Grassroot Perspective – July 21, 2003-New Proposal to Shrink Government: Term-Limit the Big-Spending

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– New Proposal to Shrink Government: Term-Limit the Big-Spending

By Jonathan Collegio

Taxpayer advocacy group Americans for Tax Reform (ATR) outlines a
proposal to cut government spending by term-limiting those in Congress
who spend the money.

WASHINGTON – The size of government continues to grow: Today, Americans
for Tax Reform (ATR), the nation’s leading taxpayer advocacy
organization, released its annual Cost of Government Day (COGD) report
showing that the total cost of government at the federal, state, and
local levels has risen to near-historic levels.

But where to lay the blame? Taxpayer advocate Grover Norquist, president
of ATR and a longtime critic of government overspending, says the blame
lies with the appropriations process and those who run it.

“There’s an old saying that Washington has three political parties: the
Republicans, the Democrats, and the Appropriators,” said Norquist on
Friday in a press conference marking COGD. “Budget Committee members are
already limited to 6 years, and serious reform of the appropriations
process – beginning with four-year term limits for those on
appropriations committees-should be considered to keep the government
from spending out of control,” he added later.

Today’s COGD press conference marked today, July 11th, as the date in
the calendar year when Americans had paid off their share of the entire
cost of government spending and regulations at the federal, state and
local levels. The cost of government, after declining for eight years
between 1992 and 2000, has risen so much in the past three years that
COGD has been pushed back to near 1992 levels.

“Government is growing at unsustainable rates at all levels: local,
state and federal,” continued Norquist, “and much of the increase is due
to those at the head of the appropriations processes, both here in
Washington and in our 50 state capitols across the country.”

The idea of term-limiting appropriators comes after the great success of
term-limiting committee chairmen in several reform acts in 1995, during
the 104th Congress.

“Before the 1995 reforms, so much power was concentrated in the hands of
a few ancient old men like Jack Brooks and Dan Rostenkowski who were so
entrenched that they worked for no one but themselves,” continued
Norquist. “They were rooted out, and a good sanitization of the
appropriations committee should be next on the reforms list.”

Above article is quoted from Americans for Tax Reform Press Release July
11, 2003

– HOT (High Occupancy Toll) Lanes Are a Good Deal, Concludes Resources for the Future

By Bob Poole

Who would win and who would lose if the existing HOV lanes on a metro
area’s freeway system were converted to HOT lanes? This question has
been much debated, but because there have been so few real HOT lanes,
and each is a single facility, there has been more heat than light in
this debate. But now Elena Safirova and colleagues at RFF have advanced
the debate considerably. They modeled the conversion of all the existing
HOV facilities in the Washington, DC metro area to HOT lanes, using the
Washington-START model, which simulates travel on the region’s entire
roadway network. Their transportation findings were hardly surprising:
significant numbers of SOV drivers opt to pay the 20-cent/mile toll to
use the HOT lanes, reducing congestion in the general-purpose lanes even
though some drivers return to the freeways from side roads.

But the really interesting findings are the estimated social welfare
changes. Overall, they estimate net welfare gains to society from this
policy change (from HOV to HOT) of $86 million/year; that’s the sum of
$40 million in new toll revenues plus $46 million in time savings for
travelers. When they break this down by income quartile, they find that
every group has net welfare gains-i.e., the benefits to each quartile
exceed what that quartile pays in tolls. The researchers conclude that
even if the toll revenue were not spent on transportation or on
redistribution (for equity purposes), “this HOT lane policy would still
provide a welfare improvement for all income groups, so there are no
losers when the welfare effects of the policy are disaggregated by
income groups.” [Elena Safirova, Kenneth Gillingham, Winston Harrington,
and Peter Nelson, “Are HOT Lanes a hot deal? Analyzing the potential of
HOV to HOT Lanes conversion in Northern Virginia,” Resources for the
Future, Issue Brief, March 2003.]

Note: In a longer and not yet published report on this modeling
exercise, the same team (plus David Mason) also model two variants of
converting all freeway lanes to priced lanes. But here they find that
the non-HOT lane pricing strategies actually make many travelers worse
off-i.e., what they pay is greater than the value of the benefits they
receive. Hence, they conclude, “[O]ur results suggest a potentially
strong case on the grounds of efficiency, equity, and political
feasibility for converting existing HOV lanes into HOT lanes . . . .An
initial jump towards more comprehensive pricing raises some troublesome
issues on equity and practical grounds.” Thus, it would appear that the
much-maligned “Lexus Lanes” are actually a more equitable approach than
generalized congestion pricing.

– Broad Support Building Up for Priced Lanes

By Bob Poole

FAST Lanes, HOT Lanes, and Toll Truckways are all examples of the same
general principle: specialized lanes, aimed at better service for a
particular subset of highway users, who pay a toll to gain access to
that better service. And the last few months have seen growing support
for these ideas, as Congress begins consideration of the specifics of
reauthorizing the federal surface transportation program.

That was certainly the theme of a May 6 hearing of the Joint Economic
Committee. Rep. Mark Kennedy presented his FAST Lanes proposal (HR.1767,
and a companion Senate bill introduced by Sen. Wayne Allard), and I
explained Reason Foundation’s proposal for HOT Networks. Other
presenters included Rob Atkinson of the Progressive Policy Institute
(who endorsed both HOT lanes and Toll Truckways), Bill Buechner of the
American Road & Transportation Builders Association (who supported
tolled truck lanes), and Michael Replogle of Environmental Defense (who
supported HOT lanes, with some conditions).

HOT lanes received another round of support at a June 4 conference on
value pricing for the metropolitan Washington, DC region. Over 200
transportation experts took part, with HOT lanes becoming the major
theme. HOT lanes have recently picked up support from the American
Highway Users Alliance, whose reauthorization issue brief, “Keeping the
Trust in the Highway Trust Fund,” endorses the concept, as long as use
of the lanes is voluntary and toll revenues are used to finance
additional highway capacity. HOT lanes have also been endorsed by Sen.
James Inhofe, chairman of the Senate Environment & Public Works

Toll truck lanes have won the support not only of ARTBA but also of the
Transportation Construction Coalition, representing 28 trade
associations and construction unions, and co-chaired by ARTBA and the
Associated General Contractors. And FAST Lanes-toll-funded lanes added
to congested Interstate routes (which could include both HOT lanes and
toll truck lanes) have recently been endorsed by both AHUA and the
350,000-member National Taxpayers Union.

The latter suggests a possible compromise on the thorny issue of a major
increase in federal fuel taxes. The two extremes have been staked out
by the Bush Administration and taxpayer groups (no increase) and the
highway groups (major increase, based on several studies showing unmet
highway investment needs). A compromise position that acknowledges the
investment need but does not break faith with no-tax-increase pledges
would be to index the fuel tax for inflation (not an increase, just
holding constant in real terms) plus provide maximum scope for tolls and
public-private partnerships to close the funding gap. While there is no
organized effort to forge such a position as yet, all the pieces are in
place for this to be a plausible outcome.

Above articles are quoted from Reason Public Policy Institute, Surface
Transportation Innovations Issue No. 9, June 6, 2003

”Roots (Food for Thought)”

Editor’s Comment: Following is most of the content of “Consumer Choice
Matters #23″ by Greg Scandlen of the Galen Institute. Business owners
and employees should read it very carefully and think about this:
Hawaii’s Pre Paid Health Care Act does not allow the consumer (employee)
any choice. We are precluded, by law, from searching for innovative,
cost saving alternatives. The result? We are in danger of pricing
ourselves out of consideration when businesses look for a place to move
or start operations. — Richard O. Rowland

– Consumer Plans to Get 20 Percent of the Market in Three Years

While not quite as enthusiastic, an article by Trevor
Thomas in “National Underwriter” also notes that, “Defined
contribution health plans (are starting) to make some
headway.” It cites several employers who report the
plans have “made a huge difference in the way employees
use insurance.” One employer says, “Now people are
a lot more interested in their personal medical fund
and how that money is spent.” Hewitt’s Tom Beauregard
says consumer driven plans will have 20% of the benefits
market within three years, and EBRI’s Paul Fronstin
notes that the number of plans has doubled since 2002.
The article reports that large employers typically
offer a CD plan as an option to its other plans, while
mid and smaller employers tend to use full replacement.
When it is used as an option, “some experts fear that
the defined contribution plans will appeal mainly to
healthy employees.” But Aetna’s Robin Downey says “adverse
selection has not been a problem,” according to the
article.” “It depends on how you structure your contribution
and how it compares to what else is available.”
SOURCE (requires subscription):

– The Leading Point of a Very Large Wedge

You know this movement has wind in its sails when publications
like “The Controller’s Report” start featuring it,
as it does in its July, 2003 issue. The article says,
“Controllers who are exasperated with rising health
care costs might consider the example of Logan Aluminum
(which) replaced its PPO with a so-called consumer
driven health plan.” The article calls these plans
“the leading point of a very large wedge, (because)
in 2002, only 13% of large employers were considering
offering these plans. But this year, 44% (are).” The
article says “controllers have heard good word-of-mouth,”
and ticks through some of the early reports of cost
SOURCE: This was published in the July issue, but it
is one of those specialized publications that is hard
to get access to. Go to:

”Evergreen (Today’s Quote)”

“Only two things are infinite, the universe and human stupidity, and I’m
not sure about the former.” — Albert Einstein

Dick Rowland says in reply: Great point, Albert; includes you, me and
all the rest, of course.

”’Edited by Richard O. Rowland, president of Grassroot Institute of Hawaii. He can be reached at (808) 487-4959 or by email at:”’ ”’For more information, see its Web site at:”’