| The dearth of BHI updates on Red Mass Group over the summer does not indicate our collective catch-up on use-it-or-lose-it vacation time. There has been no rest for the happy warriors at Suffolk University, we happy few. BHI's been exceptionally busy this summer.
Along with Americans for Tax Reform, BHI issued a critique of a plastic bag tax in D.C. ATR's Patrick Gleason sums up the study in an op-ed at National Review Online. The bag tax did little to meet revenue benchmarks or cut down on littering. Whether bag taxes or income taxes, taxpayers change their behavior in ways that policymakers deploying static analyses rarely suggest.
According to the D.C. Office of the Chief Financial Officer (OCFO), the bag tax has raised only $975,000 in the current fiscal year, well short of official projections. In its first year the bag tax only generated $1.5 million, as opposed to the $3.6 million predicted by D.C. officials. This shortfall reflects the fact that shoppers altered their behavior to avoid the tax at an even greater rate than District officials expected and that business-compliance estimates were overoptimistic. Read more over at NRO.
Earlier in the summer BHI had the honor of publishing a thought-provoking essay, A Monopoly Against Our Children: Teachers Unions vs. American Ideals, by longtime policy analyst Cornelius Chapman. Drawing on the historical event of the Boston Tea Party, a revolt against monopolies as much as taxes, Chapman argues that there is no intellectual justification for the the purchase of educational services from one private group. Since the nation’s founding, state and local governments, as single-buyers, carefully established monopolies for public goods such as toll roads or liquor cartels. Such efforts to curb competition could be justified on efficiency grounds, expediting road traffic or curbing externalities from alcohol consumption. A monopoly over public education, on the other hand cannot be justified on such grounds because other entities – such a private and charter schools -- can provide services.
In early August, BHI released the last installment of its four-studies on Chapter 58, the Massachusetts Universal Health Care Law. Having failed to curb insurance costs in the Commonwealth, Chapter 58, the Massachusetts universal health care law, should turn to more market-oriented policies such as Health Savings Accounts and tax credits. The Institute also recommends that the state not voluntarily expand Medicaid under the Patient Protection and Affordable Care Act. BHI reviewed several consumer driven policies from others states. These include establishing Health Savings Accounts (Indiana and Georgia), eliminating the tax bias in favor of employer sponsored health plans (Missouri) and reforming guaranteed issue and community rating (Maine).
Much has been written about former Governor Mitt Romney's job record and critics have seized upon the seemingly poor number of jobs created under his watch. But the conventional wisdom is wrong. Massachusetts only suffered modest unemployment rates between 2003 and 2007 because the state's labor force was smaller thus leaving less room for growth. Measured this way the record shows a better jobs picture says BHI Executive Director David G. Tuerck in his Boston Globe editorial from July 10, 2012.
One of the benefits of having a research institute like BHI housed in Suffolk University is the opportunity to work with students in the school's PhD program in Economics. With a little help from BHI, Ryan Murphy, PhD candidate, published an opinion editorial in the Boston Business Journal on the urgent need to reform the nation's patent system. Writes Murphy:
"Fixing the excesses of the system could yield significant gains by giving entrepreneurs the confidence to start businesses and create jobs without looking over their shoulders. We derail the system of free enterprise by forcing businesspeople to consult their lawyers whenever they want to try something new. And yet this is the result of legislation meant to encourage innovation."