Vermont Tiger

Seriously?

2012-02-10T11:39:42-05:00

an idea whose time, we pray, will never come

Politics by Emerson Lynn

Oh. My. God.

Our troubles are over. The answer to poor financial returns has been discovered. And all this time the answer has been before us, startlingly obvious, just waiting for a couple of state senators with enough pluck to make it work.

The answer?

The state needs to start buying private companies. Good ones. And the state [that’s all of us] should be allowed to buy controlling interest of these companies at bargain rates. The returns [guaranteed and always high] would flow to us.

Forever.

The idea, in concrete form, is being proposed by Sen. Vince Illuzzi and is being considered by the Senate Economic Development Committee. The state senator would like for the state to buy a controlling interest in VELCO, the private company owned by the state’s utilities to manage Vermont’s electric grid.

VELCO has an estimated book value of roughly a billion dollars. Mr. Illuzzi’s proposal would cost the state about $500 million. It’s also being championed by State Sen. Peter Galbraith, who essentially says it’s a no-brainer since it offers a “guaranteed” rate of return of anywhere between 10 percent to 14 percent.

Think about it. We borrow the money [which is cheap], seize control of the state’s electric grid, and feed ourselves the profit instead of letting others gobble it up. Legislators could then decide where any “excess” should be spent, and they could control the state’s power network.

How cool is that?

Through choking?

It’s hard to imagine that Mr. Illuzzi and Mr. Galbraith [and others] are serious. It’s hard to imagine an idea that has any less merit, or one that could put the taxpayer/ratepayer at more risk.

For starters, VELCO is a private company. It’s not for sale. The “net book price” of roughly $500 million would represent 51 percent, or controlling interest. That’s the price Mr. Galbraith said would be appropriate. But what profitable private company would allow someone else to buy controlling interest for net book value? If someone wants to buy controlling interest, they would be asked to pay a premium. There would be other bidders. Pretty basic.

Yes, but the state is in the process of considering a merger between CVPS and Green Mountain Power [owned by Gaz Metro.] With a wink and a nod, as intimated by Mr. Galbraith, perhaps a “deal” could be reached.

That, obviously, is coercion.

The shareholders [and their lawyers] would love that.

As for Mr. Galbraith’s “guaranteed” rate of return – 10-14 percent: Seriously?

Like the “guarantee” that housing prices would never fall?

Someone needs to grab his feet and pull him down – clearly not enough air is getting to the brain.

The utilities in Vermont are the ones who own VELCO, which was set up in the 1950s as the nation’s first statewide transmission company. The profits from VELCO flow back to the utilities which use the profits to lower costs to their ratepayers. It’s a complicated and risky business and one that is governed by strict regulatory oversight – state and federal. It’s worked well for the state of Vermont and the process is one that enjoys support from one end of the state to the other. It’s also a transparent process and one made comfortable because it’s not subject to the whims of legislators who look at something like this as the chance to change priorities.

Mr. Illuzzi is fond of saying that we should view owning the state’s transmission lines like we do owning our roads. We would not allow someone else own to our roads, thus why would we let someone else own our transmission lines?

His analogy is perfect.

Exactly. Why would we want the state to buy control of our electric grid if the condition of our roads and bridges is an example of what would happen? Our roads and bridges are billions behind in terms of needed repair.

It’s not the compelling argument Mr. Illuzzi thinks it is.

Mr. Galbraith looks at the idea as being in control of the toll booth on a highway that everyone has to use – a cash cow. All the money comes to us.

Cash cows? Again: Seriously?

And are Vermonters supposed to believe that in times of need our legislators would not feel compelled to divert a small river or two of cash to other “incredibly important” causes?

There are many reasons why what we have works reasonably well. King among them is a level of predictability. It makes no sense to reach for an answer to a problem that doesn’t exist. It makes even less sense for the state to begin a hostile take over of a private company in Vermont, at a level of risk not understood, and with the stated purpose of trying to run something they don’t understand.

Oh. My. God.

Emerson Lynn is editor & publisher of the St. Albans Messenger where this essay first appeared.

Water, Water, Nowhere

2012-02-10T10:19:08-05:00

by Art Woolf

You are at UVM and want to do something IMPORTANT.

You have three choices. You can

1. Ban the sale of a beverage that contains, water, 240 calories--mostly from added sugar--and also a variety of natural and other (unknown) ingredients.

2. Ban the sale of a beverage that contains water, 110 calories—mostly from the sugar in added fruit juices—and other ingredients called “the best stuff on earth.”

3. Ban the sale of a beverage that contains water, 0 calories, and nothing else.

If you are the UVM administration, you choose #3 and ban water. Not Coca Cola, not Snapple. Last week UVM decided to ban bottled water from campus vending machines.

Why?

“This change has been student-driven,” said Gioia Thompson, director of UVM’s Office of Sustainability, in the UVM news release.

Question number one: What’s the problem the students are concerned about?

“Students advocating for an end to sales of bottled water have dedicated many hours over the past four years encouraging fellow students to change their habits and persuading administrators to foster a more sustainable beverage system for the community.”

The first part (encouraging fellow students to change their habits) must not have been effective since they had to move from encouraging something to banning something.

Question number two: What is “a sustainable beverage system?” It apparently has something to do with what is inside the bottles, not the bottles themselves, since the only beverage UVM is banning is water. One would think that a sustainable beverage system might mean reducing the use of plastic bottles in general, but the students are only concerned about one type of beverage. (Any economist can tell you that an easy way to discourage the use of plastic bottles is to put a tax on them, or raise their price in some other way, which is pretty easy to do in a vending machine.)

What the students really don’t like is that UVM students are buying bottled water when they can get it for free from drinking fountains. Presumably, they don’t like pumping water out of the ground, putting it in bottles, and transporting it to a vending machine. That process “wastes” energy. But there’s no difference in the energy cost of doing the same thing with liquids such as Snapple or Coca-Cola, which are both 99% water.

My third question is why are students more concerned about a nebulous “sustainable beverage system” than a real problem that vending machines are part of: the problem of obesity. I don’t know how many UVM students are overweight or obese, but one in five Americans aged 18-29 are obese and among all Americans, about an equal number are overweight which means that about 1 in 3 UVM students are overweight or obese.

One way to reduce that real health risk would be to make low calorie beverages (water, anyone?) more widely available, not less. Another, more draconian way, would be to ban any beverage with sugar in it. Like Snapple or Coca-Cola.

The quest for a “sustainable beverage system” trumps the quest for better health and a reduction in obesity, I guess. Or maybe it’s just that there’s no organized constituency at UVM encouraging healthier beverage choices. That is, UVM’s green students out-organized any students who are concerned about health.

To be fair, UVM will be converting some water fountains to “water bottle filling stations” which may encourage students to drink water. At $300 a pop, it will cost UVM an estimated $100,000 to make that happen and it may or may not have any impact on UVM students’ beverage choices.

What will be the likely impact of banning water? Consider the alternatives:

1. Students who want to buy bottled water won’t be able to. It’s worth noting that they are made worse off under this policy.

a. If they don’t buy any drinks from campus vending machines, there are fewer bottles sold on campus (the advocates of this would conclude that this was a success).

b. Suppose those still-thirsty students buy some other type of beverage from the vending machine. They would have preferred buying water, but a Snapple or Diet Coke or Coke will substitute. Those students are still worse off, since they would have preferred to buy a bottle of water, but there are no fewer plastic bottles sold on campus. So those students and advocates who wanted to ban bottled water sales to help the environment have achieved nothing.

2. Some students who used to buy bottled water will bring their own water with them.

a. Some will bring that water in a refillable container and refill the containers on campus. In this case there will be fewer beverage bottles sold on campus.

b. Some will throw a few disposable bottles into their backpacks when they leave their apartments. There will still be fewer beverage bottles sold on campus, but there would be no change in the total number of disposable bottles sold in the Burlington area.

It’s not clear to me what the magnitude of any of these changes will be. I doubt that they will be large, and it will certainly have no real impact on energy use or have any measurable or significant environmental benefit. But it is symbolic, so it's in keeping with lots of other Vermont environmental initiatives.

It will be interesting to see if there are fewer bottles sold in vending machines on campus as a result of this policy. And whether UVM students put on a few extra pounds because of it.

Just Askin'

2012-02-10T07:13:56-05:00

The Freeps, editorializing about the dismal performance in math and science by Vermont's high school students, assumes its default, tut tut voice of admonishment:

The cheap shot here would be to complain that Vermonters aren't getting their money's worth for the school taxes they pay. The more difficult question is, how do we help all students do better in all of our schools?

At contract time, teachers can be relied upon to ask for (nay, demand) more money. Based on what, exactly? Performance? The legislators in Montpelier will soon be demanding more in property taxes to pay for education and passing the responsibility for further raises down to local boards by clipping the ed fund.

Why, then, is it unseemly of taxpayers to ask if their money is being well spent? After all, nobody else seems to be. Not the educators or legislators or administration officials, none of whom seems to have anticipated these test scores – which the Freeps admits are "distressing" – or to have a good explanation for them.

Those Test Scores: What We Have Here ...

2012-02-09T11:55:24-05:00

is failure of leadership

Politics by Emerson Lynn

Vermont’s reputation as a state that spends more on its schools than almost all others is a double-edged sword. The positive side is that we are defenders of education and have a reputation as a highly-educated state. The negative is the fact we are being shown that our education outcomes are not commensurate with what we pay.

If this week’s statewide assessment results are any guide, people could be expected to ask what’s up. In our high schools only 36 percent of our 11th graders were proficient in math, and in science that level dropped to 30 percent. The good news is that over 75 were proficient in reading, and, less stellar, almost half were proficient in writing.

These are overall figures. As with any statewide scoring requirement, there are schools that do remarkably well and some that fail totally. This disparity can be the reflection of everything from demographic differences, to leadership and the willingness to innovate.

Still, as a state we are now faced with the need to manage our reality and our reality is that we need to figure out how the performing schools do it and then figure out how to replicate their successes. We need to match our reputation for being a defender of our schools, with a reputation as being the center of educational excellence, which will require a tireless effort to embrace the need to change what happens in the classroom.

It’s difficult. Change is naturally resisted. Particularly in schools.

It’s also frustrating. For example, the state department of education this week said it would assess which math courses high school students were taking, and at what grade level, so that it could determine the effect not only on the test but the student’s ability to take other math courses. In other words, high schools may require students to take geometry sometime within the four years, but if it’s not taken before the students’ junior or senior year, then the students will be tested on material they’ve not learned. Test scores would reflect that choice.

Two things: First, why doesn’t the department have this information already? Vermont is a tiny state with a tiny school population. Why would something this elementary not be done as a matter of routine? Second, why wouldn’t the state simply require students to take those two courses in their freshmen and sophomore years? That would also allow the student the time and flexibility to take other math classes. The same lessons apply to science courses. This would help the state meet the need to focus more on math and science disciplines which translate to a better prepared workforce.

As an aside, how is it that we can expect our colleges and university to churn out more engineers, mathematicians, economists, data processors, etc., if our high schools are giving them students not proficient in the required fields? Aren’t we setting ourselves up for failure by refusing to coordinate and focus the high school curriculum to our collective advantage?

It begs the question: Who is in charge? Who drives this necessary change? Who focuses the debate on the need to match student outcomes with the tab taxpayers pay?

In Vermont, no one.

We have a commissioner of education, and a board of education, but they don’t have the political pull to drive a discussion. We have a governor and a Legislature, but they have little regulatory clout. This lack of coordinated authority is one of the factors that inhibits the ability of Vermont’s educational system to move forward.

As we’ve argued before, pending legislation to move the commissioner’s position to the governor’s cabinet [as an appointed position] is essential. It’s hard to see how we adopt the progressive policies necessary without it.

And, while we support the governor’s push to get this done, he must also realize that his public push to get schools to adopt flat-lined budgets for the third year running is falling on deaf ears, and should. That’s purely a political ploy to be seen as someone who is opposed to an increase in property taxes. In part, he caused his own problem by refusing to adequately fund the state’s educational kitty, shifting the responsibility to the local level.

It is also counterproductive to cut if there is no vision as to what the final product should be, and a plan to get there.

We have the good fortune of being a high spending state. That should mean we have the resources to turn out a first class result, and nothing is more important to the state’s prosperity than first class schools. Nothing.

The opportunity is there. The need, as the assessments show, is stark. The question is one of political will.

Emerson Lynn is editor & publisher of the St. Albans Messenger where this essay first appeared.

An Inquiry Into the Nature of Carts & Horses

2012-02-09T11:01:56-05:00

one of them must go first; it's a rule

We talk a lot, here in Tigerland, about economic growth. Even when it is not the specific topic of conversation, it is the subtext. It would be fair to say that we believe that while economic growth does not fix all problems, it makes almost all of them easier to endure. We had a couple of years of negative growth in Vermont and such economic expansion as we are now experiencing is pretty anemic. The discussions in Montpelier about funding education, reforming health care, mandating renewables, and all the rest would be much less stressful if the economy had grown at 3% or more for the last few years, for the obvious reason that there would be a lot more money to spend.

These days we hear people talking about "creating jobs" as though that is the same as promoting economic growth. Not so. It would be, as Art Woolf has pointed out, easy to "create jobs." Montpelier could simply make automatic teller machines, grocery store scanners, and self service gas stations illegal. Presto, more jobs. And, quite possibly, negative economic growth. For sure, no wealth creation.

True economic growth can, in fact, be a job destroyer in the short run. Which our friend, Amity Shlaes, makes clear in an essay about the controversial Clint Eastwood ad that ran during halftime of the Superbowl. (For another take on the ad, by another of our friends, click here.)

Ms. Shlaes argues, convincingly, that

the Super Bowl ad infuriates because Eastwood, like so many others before him, gets the story backward. What’s wrong with the auto industry is not that it failed to create jobs. What’s wrong is that it emphasizes jobs over general growth itself.

Vermont, in the ways it taxes and regulates, mostly gets it wrong about economic growth. But, then, so does Dirty Harry.

So we aren't in bad company.

The Energy Perplex

2012-02-09T09:01:21-05:00

When the price of oil (and gasoline) is "too high" (admittedly, an imprecise measurement), Senator Sanders thunders about the "speculators," and we can expect to hear him preaching from this text pretty soon now as the people who study these things say that gasoline will hit $4 a gallon this summer.

When oil prices decline, we do not hear an explanation from Senator Sanders. Could the speculators have stayed up too late, drinking Veuve Clicquot and now they are sleeping in?

Of course we never hear about oil prices being too low. That, of course, would be a logical impossibility.

Or would it?

New finds of natural gas and new technologies for exploiting them have made gas abundant and cheap. So cheap that businesses that are high users of energy will be able to cut costs and make more money which they might then be able to spend on wages for new hires. Thus, lower unemployment and increased economic growth. Almost as good as free beer and wide roads, you think.

But no. A new source of cheap energy is decidedly not good news in some circles.

Paul Burns, the executive director of Vermont Public Interest Research Group, says that natural gas prices are arguably too low.

“They are low enough to be making it difficult for truly green technologies on the renewable sides of things to get a foothold,” Burns says.
Seven Days

So this is how it goes in the new, green economy. We need energy that is neither too expensive nor too cheap but priced just right. That price will be the one that makes it possible for renewables to compete. Good for the people in the renewables industry. For the rest of us, not so much.

Strongarming the Senate

2012-02-08T11:58:07-05:00

day care providers playing union hardball

Politics by Emerson Lynn

John Campbell is the president pro tem of the Senate, and, by definition holds a position of influence. Thus, when Vermont AFL-CIO officials asked to talk with him about a bill to allow day care providers to unionize, he probably expected a conversation focused on the merits of the legislation. Instead, according to Mr. Campbell, a piece of paper was slipped across the table. It showed how much money the union had raised to support Mr. Campbell and his party. They made it clear what they expected in return from Mr. Campbell and told him he would be labeled as someone opposed to collective bargaining if he did not comply. It was a naked display of power: we give you our money, you give us your vote.

Mr. Campbell did not give the lock-step response the union officials might have expected. He said the bill should not go forward, saying, “…the tactics used to intimidate myself and this body are so against what good clean government is about, I think it would be rewarding bad behavior.”

To say the least.

Not only was the cash-for-vote display abhorrent, it was politically stupid. It puts other Senate Democrats on the spot. Mr. Campbell is their leader and he has rejected the notion of being bought. Will other Democrats do the same?

That’s an open question. Mr. Campbell’s cause was undermined a short time later by Gov. Peter Shumlin who said he would do all within his power to see that the Senate deals with the issue.

Clearly, he tossed Mr. Campbell under the bus. The governor’s support to the union’s tactics emboldened the union to move even more aggressively. By the end of the day, Mr. Campbell had pulled back on his complete opposition. Hearings on the bill will proceed. The union said Mr. Campbell’s turn-about was “a positive sign.”

We would encourage Mr. Campbell and his Senate colleagues to hold firm and not yield to the muscular politics displayed, which, essentially is vote-buying.

The union behind the legislation is the American Federation of Teachers, which is affiliated with the AFL-CIO. They have made this legislation their cause celebre, for the obvious reason that it could add an estimated 3,000 people to their union’s membership. They are trying to do the same nationwide.

Aside from the fact that they should not be bullying legislators, it’s also poor legislation, something that is not needed, something, that in many cases, is not wanted by the day care providers [over 280 day care providers in Vermont have signed a petition saying they are opposed to the legislation.]

What the bill does is allow day care providers to bargain collectively with the state for child-care subsidy rates and reimbursement levels from the Vermont Department for Children and Families. As union officials say, creating a collective bargaining unit would allow the day care providers to get “fair treatment” in their negotiations with the state.

Normally, a union is formed in response to the need to deal with an employer. Day care providers are self-employed and it’s the state that decides the reimbursement levels. If reimbursement levels are insufficient, why would the Legislature not vote to increase them? Why would they create a union which would then sit down with the state to negotiate what could easily be accomplished by legislators? The Legislature has the power to do everything the legislation contends needs to be done.

Mr. Campbell raises another point. If we start unionizing all groups that receive state subsidies, where does that lead? When this legislation was first considered last year, it mandated that child care centers should be included and that the union be allowed to negotiate for pension and health care benefits. That would have meant the unionization of roughly 10,000 day care providers and untold expense. Both were stripped from the legislation passed by the House. There is an effort to include the day care centers in the Senate bill and it would not be difficult to imagine that – should the law be passed – we would see the legislation grow in its reach and its depth.

Vermonters owe Mr. Campbell a vote of thanks for at least shining a light on a lobbying effort that most Vermonters disdain. We would hope he would stand firm and have others stand with him. This is not the environment we should encourage; if it’s allowed and if success follows, we can only expect more of the same.

Emerson Lynn is editor & publisher of the St. Albans Messenger where this essay first appeared.

Local Control ...

2012-02-08T11:12:19-05:00

or controlling the locals?

Governor Peter Shumlin is urging local voters to reject school budgets that include any additional spending for next year.
VPR

Question is: Will Montpelier retaliate against those local school boards that don't buckle? There are often (even, usually) good reasons to vote against increases in school budgets. But one of them isn't because the governor told you to.

The more I read, the more confused I get

2012-02-08T11:07:05-05:00

by Art Woolf

From today's Free Press

Case I. Vermont's best-known climate change activist, Bill McKibben, testified in Montpelier yesterday:

Bill McKibben went before a panel of state lawmakers on Tuesday to say the storm [Irene] was at least partly the product of climate change and a likely harbinger of a troubled future.

In the 700 word story, there wasn't one word about any contrary opinions. Such as over Mr. McKibben's assertion that

Irene fit “precisely with what the climatologists have been telling us to expect. It was not an unbelievable windstorm as it swept up the East Coast. But over the waters of New York and New Jersey, it encountered record sea surface temperatures. ... This allowed it to soak up enormous amounts of moisture, most of which it dropped on Vermont.” ...

McKibben said Vermont has gone from about 80 percent open land — mostly farms — and 20 percent forest in the 19th century to the reverse today. Since forest floors are good absorbers of water, the state should have been more resistant to flooding now than earlier in its history. That’s why Irene’s fury should be so striking, McKibben said.

Perhaps the fact that the storm travelled directly over the spine of the Green Mountains and dropped its water into a mountainous area filled with steep mountain river valleys had more than a minor contributing effect. If the storm's track had been just a little bit to the east or west it would have dropped its moisture in the Connecticut River or Champlain Valley, where its impact and physical and economic damage would most likely have been much less.

Mr. McKibben actually got one concern exactly correct.

“We think we’ve added a couple hundred million people to the rolls of the malnourished and severely hungry around the world as a result,” he said.

Except that he was referring to the Russian drought last year (allegedly brought about by climate change). There are hundreds of millions of people worldwide who suffer from abject hunger, malnutriion, and disease that result from extreme poverty and that poverty has nothing to do with climate change. For the money that nations are spending to try to reduce carbon emissions (with no short term and very little long term benefit) those nations could alleviate a tremendous amount of suffering due to poverty.

Take, for example

ten of the world’s nastiest diseases, which afflict more than a billion people. Guinea worm, sleeping sickness, bilharzia (which doctors call schistosomiasis) and the others rot tissue and cripple the organs. Even if they do not kill, they stunt children and sap adults’ energies.

And those diseases, and other problems affecting hundreds of millions of poor people worldwide could be alleviated by channeling money spent on carbon reduction projects to providing health, food, and micronutrients to those people.

Case II. There's no doubt that college costs are rising faster than just about anything else (health care may be giving it a run for its money). But when I read about Vermont State College students lobbying Montpelier for more state funding and I read

Emily Quattrocci of Lincoln, a landscape architecture major planning to graduate this spring from Vermont Technical College, said she had struggled to stay in school at times because her parents were unable to contribute to the cost.

To help pay the costs, Quattrocci said she went into business with her grandfather, growing vegetables in a garden and selling them at a roadside stand. Still, she'll have about $40,000 in debt when she graduates, she said.

The average student debt load nationally for students who graduate with debt (and about one-third graduate with no debt) is about $23,000. The article notes that Vermont Technical College, where Ms. Quattrocci goes to school, as a tuition of $10,656. That means Ms. Quattrocci must have borrowed to finance 100% of the school's tuition. That's certainly possible, but one question would be why she did not receive any financial aid from the school or from VSAC.

That question was evidently not pursued by the reporter, which leads to my next question, which is why the reporter relied on such an extreme outlier as the example of a typical student at VTC. An activist would want that extreme outlier's story told to make a point, but isn't it the role of a journalist to dig a little deeper than that?

As I said in the title of this post. I am very confused. About a lot of things.

We Are the Third Highest Spending State ...

2012-02-08T09:05:33-05:00

per-pupil on K-12 education and all we get are these lousy test results:

Every fall, public school students in grades 3 through 8 and grade 11 are tested in the areas of reading, writing and math on the common assessment exam known as NECAP.
The 2011 results show that nearly 75 percent of Vermont students are proficient in reading, and nearly 50 percent or more are proficient in writing. But only 36 percent of 11th graders scored at the ‘proficient' level in math.
VPR

And, further down in the story we learn that only 30% of 11h graders are proficient in science. So what, exactly, are we getting for our money?