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Reason Foundation

Reason Alert: Airports to Nowhere and Ponzi Schemes

Replacing Essential Air Service flights with bus travel, fixing Social Security, privatizing libraries

September 16, 2011

- Replacing Airports to Nowhere
- California Legislature Tries to Stop Cities From Privatizing Their Own Libraries
- You Say 'Ponzi Scheme,' I Say 'Fraud'
- New at Reason

Replacing Airports to Nowhere
The federal Essential Air Services program is known for its pork, airports to nowhere and half-empty flights paid for by taxpayers. Reason Foundation partnered with the American Bus Association, Natural Resources Defense Council and Taxpayers for Common Sense on a new study that shows taxpayers could save up to $89 million a year if buses replaced planes in 38 of the cities that currently get subsidized flights through the Essential Air Services program.
How Puerto Rico Is Building World Class Infrastructure

California Legislature Tries to Stop Cities From Privatizing Their Own Libraries
In the Orange County Register, Reason Foundation's Harry Kenny explains how library privatization has helped cities and why California Gov. Jerry Brown should veto a union-backed bill aimed at preventing cost-savings: "California’s unemployment rate rose to 12 percent in July. More than 2 million Californians are out of work, and a third of those people have been unemployed for more than a year. So what is the state Legislature doing? It wants to prevent cash-strapped local governments from privatizing libraries. Apparently, the folks in Sacramento believe that cities looking for ways to reduce expenses are better off with no libraries at all than with privately operated libraries. Assembly Bill 438, sponsored by Assemblyman Das Williams, D-Santa Barbara, is headed to Gov. Jerry Brown’s desk because Democrats in Sacramento voted to control local decisions and prevent cities from making choices about what is best for their own libraries. The bill represents a dramatic overreach by Sacramento into local communities. Via AB438 the Legislature mandates that cities choosing to privatize are not allowed to reduce the size of their library staffs. Further, the bill mandates that every single current library employee must keep his or her job in any future public-private partnership agreement, which explains why powerful unions have been pushing the bill. Cities will also be forced to spend time and money preparing and submitting studies and reports to Sacramento in order to obtain the state’s permission to privatize."

You Say 'Ponzi Scheme,' I Say 'Fraud'
In his syndicated column, Reason magazine's Jacob Sullum writes, "At the Republican presidential debate in Tampa on Monday night, Mitt Romney said Rick Perry has needlessly 'scared seniors' by calling Social Security 'a Ponzi scheme.' Romney, more sensitive to the anxieties of retirees, prefers to say 'the American people have been effectively defrauded out of their Social Security' (as he puts it in his 2010 book No Apology) because Congress has spent the program's surplus revenue instead of saving it to pay for future benefits—the sort of crime for which bankers 'would go to jail.' See the difference? Neither do I. Both the former Massachusetts governor and the current Texas governor understand that Social Security is a transfer program disguised as a retirement plan and that its frequently mentioned 'trust fund' does not actually exist. Their spat over how exactly to characterize that situation is illuminating not because it reveals substantive differences between the candidates but because it shows how often these simple truths are overlooked."
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