

The New Minimum Wage Amendment
Michael Les Benedict has a letter in this morning's Columbus Dispatch where he supports the new minimum wage in Ohio and claims that the onus for showing that the amendment is harmful falls on us freemarketers. You see, he admits jobs will be lost but makes it our challenge to find out how many jobs are actually lost. Because, as he puts it: The economic question is whether the minimum wage was set so high that a significant number of jobs will be lost. Significant is a value-laded term in this context. I would assume that even one job lost is significant to the recipient of the pink slip. Not so fast, Benedict will decided if the lost job is significant in his eyes. While the newly unemployed are hitting the government lines, they can warm themselves in the fact that it is in their best interest to be unemployed. Go ask Benedict. Quite an omniscient man, this Benedict.

The Statewide Smoking Ban
According to the Columbus Dispatch, we now find that truckers who drive company trucks are violating the new law when they smoke inside the cab. State health department spokesman, Kristopher Weiss, states that it is unlikely that anyone would report a smoking truck driver. Is he crazy? Ten years ago most of us would have thought a statewide amoking ban was unlikely. I'm certain that the do-gooders who sought the smoking ban will have no problem finking on the smoking trucker. Those of this ilk just had Crisco banned in New York City restaurants. These folks will not sleep until they control all behaviors. Sorry, truckers. Their eyes will be on you.

[1] Of course, I do possess a copy of the report, and with a public records request, so can you.

Wednesday, December 06, 2006

Voting with Our Feet? Local Government "Services" and the Supposed Tiebout Effect

This article published earlier in the year by provides some of the background for the forthcoming question: Is high school football a public good?

Voting with Our Feet? Local Government "Services" and the Supposed Tiebout Effect

Since Paul Samuelson defined the term some fifty odd years ago, public goods has entered the popular lexicon and become an established belief. From the simple technical definition as a good that is non-excludable and non-rivalrous, thus subject to free riders, and therefore can only be produced by government or through governmental action, public goods now encompass almost any good that a statist desires, whether neo-con or liberal. To question the concept of public goods is to attack mom and apple pie.

In 1956 Charles Tiebout extended the concept of public goods to the local level and created a model of a pseudo market for local government services (police, fire, schools, parks, etc.) whereby individuals sort themselves in such a manner that their preferences for government services match the services provided by the local government where they chose to reside. And just like Samuelson's public goods, Tiebout's local public goods plays a major role in how taxpayers view government expenditures.

The Tiebout Effect, the sorting of services and taxpayers, is supposed to provide a market solution that leads to a Pareto-Optimal equilibrium, guiding local governments toward providing only those services and quality of services that their respective residents want at a price they are willing to pay. Residents who don't like the mix of service, quality, and tax rate, "vote with their feet" and move to areas that better provide a mix that meets their preference rank. As residents either plant "for sale" signs and purchase homes elsewhere, or as prospective residents build new homes or buy existing homes, local governments recognize these activities as signals to either increase or reduce their service levels, depending on the perceived desires of the voting majority of community.

On the surface, the Tiebout model makes for a great justification for devolving a centralized government that can't provide for preference differentiation into many smaller local ones that can market themselves to individuals. Local governments are able to be as lean and mean as any private sector firm, at least according to Tiebout's model. But models are not reality.

Decentralized governments do compete with regard to tax incentives and public financing when trying to entice businesses to move into their area. But governments do not compete with each other by offering services in the same manner as entrepreneurs in the market place.

The easiest way to dispense with Tiebout is to recognize that the Austrian School has demolished the concept of public goods. Public goods simply do not exist. Sorry mom and apple pie. I am not going to address this here since there are many excellent articles and papers on the fallacy of public goods in general available at .

The Rothbardian argument that a majority of voters does not speak for everyone also dispels the belief that the mix of so-called public goods, and local public goods, is a reflection of anyone's preference rank. No market in any sense exists where the majority plus one of those who chose to vote dictate the expenditures - through taxation - of all other. This is not a market, it as a coerced redistribution of wealth. Those in the voting majority simply become the net tax consumers while all others become the net taxpayers.

Despite the Austrian refutation, mainstream economists still cling to the public goods fallacy. In particular, many papers are written that cite the Tiebout Effect, especially in reference to local public schools and property values. Economist use Tiebout models in attempt to show that individuals voting with their feet drive improved school performance and increase property values.

While it may be true that individuals on initial draw seek communities that best match their preference mix of services and tax rate, individual preferences change as does the local government's mix of services and tax rate. Since the taxpayer is unable to simply move without incurring expense and the local government is a area-wide monopoly, local governments are under no pressure to satisfy changing preferences [1]. Entrepreneurs in the market, on the other hand, must quickly respond to any change in preference or suffer financial loss or ruin. Governments as monopolies are immune to such market pressures.

For sake of argument, let's agree that there is such a beast as public goods and that government is the entity most capable of supplying such services. The question I want to address is: Does the concept of local public goods provide a market that is driven to efficiency through the movements and sorting of individuals?

Like the often used example of the frog that blissfully allows itself to be boiled if the water temperature is slowing increased from lukewarm to boiling, taxpayers can also be boiled under rising tax rates simply because the marginal cost of moving exceeds the marginal cost of almost any new property tax. This has a piecemeal effect as taxes are increased every so often but each new step in tax rate does not warrant a move. Slowly the tax rate brings the homeowner to the boiling point, boiling under the collar anyway.

People tend to fall on the sword of collectivism and believe that a community is based on homogenous preferences. Nothing could be farther from the truth. School districts like to create the ideal-type resident and then assign attributes. Districts say that, "Our residents want program x." Does their community -- an aggregation of individual acting residents -- really want program x offered at the local schools? No, some parents want program x offered because they would rather not pay the full cost themselves but favor having their neighbors forced to split the bill. Districts like having program x simply because they now have a dependent constituency that will support additional tax increases.

Assume that you are offended by this machination of democracy or recognize yourself to be a net taxpayer for someone else's wants, what do you do? Is moving to another school district that has a better mix of service and tax rate the efficient and rational response. Not usually since the likely closing costs, moving expenses, and other real estate fees, drain about 10% off of the paper value of a house. The cost, real and assumed, to the owner of a $250,000 house is close to $25,000 with each move. It becomes obvious that it make sense to let the tax temperature rise just a few more degrees, even though the boiling point is rapidly approaching.

What about improved efficiency and performance of the local public school system due to the Tiebout Effect? From a market standpoint, the consumer must be able to operate in an free, unhampered market in order to guide the economy. The public school market is neither. Given that my singular vote has no impact on a tax levy and that I can't simply cross district lines without incurring a large cost, I am captured by the school market. If I am a regular at Burger King and the service or price changes in a manner I do not like, I can easily cross the street to McDonald's, Wendy's, etc., without having to bear any additional cost. In fact, the managers of the other restaurants will welcome me with open arms. There is no system of local public goods ready to serve me in the manner of the fast food market since I can't really "vote with my feet." The school system recognizes this and therefore sees no need for improvements in services relative to costs.

Oh, sure there are studies that show the occasional Tiebout Effect in the housing market, but here are also many studies showing no effect whatsoever. Certainly acting individuals sort themselves on any matter in question, but we can never know what the true reason for the sorting is. When econometricians use models that are based on the idea-type community member and then make assumptions about preference rankings, they are operating without a solid epistemology.

The above analysis shows that no free market for supposed public goods exists, local and otherwise. But if you require empirical data, just look around. Have you ever seen school districts, or any other local political entity, embrace improvements in order to capture a better market share? What you will see is school districts spin any change in outcome, whether positive or negative, as improved academic performance, and any additional cost as improved service. You will also see school districts claim that the school market is such that any reduction in funding or salaries will hurt student outcomes even though government expenditures and quality outcomes are inversely related.

School districts do not fear rising costs the same as the local businessman. Districts show no concern when their tax rates begin to exceed neighboring districts, in fact they will sell their need for operating levies on the basis that they spend less then neighboring districts -- cost equal service.

Imagine if McDonalds refused to acknowledge the hamburger price at Wendy's across the street. Imagine if consumers of computers could be led to believe that quality cannot go up even as prices go down. That would make for a strange market, but it is the market for supposed local public goods.

In addition, as Rothbard showed, taxation reduces the value of the item taxed. There you have it, schools don't improve, but taxes rise and potential property values fall.

A Tiebout Effect? Local public goods? No, you have been convinced by the fallacies and captured like the soon-to-be-boiled frog. It's not you choosing the mix of service and tax rate, it's the school system, or other governmental entity, making the choice for you.


[1] Due to government being an area-wide monopoly, school districts, and individual schools for that matter, typically cannot be switched without a move. This creates an issue that is not a concern where area-wide monopolies do not exist, namely the issue of switching suppliers requiring the selling of one's home. I can switch between McDonalds and Burger King as often as I like and not incur moving expenses. If McDonalds was granted an area-wide monopoly which forced me to buy Big Macs based on my current address, I would end up in the same situation as that with public schools. Unlike the standard neoclassical transaction cost, the cost of moving is the result of a government-imposed monopoly. End the area-wide monopoly and the moving cost issue disappears.

Monday, December 04, 2006

How about just teaching math?

Ever wonder why there is so little time in schools for teachers to address the three R's? Read the following article from the latest edition of Teachers College Record, the mouthpiece of Columbia University's esteemed Teachers College:

Rethinking Terrestrial Pedagogy: Nature, Cultures, and Ethics

by Huey-li Li — 2006

In this article, I offer a clarification of the ambiguities surrounding the pivotal concepts that have shaped and will continue to shape environmental education movement in the United States and beyond: nature, conservation, sustainable development, and environmental justice. I point out that dualistic frameworks not only polarize environmental educators' ethical, political, and pedagogical values but also oversimplify complicated ecological issues. It is critical to generate inclusive and collective pedagogical efforts that recognize the interactions between the natural and the cultural, the possibility of integrating ecocentric and technocentric conservation education movements, and the need to foster humility for ongoing dialogues concerning sustainable development and environmental justice.

How about just teaching math instead of this muddled trash?

Sunday, December 03, 2006

Olentangy budgets; at the margin

Marginal analysis is the best way to understand the financial direction an organization is taking. By looking across the organization for changes at the margin as opposed to focusing on changes of averages, policy shifts are easy to note. When the attention is placed on average salaries, staffing ratios, etc., policy shifts can easily get lost in the sea of a big-dollar operating budget. But when the focus is directed at the margin, policy shifts are revealed.

An example: The Olentangy School District has a current operating budget of over $100 million dollars. The budget has been growing, that we all agree upon. The board and administration will claim that additional students and inflation are the main driving forces behind budget increases. Is that true?

Let's look at one item at the margin; the staff to pupil ratio. Looking at staffing practices from fiscal year 2004 to fiscal year 2006 reveals that the district had been hiring one new staff member per additional 10.6 students. Now look at the period covering fiscal year 2007 to fiscal year 2009 (forecasted), the district proposes to hire an additional staff member per additional 7.6 students; an almost 40% increase in this one statistic. Think about it; a 40% increase or an additional $3.5 million per year in expenditures and subsequent tax revenue needs. Incredible!

More incredible is the change in new administrative positions. Instead of the FY04 to FY06 pattern of one new administrator per additional 429 students, the district is projecting one new administrator per additional 159 student from FY07 to FY09; a 260% increase. Incredible ... oh, wait ... I used that already. Scary may be a more apt description.

Looking at changes as a function of the average would also reveal the changing staffing pattern, but the margin reveals what's actually behind that change - it's magnitude, and the effect on the future tax increases.

Keep this in mind as the district talks about budgets and levy millage. See if they address the expenditure train that is about to leave the station, running wild on marginal increases.

Saturday, December 02, 2006

Fads in the public schools and private industry

Listserve response to a comment that private sector managers are unable to provide guidance to public schools.


You are absolutely correct. In addition, the sufferers of the Progressive contagion are not simply public education and schools of education; private industry also suffers from some of those very same ills. Hucksters make hundreds of millions, if not billions, selling the some of the same hash that is flung in classrooms. Witness CEO's and managers embracing the newest, bizarre, and ineffective organizational philosophy concocted by the con man looking for quick bucks.

What separates private industry and public schools is the blind adherence to certain philosophies found within public schools, and the belief that the philosophy is both the means and the end desired.

In private industry, the latest management fad is quickly set aside once profits or market share begins to take a hit. The private industry firm quickly reorganizes itself in a productive manner or the pink slips begin appearing. This reorganization away from the fad will occur even if the fad is still nominally supported by upper levels of management. The name remains but the organization morphs the organizational philosophy into one that actually works.

Why is private industry forced to change? The answer is simple: The heartless consumer cares nothing about organizational fad, he only cares about price and quality, and possibly some subjective intangible.

In the public school system, since the philosophy - pedagogy - is both the means and the end, the organization does not change to correct structural flaws. In addition, because public schools have no real product to sell, other than the standard propaganda and its adopted philosophy, the school system cannot correct their processes in order to improve.

Example: Is your local school selling educational outcomes, athletic/artistic performance, social reengineering, or some sort of Progressive ideal human? Outside of some muddled philosophy such as, fostering a culture of continuous learning, no market equals no product. No product means no rational allocation of resources, and no ability to rationally restructure.

Woodrow Wilson sought the brightest minds in private industry to advise government, an idea expanded by FDR and many presidents thereafter, and look at all the ills caused by all of these brain trusters.

Wednesday, November 29, 2006

The Fairness of "Unequal" Exchange

My latest article - posted late

The Fairness of "Unequal" Exchange
By Jim Fedako
Posted on 11/21/2006

Market exchange is not based on the requirement that both parties appraise the goods about to be exchanged at equal value. Instead, market exchange is based on both parties benefiting from a two-way, unequal valuation of the goods to be exchanged.

An example from my youth: During my high school years in the early 1980's, I had purchased a double-live album of the rock group Rush for $15. Teenagers can be a fickle lot and I was no different. My musical tastes changed during my junior year and I morphed from a Rush fan into someone who felt that Fly By Night was simply noise — vulgar noise at that. Not only did I no longer listen to the album, I wanted to get rid of it since I felt that the album reduced the quality of my record collection.

Along comes a fellow student who was fast becoming an ardent Rush fan. We agreed to an exchange: I would trade my album for his $5. Fair enough. Right after the exchange, as I held the $5 and he held the album, the new Rush fan said something along the lines of, "I just ripped you off. I would have paid $10 for that album." I replied, "No, I just ripped you off since I was about to toss the album into the garbage anyway."

continue reading ...

Tuesday, November 28, 2006

Reading and malinvestment

Ludwig von Mises of the Austrian School of Economics warned of the unintended consequences of government interventions. In line with his warnings is the misallocation resulting from the malinvestment by government in activities that are not the best use of scarce resources. These malinvestments create capital structures that are not supported by real needs and wants. Bust comes when resources are cutoff or are shifted to the lines that are truly productive from those lines supported by the government interventions.

How in the world does this relate to reading? The answer is quite simple and telling, it's also an excellent lesson in Austrian Economics.

At the same time that Teach Your Child to Read in 100 Easy Lessons by Siegfried Engelmann, Phyllis Haddox, Elaine Bruner, is currently available on for $7.04, the federal and state levels of government are wasting hundreds of millions, if not billions, on Progressive reading strategies that are of little use and are potentially harmful.

Go to and search for 100 Easy Leasons, then sort the customer responses in reverse order of ranking to see the objections to the above book's program. You will find that the objections typically suggest another book or series of books that are themselves reasonably priced and readily available. None of the comments I read said that this book failed to teach reading. And, neither this program nor suggested alternatives rely on continual government resources for R&D. They are programs that are tried and true, successful yet cheap. Products of the free market.

The result of the government expenditures in reading is a capital structure that is nonproductive and wasteful, but is also a dollar-consuming Leviathan. A significant portion of the funding of these programs and departments goes into continual lobbying and PR expenditure. As a result, they grow and grow; a financial Backdraft that consumes tax-dollars and lays waste to the dreams of future generations.

Government has to fear the bust that will inevitably occur when these programs and departments are no longer funded. The result will not just be thousands upon thousands of bureaucrats, administrators, and teachers hitting the street, it will also be the loss of capital invested in private enterprises that exist to remedy the ills caused by the government-funded reading programs.

Should the products of the private sector - Teach Your Child to Read in 100 Easy Lessons , etc - replace those created by interventionist policies, you'll save thousands in yearly tax dollars while student achievement rises. Just be ready to ignore the administrator or teacher holding the cup and the sign that reads, "Will whole-language for food."

Monday, November 27, 2006

Charter schools and fixed costs, or it's all at the margin

From a pure economic standpoint, if you can't reduce fixed costs after the reduction of a student, that student did not contribute to fixed costs.

The term fixed cost can be used to describe short-term obligations (e.g. salaries, leases, etc.) and long-term capital expenses (e.g. bond repayments, etc.). Since a district's general fund does not include the capital costs associated with a building, and because the charter funding debate is always centered around a school district's general fund and operating expenses, I will only focus on short-term obligations.

In Ohio, a school board must approve its district's annual appropriation before the start of the next fiscal year (beginning July 1). The initial appropriation can be a temporary measure, with all districts having to approve a permanent appropriation measure by the 1st of October. Even though the permanent appropriation measure can be modified throughout the school year, the permanent appropriation measure reflects the likely general fund expenditures for the school year.

Each district in Ohio bases its budget on projected student enrollment (ADM). The process to estimate actual enrollment is difficult and subject to error. If a district miscalculates its ADM, it usually cannot make mid-year corrections since districts typically don't hire additional teachers or RIF excess teachers during the current school year.[1] Districts can correct enrollment projection errors when approving the subsequent year's budget, but once set, a budget and its associated contracts create short-term fixed costs for the current school year.

What does the first sentence mean in light of what I've just discussed? It's simple, there are fixed costs based on the current budget, but those costs are short-term and may not even be associated with the student who transfers to a charter school.

Example: If an elementary has 600 students and one child moves in after the budget was set and subsequently transfers to a charter school, there is no way to reduce fixed costs since the current budget had been approved. Though costs cannot be reduced, state basic aid flows to the district and then out again, this time to the charter where the child has enrolled. [2]

In order to understand the impact of this transfer, one has to go back in time to the point where that child entered the school. Upon enrollment, overhead costs were already fixed so the school did not incur additional fixed costs due to that child. Therefore, at the margin, no fixed cost can be attributed to that child, whether on the way in or way out of the school. This child was expenditure neutral.

Fixed costs can be attributed to the student whose enrollment brings about a new section, school, etc. If a district loses enough students that it can reduce staff or close an elementary, the fixed costs associated with the section or school are wiped from the books.

If a student causes the need for a new third grade section, the marginal fixed cost associated with the child are the costs of operating an additional section; new teacher contract, etc. Subsequent third grade students result in no additional fixed costs and only minimal operating costs since the section is already available with empty seats. If the subsequent students transfer to a charter school, no fixed costs can be reduced since no fixed costs were incurred due to their enrollment. When the child that caused the opening of the new section transfers, the fixed costs associated with the child are wiped from the books since the section, and teaching position, etc., are no longer needed.

In Ohio, if a district opens its doors to more students than planned, it sees a revenue gain. The district's operating costs were fixed by the budget, so each new student provides approximately $5,400 in additional state funding aid while only creating small additional operating costs; for water, paper, etc. Low estimates create a financial bonus.

High estimates, conversely, create financial distress. In such situation, costs were fixed by the budget yet the district loses approximately $5,400 for each student that doesn't arrive as planned.

But these hardships are not the result of charter schools; they are purely the result of poor planning by the district. Student populations change over time as students move into and out of districts, change to and from private schools, and choose or return from home schooling. None of these other movements of students are criticized like charter school enrollment, but there is no real difference between them; all cause an increase or decrease of $5,400 for each student over or under enrollment projections.

In fact, some of these movements are cheered. Districts encourage their students to enroll in colleges and universities through post secondary options enrollment, as well as encourage students to attend alternative schools such as the Columbus Zoo's Zoo School. Each of these activities cause funds to leave the district, yet there are few critics of such alternative programs.

Part of the confusion comes from the presentation of state basic aid on the Ohio Department of Educations SF3 form. The forms leaves the impression that the state funds on a per student basis at the state share percentage [3]. In addition, districts also believe that fixed overhead costs are apportioned out to students equally. These are absolutely not the case.

The confusion is also due to districts not understanding the effects of changes over time. In the year after an outflow to charters or other situations, districts can reduce administration and staff to recoup most of the fixed costs. That said, some costs, such as the need for a board of education, superintendent, treasurer, and at least one teacher, educational service personnel, etc., are truly fixed but are nothing compared to property tax revenue being generated locally.

Word for the wise: Revenue and costs function at the margin, never at the average.


[1] District's approve teacher contracts that provide teachers with an implied right to work. My district's negotiated agreement spells out the specifics by which the district may apply reduction in force (RIF) to terminate a teaching contract. The agreement states that the district cannot reduce staff midyear.

[2] Keep in mind that this analysis is only dealing with the expense side of the charter issue. As it has been shown before, charter schools do not reduce local revenue. The only funding that leaves the district with the student who transfers to a charter school is the $5,400 that the state earmarked for that student.

[3] The SF3 includes a state share percentage figure that many assume is the percentage that the state funds the marginal student. This is not the case. After the charge-off - 23 mills times recognized valuation - has been met, the state funds each marginal student at the full $5,400 amount.

Saturday, November 25, 2006

Letter to the editor

Dear Editor:

Is Robert Thiede, superintendent, Pickerington Local School District, serious when he states that he and other school officials have unilaterally decided to become "co-parents" to the children of his district ("School have more responsibilities, need more money", letter, Nov 25)? I will assume from his comments that the parents of Pickerington are not sophisticated enough to raise their own children and welcome the astute knowledge of such a fine public servant. When did that community buy-off on the abdication of their parental rights and responsibilities?

Sadly, this attitude - that an administrator license is the mark of superior parenting skills - is becoming more prevalent among school officials. What is forgotten is that school officials are simply your neighbors, friends, community members. They are not omniscient by any means. Witness the results of all the programs Pickerington and other districts have implemented over the past 25 years as detailed by Thiede in his letter.

If one is to believe Thiede, all those programs have left schools and society in worse condition. I'll agree with that. But I disagree that giving Thiede and other self-appointed co-parents more money will change anything for the better. The schools have a track record that is worse than any group of parents I've encountered.

Send Thiede more money, whether collected locally through property and income taxes or collected at the state-level through the host of state taxes, and you can be assured of two things; Thiede will waste it on failed programs, and he'll use it as a means to grab additional parental rights and responsibilities as he blames the failures of his programs on the parents of the community.

Jim Fedako

Wednesday, November 22, 2006

The doublespeak spin

The expected millage request is expected to come in much lower due to a realization of economies of scale due to Olentangy’s size. Teri Meider, Olentangy Board President

That has to be my favorite observation regarding the financial position of the Olentangy School District. The implication is that the reduction in expected millage and timing of the next levy has something to do with the size of the district. Not true. The latest Five-Year Forecast filed with the Ohio Department of Education is based on the new enrollment projections - reduced enrollment projections that wipe away $25 million in expenses through 2011 (the enrollment projections have been greatly reduced with the latest projections showing 1,000 less students by 2011 than predicted in the May 2006 Five-Year Forecast).

There are no economies of scale accounting for the reduction in expected mills, it's simply the result of lower expenditures due to less students.

That said, there are increased staffing patterns - increased staffing on a per pupil basis - that are driving expenditures higher than they would have been based on current staffing patterns. If the board wants to avoid higher tax burdens, it needs to address this soon. But don't count on it, since the discussion is being driven in another direction in order to present a different picture of the district's financial outlook.

Tuesday, November 21, 2006

Keeping her word

At the last meeting of the Olentangy Board of Education, Teri Meider, board president, stated that Olentangy only requests additional operating funds when they are really needed. That's interesting since the latest Five-Year Forecast filed with the Ohio Department of Education at the end of last month shows no need for a new operating levy until Spring 2008 at the earliest.

Funny, the district is currently going through the process of putting a new levy on the ballot for next Spring - a full year earlier than Meider's promise. Well ... it's not really that funny ... it's more a point of concern, and accountability.

Keep in mind that the district's budget is looking to grow 85% from FY06 to FY11 though the student population is only growing 48%. Inflationary increases do not come close to explaining the discrepancy between the two growth statistics. If the district didn't plan on accelerated expenditure growth over these next few years, the need for a levy could be pushed off until Spring 2009. Now, that would really keep the promise.

A promise is a promise only if it's kept. The next few months will show whether or not Meider and the board are ready to keep their word.

Sunday, November 19, 2006

Olentangy, math, and doublespeak

Today's Columbus Dispatch has an article on ineffective, constructivist math programs such as Everyday Mathematics. The constructivist education philosophy is centered on teachers and students being co-equals in the discovery of knowledge.[1] The teacher holds no special place since knowledge is relative, therefore the simple understanding of a third grader is equal to the supposed learned knowledge of the professional teacher.[2]

Constructivism is an application of Progressive education, the pedagogy - philosophy - that has permeated public schools for close to a century. As these ideas have taken greater hold of education - most notably since the Sixties, student achievement has gone downhill - this despite a tremendous influx of dollars and technology.

Even though constructivist math - fuzzy math - had been questioned for years, Olentangy decided to adopt the Everyday Mathematics program for its students. Well, the district will not say they have adopted Everyday Mathematics. Instead, the district will use doublespeak to say that they have adopted their curriculum maps and not any single math program, but that simply confounds means with ends.

The maps are the ends, the definition of what is to be learned - the equivalent of architectural blueprints. The textbooks are the means to achieve the ends - the building tools and materials. Funny, your tax dollars pay for Everyday Mathematics textbooks yet the district staff do not even claim that they use the textbooks to teach math. Staff members say the books are simply a resource, similar to putting a child's plastic hammer in the toolbox instead of the steel hammer.

Go ahead and ask your administrators about Everyday Mathematics, you will hear them spin a tale of educationist gobbledygook. Hold on to your own head so that it doesn't spin in response.

[1] Check out rantings of the Association for Supervision and Curriculum Development and The Teachers College Record from Columbia University's prestigious Teachers College.

[2] Administrators and teachers who buy into this philosophy may actually be the overpaid, co-equals of their students.

Saturday, November 18, 2006

Milton Friedman on homeschooling

Quote from the late Milton Friedman - recipient of the 1976 Nobel Memorial Prize for economic science - taken from "Friedman: Economic freedom is key" by Bill Steigerwald, Tribune-Review, Nov. 18, 2006:

Q: I'm sure you're familiar with the home-school movement, which has arisen over the last 10 years as a form of competition to schools.

A: It is. And the fact that it is a form of competition shows how bad our schools are. Can you think of any other sophisticated product in which the home-made product is superior to the factory-made product?

I don't agree with Friedman on everything - since he equivocated on property rights and sound money, but he hit a home run with that observation.

Hoppe's theory of political economy

Hans-Hermann Hoppe is the philosopher of the Austrian School of Economics. Hoppe, Professor of Economics at the University of Nevada, Las Vegas, has written many excellent books and articles on libertarian/anarcho-capitalism. A standout is the sadly out-of-print A Theory of Socialism and Capitalism, available at as a PDF download.

Hoppe builds an unassailable case for why all versions of socialism lead to poverty; from relative poverty when considering the form of socialism found in the European Union - a form that many in the US seek to emulate, to abject poverty due to the form of socialism adopted by North Korea. Only capitalism can provide for the wants and desires of the common man.

This book is clear and concise, and a worthwhile read.

Thursday, November 16, 2006

Bill Gates, the market, and education

Given that most of Microsoft's ideas are lifted from other companies, the odds of Bill Gates improving public education by funding the innovation of new programs is rather slim. from a listserve post


There is nothing wrong with the business model Bill Gates adopted. In fact, it is those whose software he supposedly lifted in order to create MS DOS that were in error. Think about it: either a bunch of techno-nerds (I'm in IT also) simply sit around looking at their neat operating system in amazement; or, a business savvy entrepreneur brings that same operating system to the masses. I vote for the business savvy Gates.

Success in business does not mean theft from society - in fact it means that one served society better than others in the same field. Nor does success in business equal waste of resources. Failure in business, on the other hand, does mean a waste of scarce resources since a failed business turned scarce resources into something of less value than the individual resources themselves.

Also, success in one line of business at one period in time does not necessarily translate into success in another business, or success in the same business at a different period in time. Businessmen and women are not omniscient. And, nothing translates into success in government since the government operating model is based on theft and propaganda, not service and quality.

Don't bad-mouth the man who is greatly responsible for the software that makes this listserve - and most other transmissions of data - possible at a price we can afford.

If Gates starts opening for-profit schools, then I will listen. Until then, he's sending money down the rat hole to be devoured by the same lot that has created our current system.

Wednesday, November 15, 2006

Free books to download and a great blog

Go to Gary North's web site to read excellent books on the Bible and Christian thought. Not only are the books interesting, challenging, and timely, they really are free.

Or, go to for a host of free books on Austrian Economics and the free market. You can read, or download and read, all the classics, including Human Action and Man, Economy, and State.

The Blessed Economist runs a great blog that addresses economics and political philosophy in a biblical sense. Though I'm not saying I agree with everything posted, it is all very thought provoking.

Enjoy each of these sites.

Tuesday, November 14, 2006

Most inane use of a descriptive term

Ever consider the comment, "Mr. X is such a good citizen since he pays his taxes." Or, the self-directed line, "I'm a good citizen, I pay my taxes." What in the world do they really mean? Someone who doesn't pay their taxes ends up under lock and key in a state or federal prison.

Performing an act due to coercion and compulsion does not make one a good citizen. A good citizen is one who lives by a strong moral code, respects private property and contracts. Simply holding your wallet out to the Sheriff of Nottingham so that the good sheriff can transfer your income to those who covet it does not mean that you are worthy of the descriptive term, "good citizen."

Education and the economy

Countries do well when they reduce barriers to capital investment and trade. I would doubt that the amount spent on a state-run education system has anything positive to do with the economy - in fact public education is a drag on our economy. The US has succeeded since we are still the country with the least number of government interventions - though federal regulations are said to be so voluminous that they would fill my bookshelves.

Capital and entrepreneurial know-how flow to the most open society. That has been the history of the world for eons. No one questioned the quality of the Soviet education system - in fact John Dewey and others cheered it - yet their economy was a basket case.[1]

Causation based on correlation is just as apt to flow the opposite direction as assumed. You see high education spending in the US and other wealthy countries simply because these economies have traditionally been successful. Education spending is the result of successful economies, not the other way around. An example: The education expenditures in Bexley, Ohio, a Columbus suburb, are extremely high simply because the residents have been successful. Bexley residents are not successful due to the amount Bexley City Schools spends on education, since most Bexley residents are not products of their school system.

[1] Of course, a priori, the Soviet education system had to be a mess since it was a government-run monopoly. Regardless, that didn't stop the socialists over at Columbia Univerity's prestigious Teachers College from trumpeting the success of both the Soviet education system and economy.

Sunday, November 12, 2006

Don't tread on me! Or, the War on Raw Milk.

Latest post by Jim Fedako

How ironic. Just days after Ohio citizens voted to restrain trade and reduce property rights by passing state issues 2 and 5 (an increase in the minimum wage and a statewide ban on smoking), Jeff Eschmeyer of the Ohio Farmers Union contends in a letter to the Columbus Dispatch that farmers and consumers have a right to sell and buy raw milk. Mr. Eschmeyer is correct that Ohioans have the natural right to produce and consume milk in its raw form, but as recent laws and administrative rulings in Ohio have shown, having a natural right does not translate into a legal right.

In case you may feel that this is a local issue, reports that California and Michigan have also engaged in this new war for interventionism; The War on Raw Milk.

Sadly, many smile as we continue to incrementally vote out the rights that founded this country. The power to vote out other's rights will someday be the power to lose your rights. Every time a new law or issue is passed, the supporters claim that the issue at hand will be the last step. As Eschmeyer and others are now realizing, there appears to be no end to the dreams of do-gooders who see it as their mission to force us all to live as they chose.

Whatever happened to the motto "Don't tread on me!" that defined our Revolution? Was there a second phrase to it that read, "But, I may tread on you?"

Saturday, November 11, 2006

Don't tread on me

Dear Editor:

How ironic. Just days after Ohio citizens voted to constrain trade and reduce property rights by passing state issues 2 and 5, Jeff Eschmeyer of the Ohio Farmers Union ("Farmers have a right to sell and consumers have a right to buy raw milk," letter, Nov 11) contends that farmers and consumers have a right to sell and buy raw milk. Mr. Eschmeyer is correct that Ohioans have the natural right to produce and consume milk in its raw form, but as recent polls and laws have shown, having a natural right does not translate into a legal right.

Sadly, many smile as we continue to incrementally vote out the rights that founded this country. But, the power to vote out other's rights will someday be the power to lose your rights. Every time a new law or issue is passed, the supporters claim that the issue at hand will be the last step. As Eschmeyer and others are now realizing, there appears to be no end to the dreams of do-gooders who see it as their mission to force us all to live as they chose.

Whatever happened to the motto "Don't tread on me!" that defined our Revolution? Was there a second phrase to it that read, "But, I may tread on you?"

Jim Fedako

Economics did not begin with Adam Smith

Though some tend to believe that economics was formed out of the ether by Adam Smith, economic thought had been developing since the ancient Greeks. The reality is that Adam Smith's contributions to economics lead to an errant diversion as his ideas, along with those of David Ricardo, became the precursors of the fallacies of Karl Marx.

Murray Rothbard, the dean of the Austrian School of Economic, documented the ebb and flow of economic thought through the ages in an article recently republished at

In addition, Rothbard wrote two volumes of a planned three volume set on the Austrian perspective of economic thought before his untimely death. These books are available at the store and are great reads for anyone interested in the history of economic thought.

Wednesday, November 08, 2006

What a difference a day makes

From: The Blog at
By: Jim Fedako

Though they wallowed through the mud for weeks, your federal representatives now want to be treated with respect. Just a few days ago they were the bad-talking bullies of the airwaves, now they expect all that vile to be simply forgotten. From brawls to blue suits in just one day.

The House web site automatically adds the title "Honorable" to any electronic message you try to send to your favorite congressman or congresswoman. As if there was anything honorable left with regard to those positions, or politicians.

Monday, November 06, 2006

Global warming is full of hot air

Two recent articles are worth reading for anyone interested in the global warning debate.

The first article, authored by Professor George Reisman, is from the Mises Institute. This article refutes the lunacies reported in the Stern Review on the Economics of Climate Change. Science in the political arena is usually not science at all. Reisman shows this to be the case with the Stern report.

The second article , from, is written by Sergei Boukhonine. Sergie discusses the difference between predicting the future and acting on predictions.

I wish I knew who to attribute the following observation, but it is absolutely on the mark: Once the socialists realized that socialism resulted in general poverty, they joined the greens who had been advocating for poverty all along.

Of note to my fellow Christians: Be careful about signing on with the environmental movement, the Greens have never respected that God made man in His image. God set man apart from the animals of the world. The Greens actually hate man and dream of a world populated solely by the animals - witness the new and proposed displays at the Columbus Zoo.

The Bible makes two points clear: There will always be poor with us, until the end; And, the end will come. Christians sided with the Progressives over a hundred years ago and look at the mess that was created - welfare, assistance programs, broken families, etc., and poverty. Yes, poverty is still with us - note the biblical truism - yet we all suffer from the ills of social engineering. With that in mind, why should Christians join with the greens?

Saturday, November 04, 2006

Voting Fraud - Letter to Editor

Dear Editor:

Let me get this straight: Because voting irregularities occurred in 2000, the state goes on a $200 million spending spree in order to purchase electronic voting machines only to have 1/3 of Franklin county voters chose handwritten absentee ballots; ballots which are subject to voter fraud and likely to be scanned improperly. Does anyone see the irony here?

Friday, November 03, 2006

Background to prior post: Congress giveth, congress taketh away

Market exchange is not based on both parties appraising the goods about to be exchanged at equal value; the parties instead exchange based on a two-way, unequal valuation of goods to be exchanged.

An example from my youth: During high school in the early 1980's, I had purchased a double-live album of the rock group Rush. Teenagers can be a fickle lot and I was no different. My music tastes changed and I morphed from a Rush fan into someone who felt that Fly By Night was beneath me. Not only did I no longer listen to the album, I wanted to get rid of it soon since I felt that the album was polluting my collection.

Along comes a fellow student who was fast becoming an ardent Rush fan. We agreed to an exchange: I would trade my $15 album for his $5. Fair enough. Right after the exchange, as I held the $5 and he held the album, the new Rush fan said something along the lines of, "I just ripped you off. I would have paid $10 for that album." I replied, "No, I just ripped you off since I was about to toss the album into the garbage anyway."

You see, we both had different valuations for the $5 and the album, that's why we traded. But, carefully note the verbal dialogue that occurred. To the outside observer, one of us may appear to have been "ripped off." Depending on the observer's point of reference, they may side with my claim or the claim of my fellow trader.

Or, and this is where things go wrong, one of us may have actually decided to have acted on one of those statements. Instead of accepting the exchange as agreed, I may have sought third-party rulings on the fairness of the trade. What sounded good ex ante - before the trade - now sounds like unfair negotiations ex post - after the trade. I should have received the $10 since it was a $15 album - I was truly "ripped off." Wasn't I?

I probably could have found the sympathetic ear of a government official who felt the tug of omniscience; someone believing in their own capacity to understand true value, and someone believing that the state needs to protect those acting in non-coerced exchanges. My fellow trader would have been forced to hand over the additional $5 so that the fair exchange occurred. But, why is that any more fair than the exchange we initially agree upon? In fact, it isn't.

The actions of the sympathetic do not increase fairness, neither do they increase wealth. The actions instead decrease wealth as no one knows the end result of a valid exchange. The rule of contract and common law is replaced by the rule of civil law and bureaucracy. As a result, people become less likely to exchange as the rules of the game change with the political winds.

The point: When a Tiberi, or any other government official, interferes with a valid, non-coerced exchange, they may appear to be helping one individual, but they are actually harming a foundation of modern society; free exchange of goods and services. They tend not to believe that their action can result in harm because power is almost always cloaked by the veil of omniscience.

Tuesday, October 31, 2006

Congress giveth, congress taketh away

Letter writers to local newspapers have been congratulating Pat Tiberi, our congressman, on his willingness to intervene on their behalf. What the letter writers forget is that the power to intervene is really the power to use the hammer of government in order to force individuals and firms to act other than they would have normally choosen; to act outside of already signed contractual agreements. That usage of power is anathema to the principals of Liberty that founded this country.

I'm not talking about contract or civil laws being broken, I referring to a congressman using government to lean on individuals and companies that have broken no law. Simply because someone was unsatisfied with the results of a contract that they signed under no duress, they chose to get the local power broker to have the contract amended - if the offending individuals and firms know what's best for them, they agree to the change. The ability to exert such pressure must be quite an aphrodisiac for power seekers such as Tiberi.

The ability to influence, to put the pressure on someone, cuts both ways. This time it benefits you, the next time it hurts you. When a congressman implicitly uses the power of government to change contracts and events, he has moved from realm of the citizen-statesmen to that of the political dons who control Third World politics. He's the Soviet apparatchik trading his ability to threaten for a bottle of vodka, or a front page story and letter to the editor. Why use the court system when your congressman can get the job done, extra-contractual and extra-constitutional.

While serving on the Olentangy Board of Education, I had a gentleman who first sought the influence of his congressman when the district didn't put a school bus stop near his home. The sad fact is that this gentleman went to Tiberi because each congressional office has a constituent services employee whose job is to get individuals and firms act under the threat of big G. You can be assured that we are talking implicit threats - threats of investigation, loss of influence, federal contracts, etc., since anything else would be dirty pool.

If you keep the likes of Tiberi in congress, you simply keep increasing the extent of federal power. And this comes from a Republican Central Committee member.

Of course, his opponent is no better. But at least Shamansky will be a once-again freshman in congress and have little ability to influence anything these next two years. Then, throw him out and chose someone else. The faster the political turnstile rotates, the less evil that can be done in DC.

Thursday, October 26, 2006

A great quote out of context

Latest post from Jim Fedako

"It may sometimes be expedient for a man to heat the stove with his furniture. But if he does, he should know what the remoter effects will be. He should not delude himself by believing that he has discovered a wonderful new method of heating his premises." from Human Action, Ludwig von Mises

Benita Ferrero-Waldner, European Commissioner for External Relations and European Neighbourhood Policy, uses this quote from Mises in a speech delivered at the EU's All Party Parliamentary Group on Overseas Development Lunchtime Meeting Series in order to advocate for interventionism. Talk about taking a quote out of context!

Wednesday, October 25, 2006

Best of the net

Looking for the best from the net? Go to: for articles, books, audio, etc., from the Austrian School of Economics; for the best in Libertarian thought; for the free books on Christian thought from Gary North, et. al.; for stories on education accountability.

Like a spider web, these sites link to other sites that can provide additional articles and knowledge. You'll soon find,,, the Education Consumers Clearinghouse, and many others. Have fun surfing...

Sunday, October 22, 2006

Hypocrisy and Virtue

As an nonsmoker I rarely ever venture into areas where there's cigarette smoke, I simply don't enjoy the smell. But I could also say the same for many other smells, such as fried foods, etc.

I will agree that smoking is dangerous, but I also accept that many other activities also come with risks, small and great.

The hypocrisy: The chance of an eighteen year old smoker dying from smoking within a year is trivial compared with the chance of an eighteen year old athlete dying on the sports or practice fields within a year. Yet no one is trying to put a stop to those activities - yet, anyway.

Once the smoking ban has been secured, do not think for a moment that the anti-smoking campaigners will simply go home with this one victory. No, these do-gooders will soon look for the next activity to prohibit with the force of government. These folks are not in this for the good of all, they are simply in this to control society.

Revolutions of virtue follow the pattern of the French Revolution where a Reign of Terror follows the early victories. You see, in some eyes, virtue is to be forced on everyone - at least virtue as defined by those empowered by victory.

As CS Lewis noted decades ago, the virtuous never sleep since they always believe that the non-virtuous (as defined by the virtuous) need government interventions in order to live the good life, and it's the sole function of the virtuous to find any aspect of the lives of the non-virtuous that requires intervention. This is a heavy burden that sleep only fails.

Watch out for these people...

Friday, October 20, 2006

Your voice would be heard

Response to a listserve posting regarding the conclusions of the Tennessee Project STAR Report (1990). The report claimed that smaller class sizes lead to higher student achievement, yet the data from the study did not support that conclusion. In fact, many later studies, notably from Eric Hanushek, refuted the small class size/improved performance nexus, yet Project STAR is still cited as proof that smaller class sizes lead to improved student achievement.

This is similar to recent articles which reported that school voucher programs are unsuccessful. Akin to the blurb in a newspaper movie ad, where the words of reviewers are taken out of context, certain media reported pull-out quotes from the report that were opposite of the conclusions found in the report itself.

You are absolutely correct in your analysis. You saw the contradiction in the Project STAR report yet your voice went unheard. The reason is simple: Government control of a tax-supported monopoly in education is never the solution. The best one can hope for is that the elected politician, and, more importantly, the bureaucrats, will function as the altruistic guides of the education system. Though, even this situation simply replaces the whims and fancies of the consumer with the whims and fancies of government officials. And, the officials can never define the inputs and outcomes desired by the consumer; the system flies blind. What always happens is that money and influence capture the system so that even the altruistic official is lost in the political battles, let alone the realities of government-run enterprises.

You read the Project STAR report and noted the contradiction, yet no one responded in the manner you expected. I would say that the system responded as it always does; money and influence turned a deaf ear on your correct conclusions.

In a system of choice, you would find the operator who runs the school system that matches your desired inputs and outcomes. There would be no worry about the influence of unions or others with conflicted interests. Your voice would be heard.

Sunday, October 15, 2006

State Issues 4 and 5


"When anti-smoking activists hit the streets last year with a petition to ban smoking in nearly every Ohio business, bar and restaurant owners quickly drummed up a response.

The result is a pair of ballot measures that appear similar at first glance but contain key differences.

State Issue 5, the Smoke Free Ohio measure backed by the American Cancer Society, would outlaw smoking in virtually all public businesses.

State Issue 4, dubbed Smoke Less Ohio and backed by bar and restaurant owners with funding from the R.J. Reynolds Tobacco Co., would allow smoking in bars and parts of restaurants.

Another difference might seem technical but could determine which measure becomes law.

State Issue 5 is an initiated statute, carrying the same weight as any law passed by the General Assembly. State Issue 4 would be written into the Ohio Constitution, making it much more difficult to amend or repeal.

If voters pass both measures, only State Issue 4 would take effect since a constitutional amendment trumps a statute."
from The Columbus Dispatch

Letter written in response to letter published by ThisWeekNews.


In his letter regarding statewide Issues 4 and 5, Leonard Fisher, chair of the Delaware County Tobacco-Free Coalition, tries to make the point that individual rights are not involved in these ballot issues. Nothing can be further from the truth.

Currently, I exercise my right to smoke-free environments on a daily basis by using my dollars to vote for restaurants that provide me with a smoke-free meal. Those who chose to smoke can vote with their dollars for restaurants that allow smoking or designated smoking areas. These personal decision are the application of individual rights in a free society. And, let's not forget, that property owners used to have the right to decide the manner in which their property is used. Life, Liberty, and Property are essential qualities of freedom.

The backers of local smoking ordinances, and now state-wide issues, have no concern for those three qualities of freedom. They want to supplant individual liberty with their own government-enforced values. It's sad to see someone in Delaware County advocate for the state to intervene in the personal decisions of every Ohioan - especially when that individual can already act on his preference for smoke-free environments.

Years ago, CS Lewis noted that the seemingly well-intentioned individual can create more harm than good. Using local ordinances and statewide issues to exchange freedom for state control of personal decisions brings to mind a cautionary statement from a Founding Father: Benjamin Franklin, after being asked what form of government resulted from the Constitution Convention, replied, "A republic if you can keep it." Let's vote No for both Issue 4 and Issue 5 and keep the republic.

Jim Fedako

Thursday, October 12, 2006

The good professor

"I’m not hacked off anymore," she said. "I want them to at least understand what they’re rejecting. If they choose to ignore it, that’s their prerogative." OSU Biology Professor Susan Fisher. (from the Columbus Dispatch)

This is absolutely the correct way to teach any topic in science, whether the topic is the theory of evolution (above) or something such as quantum mechanics. Typically, instructors who teach the theory of evolution seek to indoctrinate more than they seek to educate. When a teacher attempts to change or undermine one's faith, instruction is no longer education, it's indoctrination. So it's good to hear that some professors understand their role as educators, and not indoctrinators.

Science is a process that includes the continual reevaluation of past experiments, theories, and conclusions. Scientists should never establish something as an absolute fact and seek to have everyone one else accept that fact as truth, based purely on faith in science in general and the scientist in particular. Science should accept challenges and attacks, as such efforts either strengthen a given theory or reveal a better explanation - a new theory arises.

Let us never forget that one can teach a scientific theory to someone who will never accept that theory as true. In fact, the instructor may even question a theory yet still teach it to students. In addition, the scientist may not believe in the science he is using. The best example of this is Quantum Mechanics, a fundamental branch of modern, theoretical physics. Much of quantum mechanics is pure theory that is not even accepted by all physicists, yet these doubtful scientists still function as physicists - and no one challenges their science or degree.

So, if the physicist can question a pillar of their science yet remain a physicist, what is stopping the biologist who accepts Genesis Creationism from functioning as a biologist? Absolutely nothing. Then, why do Evolutionists require faithful adherence to the theories arising from Darwinism? I don't know, though I suspect that it has nothing to do with science and everything to do with challenging the Christian faith.

Root Cause of the Failure of Contemporary Education - by George Reisman

George Reisman of Pepperdine University sees the results of the education system every day:

With little exaggeration, the whole of contemporary education can be described as a process of encumbering the student’s mind with as little knowledge as possible.

Continue reading at

Monday, October 09, 2006

What are your public school educators reading?

Why, Educational Leadership from the Association of Curriculum and Development of course. ASCD is highly respected by public educators, in fact your local schools most likely have implemented a number of programs that ASCD promotes.

OK, but what are they reading? Note the quote below from the following article written by Richard Hanzelka, ASCD president:

"Regardless of international differences, we should all take heed of China's concern for the development of a whole child who is capable of being part of a harmonious society."

In an article reminiscent of John Dewey's excited report written after seeing his ideas incorporated in the schools of Soviet Russia, ASCD trumpets China's embrace of the "whole child."

For those new to such terminology, the "whole child" is the Progressive utopian child that is self-actualized yet devoid of knowledge. Educators appeal to the concept of the "whole child" since it frees public schools from having to teach the three R's. Parents, when you hear "whole child" mentioned think of the article below - the goal of this type of educations - and you will understand why college remediation rates are so high.

And people wonder why the education profession gets branded a socialist cartel, especially when the educationist want us to pursue the harmonious society that is Communist China.

Note: Your tax dollars pay for this rot. You simply cannot cannot make up stuff this bizarre.

from the latest ASCD daily email:

Harmonious Learning for the Whole Child: Education Perspectives from China

Message from the President

Richard Hanzelka

As educators in the United States struggle to expand their view of learning to embrace the whole child and not just achievement test scores, it is encouraging to know that other nations are engaged in similar processes. China, a country I have been fortunate enough to visit twice in the last two years, is also challenging itself to build a system that addresses the whole child.

This summer I traveled to China to participate in the first China-U.S. Education Leadership Conference. What I learned and experienced expanded and clarified the impressions I formed during the ASCD Board of Directors trip to China in November 2005.
continue reading ...

A Fair Wage

An always timely article published by

by Jim Fedako

You hear it from them all the time; teachers just want a fair wage. Oh, well who doesn't? This line of thought begs two questions: How are wage rates established in a free market? And, are market wage rates fair?

read more ...