a service of NPRI

February 3, 2006 
Vol. 2, No. 2

Also in this issue:

States vie to be part
of NCLB change

Las Vegas feels
industrial squeeze

The tax code boogie

Tax numbers up 10 percent

Pres takes dual tack
on immigration

The Sandy Springs Effect


Make 150,000% Today!

Addicted to polls

Bury Greenspan,
don't praise him

Lower rate =
higher revenue


from NPRI:

The private sector would do better

Nevada's big school districts don't make the grade in business terms, either

Evidence just keeps stacking up: Nevada’s two metropolitan school districts are too large and bureaucratically ingrown to do their jobs.


Make 150,000% Today!

By Matt Miller
Fortune Magazine

Yes, the Jack  Abramoff scandal is a cancer eating away at the heart of Washington, fresh proof of the Beltway's culture of corruption, etc., etc. But for business, this tawdry episode is a reminder of something that gets too little notice: A company's return on lobbying and campaign contributions--let's call it return on political investment, or ROPI--is astronomically higher than any real investment it can make. These remarkable returns, not any inherent venality, explain why the pseudo-reforms likely to come in Abramoff's wake will do nothing to stop the meltdowns from recurring.


to polls

Wall Street Journal

President Bush has seen the energy future, and he has two words of advice: wood chips. Somewhere in his cardigan sweater next to a fireplace, Jimmy Carter is smiling.

That gets to the uncomfortable heart of Mr. Bush's startling turn on energy policy Tuesday night. An Administration that once promoted drilling in Alaska and other ways to expand domestic oil and gas supplies is now lecturing the nation that it's "addicted to oil" and extolling the merits of cellulosic biomass, a k a wood chips. This may not be as bad as 1970s-style price controls, but it's also a long way from a sensible energy policy.

[continued] This article will be available to non-subscribers of the Online Journal for up to seven days after it is e-mailed.

Bury Greenspan, don't praise him

By Peter Schiff
Euro Pacific Capital

This week Alan Greenspan bids a long overdue farewell to the Federal Reserve that he chaired for 18 years. Praise from his Washington and Wall Street beneficiaries has naturally arrived by the boatload. His monetary policies enabled reckless and seemingly consequence-free deficit spending, helping incumbent politicians repeatedly win re-election; and his expansion of money supply and credit facilitated non-productive financial transactions, all to the benefit of the bankers who arranged them. It should be surprising to no one that he is so popular among these groups. The fact that Greenspan is so highly regarded by politicians and investment bankers is not a sign of how well he did his job however, but of how poorly.


Lower rate = higher revenue

By Philip G. Kerpen
The New York Sun

Capital gains tax revenues have increased in the three years since President Bush cut the capital gains tax rate, proving free-market economists right, and bureaucrats wrong. As Nobel laureate Milton Friedman often says, when you tax something you get less of it, and when you tax something less you get more of it. The "it" in this case is capital gains, which are the amount of money you make when you sell something for more than you paid for it.


WHY BusinessNevada

They never steal
all your chickens

It's time Nevada business
faces up to its situation

By Steven Miller

Some vocal elements in Nevada's business community often seem to think the way to deal with human predators is to imitate the most timid peasants in The Magnificent Seven.

At the start of that western film classic, some of the Mexican peasants, who— for the nth time—have just been robbed of their chickens and other property by a bandit gang, still reflexively shy away from any kind of action.

Instead, they start finding excuses for the leader of the gang.

"He never steals all our food," observes one. "He leaves us enough to go on with."

"That's something," nods another.

"We could beg him to leave us more," suggests the first.


States vie to be part of NCLB change

Nevada to seek new leeway in
gauging adequate yearly progress

By Lynn Olson
Education Week

At least one-fifth of the states say they plan to apply for a pilot program that would let them use a measure of student growth over time to help determine whether schools and districts have met their annual achievement targets under the federal No Child Left Behind Act.

Many other states, moreover, appear eager—judging from their participation in recent conference calls and meetings on the topic—at least to explore the possibility of applying for the “growth models” pilot. U.S. Secretary of Education Margaret Spellings announced the program in November, following pressure from states and education groups.


Federal land constraints
Las Vegas feels
industrial squeeze

Plunging vacancy rates signal
supply-constrained market

By Jennifer Shubinksi
InBusiness Las Vegas

The amount of available inventory in the industrial market is rapidly diminishing and future supply could be constrained because of land and construction prices, industry experts said. Vacancy rates for the industrial market continued to drop in the fourth quarter, indicating a high-demand, supply-constrained market and a market that could face challenges going forward, local brokers said.

The valley-wide industrial vacancy rate settled near 4 percent at the end of 2005, although numbers vary between firms because of the research methods used.

Researchers at Grubb & Ellis went so far as to say that industrial development in Las Vegas is on the brink of extinction as future projects continue to deplete an already shrinking industrial land supply.


Hidden costs
The tax code boogie

Institute for Policy Innovation

It’s begun — the 3-month countdown to income tax filing day. People are getting their W-2 forms and are beginning to twitch and grimace at the thought of doing their taxes. Call it the tax code boogie. Judging from data developed annually by the Tax Foundation, the tax code boogie is a long and winding song, that takes days to complete. In all, the foundation says that taxpayers will spend more than 6 billion hours in filling out their income taxes. With about 150 million workers, that comes out to an average of 40 hours per worker to comply with the tax code. Looked at another way, a worker has to spend, on average, of a full workweek just to comply with tax law.

This does not come cheap. The Tax Foundation estimates that, in 2005, the cost of complying with the tax code came to $265.1 billion, or more than $17,000 per worker.

A single tax rate, whether on income or consumption, would clearly cut way, way back on the time and money spent on complying with the tax code.


State revenues
Tax numbers
up 10 percent

By Geoff Dornan
Appeal Capitol Bureau

Taxable sales increased nearly 10 percent statewide in November.

The only exception was Douglas County which, reported a 3.2 percent drop in taxable sales. Total taxable sales there were $58.6 million.


Pres takes dual tack
on immigration

Seeks tougher enforcement, pushes guest-worker program

By June Kronholz
The Wall Street Journal

WASHINGTON -- President Bush drew big applause during his State of the Union address with a renewed call for "a rational, humane guest-worker program" to keep the economy humming.

But that appeal came only after Mr. Bush issued a much sterner one first -- for tougher enforcement of immigration laws, more vigilance on the border and an immigration policy that "reflects our values."

[continued] This article will be available to non-subscribers of the Online Journal for up to seven days after it is e-mailed.

The Sandy Springs Effect

Government based on results,
accountability could be model for others

By Geoffrey Segal
Reason Foundation

At 12:01 am on December 1st, a vision took reality for a large group of citizens in Sandy Springs, Georgia. After fighting Fulton County for over 30 years, their dream became a reality and Sandy Springs was officially an incorporated city—the first new city in Georgia in 50 years.

What makes Sandy Springs relatively unique is what the new city looks like today. Rather than create an entire new bureaucracy, they privatized virtually every city function. Moments after taking the oath of office for the first time Mayor Eva Galambos said, "We have harnessed the energy of the private sector to organize the major functions of city government instead of assembling our own bureaucracy. This we have done because we are convinced that the competitive model is what has made America so successful. And we are here to demonstrate that this same competitive model will lead to an efficient and effective local government."


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