Fact and Comment
by Steve Forbes
Let the People Do It
Washington is appropriating tens of billions of dollars to rebuild New Orleans and the devastated Gulf Coast region. But one measure that would cost little and quickly spur an inspiring revival of this impacted area would be making the region a true free-enterprise zone.
Residents and local businesses would be free from both federal and state capital gains levies. Parents would have genuine school choice: If they wanted to move their children to another school, they'd get a voucher or coupon equivalent to the amount spent per pupil in their current school. Pre-Katrina property tax rates would be slashed. Give people who currently live in the region or who move to it an income tax holiday: no taxes owed to Uncle Sam or state capitals for, say, ten years.
With those kinds of incentives small businesses would flourish--a handful might even become tomorrow's Microsoft or Intel or Apple or Oracle. Job opportunities would proliferate. So would good schools. People would gladly migrate to the region and build anew. Critics may cry that all this would give the area an unfair advantage vis-à-vis the rest of the country. Precisely. Which would lead to another constructive move--making the entire country a true free-enterprise zone. America would prosper as never before.
Dutch Treat
Thank goodness we have accepted the Netherlands' offer to send experts on levees and levee reconstruction. That country has an extraordinarily sophisticated system of dikes and floodgates.
The Netherlands underwent a Katrina-like disaster in 1953. Like New Orleans, much of Holland lies below sea level. The dikes broke, and 1,800 people lost their lives. Holland put in a three-tier system of levees, and its North Sea floodgates are considered a marvel of modern ingenuity.
So let's take seriously the advice of these experts on how to protect New Orleans in the future and which parts of the city should be rebuilt and which left unrestored.
Energetic Response
Out of the Katrina disaster might come--finally-a renewed sense of seriousness concerning energy.
•Oil refineries. There hasn't been a new one built in the U.S. in nearly 30 years. Yes, the petroleum industry has been remarkably creative in increasing output from existing plants, but new ones are needed. The President should push for legislation to clear obstacles, particularly delay-it-to-death environmental lawsuits and regulations. The Environmental Protection Agency, for instance, has an array of rules that force refineries to produce a variety of gasolines to meet regional environmental standards, especially during the summer. Their effectiveness is debatable; the fact that they increase gasoline costs and reduce gasoline output is not. Most of these regulations were suspended temporarily after Hurricane Katrina. Why not scrap them altogether?
•Congress should allow oil exploration in a small part of Alaska's Arctic National Wildlife Refuge (ANWR). In essence we're talking about a handful of acres here, the equivalent of a sugar cube in New York City. And we're not talking about sweeping, awe-inspiring forests: This region is bleak, even in summertime. Moreover, the oil industry has again and again proven its ability to drill in and then restore impacted terrain.
•Congress should also permit exploration and drilling in the Outer Continental Shelf (OCS), including areas off the shores of Florida and California. Some 85% of these waters are off-limits. Thankfully, drilling technology and practices have improved substantially in the last 30 years, sharply reducing the possibility of spills. Experience has demonstrated that even when spills do occur, the affected areas recover rapidly. The amounts of offshore oil and natural gas are stupendous. If these reserves were developed, our dependence on overseas energy sources would considerably lessen.
President Bush could help to once and for all pop the oil-price bubble by selling oil from the Strategic Petroleum Reserve on a more regular basis. Before the devastation wrought by Hurricane Katrina, speculators knew that Uncle Sam was a buyer of last resort. There is no fundamental reason that petroleum prices should be almost three times the level they were three years ago.
Modern Rotten Boroughs
California entrepreneur Bill Mundell--founder and CEO of Vidyah, a leading private educational organization--is spearheading a citizens' effort to attack one of the major corrupters of American politics today: gerrymandering. Thanks to high tech, politicians can now establish district lines that effectively make elections for state legislatures and for the House of Representatives uncompetitive.
In California last November not one incumbent was defeated in elections for the state legislature or Congress. Not one of the 153 seats up for grabs--53 congressional seats and 100 in the state legislature--changed party hands. As has often been observed, the U.S. is becoming a democracy in which the politicians choose the voters rather than the other way around. Aside from a handful of notable exceptions such as Iowa, states more or less follow California's Soviet-style approach to drawing voting district lines.
Mundell chairs Californians for Fair Redistricting, which is pushing for passage this November of Proposition 77, the Voter Empowerment Act. The initiative would establish a nonpartisan panel of judges to draw competitive and compact district lines. No longer would boundaries resemble a Jackson Pollock painting. Competition would be restored--and with it infinitely greater accountability.
You'd think that with more and more pols ensconced in safe districts, they'd act more responsibly. Quite the opposite--special interests have gained more influence, and spending has reached irresponsible proportions. Gerrymandering is one reason California politics has become so dysfunctional. Needed reforms are dead-on-arrival in the state legislature.
It's no wonder that Proposition 77 is despised by most Golden State politicos. California State Attorney General Bill Lockyer tried throwing Proposition 77 off the ballot on minor technicalities. Fortunately the state Supreme Court blocked Lockyer's insidiously cynical maneuver, and Proposition 77 is back on the ballot.
If successful, this initiative will set an inspiring precedent for similar redistricting reform efforts in the rest of the country. And Mundell will rightly become a political force to be reckoned with.
Selling the Brooklyn Bridge
Bridgeclimb, an Australian company at the base of the Sydney Harbour Bridge, does a brisk business selling so-called bridge climbs (see Digital Rules,). New York City should set up a similar operation at the Brooklyn Bridge. Enterprising souls are willing to do it, including those who currently run the Sydney concern. Former New York City Mayor Rudolph Giuliani wanted the city to do just that several years ago, but Big Apple government lawyers howled that the city would lose money from the liability suits brought not by the bereaved families of those who accidentally spill into the river below (as Rich Karlgaard points out, the Aussies do everything they can to make the jaunt safe, including cabling climbers to the bridge itself) but by people who stub their toes and bang their knees, etc.
Still, the idea is a great one. I climbed the Sydney Harbour Bridge, and it's a captivating thrill. Mayor Bloomberg should make a Brooklyn Bridge climb part of his reelection platform. It would win votes, and the inauguration of such a climb would be a great way to kick off his second term. New Yorkers would probably take to the bridge experience even more than Sydney-siders have.
What about those possible liability suits? Would-be Brooklyn Bridge climbers should have to sit through a safety lecture and sign multiple pieces of paper acknowledging that this trek is no cakewalk. Of course, a plethora of lawsuits could, in a perverse way, do some good: Such suits might push the normally nonsensical City Council or the New York State legislature to enact a wee bit of tort reform.
