Last night’s vote by the Wisconsin-based portion of the Wisconsin Senate has received enormous attention. The scope of collective bargaining by school district and other government employees has been narrowed, and the state will no longer automatically garnish workers’ wages to pay union dues.

This was the right thing to do. But how much of a difference will these changes actually make to the state’s bottom line? As I’ve noted, the presence or absence of collective bargaining is not strongly correlated with school district spending. Instead, unions have won their massively (42%) above- market compensation through well-funded political action; which brings us to the question of automatic paycheck deduction of union dues.

Without automatic dues withdrawals, will public school unions still be able to afford their fantastically successful political activities? There’s no reason to doubt it. Given the huge compensation premium public school employees enjoy over their private sector counterparts, they have a powerful incentive to voluntarily keep funding the political action that helped win it.

Indeed, we can see this already in right-to-work states like South Carolina. Public school employees there have no collective bargaining rights and there is no automatic union dues withdrawal, but the Palmetto State nevertheless has a teachers’ union and an administrators’ association that have spent large sums of money on political action. It’s worked. Despite not being the wealthiest of states, South Carolina still spends roughly $12,000 per pupil on its public schools, and its public school teachers earn more than the state’s median household income. The teacher and administrator groups have also successfully defeated every legislative effort thus far to open up the state’s education system to private sector competition and parental choice.

The only way to rein-in out-of-control public school spending is thus to give both families and taxpayers an alternative to the government monopoly status quo. Cut taxes on folks who pay for their own children’s education, or who donate to non-profit scholarship organizations that subsidize private school tuition for the poor. Many states are doing this already on a small scale. By so doing so on a larger scale, families will have much greater choices and taxpayers will reap enormous savings.

The U.S. trade deficit rose in January, according to this morning’s monthly trade report from the U.S. Commerce Department, and on cue the news is being greeted as a bad omen for the U.S. economy.

Reflecting the conventional wisdom, this morning’s Associated Press story states as a matter of fact, with no attribution:

A widening trade deficit hurts the U.S. economy. When imports outpace exports, more jobs go to foreign workers than to U.S. workers.

Oh really? As I’ve documented elsewhere, the U.S. economy actually grows faster during periods when the trade deficit is widening compared to when it is shrinking. That’s because an expanding economy increases demand for imports as well as domestically made goods. Stronger growth also attracts more foreign investment, which is the flip side of the trade deficit.

The same story is true for jobs. In Chapter 5 of my 2009 Cato book, Mad about Trade, I show how the unemployment rate invariably rises during periods when the trade deficit is “improving,” and declines during periods when the deficit is “worsening.” (Check out Table 2.2 on p. 81, courtesy of Google Books.)

Just think back to the 1990s. From 1992 to 2000, the trade deficit widened from 0.5 percent of GDP to 3.9 percent. During that same period, the unemployment rate fell from 7.3 percent to 3.9 percent and the economy added more than 18 million jobs.

More recently, the trade deficit narrowed sharply between 2007 and 2009 as a share of GDP, while the economy lost more than 8 million jobs and unemployment soared.

The conventional wisdom on trade deficits and the economy is due for a reality check. If politicians believe that “a widening trade deficit hurts the economy,” contrary to all the evidence, they will be more tempted to reach for the snake oil of protectionism.

A couple of years ago, I was highly critical of President Obama’s first, it turns out annual, televised school-year kickoff address to America’s students. At the time I got a lot of emails telling me how outrageous my stance was, and how anyone, of any political persuasion, should be thrilled to have the President of the United States talk to their kids.

Apparently, the thrill is gone when you actually have to do a little work to get the President. According to internal White House memos, the President’s “Race to the Top High School Commencement Challenge” — in which schools compete for a chance to get the Prez as their graduation speaker — had generated only 68 applications as of February 28, which was after the original application deadline of Feburary 25. (The White House has extended the deadline to March 11.) To put that in perspective, the nation had over 24,000 public secondary schools as of the 2007-08 school year, meaning only about 0.3 percent of public high schools have expressed any serious desire to have the President send their charges off to adulthood. (Well, or college.)

So have our high schools suddenly discovered the Constitution, which gives the President no authority to meddle in education? Probably not, but it certainly does undermine the argument that it is a super-terrific thing anytime the Commander in Chief can take to the podium to tell kids to work hard and stay in school. Apparently, it’s only super-terrific if you don’t have to lift a finger — well, other than to work your TV remote — to get the President to talk to your kids.

The Washington Post’s Ezra Klein writes:

It’s put-up-or-shut-up time for Republicans. They managed to make it through the health-care debate without offering serious solutions of their own, and — perhaps more impressive — through the election by promising to tell us their solutions after they’d won. But the jig is up. They need a health-care plan — and quickly.

The GOP knew this day would come.

Say what? Exactly what political factors are forcing the GOP to put up or shut up? Their base is happy; it wants an all-out assault on ObamaCare, and congressional Republicans are giving it to them. Republicans are even winning the ObamaCare debate among the broader public:

So why should Republicans all of a sudden stop attacking ObamaCare and start talking about their own refor–ohhhh…I see. Klein is trying to talk the dog off the meat wagon. Good luck with that.

The Wall Street Journal reports Monday:

Departing members of the House of Representatives awarded millions of dollars in extra pay to aides as they closed down their offices, according to lawmakers’ spending records.

The 96 lawmakers paid their employees $6.7 million, or 31%, more in the fourth quarter of 2010 than they did, on average, in the first three quarters of the year.…

Because most of the departing members were Democrats, fourth-quarter salary increases in 2010 for Democratic staffers were the largest in the decade LegiStorm has been gathering such data.

Republican staffers enjoyed a similar boost when many of their employers left office at the end of 2006.

And that last point sounded especially familiar. In 2007, I wrote in The Hill:

The year-end spending spree is a hallowed Washington tradition. Bureaucrats fear nothing more than the budget cuts that result if they don’t spend all the funds they’ve been allocated. And Congress frequently asks the Government Accountability Office to investigate the extent of late-breaking spending requests. But it turns out that legislators engage in their own spending binges, especially when control of Congress is shifting to the other party.

At the end of 2006, after the Democrats had won control of Congress but before they had taken office, the outgoing Republican majority voted its committee staffers unusually generous raises — with some staffers receiving significant double-digit bonuses.

After going through some specific examples from 2006 similar to those the Wall Street Journal found for 2010, I concluded:

Members of Congress are free to pay their staffers whatever they choose, up to an annual ceiling, so there’s nothing illegal about year-end bonuses, even year-end, post-election, before-the-other-party-gets-in bonuses.

But this pattern illustrates a big difference between the private and public sectors. In the private sector, if your customers become dissatisfied with your product, you tend to make less money. In the public sector, you get a couple of months to double-dip before you lose control of the money. For participating in a Congress that voters booted out of office, these bonuses are a handsome parting gift.

Not for the first time, you read it here first!

Tad recently put $61 billion in spending cuts in perspective. I’ve added a few bells and whistles to his data. Enjoy.

That’s the title of my latest Kaiser Health News column, which addresses President Obama’s offer to accelerate the waiver process that would allow states to replace many of ObamaCare’s most offensive provisions:

If you think that means the president was himself exhibiting flexibility, you would be wrong. Despite the rhetoric about compromise, what the president actually did was offer states the option of replacing his law with a single-payer health care system three years earlier than his law allows…

HHS Secretary Kathleen Sebelius has written that ObamaCare gives states “incredible freedom” to implement the law. We now know what she meant: states are free to coerce their residents even more than ObamaCare requires. What’s incredible is that she calls that freedom.

Apologies to to the Housemartins.