Thursday, March 31, 2011

Supply Side Shortcomings

It's no surprise that the business and economic news of the week is focusing on how the United States' economy is recovering and growing, yet it is not producing significant job growth. In fact, despite stronger economic gains than world trading partners, other countries are outpacing the United States in putting people back to work. The growth in the US is seen in a robust stock market and a corporate profit report that reveals profits setting records and operating at a twelve percent gain over the numbers prior to the recession. The reality is that American workers are more productive, and companies which shed jobs during the recession have realized they can make due with fewer workers. And so they will.

This realization leads to serious questions about the promotion of supply side economic policies as a way of generating job growth. The basic question is this: Who can argue that job growth is the goal of any business? In reality, it's not. Certainly, the correlation between increased business leading to a need for more workers is relevant. However, because labor costs are the greatest cost for most businesses - and that only increases as benefits' costs rise - no business is actively looking for a way to hire more people as its goal.

Expanded market share and profits are the goal of any business. Increasing sales and production while limiting costs is the predominant focus. If a company can increase profits without increasing labor or costs, it will - it must. Thus, to argue that governments can implement pro-job growth policies - especially in terms of taxes - defies basic economic sense. The current growth of the US economy validates this - albeit this is a simplified explanation.

To argue that a tax policy will spur more hiring makes no sense. Supply is only increased to meet demand. A generous business tax policy does not increase demand, and it's ambiguous that any tax cut will increase demand in any specific business sector. The economy and the spending habits and productions needs of the economy are far too complex. The economy is an emergent system, and identify specific factors of emergent system is not really possible, at least from a tax policy standpoint.

Wednesday, March 30, 2011

The Dark Side of Reform

When Steven Leavitt published Freakonomics years ago, he raised some eyebrows - and blood pressures - by arguing statistics reveal that teachers and sumo wrestlers are among the professions most likely to "cheat." The high stakes "testing" and "ranking" of each profession was indicated as the likely factor.

Now, in the DC public schools - the domain of reformer Michelle Rhee who blamed low standardized test scores on poor teachers protected by unions and tenure - it appears more data supports Leavitt's argument. In an investigative story in USA Today, the examination of rising test scores and student achievement is linked to an unusually high number of erasure marks on students tests - erasures which revealed huge percentages of wrong answers being changed to correct ones.

We should all be disappointed in this reality - but we should view it with an intent to understand the broader message. If true, the teachers of these "diligent self-checking students" should not be excused or exonerated because the pressure to show results led to poor decisions. However, this story should influence the discussions about standardized tests which are "high stakes" for schools and teachers, but zero stakes for students. And the mythical panacea of "merit pay" based on such tests must also be scrutinized.

Teen Athletes Eating Right

On numerous occasions each year, I rant about the importance of healthy eating, especially during the teenage years. From the pizza and cookies for lunch to the random snacks of donuts and chips to the way students sit casually sipping a sugar-filled Powerade, too many young people eat for crap these days. In fact, they are eating crap these days. And there is no doubt these habits will have negative long term repercussions on their health. Yet, the prevalence of low-quality processed foods is ubiquitous, and despite my rants and a semester in health class, students aren't really getting the education they need.

However, there is hope. And a recent local news feature gives my hope that my rant just might be making an impact. The fitness section of the Denver Post spotlights two local teen athletes who have seen the light. These two young men battled weight problems for years until they made the decision to beat the battle of the bulge. One of the students was a freshman in my Honors English class four years ago - and I was shocked when he came to see me last fall at the start of his senior year. He'd lost fifty pounds and was the captain of his varsity basketball team - one of the top programs in the state.

This story is great news, and it's exactly the type of story we need about young people. Yet, I worry about opposition to health information. Despite the best of intentions, the First Lady Michelle Obama has been targeted with endless criticism for attempting to promote healthier foods in schools. Certainly, it's mainly political - though it's veiled in the guise as an "assault on freedom." That, by the way, is patently ridiculous. And, hopefully more schools and kids and parents will begin to pursue healthier choices.

High fives to these young men for being an inspiration to us all.

Tuesday, March 29, 2011

Corporate vs. Public

Jon Stewart "gives up."

In a informative sketch, Stewart once again expresses dismay about the GOP-led campaign against public workers as "budget busting" leeches, while ignoring any sense that our corporate tax structure is integrally linked to the fiscal crisis. This is an argument that simply doesn't seem winnable by Democrats - and neither Stewart nor I can figure out why.

How many times have I heard conservative pundits and politicians decry our outrageous corporate tax rate - "highest in the industrialized world" - while completely ignoring (or being shamefully clueless) about the discrepancy between tax rates and taxes paid. Yes, the corporate tax rate is officially 35%. But NO corporation pays anywhere close to the rate .... and 2/3 of US corporations pay no corporate income taxes. That's none. Zero. And to make matters worse, the top earning corporations receive additional tax benefits in the from of subsidies and rebates.

It is astonishing, I know. How can such a profoundly corrupt system be completely lost on voters and Republican congressman? And I get the criticism of the Democrats. It is absolutely valid. Liberal leaders do try to accomplish too much, and they are reasonable targets for out-of-control public spending. But this double-standard is just too much for an unaffiliated, moderate voter like me.

I sympathize with Stewart, and I wonder how Democrats can be so clueless about educating the public on this. Unless they don't really want to. What would be wrong with a series of commercials - especially during elections - that is committed to exposing the corruption of the system? Why is that so hard? Where are the Democratic versions of the Koch brothers?

Sunday, March 27, 2011

Revenue or Spending

In the ever-going state budget discussion here in Colorado, conservative columnist John Andrews argues in the Denver Post that Colorado doesn't have a revenue problem and should, surprisingly, emulate states like Wisconsin and Texas. My thoughts:

In a column addressing the budgetary challenges facing Colorado, the recommendation that we adopt our tax system from Texas is quite baffling, especially for someone who's generally pretty well informed about issues of politics and government. Texas is currently facing a projected $27 billion shortfall in 2012, which aligns it squarely with the budgetary disasters in states like California and Illinois. This fiscal tsunami is in spite of increased job growth and business relocation to Texas in the past decade. Thus, Texas - which has no "out-of-control spending" and an austere, Colorado-like budget, is clearly inhibited by a revenue problem.

The revenue problem is no different than in Colorado. Certainly, as he notes, spending in Colorado has increased over the years. Yet, his criticism is ignoring a myriad of factors that lead state spending to expand - increased population, increased wear and tear on infrastructure, natural disasters from epic storms to massive fires to uncontrolled pine beetle devastation, greater demands on education for expanded testing and security and special education, rising demands of Medicaid and public health as private sector workers face increasing premiums or lose benefits while wages remain stagnant, etc. Simply put, as the years go on, costs go up. They always have - that's why I used to pay less for everything, and now, even with wages increases, costs have gone up. The economy is so much more complex than Andrews' knowledge of it, and his inability to look beyond a basic prejudice toward taxes is the foundation of the state's revenue problem.

And then we turn to Andrews' mythologized "Reagan" reference as "visionary" in terms of deficits? That's the same Reagan who cut revenue and ballooned not only the deficit but the national debt. That's the same Reagan who sought to repair the budget with eleven subsequent revenue increases between 1983 and 1987, and still left a debt and deficit that cost his successor a second term.

As an educator who urges to my students to be "people on whom nothing is lost," I am worried by voters like Andrews who take an ideological, rather than pragmatic, real-world approach to the budget. His naive recommendations simply validate one of Winston Churchill's greatest insights:

"The best argument against democracy is a five-minute conversation with the average voter."

Coloradan's votes on Ref C & D, their rejection of 60, 61, & and 101, and their election of John Hickenlooper over a notoriously inept and rather clueless GOP field seem to indicate they're not as naive as his friends at CUT (Colorado Union of Taxpayers) and the Independence Institute.

But I still worry.

Saturday, March 19, 2011

Bracket Madness

"How's your bracket?"

This question is the nationwide conversation starter, as once again the yearly tradition of March Madness in the NCAA national championship basketball tournament has begun. The event has become so ingrained in our culture that its terminology has become part of the lexicon, and its significance has become embedded in the national discourse. Certainly, there is a financial issue at stake, as friendly "office pools" have led to millions - dare I say billions - of dollars are changing hands. And, of course, the media is quick to report the economic impact of lost productivity in the workplace.

Of course, it's really just a bunch of basketball games. And there are certainly more pressing issues on both a nationwide and global scale. Additionally, this time of year jump starts discussions about the "educational mission" of the NCAA - and tax exempt status - when reporters begin to unearth the dark secret of abysmal graduation rates among college basketball players. At some colleges, the graduation rate for African-American players is a truly shocking 14%. And less than one percent of all these athletes will ever earn a living on the hardwood. Thus, there is much to criticize about our national obsession in the next couple of weeks, even as we are enthralled by the Cinderella stories and Sweet Sixteens.

Overall, our culture defines us - and often thankfully distracts us, and I'd conclude that talk of brackets is of far greater benefit to our society than cost. I, incidentally, chose Louisville for the championship game, and I had St. John's going to the Sweet Sixteen. So, it's nothing but a spectator sport for me from here on out. Go Illini!

So? How's your bracket?

Friday, March 18, 2011

Wish Week

The students at my high school devote their spring sports pep week/rally to charity and raise money for Make-A-Wish. This week their five-day total was $22,000 - enough to grant four wishes. Our kids really make me proud.

Sunday, March 13, 2011

NCAA Madness

The Buffaloes of the University of Colorado just got screwed by the NCAA. CU beat #5 seed K-State THREE TIMES. They beat Missouri, they beat Texas, the almost beat KU in conference tournament semi-finals. This is outrageous. One of the biggest snubs we've seen.

Saturday, March 12, 2011

The Lavish Life of Teachers

Jon Stewart challenges the criticism of the benefits that public employees have - compensation packages that "Papa Bear" Bill O'Reilly calls "lavish."

I am generally satisfied with my compensation after twenty years of teaching and seventy-five graduate hours past my Master's degree in English. However, I don't even use my employer-sponsored health coverage for my family because it is so expensive. Instead, I have catastrophic policy for my wife and children for which I pay all expenses - including no co-pay office visits and prescriptions - out of pocket up to a $7,000 deductible.

Clearly, like many veteran teachers, I live a comfortable middle-class lifestyle. But, lavish? Give me a break, Bill.

Wednesday, March 9, 2011

The Elmo Vendetta

In Today's Denver Post, columnist David Harsanyi defends the GOP's recent attempts and long-standing desire to withdraw federal funding from NPR/PBS because though he believes, "NPR is under-appreciated ... what practical argument is left in the defense of federal funding for entertainment or journalism in an era of nearly unlimited choices?" While I appreciate his perspective on the government's role in providing entertainment and information through NPR, I feel he overlooks one important aspect of the medium, and that is (generally) commercial-free programming.

As a parent, I am careful about exposing my children to excessive marketing, and that is why my children (ages five and eight) have only watched PBS children's programming. As they mature, and we consider allowing more access to networks and computer entertainment, I am often shocked by the excessive marketing. Additionally, with PBS there is no chance that my children will be exposed to commercials for adult entertainment - shows like CSI and Two and Half Men or horror and action movies.

Certainly, he could argue that I don't have to use any audio-visual entertainment with my children and, thus, could avoid the problem. However, by arguing that NPR funding isn't necessary because of the ample offerings of the private sector, he ignores the goal of providing information and entertainment outside of a corporate agenda that is not often in the best interest of my family.

Granted, the counter-argument is that people simply avoid corporate bias in exchange for ideological bias. Yet, that hardly seems to be the case with Arthur, Sesame Street, and Clifford. Thus, I feel there is legitimate rationale for funding commercial-free educational programming, especially because, as you note, the budgetary "saving" is arbitrary and not the reason behind the push to de-fund NPR.

While this certainly won't change any minds, I feel my perspective is worth considering,