Blog Roundup

Here are some recent citations, links, or mentions of the Commonwealth Foundation from Pennsylvania bloggers:

• PA WaterCooler notes the odds of getting laid off in the public vs. private sector.  PA Watercooler also highlights Michael Nerozzi's summary of the health care town hall in Lebanon.
• Sue Cirba links to our PolicyPoints on Pennsylvania State Debt.
• Tony Phyrillas notes the Patients First Bus Tour, as well as our PolicyPoints on Health Care Reform.
• Grassroots PA links back to our post on Gov. Rendell, Harley Davidson, and Lando Calrissian and also highlights Kara Luzik's commentary on state graduation tests.

Rendell Declares Autism Mandate a Failure

In 2008, the Pennsylvania General Assembly passed, and Gov. Rendell signed, a new mandate that private insurers would have to cover autism services. At the time, we said the new mandate would drive up insurance premiums, should be offered as an optional rider, and suggested vouchers for autistic children instead.

Gov. Rendell, however, suggested the mandate would actually save taxpayers, saying in his signing statement,

"By requiring private health insurers to shoulder their fair share of the cost of treatment, we’re taking steps to address the gap in the private insurance market and reduce reliance on government programs as the primary source of services and funding.” [emphasis added].

But now Rendell is saying we have to increase, not reduce state spending on autism services. He blasts the Senate Republicans for proposing to spend "only" $14.8 million on the line-item. In reality, the Senate budget would spend $19.1 million - using federal stimulus funds to supplement state funds - but don't expect Gov. Rendell to give the straight facts.

That total actual represents about the same as 2008-09 spending (after Rendell's freeze, which reduced the autism line item by $3.7 million, and later revision to the actual spending), and a whopping $9.2 million increase (92%) over 2007-08, when Rendell signed the autism mandate.

I guess it is pretty fair to say that if a 92% increase in autism spending in two years isn't enough, then we have not "reduced reliance on government programs"

Do Voters Want Higher Taxes?

On his blog with the Times Herald, state Senator Daylin Leach makes a couple of absurd claims.

First he suggests that residents are more concerned about potholes than high taxes, and while he may get an email about higher taxes, he will get a "very insistent personal visit" if there is a pothole in the street. Given there are likely hundreds of potholes in his district, and each one affects perhaps a thousand local residents, he must get tens of thousands of visitors concerned about potholes each week.

Second, he suggest that individuals are willing to pay higher taxes. He cites a recent Quinnipiac poll of Pennsylvanians - but selectively, citing only one question that supports his position (and not those giving the legislature a 27% approval rating or primarily blaming Gov. Rendell for the budget impasse). Here are the tax questions:

To balance the state budget next year, if you had to choose, which would you prefer - raising taxes to keep state services at their current level or cutting state services to keep taxes at their current level?
Raise Taxes: 35%
Cut Services: 55%

To balance the state budget, if you had to choose, would you prefer raising - the state sales tax or the state income tax?
Sales Tax: 62%
Income Tax: 24%

Governor Rendell has proposed temporarily raising the state income tax from 3.07 to 3.57 percent. Do you support or oppose this proposal?
Support: 33%
Oppose: 63%

Would you be willing or unwilling to pay more in state taxes to avoid state employees from losing their jobs?
Willing: 44%
Unwilling: 51%

Would you be willing or unwilling to pay more in state taxes to avoid cuts in state spending on such things as healthcare and public schools?
Willing: 53%
Unwilling: 43%

Leach thinks the last question is most reflective of taxpayers true views, because it "identifies services." So even though there is overwhelming opposition to Gov. Rendell's proposed PIT increase, and residents would prefer cuts in services and even layoffs to state workers, Leach thinks they still want higher taxes to avoid cuts to public schools and health care.

Here is the problem with Leach's reasoning - public schools and health care aren't getting cuts. Medical Assistance is getting an increase in the state budget, even with federal stimulus funding that increases the federal funding of the program. Public schools will get an 12% increase in spending under the Senate budget. So the hypothetical question isn't really based on the debate in Harrisburg.

Would voters support a tax increase if they knew that it was to increase education spending above the 12% increase they would otherwise receive? What if they knew school districts had $2.4 billion in reserve balances they weren't spending? What if they knew the true spending by public schools was $13,000 per-pupil, when most voters estimate it closer to $2,000? What if they knew that most of the proposed tax increase wasn't going to education?

Leach then tries to tie in other services he thinks voters like, and would support a tax increase for. But what if the questions asked about tax hikes to fund WAMs? Or for per diems for lawmakers? Or for public relations? Or for gifts for legislators? Or for Hollywood studios? Or for corporate welfare?

Of course, if these people want to pay more, they can. Anyone who wants to pay more can send their checks to the Pennsylvania Treasurers office, or their local school. They don't need to compel their neighbors to contribute as well.

Pennsylvania House Democrats Budget, By the Numbers

As we have done with Gov. Rendell's proposed budget, the Senate passed budget, and the House GOP proposed budget amendment, here is a breakdown of the proposed Pennsylvania state budget from the House Democrats (PDF of the budget line items)

2008-09 Spending
Total State Spending: $26.7 Billion:

• Enacted Budget: $28.3 billion
• Less "Freezes" (cuts to actual spending): $500 million
  
• Less Federal Stimulus Money (Medicaid): $1.1 billion

Funds Available: $25.2 Billion:

• Tax Revenue: $24.3 billion ($25.5 billion less $1.2 billion in refunds)
• Beginning Balance: $585 million
• Prior Year Lapses (money unspent in 2007-08): $158 million
• Oil and Gas Lease Fund: $143 million

Deficit: $1.5 Billion, made up with

• Rainy Day Fund Transfer: $750 million
  
• Health Care Provider Retention Account Transfer: $350 million
  
• Tobacco Endowment Account Transfer: $150 million
  
• Other Small Fund Transfers: $50 million
• Carried over: $200 million
  

2009-10 Budget

Total State Spending: $26.6 Billion

• General Fund Appropriations: $27.8 billion
• Higher Education Fund: $1.3 billion
  
• Less Federal Stimulus: $2.5 billion

Funds Available: $26.4 billion

• Revenue: $26.6 billion
  
• Zero-growth in tax collections: $24.3 billion ($25.5 billion less $1.2 billion in refunds)
• Increase Capital Stock & Franchise Tax to 2.89 Mills, retroactive to Jan 1: $375 million
• Redirect of Cigarette Tax from Health Care Provider Retention Account to General Fund: $190 million
• Acceleration of Tax Payments as Proposed by Gov. Rendell: ~$480 million
• Unnamed source of revenue for $1.3 billion higher education fund: $1.3 billion
  
• Unpaid 08-09 Deficit: $200 million owed

As you can see, this still leaves about $200 million short of balanced, which could be a rounding error, a slightly different estimate, or perhaps (and I'm speculating here) an additional $200 million that would remain from Gov. Rendell's proposed $1.5 billion PIT increase, if that were the source for the $1.3 billion in higher education spending.

PA House GOP Budget by the Numbers

The Pennsylvania House Republicans unveiled their state budget proposal Friday, to be added as an amendment if and when a budget bill is brought to the House floor. As we have done with the Senate and Rendell budgets, here is an overview of how it shapes up revenue and spending wise (the full line items are here). We'll add the House Democrat's version when they provide details.

2008-09 Spending
Total State Spending: $26.7 Billion:

• Enacted Budget: $28.3 billion
• Less "Freezes" (cuts to actual spending): $500 million
  
• Less Federal Stimulus Money (Medicaid): $1.1 billion

Funds Available: $25.2 Billion:

• Tax Revenue: $24.3 billion ($25.5 billion less $1.2 billion in refunds)
• Beginning Balance: $585 million
• Prior Year Lapses (money unspent in 2007-08): $158 million
• Oil and Gas Lease Fund: $143 million

Deficit: $1.5 Billion, made up with

• Rainy Day Fund Transfer: $300 million
  
• Health Care Provider Retention Account Transfer: ~$300 million
  
• Tobacco Endowment Account Transfer: est. $100 million
  
• Other Small Fund Transfers: est. $250 million
• Carried over: $550 million
  

2009-10 Budget

Total State Spending: $24.7 Billion

• Appropriations: $27.3 billion
• Less Federal Stimulus: $2.5 billion

Funds Available: $24.7 billion

• Revenue: $25.3 billion
  
• Zero-growth in tax collections: $24.3 billion ($25.5 billion less $1.2 billion in refunds)
• Maintain Capital Stock & Franchise Tax at current year’s rate (1.89 Mills): $75 million
• Redirect of Cigarette Tax from Health Care Provider Retention Account to General Fund): $190 million
• Acceleration of Tax Payments as Proposed by Gov. Rendell: ~$450 million
  
• Marcellus Shale Land Lease: ~$200 Million
  
• Tax Amnesty Program: ~$100 Million
  
• Unpaid 08-09 Deficit: $550 million owed
  

10 Ways to Balance the Budget Without Tax Hikes

Contrary to the Governor's rhetoric, there are a plethora of reforms and spending cuts that can balance the budget without firing our police, evicting our elderly, or dumbing down our kids. Below we offer our ten ways to balance the state budget, this year and the years to come, without raising taxes.

1. Eliminate corporate welfare. The Governor's latest General Fund budget contains over $410 million in corporate welfare.


2. Eliminate, privatize, or implement user fees for "private goods" - such as museums, parks, and the arts. The Governor's budget spends almost $500 million to maintain non-core functions of state government.
   


3. Control self-service government programs expenses like legislative leadership accounts used to fund illegal bonuses. A number of state programs and expenditures work to benefit of government official and the detriment of citizens. Rendell's revised General Fund budget about $200 million on self-benefiting expenses.
   


4. Reform Medicaid by giving individuals more control over their health care spending.


5. Limit the increase in basic and special education funding to 11.7%. This increase would give school districts their highest level of funding in Pennsylvania history. Over the past 25 years, per-pupil spending has increased 364% (inflation of 141%) while achievement has stagnated.


6. Repeal prevailing wage laws for government construction contracts. This unnecessary regulation inflates costs by 10-30% and increased the cost for state and local government by almost $9 billion in 2007.


7. Reform government pensions by moving from a defined benefit to a more predictable defined contribution plan.


8. Reduce advertising budgets for the state lottery ($32 million), tourism ($26 million) and the film tax credit ($576,000, which at $75 million, we should eliminate). Do we really need a groundhog on TV (and facebook) convincing us to gamble, or a psychedelic website to remind us that Feb. 2 is Groundhog Day?
   


9. Increase state spending transparency and accountability. Creating an online spending database, like HB 1460 would create savings, as demonstrated in other states, and will discourage the misuse of tax dollars in programs like WAMs.


10. Privatize state-run businesses, such as the state liquor stores. Competitively contracting out all Liquor Control Board operations could produce a one time influx of $1.7 billion, increase future revenues through corporate and property taxes, and provide better service to consumers.

Over 80 state lawmakers agree with us, saying YES WE CAN balance the budget without raising taxes. Find out what your legislator thinks.

The rest of our suggested spending cuts, totaling $5 billion, are detailed in Government on a Diet: Spending Tips 2009.

The Real Effect of Rendell's Taxes on Small Business

While Gov. Rendell continues his propaganda campaign for higher taxes (see WGAL for a related news story on the thousands Rendell has spent in taxpayer funds lobbying for more taxes), the NFIB has issued a response to Rendell's claim that his taxes would only amount to a few hundred dollars a year, or few dollars a week, or a cups of coffee per day, or a penny per second, or whatever makes the tax increase seem small.

While I have already written on how hypocritcal Rendell's tax plan is, it is useful to see what the impact would be on a real small business.

From NFIB:

The data included in the spreadsheet was taken from an actual small business with gross sales $784,000 and a payroll of $384,252.The two owners of this company each take home a salary of $45,000 per year. ...

The attached spreadsheet shows a 16-percent increase in PIT would take away $1,741 in taxes on salaries per year and $1,044 in taxes on money available for investment per year.

The proposed retroactive increase and postponed phase-out of the Capital Stock and Franchise tax would take away an additional $1,290 in taxes in year one and cost nearly $11,200 over five years.

In addition, the governor's proposed 2-percent tax on health insurance premiums would take away an additional $720 per year.

impact of proposed 2009 tax increase

Pennsylvanians are Voting with Their Feet

I wonder how many believe that forgoing new taxes and cutting back spending would lead the state of Pennsylvania to the “post apocalyptic landscape of Cormac McCarthy’s novel soon-to-be-movie, The Road.” Such is the assertion of Ed Rendell and many Pennsylvania Democrats supporting his runaway spending and tax hikes. They assert, cuts in spending will mean the end of education and agriculture, the loss of law enforcement and health care.

But even though Rendell's policies won him reelection, he is losing with another type of voter, the folks who are voting with their feet.

Pennsylvania is in the bottom half of the country in the Tax Foundation’s 2008 State Business Tax Climate Index, and has the 11th highest tax burden in the country. As a result, the Commonwealth lost 12,000 residents to other states last year, and 58,000 since 2000, according to the US Census. Pennsylvania is also the fourth highest state in outbound moves according to United Van Lines’ 2007 Migration study.

The metropolitan areas of Pennsylvania, namely Pittsburgh and Philadelphia, has seen a steady outflow of people. According to a report by the Tax Foundation, “Philadelphia is one of just six of America’s twenty largest cities by population that impose a city-or county-level tax measured by compensation, be it a tax on wages, earned income, or occupational privilege.” With the most mobile population living in large cities, movement to the suburbs or to neighboring states is not uncommon.

Rendell's propaganda machine

Brad Bumsted's latest column wraps up some of the more absurd rhetoric coming from the Rendell administration about the Senate version of the Pennsylvania budget:

• The bill "threatens juvenile delinquency and crime prevention efforts," the Pennsylvania Commission on Crime and Delinquency said.
• It would "cripple production in agriculture," Agriculture Secretary Dennis Wolff said.
• Pennsylvania communities "face the prospect of dirtier water, weakened flood protection, and swarms of biting inspects that could potentially carry the deadly West Nile virus," the Department of Environmental Protection said.
• The bill "would wreak havoc on (the) veterans' home system," displace 300 veterans and "possibly" force closure of a veteran's home, the Pennsylvania National Guard warned. (Sen. Lisa Baker, a Republican, responded it was "completely out of line with the fiscal facts" and "needlessly alarmed veterans and their families.")
• SB 850 would "cripple the tourism industry," DCED said in a curtain call.
• It would lead to the closure of at least 35 state parks, the Department of Conservation and Natural Resources said. ("Scare tactics," the GOP said.)
• The most sweeping indictment came from the Department of Health, warning the bill "threatens the health of millions of Pennsylvanians" by restricting or eliminating vital health care.
• And it would be "devastating" for school districts, students and taxpayers, Education Secretary Gerald Zahorchak warned.

"Is public education socialism?"

In defense of a single-payer health care system, possible U.S. Senate candidate and state Rep. Bill Kortz (D-Dravosburg) asked, "Is public education socialism? No. This is the same thing."

Kortz is certainly right, that single-payer health care is akin to public education. But is he correct about it not being socialism?

An honest look at American "public schooling" reveals that it is indeed the most socialistic institution in our country. Most people are surprised to learn that "free" public schooling is one of the "Ten Planks" (key tenets) of the Communist Manifesto.

Funding for public education is clearly organized around the Marxian principle of "from each according to his ability, to each according to his need" as we take wealth from those who have it (in the form of property, income and consumption taxes at the local, state, and federal levels) and we redistribute it to the schools based upon "need" as determined by Washington, Harrisburg, and District officials.

Of course, the "education" of each public school child -- from the teacher training to the curriculum to the standards -- is also determined and planned by political agents at those various levels of government. It is not the parents or the students who control their education, it is the "state." Sure, we give lip-service to parents and students as "customers", but the reality is that they are at the very bottom of the totem pole...if at all.

Then when these schemes utterly fail, the response from these public education central planners is ALWAYS "we just need more money" to make it work. That's what Gov. Rendell's "Tax You More Bus Tour" was all about this past week.

And so it would be with Kortz's desire to "public educationize" our health care system.

Call it whatever you want, Representative, but the results will be the same -- ever-increasing costs, never-increasing quality, and excuses galore from the political officials in charge.

Gov. Rendell Calls the Kettle Black

The Sun-Gazette has a recent article on the Pennsylvania state budget titled "Rendell lashes out at Senate plan".  It didn't sound like something that would surprise me - but it did, because of the reasons Rendell is criticizing the Senate budget plan.

Just to recap, here are some of the basics of the Senate plan, and Rendell's budget, which he promises to cut by an additional $400 million.  What does Rendell critique in the Senate budget?

1) He says it isn't balanced - "It's out of whack from $750 million to $1 billion" and needs either more revenue or more cuts.  But here is the problem: Rendell proposes spending (after his new cuts) $1.3 billion more than the Senate, his proposed tax increases amount to less than $500 million.  In other words, by Rendell's own math, his budget is out of whack by $1.55 to $1.8 billion. 

2) He blasts privatizing the state liquor stores - this isn't part of the Senate budget, but has been touted as a possible revenue option.  Rendell decries using one-time revenue sources, "You don't do stuff like that," he said. "Those are gimmicks."

Hmm...

One time revenue sources used in Gov. Rendell budget for this year and next:

• Federal Stimulus: $3.5 billion
• Rainy Day Fund: $625 million
• Health Care Provider Retention Account: $350 million
• Legislative Surplus: $175 million 
• Marcellus Shale Lease Revenues: $174 million
• Prior Year Lapses (money unspent in 2007-08): $91 million

Hey kettle, this is the pot, you're black.

Warmed-Over RendellCare Includes a New Tax on Health Insurance

The Pennsylvania State House has been debating HB 1, which would expand the state's Adult Basic program, to make more individuals eligible for government health care. The Commonwealth Foundation has not said much about the bill, for a couple reasons:

1. It isn't going anywhere - the legislation couldn't pass in previous years, when Pennsylvania had a surplus. Now, with a deficit likely to exceed $3 billion, I see no way the legislature will pass a quasi-entitlement.
2. It isn't substantially different than previous editions, which we critiqued - the original "Cover All Pennsylvanians" (aka RendellCare 1.0), and last session's PA ABC.

That said, there are a couple of important things to note about the funding schemes. The talking points on the legislation notes it will rely on "surplus monies" in the Health Care Provider Retention Account (as well as shortening the period before the state can take ownership of unclaimed property). Budget watchers would note that the HCPRA surplus could only fund the program for one year, and Gov. Rendell already has plans to use that pot of money to fill the current budget gap.

More importantly, the legislation includes a provision to charge a 2% gross receipts tax on insurance premiums. This appears to be a tax only on plans not currently being taxed, i.e. HMOs and some PPO plans (though that hasn't been entirely clear), but effect should be pretty clear: this will make health insurance more expensive.

If you are wondering, given all this, how HB 1 even got to the House floor, John Micek sums it up, noting that the House adopted new rules on June 1, and were able to go back to some of their old tricks, before the 2007 rules reforms.

Satisfaction with Health Care: U.S. v Canada

John Lott has some interesting research on the satisfaction of U.S. and Canadians on their health care.  The primary finding of his study (downloadable here), is that Canadians - all covered by the government - have substantially lower satisfaction than U.S. insured residents, and closer to the satisfaction rate of the uninsured in the U.S.

I would like to have seen a breakout of private vs. government health coverage in the U.S. as well, since it is well documented that government programs provide a much lower quality of care.

This is not to suggest we should not reform health care, but as I have suggested, we need to take the alternate path from what Gov. Rendell, Preisdent Obama and their allies are pushing - away from a further government takeover of health care and toward reforms putting individuals in charge.

PA Senate Budget by the Numbers

Jake Corman, PA Senate Appropriations Chairman, has introduced the Senate Republicans version of the state budget (SB 850). The $27.3 billion General Fund budget represents a $1.7 billion reduction from Rendell's proposed budget, (introduced into legislation as HB 1416 by Dwight Evans) and a $414 million reduction from the revised budget for 2008-09.

Their budget also includes no tax increases (though a suspension of some tax credits) and a preservation of the entire "Rainy Day" fund. Some related news stories from the Pittsburgh Post-Gazette and the Philadelphia Inquirer.

To put the spending number in perspective, it represents a $6.9 billion increase from when Gov. Rendell took office - or the 2002-03 budget, increased by the rate of inflation and population growth, plus an additional $2.9 billion.

Filling the 2008-09 Shortfall
Enacted budget: $28.3 billion

Estimated Revenue Shortfall: $2.9 billion
Revised Budget: $27.7 Billion; includes

• Cuts/Freezes from Enacted Budget: $557 million
• Prior Year Lapses (money unspent in 2007-08): $91 million
• Federal Stimulus (Medical Assistance): $1.1 billion
• Additional Federal Funds: $800 million
  
• Transfer of Marcellus Shale Lease Revenues: $174 million
• Use of Legislative Surplus: $100 million

2009-10 Budget
Appropriations: $27.3 billion
General Fund Revenue: $24.6 billion, includes new sources:

• Redirect of Cigarette Tax from Health Care Provider Retention Account to General Fund: $198 million
• Suspension of Certain Tax Credits: $250 Million
  

One-time Revenue Sources:

• Federal Stimulus: $2.7 billion - Categories of Medical Assistance and State Fiscal Stabilization (used in Education and Corrections).
• Miscellaneous Fund Transfers: $28.5 Million

How PA Should Use Its Stimulus Money

Lawmakers in Missouri announced they are foregoing pet projects in order to temporarily lower the state's personal income tax from 6% to 5.5%. (HT NTU)

Governor Rendell would be wise to follow suit, or at least pay down our mountain of debt, or at the very least contribute to enormous unfunded liabilities including pensions and health care.

Overspending created the budget deficit, and no amount of new spending is going to plug it.

Is Pennsylvania's Medical Malpractice Crisis Over?

Governor Rendell has declared that Pennsylvania no longer has a "crisis" in medical malpractice lawsuits, citing recent declines in the number of suits filed.  Critics claimed that reform have weeded out junk lawsuits, but there is still a high cost of litigation which continues to make Pennsylvania unfriendly to doctors.

The Pacific Research Institute gave Pennsylvania a lowly ranking of 45th out of 50 states on their 2008 Tort Liability Index, including 36th on Medical Malpractices Losses.

Indeed, while Governor Rendell has proposed dropping the MCare Abatement, a subsidy from the cigarette tax - to fill the budget gap and because he refused to renew it unless the legislature passed RendellCare, which they refused - doctors and hospitals will still be required to pay into MCare.  MCare is the state program which supplements health care providers' private medical malpractice insurance, for lawsuit awards over $500,000.

Instead, Governor Rendell should end MCare entirely, and embrace real tort reform, including joint and several liability - limiting a party's share of the liability costs to their share of the responsibility - and caps on non-economic damages. 

PA Governor Releases April Fool's Joke Too Early

Governor Rendell has a great April Fool's gag, announcing a Pennsylvania "Stimulus Czar" (like anyone would think that's a real job) that pays $120,000 per year for part-time work.

Rendell's gag press release goes on to make lots of jokes about what the stimulus funding will do:

"It won't be long until you will see more and more people packing their lunch pails and heading back to work," Governor Rendell said. "Federal stimulus money is starting to flow into Pennsylvania to help put people back to work and stabilize our economy. There’s a surge going on in our economy. It’s not a tsunami yet, but it is building.

"In addition to creating jobs for hard working Pennsylvanians, the stimulus money will help us to achieve energy independence, reduce the cost of health care and improve public schools while stabilizing property taxes, and keep the costs of state government down and manageable in the long term."

Hilarious, no one could fall for this. He might as well have gone on about how the stimulus will cure cancer, end racism, and buy happiness.

But I can't understand why he released it on March 31. Doesn't make much sense to me. Now wait a minute ...

Will Rendell Lower the Cost of Prescription Drugs?

Governor Rendell announced a number of new proposals increasing the number of people in Adult Basic health care, shifting funds to help with mortgage assistance and home heating cost.

His final proposal is to create a website where residents can search for the lowest cost prescription. But what would help residents even more would be if government stopped requiring higher prices on prescription drugs.

That's right, in Pennsylvania we have a longstanding law that requires drugstores to have higher prices than they otherwise would. Wal-mart, for instance, has a number of prescription drugs they sell for $4 for a monthly supply in other states, but have to sell for $9 in Pennsylvania (along with $9 drugs that cost $25 in PA).

The Senate Republicans have included repealing this law as one of the health care reforms. Will Rendell sign on?

Freedom in Pennsylvania and the 50 states

The Mercatus Center has a new report ranking freedom - both personal and economic - in the 50 states.  Overall, they rank Pennsylvania 20th. See a related story in the Post-Gazette.  In their three categories - Fiscal Policy, Regulatory Policy, and Paternalism/Personal Freedom - Pennsylvania ranks 32nd, 3rd, and 29th.  Here is what they say about Pennsylvania:

At #20, Pennsylvania is freer than all six of its neighboring states. The state is not particularly good on fiscal policy, however, with a high debt ratio and government spending. For a northeastern state, its gun control laws are not awful. By our admittedly crude measures, Pennsylvania actually has the most liberal gambling laws in our dataset, being the only state to legalize statewide all forms of gambling we track: Internet, track, casino, pari-mutuel, charitable, and slots. However, the law does not have a  social gambling exception, and the government presumably tightly regulates each of these forms of gambling. Pennsylvania’s home school laws are draconian, and its private school regulations are not much better. Teacher qualifications and licensing need to be repealed, and standardized testing, notification, and record-keeping requirements reduced. Pennsylvania is one of only three states to have no form of community rating in small group and individual health insurance (Hawaii and Virginia are the other two). However, mandates are rather high, raising the price of health insurance policies at least 46%.  Occupational licensing is quite rare. Smoking bans have not gone far at all.

Of course, Pennsylvania seems to be losing some of its freedom - these rankings don't include Pennsylvania's statewide smoking ban, which would certainly drop the rankings, and Governor Rendell has been pushing community rating.  Likewise, many might disagree with Pennsylvania gambling laws as a positive for freedom - given the role of state government in licensing gambling monopolies to the politically connected.

You can get the data they used here and even play around with the rankings here, giving more weight to categories you think are more important.

Another recent study on economic freedom in the states (which does not consider some of the personal freedoms of the Mercatus study) by the Pacific Research Institute ranks Pennsylvania 46th.  The Fraser Institute's Economic Freedom of North America ranks Pennsylvania 26th among US states and Canadian provinces.

Transparency on PA's Stimulus Money

Governor Rendell announced his ideas for "oversight" of the funding Pennsylvania will receive from the federal stimulus (related story here), and unveiled a new website - recovery.pa.gov -  to promote transparency in the simulus spending.

While the website does breakdown how much stimulus money PA will get by category, and profiles some of the tax provisions for citizens - indicating someone read the bill - I'm not overly impressed with the promised level of transparency.

For example:

A key provision of the federal recovery is regular public reporting of project status, spending, and job creation and retention.  These quarterly reports will be made available on this website

As I suggested before, a continually updated checkbook register would offer far better transparency and accountability.  

As for the level of detail under the FAQ for "Where is your money going?", we get answers like this:

Pennsylvania’s young people will benefit from more than $2.5 billion for tuition assistance and improved public education.  ...


The economic recovery plan provides an estimated $4 billion to increase access to quality health care for elderly, disabled and low-income Pennsylvanians, as well as other assistance programs.

That's not transparency, it's marketing slogans.  They might was well write, "We'll spend lots of money, and it will be awesome."