Study: Charter schools improve teacher quality at traditional public schools

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Charter schools increase the average quality of traditional public school teachers by providing high-quality, unlicensed teachers an easier pathway into the field, a new paper published by the National Bureau of Economic Research concludes. 

“Because the fixed costs to participating in the charter sector are low, teachers are able to explore their taste for teaching before committing to fixed costs (licenses). This in turn generates positive selection on the quality of teachers entering public school careers,” conclude economists Jesse Bruhn of Brown University, Marcus Winters of Boston University and Scott A. Imberman of Michigan State University. 

Looking at Massachusetts public charter schools, the economists discovered that charter schools exhibited a U-shaped teacher attrition pattern, with high-performing teachers and low-performing teachers both tending to leave at high rates. But the destinations of the high-quality and low-quality teachers were polar opposites. 

Unlike in traditional public schools, low-performing charter school teachers tended to leave teaching for other fields. By contrast, high-performing charter school teachers tended to pursue licensure and transfer to a traditional public school. 

The authors conclude that the low barrier to entry for becoming a charter school teacher attracts people who are interested in teaching but who are not ready to commit to getting a four-year teaching degree and a state license. 

By offering a quick on-ramp into the teaching profession, instead of a wall that takes years to climb over, charter schools are able to attract talented teachers who otherwise would never enter the field. Once they decide to stick with teaching, they then pursue licensure and move to traditional public schools, which typically offer higher pay and more generous benefits. 

In short, charter schools perform a valuable public education service by weeding out poor-performing teachers and channeling high-performing ones into traditional public schools. 

Bruhn, Winters and Imberman write that “charter schools tend to hire unlicensed teachers who are ineligible to teach in the public sector and then there emerges a mobility pattern such that the least effective charter school teachers are more likely to exit teaching while effective teachers are more likely to obtain a license and move into the traditional public school sector. This pattern of results suggests that charter schools create a positive externality for local public schools by increasing the average quality of the labor available to them.”

Charter schools are public schools that are operated under a contract, or “charter,” with the state or a local school district. They are not subject to district-negotiated teacher union contracts or many state regulations that dictate how public schools are to operate. That gives them the flexibility to pursue alternative management practices. 

The authors note that rigid employment restrictions at traditional public schools likely make traditional public schools less, not more, effective.

“Employment restrictions embedded in collective bargaining agreements, administrative policies, and legislation may inhibit public school effectiveness by limiting their ability to retain effective teachers and remove ineffective teachers (Goldhaber & Hansen, 2010; Staiger & Rockoff, 2010; Cowen & Winters, 2013),” they write.

By contrast, charter schools that aren’t subject to rigid employment restrictions have found ways to recruit very high-performing teachers into the profession while pushing low-performing teachers out. 

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The amazing bargain of the governor’s $1.5 million in aid to lower-income students

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To help lower-income students at risk of falling further behind in the 2020-21 school year, Gov. Chris Sununu allocated $1.5 million out of $1.25 billion in federal coronavirus relief aid to scholarships students whose families earn no more than 300% of the federal poverty level. Much of the coverage and commentary about this modest effort to help these students has been inaccurate or misleading.

This is hardly surprising, as attacks on these scholarship programs have always consisted largely of misinformation. Here we explain some of the misleading claims being made in attacks on the governor for offering aid to lower-income students.

 

Claim: This is a taxpayer giveaway to private schools.

Fact: This aid goes to low-income families via two non-profit scholarship organizations that administer New Hampshire’s tax credit scholarships. Those organizations give scholarships directly to families, not to private schools. By law, families may use these scholarships at any private or parochial school, at any public school outside their home district, or to home school their children. The money is not direct aid to private schools. It is aid to families, who are free to choose public schools if they wish. They tend not to choose public schools, which are more expensive than most of the private or home-schooling options.

 

Claim: The scholarship organizations are sitting on $1.7 million in unspent funds from the last school year.

Fact: The $1.7 million listed as unspent in the scholarship organizations’ 2018-19 annual reports was used for scholarships awarded in 2019-20. It is not cash sitting in reserve. The effort to paint these funds as cash-rich is deliberately misleading. (The way the groups collect and spend money has been explained to legislators and education activists repeatedly.) The scholarship organizations collect money in one academic year for distribution the following academic year.

 

Claim: Money slotted for the education of children must go to public schools only.

Fact: New Hampshire has never reserved education spending exclusively for public schools. In the 19th century, municipalities would sometimes pay private schools to educate students.  State law allows public education funds to pay for tuition at private schools in some circumstances. The goal of public education is to pay for students to become educated, not to fund one particular institution exclusively, particularly if that institution offers some students an inadequate education. On average, minority and lower-income students significantly underperform white and more affluent students in public schools. There is evidence that this gap has widened during the hastily improvised remote instruction period in 2020 (see here and here). The $1.5 million is not being set aside to fund private schools, but to shrink that achievement gap by giving lower-income families the ability to access an education that will work better for their children.

 

Claim: The scholarships will equal roughly $1,875 per pupil, much higher than the few hundred dollars per pupil that public schools are receiving.

Fact: Breaking down the coronavirus education aid this way creates the misleading impression that taxpayers are being cheated. The opposite is true; they are realizing an amazing bargain. New Hampshire public schools spend an average of $19,806 per pupil, including capital and transportation spending. Of that $19,806, more than $12,000 of local taxpayer money will remain in the local public school after a scholarship student leaves. On average, the state’s portion is more than $5,000 to educate each of these students (depending on how much additional state aid they get for special educational needs and socio-economic status). With these scholarships, the state would spend a paltry $1.5 million to educate approximately 800 students ($1,875 per student), instead of more than $4 million to educate them in a traditional public school.

Including all state, local and federal spending, the value is even more stunning. For a mere $1.5 million, the state is buying an education for 800 students that would cost more than ten times as much ($15.8 million) in a traditional public school.

Furthermore, if the $1.5 million in question were divided among all New Hampshire public school students, it would equal an additional $8.65 per student, producing no noticeable impact on student achievement. Using these funds to provide scholarships for students most at risk of falling behind would save taxpayers money while freeing up space in public school classrooms when space is at a premium.

 

Summary: This supposed controversy really isn’t about what’s best for the at-risk students who will be winning scholarships or about taxpayer value. It’s about whether families ought to be empowered to choose an alternative education. For some, anything that allows families to choose an alternative to their assigned public school — even another public school in a different district — must be crushed. That’s the basis of the objection, which is really a shame.   

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Eight police reform proposals

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In our republican form of government, all public employees, including police officers, exercise only the powers granted them by the people. All public employees serve the citizens and are accountable to them. The powers granted to public employees are altered from time to time as the people demand.

High-profile abuses of police power in recent years have led to widespread demands for increased accountability. In this paper, attorney Chuck Douglas offers eight proposals for reforming New Hampshire police practices and making officers more accountable to the people.

The eight proposals are:

  1. Make police discipline files public.
  2. Outlaw chokeholds or neck compression, regardless of the circumstances.
  3. Mandate body cameras and verbal warnings.
  4. Require officers to intervene, stop, and report misconduct.
  5. Improve screening and treatment for PTSD.
  6. Pursue more and better de-escalation training.
  7. Adopt better use-of-force policies that require force to be reasonable, necessary, and proportionate to the crime and circumstances.
  8. End officer immunity from civil lawsuits.

You can download and read the full report (in pdf format) here: Josiah Bartlett Center Eight Police Reform Proposals

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Smokers, Mass. lawmakers may have saved N.H. businesses from tax hike

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Cigarette smokers and flavored tobacco scavengers from Massachusetts produced a surge of New Hampshire tobacco tax revenue that almost single-handedly prevented a business tax increase, preliminary, unaudited state figures suggest.

State tobacco tax collections rose significantly in March, April and June, putting tobacco tax revenue $14.5 million (7.3%) higher than budgeted and $13.7 million (6.9%) higher than last year, according to the Department of Administrative Services’ June revenue report. 

Revenue from the federal tobacco settlement was $2.9 million above plan, for a total tobacco-related increase over budget projections of $17.4 million. Preliminary, cash figures suggest that the state missed triggering an automatic business tax hike by $15.35 million. 

In the last state budget, lawmakers included a provision that would trigger automatic business tax hikes if state general and education fund revenue fell at least 6% below projections. Based on June’s cash figures, revenues appear to have fallen 5.4% below projections. These are preliminary figures, however, and are subject to revision when adjustments are made based on the state’s later, more thorough accounting of the year’s revenues.

If these figures hold, business owners could reasonably thank smokers and Massachusetts lawmakers for helping to prevent those automatic tax hikes. Tobacco tax revenue was 34.6% above budget in June, 34.9% above budget in April, and 10% above budget in March.

Department of Revenue Administration staff say those increases are most likely caused by smokers stocking up for the first lockdown and in anticipation of a second lockdown, combined with Massachusetts residents crossing the border to buy flavored tobacco. 

Massachusetts banned the sale of flavored tobacco products, including flavored snuff and chewing tobacco, effective June 1. In addition to a cigarette sales surge, state tobacco tax data show a large increase in smokeless tobacco sales, particularly snuff, in June. 

Sales of what the state classifies as “other tobacco products,” meaning everything excluding cigarettes and premium cigars, have spiked in recent months, surpassing 7% of all tobacco sales in June. 

A sizable portion of that is likely related to the Massachusetts ban on flavored tobacco products. In addition to flavored smokeless tobacco, the ban also includes menthol and other flavored cigarettes as well as flavored vaping products. 

New Hampshire budget writers expected to supplement state revenues this year by applying the tobacco tax to electronic cigarettes. Last year, legislators expanded the tobacco tax to cover e-cigarettes, even though there is no tobacco in e-cigarettes. 

The tax went into effect on January 1, but it has produced less revenue than expected. By the end of the state’s 2020 fiscal year on June 30, taxes on e-cigarettes had generated just $1.2 million. 

Legislators budgeted $5.7 million in revenue from e-cigarette sales for Fiscal Year 2021, which began on July 1. Based on the first six months of collections this year (covering the final half of Fiscal Year 2020), that projection seems unrealistic. Collections so far suggest that the state could expect to bring in less than half what it projected to take from e-cigarette sales in FY 2021.  

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Don’t celebrate dodging business tax hikes just yet

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On Monday, the Josiah Bartlett Center reported on our website (which you should read religiously because you’re smart and you want to drop impressive knowledge on unsuspecting strangers at cocktail parties, whenever we can have those again) that preliminary state revenue figures suggest there won’t be automatic business tax hikes for the 2021 fiscal year. 

The key word there is “suggest.” A business tax increase is still a possibility, if a remote one.

Last year’s state budget contained a provision that would trigger a Business Profits Tax increase of 2.6% and a Business Enterprise Tax increase of $12.5 percent if state General and Education Fund revenue fell at least 6% below projections. 

State collections for June, the final month of the fiscal year, show that General and Education Fund revenues fell below plan for the year by 5.4%. But the June report is based on cash collections as of the end of June. The numbers are always adjusted later, and the totals are not final and official until the audited financial report is released in December. 

We looked back at state revenue reports through 2007 (the last year for which reports are posted online) and found five years between 2007 and 2019 in which there was at least a $20 million difference between the June cash report and the final audited revenue figures.

The differences are as follows:

2008: $20.4 million

2010: $78.5 million

2012: $27.2 million

2016: $67 million

2019: $-25.1 million

Only in 2019 was the audited figure lower than the June cash figure, and most of that change (more than $16 million) was attributable to business tax refunds. But there was a drop of about $9 million not related to tax refunds. 

If the final, audited General and Education Fund revenues for FY 2020 are lower than June’s reported revenues by $15.35 million, the tax increases would be triggered. 

That would be an unusually large drop, but it’s not unprecedented. Businesses face the prospect of spending the next six months in tax-rate limbo, which can affect hiring and other spending plans. 

If you’re uncertain whether your taxes are going to go up, you’re more likely to save cash and avoid hiring, especially since payroll makes up the largest share of the Business Enterprise Tax, which is scheduled to rise by 12.5% if the revenue trigger is met. 

Legislators had the chance to remove this uncertainty and repeal the tax-hike trigger. But, hoping for a tax increase, they refused. 

We’ll have a better idea of the situation in a few weeks, when the state releases June preliminary accrual report. That’s a follow-up report to the June cash report. It includes a fuller financial picture and tends to be much closer to the final, audited report released in December.

For now, business owners and managers should keep the celebrations on hold.  

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N.H.’s tax credit scholarships must include religious schools, U.S. Supreme Court confirms

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The June 30th U.S. Supreme Court ruling in Espinoza v. Montana Department of Revenue demolishes once and for all the false claim that New Hampshire’s Education Tax Credit Program violates the New Hampshire and U.S. Constitutions. 

Further, the ruling renders inoperative New Hampshire’s anti-Catholic Blaine amendment, added to the state constitution in 1877. 

“While the plain text and history of New Hampshire’s Blaine Amendment should not have been an impediment to enacting robust school choice programs prior to the Supreme Court’s ruling in Espinoza, there is now no question that legislators and policymakers in the Live Free or Die state are free to design and enact programs that will empower parents to choose the educational environment that will best serve their children’s learning needs,” Tim Keller, senior attorney at the Institute for Justice and co-counsel in the Espinoza case, told the Bartlett Center.

The Espinoza case overturned a Montana Supreme Court decision that had blocked that state’s tax-credit-funded educational scholarship program because it allowed parents to use the scholarships at religious schools. 

In 2013, New Hampshire political activist Bill Duncan sued to have New Hampshire’s similar program overturned for the same reason. The New Hampshire Supreme Court did not address the merits of the case, ruling in 2014 that Duncan did not have legal standing to sue.  

In the Espinoza case, the U.S. Supreme Court rejected the Duncan argument. The court ruled that if a state has a scholarship program, it may not discriminate based on religious status. Such discrimination violates the First Amendment’s guarantee that individuals have the right to the “free exercise” of religion.

At issue in the case was Montana’s “Blaine amendment,” an anti-Catholic amendment to the state constitution that prohibited state appropriations from going to “sectarian schools.”  

The New Hampshire Constitution has a similar amendment, added in 1877, which states that “no money raised by taxation shall ever be granted or applied for the use of the schools of institutions of any religious sect or denomination.”

These amendments are often called “no-aid” provisions.

“Montana’s no-aid provision discriminates based on religious status,” the court held.

“Montana’s no-aid provision bars religious schools from public benefits solely because of the religious character of the schools,” the court determined. “The provision also bars parents who wish to send their children to a religious school from those same benefits, again solely because of the religious character of the school.”

“To be eligible for government aid under the Montana Constitution, a school must divorce itself from any religious control or affiliation. Placing such a condition on benefits or privileges ‘inevitably deters or discourages the exercise of First Amendment rights,’” the court concluded.

In sum, education scholarship programs cannot discriminate against schools based on the religious status of those schools. New Hampshire’s Education Tax Credit Program does not bar funds from going to religious schools, so no change needs to be made. The Espinoza ruling clarifies that this practice is constitutional and that changing the program to exclude religious schools would be unconstitutional.

In 2017, the Josiah Bartlett Center for Public Policy and the Institute for Justice published a briefing paper arguing that New Hampshire’s tax credit scholarship program does not violate the state or U.S. constitutions, for reasons similar to those laid out in the Espinoza case. 

The co-authors of that report were Richard Komer and Tim Keller of the Institute for Justice. Komer argued the Espinoza case before the U.S. Supreme Court last year, and Keller was a co-counsel on the case. 

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An online reverse auction can save N.H. up to $22.2 million a year on prescription drugs

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A new Josiah Bartlett Center for Public Policy study finds that switching to an online reverse auction for the state’s pharmacy benefits management contract can save New Hampshire taxpayers save up to $22.2 million a year.

The study by Dr. Wayne Winegarden, director of the Center for Medical Economics and Innovation at the Pacific Research Institute, finds that New Hampshire can expect to save an estimated $17.8 million — $22.2 million a year by using an online reverse auction to generate more competitive bids for pharmacy benefits management. Over the three-year life of the state’s existing pharmacy benefits management contract, the savings would total an estimated $42.5 million — $53.1 million. (Under the contract, the annual costs are different from year to year.)

“At a time when budget savings are needed, New Hampshire could save millions of dollars annually by adopting an online reverse auction to purchase PBM services,” Dr. Winegarden said. 

Josiah Bartlett Center President Andrew Cline emphasized the value of always looking for cost savings through improved systems, not simply cutting budget line items.

“This study shows the importance of always looking for opportunities to increase taxpayer value by improving system operations,” Cline said. “Adopting a modern, internet-based bidding system for the state’s pharmacy benefits management is a great example of how taxpayers and public employees can save money without reducing services.” 

Pharmacy benefit managers (PBMs) administer prescription drug benefits for commercial and government health plans. PBMs negotiate prices with drug manufacturers, maintain the plan’s drug formulary (the list of approved drugs), and process claims. 

New Hampshire used a traditional Request for Proposal (RFP) process when it signed a three-year, $212.5 million PBM contract with Express Scripts in 2018. Using an online reverse auction rather than a traditional RFP process could have saved the state tens of millions of dollars over the life of the contract, this analysis shows.

In an online reverse auction, pre-qualified suppliers provide competing bids (typically over multiple rounds) to a single buyer. It is the reverse of the more familiar forward auction, in which buyers compete to purchase a product or service from a single seller. For PBM services, New Hampshire would be the single buyer inviting several PBMs (the multiple sellers) to bid on providing PBM services to the state over a defined time period.

Online reverse auctions have saved governments and private businesses billions of dollars and have become a standard procurement method for large organizations. New Hampshire should adopt them for its PBM contracting as well as any other services for which they could produce savings. 

The full study can be read here (pdf): JBC Reverse Auction For PBM services Study Winegarden

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The justifications for prolonged closures are unraveling

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When the governors of Florida and Georgia announced that they would reopen their economies, the predictions of mass mortality were immediate. In April, a writer for The Atlantic hysterically labeled Georgia’s reopening plan an “experiment in human sacrifice.”

In the weeks that followed, the mortality surges never happened. 

Digging through COVID-19 mortality data this week, we noticed something that to our knowledge had not previously been highlighted. There have been fewer COVID-19 deaths in Florida, Georgia and Colorado combined (three states criticized for opening “too early”) than in New York nursing homes alone. 

The absence of a mortality surge is finally getting the attention of network TV news and other national media. ABC News’ lead medical reporter Eric Strauss tweeted on Thursday, “JUST IN: @ABC looked at 21 states that eased restrictions May 4 or earlier & found no major increase in hospitalizations, deaths or % of people testing positive in any of them. [SC, MT, GA, MS, SD, AR, CO, ID, IA, ND, OK, TN, TX, UT, WY, KS, FL, IN, MO, NE, OH.”

Politico Magazine on Thursday published a long essay on Colorado, “the blue state that gambled on an early reopening.” 

Colorado’s Democratic governor, Jared Polis, “moved to lift stay-at-home orders not only well before other Democratic-leaning states, but ahead of Republican-led Georgia, Florida and Texas,” Politico pointed out. And he had a plan. 

Polis, “instead of looking most closely at case and death counts, which lag behind the reality on the ground… focused on bringing down the virus’ transmission rate from one person infecting up to four others to one person infecting just one other person, which the state managed in April. As officials added thousands of temporary hospital beds, the governor also closely tracked the daily hospitalization rate, which had begun to slow by the time he made his April 20 announcement.”

Using realistic metrics that indicated how much of a public threat the virus was, Polis determined early that reopening could be done without causing an unmanageable surge in transmissions or hospitalizations.

The result? 

“An average of just 4.64 percent of people tested over three days ending Tuesday were positive for COVID-19. That’s the lowest since the state started tracking a three-day average of positive cases back on March 10,” Colorado Public Radio reported on Wednesday.

Colorado is still experiencing outbreaks in places like meat packing plants, prisons, a grocery store, and an office. But those outbreaks are not spiking overall transmission rates. “While outbreaks continue to occur, overall, the number of new cases reported to the state continues to drop,” the Colorado Public Radio report concluded.

Many Colorado businesses have been operating under capacity restrictions. But by identifying meaningful, reasonable metrics to guide the reopening, the state was able to begin its economic recovery early and eliminate some of the uncertainty for business owners. 

New Hampshire Gov. Chris Sununu has managed a difficult challenge with great skill and has listened to business owners, adjusting some regulations and guidance after seeing how harmful it could be. Bringing business and community leaders into the decision-making process by creating task forces has allowed a greater degree of citizen input and prevented some of the more restrictive regulations seen in other states.

Yet it is not clear what data are guiding New Hampshire’s approach and what the precise goals are. Business owners and employees remain frustrated because the state has offered little clarity on how emergency rules are to be lifted. 

Initially, the state’s emergency measures were focused on ensuring adequate hospital capacity in case of a surge of COVID-19 cases. The curve flattened weeks ago and the anticipated surge never happened. This week the governor ordered 10 of the state’s 14 overflow hospital sites closed.  

Yet the governor also extended his emergency order and the stay-home order this week. People see the numbers going down, the curve flattened, but emergency orders and restrictions remaining in place.

Asked on Tuesday what data the state is using to guide its decision-making, Health and Human Services Commissioner Lori Shibinette struggled to give a coherent answer. After being asked several times about the state’s declining infection rate, she seemed to say that the state’s goal was to prevent every long-term-care facility employee from getting infected.

“Those caregivers are part of our communities. So, as long as there’s still COVID circulating in our communities, there is always a risk of bringing it into a nursing home. And there is always a risk of negative outcomes,” she said. 

Ensuring that no long-term-care facility staff become infected cannot be the goal. It’s an impossible target. 

The governor on Friday offered some clarity, saying that “flattening the curve” to keep hospital capacity available remains the goal. With the curve already flattened, the state is striving to prevent a new surge from overwhelming the hospitals, he said.

The governor added in response to a question that the guiding data are the percent positive and the hospitalization rate. Yet state officials still have not explained exactly what the state’s target numbers are. 

Without clarity on the state’s targets, people will continue to be frustrated and anxious, and business owners will be unable to plan.

As the state’s own chart below shows, New Hampshire’s rate of positive COVID-19 test results has trended downward for weeks and is below 5%, about the same as Colorado’s. The state has 110 hospitalized COVID-19 patients, well below capacity. By any of the standard metrics, the state’s numbers have been trending in the right direction for weeks. 

 

Yet economically crippling restrictions on business and personal activity remain, imposing enormous costs. In April, the state counted 101,490 newly unemployed Granite Staters, for an unemployment rate of 17.2%. It’s worse up north. Coos County’s unemployment rate hit 22.6% and Carroll’s 24.3%. 

There’s little reason to believe that, say, Coos County retail and restaurant employees have to lose their jobs to protect the state’s vulnerable population, most of whom are elderly residents of long-term care facilities and individuals with co-morbidities. 

The overwhelming majority of New Hampshire’s coronavirus deaths (78%) have occurred in long-term care facilities, and 77% of deaths were associated with a cluster, meaning three or more cases in a single workplace or facility. 

Community transmission accounts for 20% of New Hampshire hospitalizations and 13% of deaths. Clearly, a vulnerable individual can contract the virus out in the community, get sick, and die. But the available data suggest that this risk is very low and that these individuals can be protected through less drastic measures.

Japan offers a case study. On Tuesday, Science magazine reported that Japan had ended its state of emergency, having achieved its public health goals without ever issuing a lockdown.

“It drove down the number of daily new cases to near target levels of 0.5 per 100,000 people with voluntary and not very restrictive social distancing and without large-scale testing. Instead, the country focused on finding clusters of infections and attacking the underlying causes, which often proved to be overcrowded gathering spots such as gyms and nightclubs.”

Japan lacks the legal authority to impose mandatory lockdowns, so instead it focused on educating the public about mask-wearing and avoiding the “three Cs”—closed spaces, crowds, and close-contact settings. 

These are specific, attainable, and goal-oriented guidelines. They are easy for the public to understand, and they allow business owners and employees to participate in the process. If the state publicized that the economy could fully open when X and Y metrics were met, and initiated a high-profile publicity campaign to encourage broad public participation in reaching those goals (by wearing masks, social distancing, not forming large crowds, etc.), everyone would have clear goals they could work toward together. 

Instead, the public remains in a state of suspense, waiting anxiously each week for new reopening guidelines segregated by industry. 

As we’ve recommended before, the state’s focus should be on encouraging socially responsible behavior. Many businesses that are closed or partially closed now can open responsibly, posing little risk of creating mass outbreaks, if the state devotes its resources to education, instruction, and assistance rather than categorical business lockdowns. 

The longer the state continues this slow lifting of restrictions, the worse the economic damage will be and the more frustrated members of the public will become.   

 

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Five guidelines for reopening New Hampshire’s economy

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New Hampshire’s economy spent March and April of 2020 rapidly contracting. Cell phone data and reported restaurant and retail store revenue show that consumers voluntarily began staying home in the early March. Then on March 27 the governor issued a stay-home order and ordered “non-essential” businesses closed to in-person interactions.

That one-two punch put nearly 160,000 Granite Staters out of work in a matter of weeks. The state’s unemployment rate rose from less than 3% in March to approximately 15% in April, according to state figures released this week. 

Those numbers are not just statistics on a financial spreadsheet. Each application for unemployment benefits represents a real person who has been made idle involuntarily. 

Those Granite Staters — our friends, neighbors, and family members — have lost the ability to provide for themselves and their families. Some of their employers have stayed open with skeleton crews, some have closed temporarily, some permanently. 

New Hampshire’s economy is in serious long-term danger because roughly 96% of New Hampshire businesses are small businesses. Small businesses tend to have low cash reserves. A JP Morgan Chase study of nearly 600,000 small businesses in 2015 found that the median small business holds less than one month’s worth of cash reserves. A quarter hold less than two week’s worth. If small businesses remain closed by state order much longer, many won’t survive. 

Again, that’s not just a financial story. It’s a human one. Businesses provide the goods and services people need, and the revenue businesses generate pays the rent, the mortgage, the grocery bills, the gas bills, etc., for all of their employees. 

Free economic exchange is not a luxury to be disregarded in times of crisis. It is how Americans feed, clothe, and shelter themselves. It is how most of us define who we are. It is how people generate the business profits that fund scientific research and the tax payments that fund government services. It is, by itself, essential for the creation and maintenance of any prosperous and healthy society.  

Getting people back to work, then, ought to be an urgent priority for state and local policymakers. 

The government has a vital role to play in minimizing the possibility that a deadly new disease will overwhelm our health care system. But achieving that goal can and should be done in a way that produces the smallest possible negative impact on the economy. Here we suggest five ways to achieve both of those important goals. 

To reopen the economy with minimal risk to the health care system, government policy should follow five guidelines:

  1. Exercise the minimum intervention necessary
  2. Focus on safe practices, not categories of businesses
  3. Enable innovation and adaptation
  4. Reduce costs and burdens on employers & business owners
  5. Prioritize information and flexibility over control

Read the full report here: JBC Reopen Report

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Virtual Happy Hour with P.J. O’Rourke!

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Join us Friday, May 1, from 4:30-5 p.m. for a very special event, our first Virtual Happy Hour with author P.J. O’Rourke.

 

We’ll talk politics and policy during the coronavirus era.

Our thanks to

Jeremy Hitchcock

and

the New Hampshire Brewers Association

for sponsoring the event.

Everyone who attends the Happy Hour with P.J. O’Rourke will also receive free admission to the Brewers Association’s Virtual Beer Festival on Saturday, May 2.

There is no charge for the happy hour.

Register here: pjhappyhour.eventbrite.com

 

SPONSORED BY:

Jeremy Hitchcock 

and

 

 

 

 

 

 

 

 

 

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