Wednesday, January 30, 2013

Democracy as a yacht race revisited.

Last Dec. 13 I did a blog post titled "Has democracy turned into a yacht race?" In a yacht race, you can win by having the fastest boat, or the most skilled skipper and crew, or by manipulating the rules.

I pointed out that there seemed to be a lot of rule manipulation going on in politics and used Michigan as an example. If you recall, Michigan's governor announced at an 11 AM news conference that he was in favor of a right-to-work law for his state. A strange turn of events since during the election season he had said that he opposed such legislation as being too "divisive."

The Michigan right-to-work law was introduced in both houses of the legislature later that day and passed by 8 PM that evening with no hearings or real chance to debate the issue. And just to be certain that the people of Michigan couldn't overturn the law at the polls, the legislature attached it to the one type of law not subject to voter referendum: a budget bill.

And we thought that was breathtaking. But wait, it turns out that Michigan could do better!

Last November, Michigan voters turned thumbs down on a law which allowed the governor to appoint an "emergency manager" for any governmental unit (village, town, county, school district) within Michigan. This manager would wield absolute dictatorial power over the affairs of that unit. He could nullify contracts with workers, spend or not spend money, etc. all without the approval of the democratically-elected officials of that governmental unit.

Benton Harbor, Michigan was a good example. Think of Benton Harbor as a smaller version of Detroit. One of the actions of Benton Harbor's emergency manager was to sell a piece of land which had been deeded in perpetuity to the city as a park to a private developer to create a country club and golf course, even though there are not many golfers among the citizens of Benton Harbor and even fewer citizens who could afford country club dues.

The citizens of Michigan apparently did not like the idea of some appointed overseer substituting for their elected officials. So they collected signatures on petitions and got enough to put the law on the November ballot where it was defeated.

End of story? Hardly. The legislature passed what was essentially the same law--but this time attaching it to a budget bill so it would not be subject to referendum--and the governor signed it.

It's difficult to imagine a bigger middle-finger salute to the people of Michigan and to democracy!

There's a great example happening of politics as yacht racing on a national scale, but we'll leave that to another post. Here's a question to consider though: Since there are so many more people living in urban areas than rural areas, should we balance things out by giving urban voters only 3/5 of a vote per person in national elections?

Thursday, January 24, 2013

America's foam finger problem.

Sometimes I feel as if I'm living inside a giant pep rally for America. Politicians love to tell us how we are the greatest country on the face of the Earth, the "land of opportunity" a "shining city on a hill." We're told that God especially loves America, so much so that there was a painting making the rounds recently in conservative circles showing Jesus delivering the Constitution to our founding fathers.

Maybe we should set aside a day each year when we all wear those giant "We're Number 1" foam fingers and chant "USA, USA" for a full 24 hours just to get it out of our systems.

Now don't get me wrong. I love this country and have no plans to move anywhere else. But, we have some pretty large failings. Tuesday's NY Times Editorial Page Editor's blog references a list of a few of our shortcomings compiled by Gus Speth:

"To our great shame, among the 20 major advanced countries America now has
  • the highest poverty rate, both generally and for children;
  • the greatest inequality of incomes;
  • the lowest government spending as a percentage of GDP on social programs for the disadvantaged;
  • the lowest number of paid holiday, annual, and maternity leaves;
  • the lowest score on the United Nations’ index of “material well-being of children”;
  • the worst score on the United Nations’ gender inequality index;
  • the lowest social mobility;
  • the highest public and private expenditure on health care as a portion of GDP,
yet accompanied by the highest
  • infant mortality rate;
  • prevalence of mental health problems;
  • obesity rate;
  • portion of people going without health care due to cost;
  • low-birth-weight children per capita (except for Japan);
  • consumption of antidepressants per capita;
along with the shortest life expectancy at birth (except for Denmark and Portugal);
  • the highest carbon dioxide emissions and water consumption per capita;
  • the lowest score on the World Economic Forum’s environmental performance index (except for Belgium), and the largest ecological footprint per capita (except for Belgium and Denmark);
  • the highest rate of failing to ratify international agreements;
  • the lowest spending on international development and humanitarian assistance as a percentage of GDP;
  • the highest military spending as a portion of GDP;
  • the largest international arms sales;
  • the most negative balance of payments (except New Zealand, Spain, and Portugal);
  • the lowest scores for student performance in math (except for Portugal and Italy) (and far from the top in both science and reading);
  • the highest high school dropout rate (except for Spain);
  • the highest homicide rate;
  • and the largest prison population per capita."
The author concludes that " a 20-country group of America’s peer countries in the OECD, the U.S. is now worst, or almost worst, on nearly 30 leading indicators of social, environmental, and economic well-being."

So what I would like to see is a politician with the courage to say "We can learn some things from our competitors."

Want to run government like a business? Google "learn from your competitors" and you'll find a raft of articles from business journals like one from Business Week saying " The quickest way to learn how to be successful is to check the playbook of your competitors. By taking the time to investigate what has made their businesses work, you’ll be able to learn their best methods and improve upon their model."

That's precisely what our international competitors did to us. We were once number one in education, manufacturing, etc. They studied what we did and improved upon it. Yet we are now too arrogant to admit that we could learn a thing or two from their innovations.

As an example, we mouth platitudes about wanting equality of opportunity for our children. Finland has put that idea into practice in its first-in-the-world education system. Nobody puts their kids into a private school in Finland. Regardless of the wealth of the community, every school has exactly the same resources and draws from the same pool of teachers. If a child does well it's because they had talent and worked hard, not because they got to start the inning by standing on third base.

That's very different from America. Nicholas Kristoff points this out in his NY Times column this morning:

"Point to a group of toddlers in an upper-middle-class neighborhood in America, and it’s a good bet that they will go to college, buy nice houses and enjoy white-collar careers."

"Point to a group of toddlers in a low-income neighborhood, and — especially if they’re boys — they’re much more likely to end up dropping out of school, struggling in dead-end jobs and having trouble with the law."

"Something is profoundly wrong when we can point to 2-year-olds in this country and make a plausible bet about their long-term outcomes — not based on their brains and capabilities, but on their ZIP codes. "

So how about we give the foam fingers a rest, admit that we have some problems and adopt Inc. Magazine's suggestion:" Spend some time studying the guy who wants to eat your lunch. You might learn something."

Saturday, January 19, 2013

Business Roundtable solves Social Security.

The Business Roundtable is made up of the CEO's of 200 major corporations. They met in Washington this week, and you'll be happy to know that they solved the Social Security problem.

What is that problem? Is it caused by the "babyboom" retirement bulge? No, that problem was solved in the 1980's when a government commission recommended planning for that increased load on the system by increasing FICA payroll taxes beyond the level actually needed in order to produce a surplus in the Social Security trust fund. That surplus would be used to cushion the effect of babyboom retirements.

Yes, Virginia, there was a time in our recent history when our government was capable of recognizing a problem and coming up with a bipartisan solution.

The current problem is that the Social Security trust fund will only be able to pay full benefits for the next two to three decades. If no adjustments are made it will only be able to pay 75% of expected benefits thereafter.

Many people feel that a reasonable solution is to change the maximum wage subject to FICA payroll tax. Right now, the first $110,000 in earnings is subject to the tax. Raising it to the first $220,000 in wages totally solves the problem.

The Business Roundtable disagrees. The members--whose average compensation is $11.3 million per year--claim that this will put a terrible drag on the economy.

Up pops the old "job creator" argument. If they have to pay anything more in taxes, they just won't create jobs. Sorry, that just doesn't wash.

What causes businesses to create jobs is demand. When customers with money in their hands come through the door but leave because the product is unavailable or they have to wait too long for a too small workforce to wait on them, businesses create jobs.

Getting more and more money to CEO's doesn't create jobs, it just increases the size of their yachts.

OK, what solution did the Business Roundtable come up with? Everyone should just work until they're 70 before collecting Social Security. They also thought that this was a great idea for Medicare as well.

After all, they reasoned, people are living longer. That's true, but how much longer depends on where you are on the economic scale. Since the 1970's the life expectancy of someone in the upper 50% of the income continuum has increased by more than 6 years. If you're in the bottom 50%, it's up by barely one year.

I suppose I'd be happy to work into my 70's if my job involved sitting behind a big desk, going to meetings and flying in a private jet all over the world to make deals in expensive restaurants all the while making $11.3 million per year.

Now lets talk about the coal miners, construction/factory workers, waiters, retail clerks and even teachers who find themselves on their feet for most of the workday. Oh, by the way, lots of those folks in their 50's are finding themselves laid off and unable to find work.

Note to Business Roundtable: Something else has increased since the 1970's and it's called "executive compensation." If I read the charts correctly, executive compensation--even corrected for inflation--has literally skyrocketed while real wages for the rest of us have stayed flat in real dollars, or even fallen a bit.

Just put one less gold faucet in the eighth bathroom of your McMansion and pay your fair share!

Tuesday, January 15, 2013

Should teachers be armed?

I owned a .22 rifle when I was a teenager. It was a gift from my dad. Living in the city of Rochester, however, did not afford many opportunities for firing that weapon. I never hunted. We had to head out to the country to find empty quarries for target practice.  I lost track of that rifle when I headed out to college.

That rifle was the only gun I ever owned. I'm one of those people who believes the statistics that show a gun in the home is more likely to kill a resident of that home than an intruder. I was at our summer place a few miles away from Old Forge, NY last summer when a vacationing NY City policemen shot and killed his own son whom he mistook for an intruder trying to get into his motel room.

I don't want to own a gun, but I understand the feelings of those who do. The Supreme Court has recently ruled that irrespective of a "well-regulated militia," the second amendment allows for private ownership of guns. They also said that the second amendment allows for reasonable restrictions on that right. As with the right of free speech--you cannot yell "fire" in a crowded theater--second amendment rights are not absolute.

Almost all of us agree that your neighbor should not be able to own a nuclear ICBM or a drone armed with air-to-ground missiles but--absent mental illness or criminal behavior--should be allowed to own a handgun or hunting rifle. The argument is really where on that continuum we want to be.

To be sure, there are some among us who believe that they need the same level of armament as the government in order to resist the tyrannical intrusion of the government into their lives. Usually their definition of tyranny involves a government chosen in a free election with whose policies they do not agree. What they see as tyranny the rest of us call democracy.

The Newtown school shooting has brought about calls to arm teachers. I spent 33 years in school classrooms, so I thought about whether I would have wanted to be armed.

Certainly no one is suggesting that teachers walk around with pistols strapped to their hips. I can imagine a student altercation in which a muscular student easily gets the handgun from the teacher's holster. We'd have a situation in which the students couldn't get a gun into the school themselves, but several teachers could accomplish that for them.

So we would lock up the guns. What was your desk like at school? How long would it have taken for someone with a tool or two to get to a gun locked in that desk? Would a gun locked in the desk of the Sandy Hook principal have saved the day? Not likely. Her first instinct would have been to go see what all the commotion was about and then it would have been too late to find the key and unlock the gun in her desk.

What if the classroom teachers had been armed? Imagine you are in your classroom when you hear shots from another part of the building. Would you rush to unlock your gun safe and run to the rescue? Not likely.

Firefighters are taught not to run into burning buildings. Those who run in very often make bad mistakes. They are taught to walk in, giving themselves time to size up the situation. Having no body armor or police training I would think that a teacher might not rush to the sound of gunfire like the Lone Ranger coming to save the day.

Personally, I don't believe that I would head out into the hallways. My thoughts would be of my spouse and children. By running down the hallway with only a handgun I am putting my family in danger. They are my primary responsibility. I am not a trained and equipped police officer. I'm staying put in my classroom. I will do my best to protect my life and the lives of the students in my classroom, but I'm not going out looking for a gunfight in which I will most likely be outgunned.

So I'm staying put with my gun aimed squarely at the classroom door.

Which causes another problem. When they arrive, how do the police get people out of the building? Does someone get on the PA and announce that everything's OK. How do those of us hunkered down in our classrooms know that this isn't just a ruse being used to get more shooters into classrooms without opposition? How do we know that they weren't wearing police uniforms to begin with?

Suppose some teachers have engaged the intruders in a gunfight? When the police arrive, how do they tell the "bad" shooters from the "good" shooters? In several of the latest incidents, shooters have dressed in the same black military-style clothing and ski masks that are often worn by police SWAT teams. How will the teachers know that the SWAT team trying to rescue them are not additional killers?

Are we overreacting to Newtown? Shootings occur at movie theaters and malls. Should we arm the clerks, ushers, popcorn vendors and projectionists?

If we do arm all these people, are we causing more problems than we're solving?

Wednesday, January 9, 2013

Quick Quiz: Do you really understand the debt ceiling?

OK, here's the question: If Congress refuses to raise the debt ceiling, will this keep the U.S. from spending more money?

If you said "no," then pat yourself on the back. There's a good chance you just might understand something that most Americans don't.

Regardless of whether you think the USA should spend less, the debt ceiling vote isn't about spending money. Congress has already authorized the spending in bills passed months ago. The debt ceiling vote is about paying those bills.

Why should retired teachers care about this vote? To begin, Republicans will threaten to withhold support for raising the debt ceiling unless there are big cuts in: Social Security, Medicare and Medicaid. Got your attention now?

I know, Social Security has not one damn thing to do with the deficit. It's fully funded by its own FICA payroll tax and--in fact--it runs a surplus. I'm sure that there are a whole lot of Republican Social Security recipients who won't like seeing their cost-of-living increases reduced. Go figure!

Of course, very little makes sense when it comes to Congress, an organization which actually has a lower public opinion rating than cockroaches.

Another reason retired teachers should care about the debt ceiling vote is what refusing to raise the ceiling will do to our economy. Ezra Klein of the Washington Post is my favorite "policy wonk." Here's part of his description of what happens if we default on our debts: "Imagine we hit the debt ceiling Feb. 15. ... federal spending over the next month will be about $450 billion. Federal revenues will be nearer to $277 billion. That means that the government will have to default on about 40 percent of its obligations."

"The choices it will face quickly become stark. It can cover interest on the debt, Social Security, Medicare, Medicaid, defense spending, education, food stamps and other low-income transfers, and a handful of other programs, but doing all that will mean defaulting on everything — really, everything — else. The FBI will shut down. The people responsible for tracking down loose nukes will lose their jobs. The prisons won’t operate. The biomedical researchers won’t be funded. The court system will close its doors. The tax refunds won’t go out. The Federal Aviation Administration will go offline. The parks will close. Food safety inspections will cease."

"Then, of course, there’s the financial-market chaos. Trillions of dollars in derivatives and other financial products are based on the interest rate that the federal government pays when borrowing. U.S. government debt is, after all, supposed to be the safest investment in the world, and so it’s used to “benchmark” all other sorts of debt. A spike in the Treasury rate would mean a spike in credit card rates and mortgage rates, not to mention all manner of more esoteric financial derivatives. The damage to the economy would be tremendous, and it would occur at every level, from individuals looking for a loan to buy a house to hedge funders trying to play the markets."

And the crazy thing is that this is all self-inflicted. Walter Dellinger, Bill Clinton's solicitor general nails the absurdity of it all in an email to Greg Sargent of the Washington Post: "I understand why the debt ceiling is a problem. What I don’t understand it why it’s Obama’s problem. The debts that will come due are the debts of the United States, not the debts of the Obama family and not even the debts of the executive branch…"

"If the U.S. defaults on loan obligations because of failure to increase the debt ceiling, every single American would be made somewhat poorer by the dead weight loss to the American economy that this would cause. I don’t see why either political party or either branch of government should gain any leverage by threatening economic harm to the United States of America whose financial management is the mutual responsibility of each of them."

"The whole thing reminds me of the great moment in “Blazing Saddles” when Sheriff Bart takes himself hostage by pointing a gun at his own head. The simple townsfolk of Rock Ridge were dumb enough to fall for it. Are we?"

Sargent concludes: "Yes, apparently we are. You can read through reams of reporting about the debt ceiling and not find anything that explains the most basic facts about the situation. It is widely being reported on as a conventional Washington standoff, in which Dems want a debt ceiling hike, Republicans want spending cuts, and we’re now going to see a game of chicken in which the two will meet somewhere in the middle. This bears no relationship to the reality of the situation, in which Republicans are pretending that in refusing to hike the debt ceiling, they are withholding a concession for which they should ultimately be rewarded. In reality they are demanding that Dems give them something in exchange for agreeing not to do immense damage to the whole country. As Dellinger’s email neatly demonstrates, the situation is profoundly absurd and unbalanced — yet this is completely lost in the business-as-usual coverage."

Stay tuned, you have a real stake in the outcome of this absurd drama.