Jun 29, 2011

Rick Santorum for Vice President: Stranger Things Have Happened

Guest Column by G. Terry Madonna and Michael Young

It’s an old political proverb: no one runs for vice president except everyone running for president. Okay, we made up that last part.

The actual adage is shorter: no one runs for vice president. But that is patent nonsense. Although they’ll deny it to the bitter end, presidential candidates often end up hoping their party’s nominee will pick them to run as vice president. In fact, many of them are selected as running mates by their former presidential rivals. Recent examples include Joe Biden, Al Gore, George H. W. Bush, and Lyndon Johnson.

All of this brings us to a question. Exactly why is Rick Santorum running for president in 2012? It can’t be to win it. Santorum is virtually unknown outside Pennsylvania, suffered one of the worst defeats in modern state history defending his Senate seat in 2006, has relatively little money, and possesses a penchant for making people mad at him for things he says—sometimes very mad.

One recent poll shows him in the low 4 percent range, just ahead of Gary Johnson. Who is Gary Johnson, you might say? That’s exactly the point.

Let’s put it this way. If one were to construct a list of the 10,000 or so most eligible, most likely, and most promising people to run for president, Santorum wouldn’t be on it. It’s very unlikely Santorum could even win statewide office in Pennsylvania again, maybe not even a congressional seat. It’s possible his time might come around again. Few, however, believe that time is now.

Yet despite all the reasons he shouldn’t be running for president, he is running.

Or is he?

Maybe instead, Santorum is actually running for vice president. There are some pretty compelling reasons to suspect that’s so. First of all, Rick Santorum is no dummy. Yes, he says and sometimes does dumb things. But he is one of the shrewdest, most tenacious, and ambitious politicians of his generation. He may tilt at the odd windmill once in a while, but he’s always known it’s really a windmill.

Second, Santorum can’t possibly win the GOP nomination. His base is too narrow, his funding is too fragile, and his message is too polarizing. In presidential terms, he is a fringe candidate.

Finally, Santorum, looking to the history of the GOP, knows well the overwhelming probability is that the eventual nominee will be an establishment figure—perhaps Romney, Pawlenty, or Huntsman—running on a jobs and economic growth platform. And such a choice leaves the socialconservatives out in the cold. Not good for social conservatives and very bad for the Republican Party.

Except Santorum will be there to make sure that won’t happen. Most social conservatives like him or at least tolerate him well. He’s a true believer, strong on the hot button social issues, and the perfect balance to a ticket likely to need a lot of balancing. True, there are other social conservatives who could do the job beside Santorum. But Palin isn’t going to run for vice president again, and Michelle Bachmann seems unlikely to give up her base to be second banana to a Romney, Pawlenty, or Huntsman.

That leaves Santorum, who could become the Dick Cheney of 2012—someone few really like but everyone understands to be necessary.

Santorum becomes the vice presidential choice if—and it’s a serious if—he can successfully negotiate the early primaries and caucuses. The ideal game plan for him is to draw a respectable vote in Iowa, survive New Hampshire, and maybe get through South Carolina. Then he can drop out, play loyal Republican, and even endorse the frontrunner after leaving the race himself.

After that, events will be in the saddle, as they say. Santorum could become the default choice, and then it’s game time for the fall contest.

Is Santorum thinking about all this? Absolutely! Can he actually pull it off? That’s another question.

Staying in all the way to South Carolina is going to be challenging for him. And then there are other social conservatives who could take his place. Bachmann and Palin have already been mentioned. In addition, Mike Huckabee, Mike Pence, and John Thune would probably satisfy conservatives. All three, however, have removed themselves from the 2012 race.

If Santorum did run and the Republicans did win, what kind of vice president would he be? Comparisons will be made to Cheney, but actually the incumbent Joe Biden is a better model. Santorum is the conservative counterpart to Biden. He is as conservative as Biden is liberal, experienced in the Senate, and equally as voluble—meaning prone to saying almost anything at almost any time.

It would be an interesting four years.

Politically Uncorrected™ is published twice monthly, and previous columns can be viewed at http://politics.fandm.edu.

Jun 22, 2011

Conservative group says a Marcellus Shale Impact Fee is a New Tax

Americans for Prosperity Pennsylvania and its State Director, Sam Rohrer, are calling on Governor Corbett to continue to honor his pledge to not raise taxes, and on the Legislature to break from taxation and spending, as a bill to impose a drilling “impact fee” makes its way through the Pennsylvania Legislature.

“We know how difficult it is to attract new economic development in this Commonwealth,” said Rohrer, “and we also know just how desperately we need this type of growth. High tax rates, fatiguing regulations and permits, all serve to make this state difficult at best in which to do business. And now with the discovery of abundant natural resources in the form of natural gas, and the promise of broad based economic prosperity on the horizon, the ‘tax and spenders’ emerge again.”

Rohrer likened those in favor of tax and spending to mosquitoes that seek to engorge themselves on the very life-blood of others. “And it’s not just one side of the political isle,” Rohrer insisted. “In reality, there are tax and spenders on both sides and in both the Senate and House.”

For some time, members of the Legislature have pushed to impose a severance tax on drilling. Thus far, Governor Corbett has kept his promise to not raise taxes. Rohrer says that the Governor has made this intention clear by vetoing any such tax and has “tied his integrity directly to the honoring of this pledge.”

AFP-PA supports the Governor in upholding his promise to not raise taxes during his administration, said Rohrer, "and in addition, we steadfastly encourage and support serious, overall tax reform and recovery. We strongly oppose any effort to add a new tax—in any form, by any name. We urge the Governor to continue to do the same. These are critical times when Government should be looking toward serious, overall tax reform, not for more money to spend.”

According to Rohrer an involuntary financial assessment, by any name, is a tax. Call it what they like,” he argued, “but the proposed ‘impact fee’ coming from proponents in the House and Senate is nothing short of a new tax.” “It makes no difference” Rohrer firmly asserted, saying that regardless of that for which the proposed new revenue stream would potentially be used, “a promise is a promise. If Governor Corbett signs off on this ‘impact fee’ it boils down to a new tax, and a broken promise to the taxpayers.”

“It’s time to be forthright,” maintained Rohrer, who went on to cite the following as reasons the Legislature and the Governor must resist and oppose all efforts to impose any new tax:
  • “To position this new ‘fee’ or ‘impact fee’ as something other than a “tax” is dishonest. Individuals and business owners recognize that there is no difference.”
  • “To seek such a tax increase on a newly developing industry, regardless of its potential size and ability to pay, and especially in the absence of clear necessity, is a form of governmental extortion.”
Rohrer went on to point out that Pennsylvania is already receiving significant increases in revenue and that as new industry-related businesses spring up, and jobs with them, the state will continue to see increased revenues without any change in the current tax structure. He projects that the growth in this industry will naturally result in additional contributors to Income taxes and other current taxes.

“No new tax, fee or substantive ongoing financial assessment should be imposed on this or any new industry without a comprehensive overall restructuring of our corporate tax system,” said Rohrer.

If the Governor signs any tax or fee increase, Rohrer says it is a violation of his pledge. “The legislature and the Governor should focus their attention on reform of our uncompetitive tax system and work toward eliminating the host of job-killing regulations that plague the job creators of this Commonwealth.”

“To those committed to economic prosperity and job creation,” Rohrer says that now is the time for true leadership, and he is calling on them to “stand up and protect liberty and prosperity from bloodsucking, by opposing this massive tax increase.”

PennPatriot Blog Listed As One Of The Top Conservative Blogs

About two weeks ago PoliticsPA, Pennsylvania's premiere online political news website, asked visitors "What are the Best Blogs in PA?" The competition was broken down into categories like best overall blog, best liberal blog, best paper backed blog, and best conservative blog.

Today, PoliticsPA listed the results of their best blogs in Pennsylvania contest. To my surprise, PennPatriot Blog was mentioned as one of the top conservative blogs. PAWatercooler took the top prize in the conservative blog category, but PennPatriot Blog was mention along with the Keystone Conservative and the Commonwealth Foundation's Policy Blog as a must read for Pennsylvania conservatives.

This is a true honor and all of PennPatriot Blog's contributors should be proud of this accomplishment. You guys do a bang up job and keep up the great work!

I also want to congratulate John Micek of the Allentown Morning Call. His blog Capitol Ideas was listed as the best overall blog in PA and I couldn't agree more. John is a great guy and does a great job of keeping all of us informed. Congratulations John!

Thanks to everyone who voted at PoliticsPA and thanks to everyone who visits PennPatriot Blog on a daily basis!

Click Here to check out all the to blog listings at PoliticsPA

Jun 21, 2011

These numbers don't lie: School vouchers are Pennsylvania's only choice

Guest Column by Jay Ostrich

At the start of our nation, Founding Father John Adams was as concerned with the positive development of our offspring as he was with that of the republic.

Seeing the relationship as symbiotic, he considered it imperative that citizens challenge our children and “excite them in a habitual contempt of meanness, abhorrence of injustice and inhumanity, and an ambition to excel in every capacity, faculty and virtue. If we suffer their minds to grovel and creep in infancy, they will grovel all their lives.”

If correct, I wonder what he would think of the meanness, injustice and inhumanity produced today at our 144 most failing public schools in Pennsylvania.

Hyperbole? Hardly. In the last year alone, these schools produced staggering statistics that make our state’s education system more like a state emergency. According to the Pennsylvania Department of Education, not one of these 144 schools scored more than 53 percent proficient in reading and math.

University City High School, just three blocks from the Ivy League’s University of Pennsylvania, now in its eighth year of corrective action under the state’s federally mandated annual yearly progress program, scored worst in the state with less than five percent. No Child Left Behind? Try more than 95 percent of children left behind.

In the 2009 school year, students trapped at these schools endured seven rapes, 1,983 assaults on students, 1,027 assaults on staff, 121 indecent or aggravated assaults, 554 illegal weapon possessions, 548 acts of vandalism, 31 terrorist threats, 26 bomb threats, 593 thefts, 107 acts of arson, 163 robberies, 171 acts of criminal trespassing, 20 burglaries, 38 cases of reckless endangering, four interferences of child custody, 30 indecent exposures, four sexual assaults, one involuntary sex violation and two official riots.

Have we become so unaffected or apathetic to the plight of endangered children trapped not by their ability or desire but through the digits in a ZIP code that our failure to act enables the status quo? The quagmire over school choice legislation seems to suggest so.

Presently, state legislators continue to debate the merits of combining vouchers with expanded opportunity scholarships such as those in Senate Bill 1, designed to allow parents the ability to remove their children from failing and often violent schools and place them into a school of their choosing. Meanwhile, our children watch, wait and wonder whether an educational lifeline will ever be thrown their way.

Opponents of the bill have challenged it as anything from an unconstitutional entitlement to an unconscionable attack against teachers. While some cling to the notion we will magically lift these schools from the ashes to reach 100 percent proficiency with more time, others hold true to the notion more money is needed to combat the problem.

Both arguments — more time, more money — have proved ineffective. Since 1996 when Pennsylvania spent $13 billion on education, the state has now more than doubled its spending to $26 billion, yet proficiency has stagnated.

While not a panacea, school choice has proved a worthy alternative. Nearly every empirically based study shows that school choice programs increase academic achievement for students and improve public schools through competition. No study has ever shown harmful effects to scholarship recipients or public schools.

What remains indisputable are the effects caused by the more than 5,400 incidents of violence reported in just our bottom five percent of schools. Instead of setting these children up for prosperity, many will be condemned to a life of poverty or the penitentiary.

To reverse this violent trend, the mantra of mediocrity — more time, more money — that produces violent schools on eight years of corrections but still 95 percent failure must be silenced. If not, the future for many of our children will not be bright.

Jay Ostrich is director of public affairs for the Commonwealth Foundation.

Our Health is Overinsured!

Guest Column by Tracy Miller

One of the arguments for healthcare reform is that millions of Americans with employer-provided healthcare are underinsured. Proponents of this view are saying that people are underinsured if they are paying too many of their healthcare costs out-of-pocket. Quite the contrary, a little reflection on what insurance is and is supposed to do suggests that the problem is really the opposite: many, if not most Americans are overinsured—they have too much health insurance coverage.

On what basis can I claim that Americans have too much health insurance? The purpose of insurance is to protect people from risk. Private companies offer affordable insurance against losses from automobile accidents, accidental death, fires, storms, and floods, among other things. These kinds of insurance arose in response to people’s willingness to pay for a contract that will compensate them for losses due to a relatively low probability event over which the insured party has little or no control. Yet, unlike other kinds of insurance, most of what is covered by many health-insurance plans does not fit this description. This is why so many people who do not have employer-provided health insurance are either uninsured or purchase only catastrophic coverage.

The problem with many existing health-insurance plans is that they cover the cost of routine treatment for illnesses, such as colds and flu that occur frequently, or the cost of care for conditions, such as pregnancy, that are heavily dependent upon the choices of the person who is insured. Basic economics teaches that paying for routine treatment via a third-party insurance company will raise the total cost of that treatment. This happens for two reasons: First, the insurance company, as middleman between the consumer and the healthcare provider, has costs that must come out of what the consumer pays. Second, insurance that pays for routine care lowers the cost of each doctor visit to the consumer, thus increasing demand. Higher demand with a given supply means higher prices.

It does not matter whether consumers or employers pay health-insurance premiums. The premiums are part of the cost of healthcare. Eliminating routine care from being covered by health insurance would mean premiums would decrease and employers could pass the savings along to their employees as higher wages. The average consumer would be better off as a result. If it were not for the tax deductibility of health-insurance premiums, employers would not cover routine care and treatment for preventable conditions as much as they do.

This is not to deny that many Americans do not have sufficient access to affordable healthcare or that the inability of some to afford health insurance is something we should be concerned about. Although it does not make sense for insurance to cover the ordinary medical costs of child birth, treating chronic asthma, or flu symptoms, it may be a good idea to have insurance in case of complications resulting from childbirth or to cover hospitalization for pneumonia and other serious illnesses.

The best way to help those who cannot afford basic health insurance is not to require or subsidize the kind of comprehensive health-insurance plans that most employers now offer. On the contrary, healthcare costs and the cost of health insurance that would cover life-threatening illnesses and serious accidents would be considerably lower if the existing system of taxes, subsidies, and government regulations did not result in so many people being overinsured.

Dr. Tracy C. Miller is an associate professor of economics at Grove City College and contributing scholar with The Center for Vision & Values.

Jun 18, 2011

Should You be Permitted to Vote?

By Kolbold

With the advent of the upcoming political season, endless campaign rhetoric and propaganda: I wish to direct the readers’ attention to the end result, the voter. A society becomes civilized when its people are well-educated and as its people and its government values and promote knowledge.

The Founding Fathers of our society were, almost to the man, thoughtful, ambitious, well-educated and discriminate people. Most of their knowledge was self taught and the result of reading books. Universal suffrage was actually unthinkable to most of the early founders. These were men who were inclined towards requiring voters to have basic intelligence, an education or property. The Founding Fathers believed, as I do, that the long term welfare of our nation is best served by an informed, invested electorate. They felt that landowners represented this concept. They believed that such a requirement to qualify to vote was not unreasonable. When writing state constitutions it was doubted that every citizen, especially those without property, money or formal education were capable of electing sound representatives.

This may sound heartless in our time but, the presumption of our founders was that normal human beings were capable of taking care of themselves. But times were different then. Those who owned property were usually educated or literate. Nevertheless because of concerns over class warfare, property qualifications for voting were mostly eliminated by 1820. Well we've come full circle now. Class warfare is alive, well and will be front and center in every election campaign. Although the Constitution is not clear, permitting only informed citizens with a vested interest to vote is a sound one. If anyone today may be regarded as well-informed and as a vested non-land owner, let them vote. But preserve the integrity of the system and erect a bar over which people must climb before voting. We will all be better off.

Knowledge is very long term and is readily available. The Founding Fathers lived in a world where most people only traveled as far as they could walk and no one had news media or the internet. The newspapers carried news. Political pamphlets such as produced by Thomas Paine were acknowledged as such, and not considered news. They valued knowledge, information, and the free flow of ideas. They came up with a durable form of government that has kept us safe and secure for a couple hundred years. The Founders knew that knowledge is power.

The limitations that the Founding Fathers placed on "one man, one vote" were almost all designed to bias the electorate towards men of education, knowledge, and social responsibility. Men of educated views

We the electorate has become the problem. There is the category of people that work hard, pay their taxes and stay informed on issues that will affect their way of life. These are independent thinkers that formulate a position based on logic, knowledge of issues and often a position of limited government. Another group that falls in this category includes a group swayed by scare tactics employed by voting block factions such as labor unions and organizations like the AARP.

Many more of us, the third category receive much of our information in sound bytes or biased newspaper articles. These members of this electorate are, less educated, fickle or go about life never reading or hearing anything but, rock music or reality TV. Thomas Jefferson said, "The man who reads nothing at all is better educated than the man who reads nothing but newspapers." Of course Mr. Jefferson never envisioned Oprah or Jerry Springer.

The first category, the more educated, has a vested interest in the country and its political outcomes because it affects personal earnings, investments, taxes and way of life. The second and some of the first category, unions and AARP members, in particular have only an interest in the outcome since it directly affects their public source of income, social services and housing. Their votes based on increasing benevolent government income transfer programs from the minority to the governing majority. John Adams prognosticated, “Men who are wholly destitute of property, are too dependent upon other men to have a will of their own"

Being well informed is being well armed. We should listen closely to everything the founders said. Ben Franklin stated "Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote!" I would imagine he was not talking about muskets. After all, he was part of this experiment we call the United States of America which has produced the greatest country in the history of mankind.

Bachmann vs. Palin

For the record, I am not a big fan of either Rep Michele Bachmann or Sarah Palin. I think both lack the experience and leadership qualities needed to be the President of the United States let alone the leader of the free world. But according to my Tea Party friends, they seem to be the two favorites amongst Tea Party supporters so here are my thoughts on Bachmann and Palin.

Palin's a great "cheerleader" with tons of charisma and the heart of a true patriot. She can deliver a "prepared" speech almost better than anyone, but ... if she's the Republican nominee, we'll all spend the election season "holding our breath", hoping she doesn't put her foot in her month when not speaking from prepared notes. She will not hold up in a debate against Obama or the biased media. However, she'd make a great member of the cabinet. I believe the best place for her would be as head of the RNC.

As a speaker/debater, Bachmann is much more adept than Palin when speaking extemporaneously. Though I may find a few (and that's very few) issues on which I disagree with her, she is consistently on the mark 95% of the time. She, DeMint, and Steve King are the three most willing politicians to challenge moderates and RINO's in the Congress.

Although both have good qualities and positions I support, their negatives are too overwhelming to sustain a real challenge to Obama. It is about time that the Republican Party leaders and Tea Party members get serious about the Presidential race. The GOP needs to understand that Romney isn't going to cut it and Tea Party leaders need to realize they are wasting their time upporting candidates like Bachmann or Palin who have no shot of winning at this point.

I just watched Newt Gingrich's speech at the recent Republican Leadership Conference. I am more likely to support Newt at this point over Palin and Bachman. Newt's message on the economy and taxes is dead on. Newt has the depth and real policy experience to really challenge Obama on his economic policies which will be the main issue in the Presidential race.

Does It Matter?

Guest Column by G. Terry Madonna & Michael L. Young

According to an old cliché, there are nodumb questions. But we’re asking one that might seem dumb—one that challenges some cherished assumptions about politics, presidents, and elections.

The question is this: What matters in choosing among presidential candidates? Does it matter if someone is ignorant of U.S. history, prone to eccentric views, belongs to an unfamiliar religion, doesn’t always speak correctly, gets confused about facts, or is given to unambiguously immoral sexual behavior? Are they likely to be a worse president because of those things?

More specifically, does it matter that Sarah Palin doesn’t know much about Revolutionary War history? Or does it matter that Michele Bachmann gets a little confused about American geography?

Does it matter that Rick Santorum thinksSocial Security can be fixed by ending abortion? Or does it matter that both Mitt Romney and Jon Huntsman are Mormons?

Or going back a little further, did it matter that George W. Bush often fractured his syntax speaking or that BillClinton was a cheating womanizer? Even further back, did it matter that Ronald Reagan often got facts wrong? Or did it matter that Gerald Ford seemed awkward in public, that both John Kennedy and Dwight Eisenhower had mistresses, or that Franklin Roosevelt had a secret handicap?

Clearly in varying degrees these things did matter to the people affected by them. Palin and Bachmann presumably were privately embarrassed. Santorum seems to have rethought his Social Securitysolution. And both Romney and Huntsman understand they have an electoral problem because of the religion they share.

But the big question is, does any of this matter to us in selecting a president? And the even bigger question is, what should matter?

Judging from recent and not so recent evidence, it appears that such things matter very much to us. Our national obsession with “gotcha” politics fixates upon the inevitable faults, flaws, and faux pas of candidates.

Just the recent furor over the history gaffes by Ms. Palin and Ms. Bachmann make clear the importance we attach tosuch things. We cared enough to impeach Clinton over his behavior. Ford’s (undeserved) reputation for clumsiness didn’t help his reelection attempt. Kennedy’s Catholicism probably made his razor thin victory over Nixon closer than it would have otherwise been. And Franklin Roosevelt believed that general knowledge of his handicap would destroy his presidential career.

So the slips and spills of presidential candidates do matter to us—sometimes a little, sometimes a lot. Often they matter because we think they predict how effective a president a candidate would make. We often use these candidate foibles as handy proxies to forecast presidential success or failure.

So, Sarah isn’t going to make it because she doesn’t read enough. Michele will get us lost with her sense of geography. Bill will take the country to perditions because he is a cheater and so on and so on.

And what is the empirical evidence that someone’s knowledge level, someone’s religion, someone’s attention span, someone’s sexual ethics, etc. tell us whether they’re likely to be successful as president?

None! There is precisely zero good evidence that we can predict anything about a presidential candidate from knowing these sorts of personal or idiosyncratic things.

Maybe deep down we know that already. But we look to personal foibles anyway because they take less time than reading position papers, listening to debates, or going to rallies. That’s anunderstandable if not completely comfortable reason for using them.

Some of us, too, use personal foibles tomake moral judgments about candidates, and that’s certainly defensible—as long as it’s remembered that they don’t often forecast much about future presidential performance. Kennedy’s religion, Franklin Roosevelt’s handicap, and Reagan’s penchant for tall tales foretold nothing about the presidents they would become.

Similarly, Palin’s knowledge of history, Romney’s religion, or Bachmann’s geographic skills tell us nothing about the president they would be. It may make interesting copy and provide titillating details and enough material to keep the talking heads busy for weeks. But does it tell us what kind of president a candidate would make? Not so much. It simply doesn’t matter.

Fixating on candidates’ foibles, however, brings a greater risk than merely wasting time. More serious is the danger that preoccupation with things that don’t matter puts us in hazard of missing what does matter. Even a cursory review of modern presidents suggests we have not always been making the best choices.

Since at least 1972, Americans have not been markedly happy with their presidents. Three presidents (Ford, Carter, and Bush 41) were rejected outright for second terms. Another was impeached, and another was forced to resign. The most recent, George W. Bush, finished his term near record-low approval ratings, while the incumbent Obama is experiencing low public approvals in his third year in office. Only Reagan was an unqualified success.

With a record like this maybe we are doing something wrong. Maybe we are spending too much time worrying about things that don’t matter in electing a president—and too little time thinking about things that do.

Politically Uncorrected™ is published twice monthly, and previous columns can be viewed at http://politics.fandm.edu.

Jun 17, 2011

Utility Executives Hold Contradictory Views About Energy Prices & Renewables

What utility executives think matters. They make key technology, capital investment, and fuel decisions for their investors, public owners, and consumers. They have energy distribution monopolies, though they increasingly operate in competitive electric generation markets or are buffeted by them.

According to the 4th annual survey of utility executives conducted by Black and Veatch (www.bv.com), 70% of 700 utility executives believe electricity prices and commodity prices will increase significantly in the next 5 years.

Despite the large majority that believes large electricity price increases are ahead, only 34% of utility executives believe renewables will be cost competitive within 5 years. Another 18% are not sure and 48% think that they will not be economic.

I agree with the 34% of utility executives that believe renewables will be cost competitive in 5 years and I am doubly sure of that result if large electricity price increases take place in the next 5 years.

There are clear reasons to think electricity prices may go up, though I have my doubts that the increases will be large or "significant." Interest rates are likely to rise from historic lows and the utility industry has high capital costs; substantial upgrading of utility infrastructure is needed in many service territories; and a case can be made that coal and gas prices will go up over the next 5 years. All those are real reasons to believe electricity prices will increase and perhaps significantly.

The counter case would focus on burgeoning demand-side resources, energy conservation, booming distributed generation, and the shale gas revolution.

I tend to think there are conflicting price pressures; some pushing down and others pushing up, with the result being modest electricity price increases. A big X factor is the economy.

Policies are being successfully advanced in Congress that would bring another economic contraction, and were that to happen, electricity demand will fall, putting further downward pressure on generation prices.

But I am sure that if significant electricity price increases do occur within 5 years, then solar will be at grid parity by 2015. That will occur without major grid electricity price increases as solar is on the way to $2 per watt fully installed. Wind energy, biomass, hydro, and geothermal would all be cost-competitive within 5 years given large electricity price increases.

Utility executives that are not preparing to take advantage of or navigate safely in an energy world where renewables are cost competitive within 5 years are making a significant strategic business mistake.

2011 Q1 Solar Installations Grow At 66% Rate On the Road to 100,000 Megawatts By 2020

It is not a fluke. It is not a flash in the pan. It is real and growing. It is an energy revolution.

Building on 100% growth in 2010 for US solar installations, the US solar industry grew in the first quarter of 2011 66%, according to data released by Rhone Resch, the President of the Solar Energy Industries Association.

US solar installations in 2011 may reach 2,000 megawatts, up from just a little less than a 1,000 megawatts installed in 2010. Solar costs nationally to the consumer declined by another 15% in the last 12 months or by 1.25% per month.

Lower prices are a key foundation of sustaining the booming US solar industry. Resch predicted that the solar industry would add nationwide 25,000 to 50,000 jobs in 2011.

By 2015, 10,000 megawatts per year of solar will likely be built in the USA. By 2020, the USA will likely have 100,000 megawatts of solar operating.

Globally a total of 40,000 megawatts is now installed and another 20,000 megawatts is likely to be built just in 2011.

Jun 11, 2011

PA Auditor General, Jack Wagner, Urges Lawmakers To Keep Public Notices In Newspapers

As Pennsylvania’s independent fiscal watchdog, I generally applaud efforts by the General Assembly to hold down spending and save taxpayer money, but there are exceptions to every rule.

Such is the case with House Bill 633, which would eliminate the requirement that school districts and local and state governments place public advertisements in newspapers advising the public of their intended actions.

While there may be some validity to the argument that posting these notices on the Internet would save money, the financial benefits would be dwarfed by the drawbacks to this plan. Most worrisome to me would be the reduction in government transparency and the inevitable loss in public confidence that it would engender.

There is no argument that more Americans are turning to the Internet for information, but usage declines rapidly according to age. For instance, about half of adults aged 18-49 use the Internet every day, but that usage falls to 44 percent for those aged 50-64 and to 17 percent for those 65 and older.

By comparison, about 40 percent of all Americans read a newspaper every day, but that usage rises with age. Daily readership is 52 percent for those aged 35-54, 58 percent for those 55-64 and over 75 percent for those 65 and older.

These demographic numbers are especially significant in Pennsylvania, which has an older population than the national average, and they indicate that it will be many years before the Internet overtakes daily newspapers as the primary source of local news in most Pennsylvania communities.

I am particularly concerned about any public perceptions of less transparency in government because, as auditor general, several of my most important audits and reports have highlighted this issue. We documented instances of the Gaming Control Board’s violating the Sunshine Act, the Turnpike commission’s removing fare information from toll tickets, and numerous state agencies failing to adequately publicize contracting opportunities to potential vendors. House Bill 633, if enacted, would be another setback in making government more open and accountable to the public. Citizens interested in reviewing public notices would have to visit multiple websites to obtain the information they are seeking. This is not convenient and will decrease, rather than increase, bidding competition. In short, it’s a bad deal for taxpayers. Conversely, I would wholeheartedly support any legislation that requires school districts and other government agencies of being required to post public notices on the Internet IN ADDITION to posting legal notices in newspapers. I believe this would increase transparency and make government more open and accountable to taxpayers.

Thank you for the opportunity to share my views on this important legislation with you and members of your committee. As always, my department and I are available to assist in any way in finding solutions that save taxpayer money while making government more open, efficient, and accountable to those it serves.


PA Auditor General

Jun 10, 2011

Coalition Slams School Voucher Bill, Support Rep Curt Schroder's Alternative Plan

Harrisburg, PA (June 8, 2011) -- The Grassroots Coalition for Real School Choice, an association of over 20 Pennsylvania groups representing thousands of voters, has announced, today, its support for school choice legislation currently being proposed by State Representative Curt Schroder (PA-155).

"We think its time to forget SB 1 and get behind voucher legislation that truly stands a chance of passage in both houses of the Pennsylvania Assembly," said Coalition leader, Sharon Cherubin, Executive Director of Unite PA.

"The concept of SB 1 was fatally flawed from the beginning and the sooner we realize it and move on, the better it will be for Pennsylvania school children."

Coalition leader, Teri Adams, President of the Independence Hall Tea Party Association, said that SB 1 did not adequately address the needs of middle income children--especially those trapped in failing schools.

"In SB 1, over 27,000 middle income children attending failing schools were denied vouchers in the first three years of the program--and then, were included in the bill only in the fourth year--only 'if' funds were available," she said.

"Other middle income children were also excluded from receiving vouchers until the fourth year. They, too, would only be eligible to participate in the program 'if' funding were available. Who can plan their child's education around an if?"

"Rep. Curt Schroder's bills do not discriminate against middle income children. The first bill, The Failing Schools Student Rescue Act, would offer $5,000 vouchers to all children attending failing schools, regardless of income." said Ms. Cherubin.

"The second, an 'Opportunity Scholarship' bill, would offer a $5,000 voucher across the board--to all children enrolled in kindergarten, primary, and secondary schools," she said.

"These bills, together with HB 1330, legislation expanding the EITC Scholarship program sponsored by State Representative Thomas Quigley (PA-146), will offer Pennsylvania children real school choice."

What we can learn from Texas' Barnett Shale

Guest Column by Bernard L. Weinstein

Twenty years ago, the Barnett Shale in north Texas was virtually unknown. Today, it’s the largest producing natural-gas field in the United States with output exceeding 4 billion cubic feet a day. What’s more, the Barnett Shale has added a new dimension to the north Texas economy, supporting thousands of jobs and generating millions in tax revenue for local governments and school districts.

One recent study prepared for the Fort Worth Chamber of Commerce found that drilling and production activity in the Barnett was supporting, directly and indirectly, more than 110,000 jobs across the region.

And a study by this author a few years ago calculated that Barnett wells and related equipment had added $6 billion to the local property tax base. In south Texas, where new oil wells are being drilled in the Eagle Ford shale, the unemployment rate has fallen to half the state average while sales tax receipts have jumped 70 percent.

This is not to suggest that the growth of shale gas drilling and extraction in Texas has occurred without controversy. In particular, concerns have been raised about the use of hydraulic fracturing — a high-pressure mix of water, sand and chemicals — to force gas out of rock formations. This process utilizes huge quantities of water, and the spent fluids must be disposed of properly to avoid surface-water contamination.

Similarly, because all wells are drilled through the ground water table, care must be taken to ensure that the well casing is sufficiently reinforced to prevent migration of gas or fluids into the water supply.

Fortunately, accidents related to shale gas extraction have been rare in the Barnett, with only a handful of surface water contamination incidents in the completion of more than 14,000 wells.

In those cases, responsible companies have provided clean water and compensation to affected families. What’s more, careful studies by the Environmental Protection Agency and the Ground Water Protection Council haven’t revealed a single case of ground water contamination from shale gas drilling.

Today, most local drilling companies are utilizing “greener” fracking fluids and reprocessing them many times before final disposal into specially designated wells. In addition, the Texas Legislature recently passed a bill requiring oil and natural gas companies to disclose the contents of their fracturing mixture on a publicly accessible data base.

Local concerns also have been raised about releases of volatile organic compounds from gas production sites and accompanying pipeline compressor stations. In response, the Texas Commission on Environmental Quality has developed and installed an automated gas chromatograph monitoring network at various drilling and compression sites in North Texas. To date, no emissions have been detected in excess of ambient air chemical concentrations.

In terms of potential output and economic impact, the Barnett and Eagle Ford are dwarfed by the Marcellus Shale formation. Pennsylvania is already benefiting mightily from shale gas production, and several studies have recently documented the huge economic boost to the state in term of jobs, income and tax revenue. Indeed, one study found that nearly 48,000 jobs related to Marcellus Shale activity have been created in Pennsylvania during the last year. By contrast, New York State, with an effective moratorium on shale gas drilling, continues to hemorrhage jobs along its southern tier.

The experience of Texas has shown that oil and gas extraction from shale formations can be accomplished with minimal environmental degradation while generating huge economic and fiscal benefits. Is producing, gathering, processing and delivering oil and natural gas from shale formations risk free?

Of course not. But these minor risks must be weighed against the economic and national security benefits that can be realized by fully developing America’s and Pennsylvania’s domestic oil and gas resources.

Bernard L. Weinstein is associate director of Maguire Energy Institute and an adjunct professor of business economics at Southern Methodist University’s Cox School of Business in Dallas.

Pa. Marcellus Shale gas severance tax counterproductive

Guest Column by Katrina Currie

Jim VanBlarcom, a busy Bradford County dairy farmer, came to Harrisburg to tell his story to Gov. Corbett's Marcellus Shale panel. Royalty money from leasing farmland helped him double his dairy herd size, and he's glad the industry's here.

VanBlarcom understands firsthand the growing pains natural gas activity brings. A trucker working with the gas industry took out an electric pole near his farm, shorting out his compressor and causing 3,000 gallons of milk to spoil. He then explained how the trucking company paid him market value of the lost milk and money to fix his compressor and labor costs.

When it came to road damages, VanBlarcom explained, "All of them have been rebuilt better than ever, and all it took was a phone call to the gas company. The next day they had trucks in there resurfacing the entire roadway."

Jacqueline Root, a Tioga County farmer, similarly remarked, "I see the roads being repaired in a much more timely fashion with the companies taking care of it, and in ways that our townships can't necessarily cope." Root went on to say that she would only support a local impact fee — a subject being considered by the governor's panel — if it did not change the industry's current role in infrastructure improvement and work in the region.

In many ways, Jacqueline Root, Jim VanBlarcom and other Pennsylvania landowners, farmers, job seekers and consumers would be the real victims of a severance tax on natural gas. While drilling won't disappear with a tax, the effects will be borne through reduced investment in the state, lower wages, reduction in job growth or a reduction in spending on things like road improvements and philanthropy.

Most people don't realize a severance tax would hurt Pennsylvanians directly, but a typical lease splits tax obligations between drilling companies and landowners. The industry has paid an estimated $7 billion in lease and royalty payments to residents since 2006 — money that landowners stand to lose.

No matter how much tax advocates argue otherwise, there is no evidence to support the claim that natural gas companies aren't paying their fair share. Because of this, it's unjust to enact an impact fee while failing to identify impact costs drillers are not addressing. Proponents just want more money for Harrisburg politicians to dole out, and they really don't care if pesky little things called facts don't support their demands for higher taxes.

Moreover, tax advocates don't care how much drilling companies are paying in taxes now — more than $1.1 billion since 2006, according to the state Revenue Department. This figure includes $234 million paid this fiscal year. They don't seem to care that other states have used severance taxes to lower or eliminate personal income or corporate taxes, or that Pennsylvania, after factoring in the federal corporate tax rate, has the second highest corporate tax rate in the world. They don't seem to care that state oversight for drilling is entirely funded through natural gas permits, or that drillers fully pay for the cost of any accident and pay hundreds of millions each year for road repair.

Although drilling companies must repair damage they cause to roads, they also provide transportation funding far above that, voluntarily using their money to improve roads and invest in local communities.

Talisman Energy, for instance, paid $25,000 to have a guardrail installed on a dangerous roadway in Towanda, Bradford County, after a young girl traveled off the road and died. Although the accident was unrelated to drilling or Talisman Energy, the company offered to pay for the project when the township didn't have the funds.

Overall, residents with drilling in their hometowns are having positive experiences with the industry, due largely to the fact that the Keystone State employs among the strictest drilling oversight programs in the world. When EOG Resources had an accident in Clearfield County, the company paid eight times in fines the cost of the investigation and cleanup. This is the responsible way to hold companies accountable and address environmental concerns, not through new taxes that create special funds, which — given well-documented recent history — are likely to get raided by politicians and special interests.

Ultimately, gas drilling has stimulated the economy, saving family farms and putting tens of thousands of Pennsylvanians back to work. Sadly, it is clear that despite these benefits, politics and the insatiable desire for more revenue are driving calls for a severance tax.
Katrina Currie is a policy analyst for the Commonwealth Foundation

Jun 5, 2011

Abandon Hope in Pennsylvania

According to Dante, “Abandon hope all ye who enter here” is the sign at the entrance to hell. I’m thinking we ought to put that sign up in place of all the “Welcome to Pennsylvania” signs that ring our border.

The latest example of socialism gone wild is Dominic Pileggi’s plan to levy a tax on natural gas extraction to reduce the property tax burden of seniors. This is naked special-interest political pandering with zero economic sense.

When government abandons “user pays” policies, then it is necessarily engaged in welfare. Since welfare involves the taking from one person in order to give to another, it is a strict violation of government’s first and foremost responsibility—protection of people’s property. Apparently, good government is not a priority for Mr. Pileggi and the Republicans who put him in leadership.

Additionally, Pileggi is attempting to transfer wealth from the natural gas industry to Pennsylvania seniors. But as any student in any economics class could tell you, the economic incidence of a tax (those who actually pay the tax) may be quite different from the legal tax incidence. In other words, to the extent the gas industry can pass on this tax to consumers (and it surely can), then we all end up, even seniors, paying for another patch of an already overly complicated tax regime.

With government leaders like Pileggi, economic vibrancy is never going to return to Pennsylvania.