Unsurprisingly, Academically Adrift: Limited Learning on College Campuses (University of Chicago Press, 2011), by Richard Arum and Josipa Roksa, reveals that at least 45 percent of undergraduates demonstrated "no improvement in critical thinking, complex reasoning, and writing skills in the first two years of college, and 36 percent showed no progress in four years." And that's just the beginning of the bad news.
I read somewhere, written by a more literate person - I believe an economist - that the weakest point of the Marxist theories was that Marx, as an economist, was such a bizarre failure he never understood the role of resellers.
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But you really, really, really cannot study Marx for any length of time without seeing other holes. For instance, take his entire view of power relationships in society. It is clear these are modeled on Academic Relationships, which is why - poor bunny - he got the whole thing upside down and sideways. Marx didn't understand the concept of "mutual benefit."
...Marx saw only exploitation.
Part of this was because of Marx's understanding of value, which is the pinnacle, or perhaps the foundation on which ALL his misunderstandings rest. It is also the most widely, insinuatingly pervasive of the Marxist concepts in our society.
To Marx value was raw material plus work. The means of producing that work (machinery, etc) were just sort of there. And he made no allowance for invention. (Which is why though Marxist revolutions often recruit intellectuals they're the sort of intellectuals who never had an original idea in their life.) Of course in our day and age, invention and original thought are at least as important as machinery in creating product. Also, the raw material fallacy means all the countries who have nothing else to sell feel "exploited" because we're taking their "value" away. Imbuing raw material itself with value means that it's sort of like stealing national treasure. This has given rise to an entire colonialist-exploitation-theory of history which has held more people in misery in developing countries than the most brazen robber baron could manage. And no one, NOT ONE seems to realize that their raw materials mean absolutely nothing if not used. If someone doesn't have an idea to use it. If the finished product is not good for something. In other words, if you're not producing something that someone else finds useful. (I.e. enough to pay for.) If the relationship isn't MUTUALLY beneficial.
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Good old Marx is also responsible for that most insane of ideas, the minimum wage. Dictating a minimum wage people have to be paid is the same as saying that labor has an intrinsic, minimal value. And before you scream I'm cruel or heartless, what the heck do feelings have to do with economics? Economics is the science of value. Value is what someone is willing to pay for something. NOT "but they need this to survive." THAT is an idea that work in itself has a value.
If that were true, we could hire an army of unemployed workers to polish dog turds for the international market. We'd be rich, rich I tell you.
Obama is so keen to preserve and nurture public sector unions because they are the lifeblood of the contemporary Democratic Party. To an astonishing extent, the unions are the government in many locales. They elect officials and then sit down to bargain with them over their salaries and benefits. Since they are essentially bargaining with themselves, they generally make out quite nicely. It’s a corrupt and ultimately unsustainable practice. Sooner or later, as Margaret Thatcher observed about socialism, they will run out of other people’s money. Many of us believe that day is nigh, but the unions and their enablers apparently have calculated that there is at least a little more ruin they can inflict.
Still, the issue in Madison is not just the future of public-sector unions. In my view — it’s one thing I agree with FDR about — they should once again be declared illegal, as they were in all states until the 1960s (currently about 40 percent of government workers are unionized). No, important as the fight over public-sector unions is, that battle is only one aspect of a much larger battle: the battle over the fate of individual freedom in a neo-collectivist age. As I said above, Obama has done us the great service of dramatizing the stark choice that faces us. At least since LBJ and his preposterously misnamed “Great Society” programs, the United States has been lurching down the collectivist path. The government has intruded itself in one aspect of life after the next, always with ruinous results. It is ironic, I suppose, that a crossroads should be reached in Madison, Wisconsin, a city named for that great patron of limited government James Madison. “The powers delegated by the proposed Constitution to the federal government are few and defined,” Madison wrote in Federalist 45.Those which are to remain in the State governments are numerous and indefinite. The former will be exercised principally on external objects, as war, peace, negotiation, and foreign commerce; with which last the power of taxation will, for the most part, be connected. The powers reserved to the several States will extend to all the objects which, in the ordinary course of affairs, concern the lives, liberties, and properties of the people, and the internal order, improvement, and prosperity of the State.
In any case, it seems to have escaped Krugman's and Drum's notice that the Wisconsin dispute has nothing to do with corporations. The unions' antagonist is the state government. "Industrial unions are organized against the might and greed of ownership," writes Time's Joe Klein, a liberal who understands the crucial distinction. "Public employees unions are organized against the might and greed . . . of the public?"
The "labor movement" in America has increasingly come to consist of people who work for government, not private companies. As the BLS notes, the union-participation rate for public-sector workers in 2010 was 36.2%, vs. just 6.9% for private-sector workers.
There is a fundamental difference between private- and public-sector workers. A private-sector labor dispute is a clear clash of competing interests, with management representing shareholders and unions representing workers. In the public sector, as George Will notes, taxpayers--whose position is analogous to that of shareholders--are usually denied a seat at the table:Such unions are government organized as an interest group to lobby itself to do what it always wants to do anyway - grow. These unions use dues extracted from members to elect their members' employers. And governments, not disciplined by the need to make a profit, extract government employees' salaries from taxpayers. Government sits on both sides of the table in cozy "negotiations" with unions.Collective bargaining in the public sector thus is less a negotiation than a conspiracy to steal money from taxpayers. The notion that this is "in the economic interests of the middle class" for government employees in Wisconsin and elsewhere to get above-market wages and extremely lavish benefits is just laughable. Sure, government employees are "middle class," but so are the vast majority of taxpayers who don't enjoy the special privileges that come from owning the means of coercion.
In the private sector, the capitalist knows that when he negotiates with the union, if he gives away the store, he loses his shirt. In the public sector, the politicians who approve any deal have none of their own money at stake. On the contrary, the more favorably they dispose of union demands, the more likely they are to be the beneficiary of union largesse in the next election. It’s the perfect cozy setup.
To redress these perverse incentives that benefit both negotiating parties at the expense of the taxpayer, Walker’s bill would restrict future government-union negotiations to wages only. Excluded from negotiations would be benefits, the more easily hidden sweeteners that come due long after the politicians who negotiated them have left. The bill would also require that unions be recertified every year and that dues be voluntary.
Recognizing this threat to union power, the Democratic party is pouring money and fury into the fight. Private unions have shrunk to less than 7 percent of the working population. The Democrats’ strength lies in government workers, who now constitute a majority of union members and provide massive support to the party. For them, Wisconsin represents a dangerous contagion.
Hence the import of the current moment — its blinding clarity. Here stand the Democrats, avatars of reactionary liberalism, desperately trying to hang onto the gains of their glory years — from unsustainable federal entitlements for the elderly enacted when life expectancy was 62 to the massive promissory notes issued to government unions when state coffers were full and no one was looking.
Obama’s Democrats have become the party of no. Real cuts to the federal budget? No. Entitlement reform? No. Tax reform? No. Breaking the corrupt and fiscally unsustainable symbiosis between public-sector unions and state governments? Hell no.
Thus, when government bureaucrats go on strike they have the ability to completely shut down the entire "industry" they "work" in indefinitely. The taxpayers will complain bitterly about the absence of schools and garbage collection, forcing the mayor, governor, or city councillors to quickly cave in to the union's demands to avoid risking the loss of their own jobs due to voter dissatisfaction. This process is the primary reason why, in general, the expenses of state and local governments have skyrocketed year in and year out, while the "production" of government employees declines.
The housing bubble and subsequent Wall Street collapse wreaked havoc on the nation's retirement savings, as many pension funds and 401(k) plans suffered losses of 30% or more. State and local governments are now facing huge unfunded pension liabilities, prompting policymakers to scramble for ways to close the gap without slashing payrolls and services. But a new report from the Little Hoover Commission in Sacramento makes a more troubling point: Many state and local government employees have been promised pensions that the public couldn't have afforded even had there been no crash.
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A bipartisan, independent agency that promotes efficiency in government, the Little Hoover Commission studied the public pension issue for 10 months before issuing its findings Thursday. Much of the 90-page report is devoted to making the case that, to use the commission's blunt words, "pension costs will crush government." Without a "miraculous" improvement in the funds' investments, the commission states, "few government entities — especially at the local level — will be able to absorb the blow without severe cuts to services."
The problem is partly demographic. The number of people retiring from government jobs is growing rapidly, and longer life expectancies mean that a growing number of retirees will collect benefits for more years than they worked. But the report argues that political factors have been at least as important in driving up costs, starting with the Legislature's move in 1999 to reduce the retirement age for public workers, base pensions on a higher percentage of a worker's salary and increase benefits retroactively. The increases authorized by Sacramento soon spread across the 85 public pension plans in California.
Compounding the problem, the state has increased its workforce almost 40% since the pension formula was changed and boosted the average state worker's wages by 50%. Local governments, meanwhile, raised their average salaries by 60%. Much of the growth came in the ranks of police and firefighters, who increased significantly in number and in pay.
[T]his president is too weak, too cautious, too beholden to politics over policy to lead. In this budget, in his refusal to do anything concrete to tackle the looming entitlement debt, in his failure to address the generational injustice, in his blithe indifference to the increasing danger of default, he has betrayed those of us who took him to be a serious president prepared to put the good of the country before his short term political interests. Like his State of the Union, this budget is good short term politics but such a massive pile of fiscal bullshit it makes it perfectly clear that Obama is kicking this vital issue down the road.Obama's game is transparent, isn't it? He is playing a game of chicken. He puts forward a series of proposals that he knows are more or less insane; but he also believes that Republicans will come to his rescue. They, not being wholly irresponsible, will come up with plans to reform entitlements--like, for example, the Ryan Roadmap. Ultimately, some combination of those plans will be implemented because the alternative is the collapse, not just of the government of the United States, but of the country itself. But Obama thinks the GOP's reforms will be unpopular, and he will be able to demagogue them, thus having his cake and eating it too. Is that leadership? Of course not. But it is the very essence of Barack Obama.
To all those under 30 who worked so hard to get this man elected, know this: he just screwed you over. He thinks you're fools.
How unserious is this budget? Although the White House trumpets $2.18 trillion in deficit reduction over the next decade, those savings are so far off in the magical "out years" that you can barely see them from here. More than 95% of the savings would happen after Mr. Obama's first term in the White House is over, and almost two-thirds of the promised deficit reduction would arrive after 2016. Pretending to cut deficits by pushing all real cuts into the future is Budget Flimflam 101.
From hard experience, we know that what matters are the cuts and reforms a White House is willing to make now. The Obama budget doesn't cut a penny from the deficit in the last seven months of fiscal 2011. Over the next three years—through 2013—the spending reductions in this budget add up to a paltry $20 billion net, out of a projected $3.5 trillion deficit. That's a 0.57% reduction in red ink and less than what the feds spend every two days.
Starting in 2014, net interest payments will surpass the amount spent on education, transportation, energy and all other discretionary programs outside defense. In 2018, they will outstrip Medicare spending. Only the amounts spent on defense and Social Security would remain bigger under the president's plan.
The soaring bill for interest payments is one of the biggest obstacles to balancing the federal budget, pushing the White House and Congress to come up with cuts deeper than previously imagined. Unlike with discretionary spending or even entitlement programs, the line item for interest payments cannot be altered except through other budget cuts.
The phenomenon is a bit like running up the down escalator. Without interest payments, the president's plan would balance the budget by 2017. But net interest payments that year are expected to reach $627 billion, up from $207 billion in the current fiscal year.
"This goes to the heart of why we have to address our fiscal problems," said Mark Zandi, co-founder and chief economist at Moody's Economy.com. "If we don't, we're going to get swamped by our interest payments."
Benjamin Friedman, a Harvard economic professor and author of "Day of Reckoning," about U.S. economic policy, said, "I think it's a reminder that we have a very serious problem and that the budget that's on the table does not address that problem."
Even with the cuts in Obama's budget, relief would not come until 2021, when the deficit as a percentage of gross domestic product would stop rising and plateau at 3.4 percent.
The explosion of interest payments comes from a double whammy of economic factors. First, the nation's debt is growing faster than the economy. Second, interest rates are rising. Over the next decade, net interest payments will amount to nearly 80 percent of the debt added, an indication of how past borrowing is forcing the country deeper into debt.
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"We're running a gigantic deficit, and we're not growing very fast," said Kenneth Rogoff, an economics professor at Harvard University and former chief economist at the International Monetary Fund. "We're on a dramatically unsustainable path."
The Obama administration's latest forecasts starkly illustrate the phenomenon of generation shifting, moving today's costs to future taxpayers. The borrowing the United States did over the past decade - to pay for the 2001 tax cut, the wars in Iraq and Afghanistan, and propping up the economy during the steep 2009 downturn - is coming due this decade.
EVAN THOMAS, NEWSWEEK: Only the President, only the President can break the logjam. His State of the Union was a profile in cowardice. His budget is a profile in cowardice. I hope there’s a secret plan he has here to come forward to lead us, but he hasn’t shown it yet.
Paul Ryan doesn't look like the menacing sort. He's amiable in a familiar Midwestern way, his disposition varies between cheerfully earnest and wry, and he uses words like "gosh." Yet to hear Democrats tell it, the 41-year-old Republican congressman is the evil genius, the cruel and mad budget cutter who threatens grandma's health care, grandad's retirement, and the entitlement state as we know it.
Senate Democrats like Chuck Schumer issue almost daily press releases attacking Mr. Ryan, Paul Krugman is obsessed and demeaning, and even President Obama can't stop mentioning him. Only this week, the president justified his own failure to tackle entitlements in his dud of a 2012 budget by saying that "the chairman of the House Republican budgeteers didn't sign on" to the final report of Mr. Obama's deficit commission.
What are they all so afraid of?
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"The way I look at things is if you want to be good at this kind of job, you have to be willing to lose it. Number two, the times require this. And number three, if you don't believe in your principles, and applying those principles, then what's the point?" He mentions limited government and economic freedom. "I believe these are the best solutions. I believe they will result in growth and opportunity for the country."
But why will this attempt at reforming entitlements be different politically than the marches into fixed bayonets of 1985, 1995 or 2005?
"Politically, I also believe it's going to be the right thing to do. People want conviction politicians. People want the problem solved. People turn on their TV, they see the European debt crisis. They see California, New York, Illinois. They understand there is a sovereign debt crisis popping all over the place," he says. "And to see a president duck and punt, and then try to use it as a political wedge against the opposing party to manipulate his re-election is not going to fly in this kind of climate."
Before being elected to office in November, freshman representative Alan Nunnelee (R., Miss.) knew that the ballooning cost of entitlement spending was threatening the financial future of the United States. But only when he arrived in Washington did he begin to understand the full, frightening extent of the situation. “I knew it was a serious problem when I was campaigning,” Nunnelee tells National Review Online, “But not until I saw’s Paul’s graphs did I realize the magnitude.”
The Paul he is referring to is Rep. Paul Ryan (R., Wis.), chairman of the House Budget Committee and, as it turns out, dean of budget studies. Since the convening of the 112th Congress, Ryan has teamed up with party leadership to conduct “listening sessions” for new GOP members to give them a rundown on the national debt and other fiscal matters, or, as one aide describes it, “Budget 101” for freshmen. The meetings have become so popular that some members, such as Nunnelee, kept coming back “three or four times.” And while the sessions were initially intended for freshmen, the surge in demand prompted party leaders to open them up to the entire conference.
“Studies have shown that telecommuters are more productive than their office-bound colleagues,” Davis says. “They use less sick time, there’s less tardiness, [they] have improved morale, and companies can draw from a wider pool of candidates because they're not geographically limited.”
Telecommuting cuts overhead expenses for companies because they need less office space and supplies. It also cuts down on inter-office socializing and distractions, leading to an increase in productivity.
Telecommuting is not for everyone; you have to be self-disciplined and independent enough to work on your own. If you thrive in a group setting, you may miss the interaction with your colleagues.
In 2008, 70 percent of all the jobs in the country were created in Texas. In 2009, all of America's top five job-creating cities were in Texas.
More recently, "Texas created 129,000 new jobs in the last year -- over one-half of all the new jobs in the U.S. In contrast, California lost 112,000 jobs during the same period," according to "Texas vs. California: Economic growth prospects for the 21st Century," a new report by the Texas Public Policy Foundation released in October.
Texas is home to 64 Fortune 500 companies -- more than any other state in the union. (California has 51 and New York has 56.) For five years in a row, Texas has topped Chief Executive magazine's poll of the best state to do business.
Meanwhile, California is ranked dead last in the Chief Executive's survey. California state treasurer Bill Lockyer even went so far as to pen a Dec. 20 op-ed in the Los Angeles Times denying "the claim that we have a hostile business climate."
So why are businesses flocking to Texas and fleeing California? Well, as a recent headline from The Economist put it, in California "They paved paradise and put up the parking taxes."
Texas has no personal income tax. With a top rate of 10.3 percent, California has the third-highest state income tax after Oregon and Hawaii.
The tax advantage goes much deeper. The Tax Foundation cites California as having the 33rd highest corporate income tax topping out at 8.8 percent -- much higher than Texas' modest 1 percent gross receipts tax on business.
California's capital gains tax is the highest in the country, whereas Texas levies no tax on capital gains. California's sales tax is the second highest in the nation and its energy taxes are the highest in the country.
And as California's taxes have gotten higher, the state's revenue has become more unstable.
It’s a solution of apparent Alexandrian elegance and simplicity: Empower America’s cash-strapped states to slice cleanly through a strangling knot of debilitating debt and government union cronyism by letting them file for bankruptcy. Long-term liabilities could be restructured, unaffordable labor contracts rewritten, fiscal health restored. No federal bailouts necessary.
This intriguing idea quickened last November when former House speaker Newt Gingrich gave it an animating shoutout during a speech at a Dallas think tank. That was followed by a detailed explanation in this magazine by David Skeel, a corporate law professor and bankruptcy expert at the University of Pennsylvania (“Give States a Way to Go Bankrupt,” November 29, 2010). As conservative Republicans on Capitol Hill began cooking up legislation to change the federal bankruptcy code, the concept exploded across the Internet—not to mention in Wall Street research departments.
Liberal bloggers, in particular, seemed to perceive the danger to a status quo where Big Labor elects state and local legislators who then return the favor by agreeing to contracts that, say, allow police officers to retire at age 50 with pensions equal to 90 percent of their highest salary. It’s a system that’s made government unions crazy powerful within the Democratic party while also helping states rack up some $3.5 trillion in unfunded pension and health care liabilities. (And that’s in addition to the anticipated $250 billion shortfall in state budgets over the next two years.) Kevin Drum of Mother Jones put it this way: State bankruptcy “promises to become a pretty serious battle. For Republicans it’s got everything: The tea parties will love it, it provides an alternative to raising taxes, and ... it helps defund a key Democratic interest group. What’s not to like?”
Surprisingly, quite a bit—at least among some Republicans and conservatives. In a January 24 session with reporters, House majority leader Eric Cantor brushed off the idea. “I don’t think [permitting states to declare bankruptcy] is necessary because state governments have at their disposal the requisite tools to address their fiscal ills.” The Virginia Republican added, “They have the ability to enter into new negotiations if there are any collective bargaining agreements in place. They have the ability to adjust levels of spending as well as revenues at the state level.”
A more pointed critique was offered by members of the highly respected free-market Manhattan Institute, Nicole Gelinas and E. J. McMahon, in the op-ed pages of the Wall Street Journal and other papers. Among their many objections to state bankruptcy: It would violate the constitutions of many states; it would damage the balance sheets of banks holding a quarter of a trillion dollars in state and municipal bonds; it might even cause such investor panic as to risk repeating the 2008 financial meltdown. “Bond-market brinkmanship and bankruptcy threats can’t save the states from themselves,” Gelinas wrote in the Boston Globe on January 23.
In recent years, states have been raising taxes, cutting services and firing workers in an effort to close record budget gaps opened by the recession. With the U.S. unemployment rate stuck at 9 percent or higher for nearly two years, 30 states - including California, Michigan and Nevada - have drained their unemployment insurance funds, forcing them to borrow to pay benefits to jobless workers.
