Business regulation

I have spent most of my life in the private sector, as a journalist, then a lawyer, an insurance executive and now a farmer. I love business for its creativity, its enterprising spirit, its competition. If people make money in business it is because they have provided a product that people want and a price they are willing to pay. If they make a profit that is to compensate them for the risks they take. 

So what can the state do to improve the business climate, allow our companies to prosper and to increase the wages paid to employees?

Run an efficient government. Enact laws that are straightforward and certain, so that businesses can better calculate the cost of doing business here. Support and not demonize people who work hard to provide jobs for others. Leave them alone to follow their dreams and to create enterprises that will benefit the state for generations (National Life, Rock of Ages, Sugarbush Ski area, Cabot Creamery come to mind here in Washington County).

Last year in the legislature there was an effort to clarify the rules regarding who is an independent contractor. When I practiced law, the issue frequently came up, and the rules seemed pretty simple. Who controlled the work?  And in answering that you looked at things like who set the hours of work; who provided the tools; who determined when the work was done. Now the state has attempted to dictate new elements of this relationship and to force businesses to treat some independent contractors as employees, which raises a host of cost implications.

An effort is now underway, led by the Central Vermont Chamber of Commerce, to bring back this bill, which was yanked out of committee last winter by House Speaker Shap Smith. I support that effort because certainty is needed in this area.

 

Education

 

            Education is one of the state’s largest expenses. I don’t pretend to be an expert on our educational finance system but do have general opinions about what works and what doesn’t work.

 

            First, I will point out that my wife and I have five grown children, and all of them attended public schools in Vermont through high school. My wife Wibs was a public school teacher for many years.

 

            Second, I believe that while schools are important, their impact pales in comparison to the influence of family (parents in particular) and peers on a child’s desire to learn and to succeed. Put another way, schools succeed almost in direct proportion to the energy that parents and students put into them and not based on the money spent.

 

            We have a serious financial problem in our educational system in Vermont. In short, we are spending too much per pupil and not getting the educational result to justify that expense. Some of the high cost is due to our rural geography and some to high administrative costs. Efforts are underway to consolidate school districts (Act 46) with mixed results. A bad result would be consolidation which may look good on paper but which leaves parents disengaged.

 

            Following the Brigham court case of two decades ago mandating equal educational opportunity throughout Vermont, the state developed a complicated financing system. In a nutshell it makes the state responsible for financing education but leaves to the school districts a decision on how much to spend. As a result of income sensitivity adjustments, many voters are “without stake” in decisions to increase taxes for schools. A separation of decision making from responsibility is never prudent in my opinion, and somehow we need to change that in Vermont with regard to education (as well as elsewhere!).  Also, while the Brigham philosophy was admirable, I don’t believe the district-by-district disparity in educational test scores has changed much in 20 years.

 

            While the “devil is in the details,” I support school choice in Vermont, in large part because of my philosophy that competition for services tends to increase commitment of the customer, keep those offering the services on their toes, and insulate the state from making bad choices that can negatively impact its finances for years or decades to come.  (As a general rule, faced with a choice between possibly hitting a home run or getting a walk, governments like ball players should gladly accept the walk. Sadly, many power intoxicated politicians do not agree.)

 

Energy

 

            We have high energy costs in Vermont, so clearly an objective will be to control those costs or even lower them. At the same time many in this state desire a “greener” mix of our energy supplies, and that can mean higher costs for new technology as well as a fundamental change in our vision of Vermont. We read every day of the conflict these two goals present.  I don’t have a prescription one way or the other but would tend to look at each project individually for the best outcome.

 

            I am not a climate change denier, but neither am I a 100% convert to the philosophy that man is responsible for it.  (Climate has always, and will always, change on earth, and weather casters are better than they were but they are still not infallible.) I do accept the likelihood that we will have heavier rainfalls, rising seas, stronger storms, and increased carbon dioxide in our air over the coming years.

 

            When I consider the downside risk of climate change with the higher cost of adopting new technology and techniques to combat climate change, it is clear to me that we should move to the new technology and away from a carbon based energy future. What that means in practice is more electric cars; more solar power; more hydroelectric power; and other technologies we haven’t even dreamed of.

 

            As a young Associated Press reporter in my twenties I interviewed the president of Exxon in New York City. I recall him saying that petroleum was way too valuable (as a source for plastic and other commodities) to burn. He was right then but we have continued to burn it ever since. (He was wrong in saying that the world would run out of oil in his lifetime.)

 

            My preference is to let the energy picture evolve through market forces rather than by government dictate.

 

Check back later for more comments about hot button issues.