Category Archives: Public Policy and Governance

Who’s Afraid of the Big Bad “Frankenfood”?

Last Sunday’s New York Times ran an extensive article about the highly emotional grass-roots effort to eliminate or label GMOs--genetically-modified organisms–and the political risks to those who resist that emotionalism in favor of reliance on the science.

This is an issue that drives my cousin, a cardiologist and scientist, up the wall. At his own blog, he has written extensively on the subject, pointing out–among other things–that foods made with GMO crops have been consumed by hundreds of millions of people around the world for more than 15 years with no discernible ill effects; that virtually all processed foods sold in the U.S. contain GMO ingredients; that genetic engineering simply “speeds up” the conventional cross-breeding and hybridization that humans have done for thousands of years.

He also points out that genetic manipulation allows us to produce plants more resistant to insects and disease–which in turn allows us to reduce the use of pesticides and herbicides that can be harmful. He also points to the promise of better nutrition for people in third-world countries.

The scientific community is solidly in my cousin’s corner on the issue.

There is one thing, however, that I think my cousin gets wrong. He has concluded that “the irrational opposition to these products is likely being propagated by the same individuals who deny, among other things, global warming and evolution.”

Not quite.

As the New York Times reported,
Scientists, who have come to rely on liberals in political battles over stem-cell research, climate change and the teaching of evolution, have been dismayed to find themselves at odds with their traditional allies on this issue. Some compare the hostility to G.M.O.s to the rejection of climate-change science, except with liberal opponents instead of conservative ones.

“These are my people, they’re lefties, I’m with them on almost everything,” said Michael Shintaku, a plant pathologist at the University of Hawaii at Hilo, who testified several times against the bill. “It hurts.”

So why are liberals willing to accept the scientific consensus on climate change and evolution and most other things, but so suspicious of that same science when it comes to GMOs?

There is a lack of scientific literacy that contributes to all “denialism,” of course, and we all suffer from a lack of good reporting on scientific issues. But I think something else is going on here. Liberals are willing to trust scientific expertise in other areas–why not in this one?

I think at least part of the answer is that the GMO issue has become confused in the public mind with other practices of the food industry that are far less benign.

The use of hormones and antibiotics in order to fatten chicken and cattle more quickly and with foodstuffs they wouldn’t otherwise tolerate is a cause of widespread and well-founded concern. The rapacious and well-documented business practices of companies like Montsano certainly suggest that those companies are willing to put profits above people’s health, and shouldn’t be trusted. Films like “Food, Inc.” have disclosed the frequently inhumane treatment of the animals raised to feed us, and engendered a visceral response in viewers. (I couldn’t eat chicken for months!)

Add these unquestionably valid concerns to our very imprecise use of the term “genetically-modified” and you get an understandable–if misplaced–reaction to anything considered remotely “unnatural.”

 
 
 
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Emerging from a Different Kind of Prison?

There are the prisons we all recognize–utilitarian buildings constructed to hold lawbreakers–and then there are prisons of a less recognizable sort: rigid beliefs, the sorts of ideological commitments impervious to evidence.

Yesterday’s post referenced the copious academic literature analyzing one such ideological commitment.

As I noted in that post, for the past thirty-odd years, devotion to contracting-out (mis-labeled “privatization”) has been an article of faith with a lot of public managers and political science theorists, not to mention substantial numbers of folks in the business community that have profited from such contracts and the even higher percentage of nonprofit enterprises that have come to depend upon government funding.

This belief in the benefits of privatization has persisted despite significant amounts of research painting a considerably more nuanced picture.

Sometimes, however, reality really does bite. So I was interested in an article from the Idaho Statesman, reporting that the state will resume control of a prison that has been run by CCA, one of the largest private prison companies in the country.

An Associated Press report last year raised questions about how the Nashville, Tenn.,-based company was staffing the prison, and the state’s move is part of a larger debate over whether prison privatization works.

Over the past several decades, contractors have been brought in to run prisons, federal lockups and even county-level jails. The number of inmates housed in the facilities grew from 85,500 in 2000 to more than 128,000 in 2012, according to federal statistics.

Private prison operators have been repeatedly sued, amid allegations of rampant violence, understaffing, gang activity and contract fraud.
The Idaho Statesman article quoted University of North Florida criminal justice professor Michael Hallett, who has written a book on prison privatization. Hallett said the problems in Idaho reflect those seen nationwide.

“A private prison corporation operates just like an old-fashioned HMO, where the less they spend, the more they make,” Hallett said. “ … There’s lots of ways to game the system, through contract violations and even just legal contracts to house easier inmates.”

Idaho’s governor has been a longtime supporter of privatization, but the problems became too obvious for him to ignore. The situation is reminiscent of then-Governor Daniels’ belated admission that Indiana’s costly experiment with welfare privatization was a disaster.

The lesson today and yesterday isn’t that government should never contract out. The lesson is: the decision to contract for public services is more complicated than ideologues want to make it. Sometimes contracting is a good idea; often, it isn’t.

We deserve public managers who can tell the difference.

Academics Say the Darnedest Things…

It’s too bad that articles in academic journals are so filled with jargon, because they often contain valuable information, or make important points that get ignored or glossed over, even by other members of the academy.

Case in point, a recent article in Public Administration Review, a very highly-regarded journal focusing on issues of public management. The title ” Governance, Privatization and Systemic Risk in the Disarticulated State” was calculated to make your eyes glaze over, and I will admit I only read it because I know both of the co-authors (one is a SPEA colleague) and know them to be first-rate scholars.

Ignore the wonky title. This is yet another analysis of government’s love-affair with privatization.

The authors apply research on “systemic risk” to the public-private partnerships that have become ever more common over the past quarter-century or so, the networks of for-profit and non-profit organizations increasingly used by public-sector agencies to do government’s work and deliver public services. As they note, such public networks are similar to financial systems: they are complex, interdependent and risky. Furthermore, if and when they fail, that failure has “potentially catastrophic” effects on citizens who depend upon public services.

One of those risks is that an organization in one of these privatized networks will try to benefit at the expense of the others. The article cites several examples: halfway houses in New Jersey were found to have falsified records in order to have high-risk inmates placed in their (understaffed) facilities; in Tucson, Arizona, a downtown development project employed a network of developers and consultants that spent millions of taxpayer dollars and failed to produce anything.

The risk isn’t confined to dishonesty and self-dealing. The Providence Service Corporation is the largest provider of privatized social services in North America. When the 2008 Great Recession hit, investors dumped their stock in the company (it went from $36 per share to less than a dollar). The loss of capital threatened the ability of the company to continue delivering services to 70,000 clients.

After an extensive discussion of the nature and extent of the dangers involved, the authors conclude that, “reliance upon third parties to produce government services is fraught with risk at all levels.”

This analysis joins a growing and steady accumulation of evidence that the wholesale embrace of privatization of public services is too often costly, risky and counter-productive.

The rush to privatize–to offload public responsibilities–is part and parcel of the assault on the whole enterprise of government that has always been part of American political discourse, but which really gained traction during the Reagan Administration. It’s an attitude, rather than a philosophy, and it plays to the very American desire to address messy, complicated realities with simple, bumper-sticker remedies.

As we are learning the hard way, government can’t privatize away its responsibilities, and too often, the effort to do just that ends up making matters worse.

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Dollars and Sense

This morning, I was scheduled to participate in a statehouse rally intended to urge the Governor and General Assembly to exhibit rational behavior, also known as Medicaid expansion under the Affordable Care Act. (Of course, this is Indiana, where rational political behavior can be pretty rare.)

The weather required organizers to reschedule, but I’m posting my prepared remarks, which centered on dollars and sense.

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Many of us have just wished our friends and loved ones a healthy, happy and prosperous New Year. In Indiana, those are going to be elusive goals.

According to a report issued in December by the respected Kaiser Family Foundation, Indiana stands to forego17.3 billion dollars between 2013 and 2022 because we are refusing to follow the lead of surrounding states (including those governed by Republicans) and implementing the ACA’s Medicaid expansion.

Indiana is refusing to accept the federal dollars that would pay for expansion of Medicaid despite the fact that over half a million Hoosiers have lost employer-sponsored coverage since 2000, and despite the fact that Indiana has seen the nation’s largest loss of health insurance coverage for children. More than eighteen percent of Indiana children have lost coverage since 2000.

Let’s talk dollars and sense.

Under the ACA, the federal government will pay 100% of the costs of expanded Medicaid for the first three years and 90% thereafter. Expansion would actually save Hoosier taxpayers money, since some of those federal dollars would pay for services we currently provide.

Since there is no rational reason to forego billions of dollars and deny a quarter of a million Hoosiers access to affordable coverage, some Indiana officeholders have resorted to deliberately misleading their constituents. One legislator recently sent out a survey seeking “input on legislative topics”.  The Medicaid question read as follows:

 “Currently, one out of six Indiana residents is on Medicaid, or about 1.1 million Hoosiers. Medicaid makes up about 14 percent of the state’s budget. Under the Affordable Care Act (or Obamacare), Indiana can expand Medicaid to cover more uninsured Hoosiers at a projected cost to taxpayers of more than $1.4 billion by 2020. This expansion would allow one in four Indiana residents to enroll in the program. Do you support full Medicaid expansion for Indiana under Obamacare guidelines?”

The question clearly–and dishonestly–implies that Indiana taxpayers would foot the bill for expansion. (Of course, he might get an answer he doesn’t want if he explained that new federal dollars would cover the costs.)

The question we need to ask our Senators and Representatives is pretty simple: Why are you refusing to allow the federal government to pay the entire cost of expanded coverage for three years and 90% thereafter—especially when those dollars you are rejecting would create an estimated 30,000 Hoosier jobs and, according to health economists, would reduce premiums paid by those of us who do have private insurance?

The only response I’ve heard is weak and highly speculative: the federal government might stop paying the full 90% at some future time. But if the feds cut payments, we could cut services, so that excuse just doesn’t pass the smell test.

It’s hard to escape the conclusion that Indiana is leaving 17 billion dollars on the table, leaving more of our citizens uninsured, costing Hoosiers who are insured more money, and refusing to cover Indiana’s most vulnerable children simply because our governor and state legislative leaders will oppose anything and everything proposed by this President, no matter how that opposition affects the citizens they were elected to serve.

Here’s a news flash: you don’t have to like this President—and you don’t have to like the Affordable Care Act—in order to accept billions of federal dollars that will save lives and money and create jobs for the people of Indiana.

Thanks to Governor Pence’s refusal to implement  Medicaid expansion, Hoosiers will pay higher state taxes, higher health insurance premiums and higher out-of-pocket expenses. And those costs will fall most heavily on those who can least afford them.

Our politicians may be aiming at President Obama, but the people they are hurting are the Hoosiers who elected them.

 

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No Free Burgers…

If there’s one thing that conservative and liberal economists agree about, it’s that old bromide about there being no free lunch.

That widget you are manufacturing contains raw materials, its construction takes labor, and its distribution and marketing must be paid for. Your facility and utilities cost money.  Those costs–plus some profit–have to be reflected in the price, or you’ll go broke.

You may be able to gain a market advantage by shifting some of your costs to others–we all know of cases where pollution created during production is discharged into the air or water to be paid for by the community at large, rather than by being properly disposed of and the cost of that disposal factored into the product’s sales price–but if it’s a cost of doing business, someone has to pay it.

Market theory assumes that the widget manufacturer will pay all the costs of production,  and then pass those costs on to the ultimate consumer, as part of the price.

Increasingly, however, taxpayers are assuming those costs.

Case in point: we are subsidizing the wages of a quarter of the people who have jobs today. A recent study from UC Berkeley and the University of Illinois found that fully 52% of fast-food workers receive public assistance–mostly Medicaid and food stamps–to the tune of $7 billion dollars a year. (McDonald’s workers alone got $1.2 billion of that.) One Wisconsin Wal-Mart costs taxpayers over a million dollars a year.

The United States now has the highest proportion of low-wage workers in the developed world. And as the report noted, every dollar taxpayers spend subsidizing corporations so they can continue paying their workers poverty wages is a dollar not spent on early childhood programs, or schools, or roads, or any other social good.

We need to have a national conversation about who is paying for that burger.

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