The Rise of the Nation State--Again

by Charlotte Hays
September 2, 2010, 6:47am

The oh-so-modern notion that we can transcend our national loyalties, perhaps best embodied in the European Union, is coming up against a harsh reality: some of us really love our own countries.

While there are some inherent problems in this (think competition between nation states that can lead to armed conflict), it does seem to be happening, as the historian Victor Davis Hanson notes:

The post-Cold War New World Order is rapidly breaking apart. Nations are returning to the ancient passions, rivalries, and differences of past centuries. 

Take Europe. The decades-old vision of a united pan-continental Europe without borders is dissolving. The cradle-to-grave welfare dream proved too expensive for Europe's shrinking and aging population.

It seems to me that the best thing to do is recognize this factor and act accordingly. Looking at the Middle East, for example, through this prism, we will see something different from what we're used to seeing:

The tired Israeli-Palestinian fight over the future of the West Bank is no longer the nexus of Middle East tensions. The Muslim Arab world is now more terrified by the re-emergence of a bloc of old familiar non-Arabic, Islamic fundamentalist rivals.

With nuclear weapons, theocratic Iran wants to offer strategic protection to radical allies such as Syria, Hezbollah, and Hamas, and at the same time restore Persian glory. While diverse, this rogue bunch shares contempt for the squabbling Sunni Arab world of rich but defenseless Gulf petro-sheikdoms and geriatric state authoritarians.

Turkey is flipping back to its pre-20th-century past. Its departure from NATO is not a question of if, but when. The European Union used to not want Turkey; now Turkey does not want the shaky EU.

VDH, as we ardent fans call him, provides a tour of the world (I think it's time for another "reset" with regard to Russia), as seen in the light of the re-rise-of-nationalism. What does it mean for the United States? Well, there's bad news and good news:

As European socialism implodes, for some reason a new statist U.S. government wants to copy failure by taking over ever more of the economy and borrowing trillions more to provide additional entitlements. 

As panicky old allies look for American protection, we talk of slashing our defense budget. In apologetic fashion, we spend more time appeasing confident enemies than buttressing worried friends.

Instead of finishing our border fence and closing the southern border, we are suing a state that is trying to enforce immigration laws that the federal government will not apply. And as sectarianism spreads abroad, we at home still pursue the failed salad bowl and caricature the once-successful American melting pot.

But just as old problems return, so do equally old solutions. Once-stodgy ideas like a free-market economy, strong defense, secure borders, and national unity are suddenly appearing fresh and wise.

Grading Teachers in L.A.

by Charlotte Hays
September 2, 2010, 6:09am

The Los Angeles Times has stirred up a hornet's nest by going undercover and grading the teachers in L.A.'s abysmal public school system.  The union and school district are predictably outraged (union leaders are calling for a boycott of the newspaper), but I'm giving the LAT an A.

Slate's acerbic media reporter Jack Shafer also finds that the LAT has done its readers a great service:

The Times findings, which took bravery to express in liberal, union-enslaved Los Angeles, are hardly incendiary. The paper found that effective teachers "often go unrecognized"; that the school district does not act on the information it's gathered to fire ineffective teachers because it basically fears the union; that the best teachers are scattered throughout the system, not concentrated in the rich neighborhoods or the "best schools"; that parents are denied "access to objective information about individual instructors, and they often have little say in which teacher their child gets"; that seniority determines pay and job protection; and so on.

The expose bolsters one of my favorite points about public education: It's not the money, honey.

It almost seems that the more a district throws at education, the worse the schools are. This is certainly the case in Los Angeles. As a fine piece in today's Wall Street Journal notes:

Since 1990, K-12 education spending has grown by 191% and now consumes more than 40% of the state budget. The Cato Institute reports that L.A. spends almost $30,000 per pupil, including capital costs for school buildings, yet the high school graduation rate is 40.6%, the second worst among large school districts in the U.S.

After decades of measuring education results only by money spent, with little to show for it, parents are finally looking for an objective measure to judge teacher effectiveness. Taxpayers also deserve to know whether the money they're paying teachers is having any impact on learning or merely financing fat pay and pensions in return for mediocrity. The database generated 230,000 page views within hours of being published on the paper's website, so the public would appear to want this information.

It is difficult to evaluate teachers. That's a given. But, as somebody who is grateful to have grown up in the era of starchy old-maid teachers who took sadistic delight in forcing us to diagram sentences, I'm appalled that we now have teachers who themselves can't conjugate a verb. Something must change. The WSJ points out:

Currently, less than 2% of teachers are denied tenure in L.A., and teacher evaluations don't take into account whether students are learning. [American Federation of Teachers President Randi Weingarten] Weingarten prefers to continue a system of meaningless teacher assessments that almost never result in an instructor being fired for performance. So she wants to shoot the messenger for telling readers things they clearly want to know.

 Focusing on the quality of teaching, not just the $$$, is a first step towards ensuring that kids whose families can't send them to private schools (but on whom the public system spends more than it would cost to go to a good private school) will have a chance at acquiring the skills that make for a good life.

Women Are Earning Bigger Bucks

by Sarah Walters
September 1, 2010, 2:55pm

As I've written previously on Inkwell, the wage gap between working men and women in America is not quite the socioeconomic knot that some would have you think.  The wage gap refers to the difference between what men and women, on average, earn, and typically women have earned about three quarters of what men earn.  Some have blamed the gap on discrimination but research has shown that most of the gap can be explained by the different career choices, levels of education, years of experience, and other factors that reflect individual preferences and choices.  The wage gap is trending out of the workforce as workers age.  In fact, young women will never experience the career-long wage gap that their mothers or grandmothers have dealt with, but their boyfriends just might.  There's actually a reverse gender gap trend going on in America's cities for young working women aged 30 and under.  Here's what TIME said about it:

 "But now there's evidence that the ship may finally be turning around: according to a new analysis of 2,000 communities by a market research company, in 147 out of 150 of the biggest cities in the U.S., the median full-time salaries of young women are 8% higher than those of the guys in their peer group.  In two cities, Atlanta and Memphis, those women are making about 20% more. This squares with earlier research from Queens College, New York, that had suggested that this was happening in major metropolises. But the new study suggests that the gap is bigger than previously thought, with young women in New York City, Los Angeles and San Diego making 17%, 12% and 15% more than their male peers, respectively. And it also holds true even in reasonably small areas like the Raleigh-Durham region and Charlotte in North Carolina (both 14% more), and Jacksonville, Fla. (6%)."

The trend is likely to continue.  Working women 22-30 in metropolitan areas are more likely to have attended college and earned a degree than their male counterparts.  Additionally, women are less likely to be in one of the many blue collar industries that experienced massive amounts of job losses.  If education and job trends don't turn around soon, guys will be at a critical loss.  We need to encourage education reform to get guys to college, and job training to transition workers into new opportunities in our 21^st century economy.

Global Leader for Hire

by Charlotte Hays
September 1, 2010, 2:22pm

 If I get around to reading former PM Tony Blair's new book, I'm likely to want to like it just because Blair was a loyal ally when the U.S. needed him.

Still, a piece in the (U.K.) Spectator on what the book reveals is irresistible. It argues that Blair's book is really about the emergence of a new global elite, unshackled by mere voters:

Blair's book tells about how the world is changing, and governments are losing control of it. He paints a picture of a new global elite, and it's easy to see that he regards himself as a potential master of this new universe. No one elected Bono, but - Blair gushes - "he could have been a Prime Minister or President standing on his head". Bill Clinton has this status, of Global Leader For Hire, and even found himself resolving real disputes - taking hostages back from North Korea last year. Blair is transcending both party (there's nothing left-wing about his memoir) and even country (he's being less and less British every time he makes a guest appearance here). Like Clinton, he has discovered that a smile and a contacts book can be worth a lot of money.  

Blair Inc isn't about making a rich man even richer. It's about pioneering a new form of statesmanship - for leaders who are no longer shackled to their electorates. Blair is going global. "I now travel to China frequently" he says - and you can bet it's not for the lemon chicken. Not for nothing does the Blair Faith Foundation have offices in East and West. This book is about promoting a global brand: that of Blair himself. So we should not waste too much time scouring it for his thoughts about the country he has left behind.

It is interesting that some powerful people don't opt to become part of this globalized elite.  Condoleeza Rice is one of those who didn't have her head turned by power:  

"[Rice]is a classic example of the absurdity of people with experience and capacity at the highest level not having big political jobs after retirement from office," he writes. "But that's another story!" Indeed it is.

Would rooted in her own country be another way of describing Rice?

I'm Sorry. What?

by Hadley Heath
September 1, 2010, 2:19pm

Please tell me I'm not the only person who read this and thought, "I'm sorry. What?"  There is something really fishy about this logic.  Ruth Marcus writes for the Wilmington News Journal:

Economist Keith Hennessey, an adviser to President George W. Bush, looked at the issue from a different perspective. He assumed that the longer period for collecting benefits would result in increased unemployment - contributing somewhere between 0.5 and 1 percentage points to the unemployment rate - and considered whether the trade-off was worthwhile.

At the lower effect, with unemployment at 9.5 percent, he calculated that "eight people who would like a job but cannot find one are getting more generous (unemployment) benefits for each person who is getting those same benefits and choosing not to take a new job."

At an 8-to-1 ratio, extending unemployment is good policy, Hennessey said. And what if the more generous benefits contribute a full percentage point to the unemployment rate? Then the ratio of out-of-luck worker to loafer drops to 3.5-to-1. "That is a tougher call, but I would still say yes," Hennessey concluded.

Okay, so either one out of every nine unemployed people will remain unemployed because of the disincentive to work in the extension of jobless benefits. Or two out of every nine unemployed people will remain unemployed for this reason.

It seems that Marcus (and Hennessey) are ignoring how high unemployment affects the economy - not just the individuals who are unemployed.  Consider those numbers again: if one or maybe even two out of every nine jobless people are voluntarily unemployed - they aren't trying that hard to get work because they can rely on the unemployment benefits - that adds up to millions of people.  There are currently about 14.6 million unemployed people in the United States.  So, are you telling me that a policy that essentially encourages approximately 1.62 to 3.24 million people to remain jobless is good for the United States?  That's billions in lost productivity and a smaller economic pie, in addition to the money spent paying unnecessary benefits.

 
Putting that part of the work force back into jobs is tantamount to taking our current unemployment rate of 9.5% and lowering it to 8.4% or 7.4%.  That's pretty significant.

Of course we don't want people who are looking for work in earnest, and simply can't find a job, to suffer, but we need to also understand the full consequences of policies that discourage work.  It's more than a budget problem.  It's a big economic problem.

Bernie Sanders is in Denial

by Carrie L. Lukas
September 1, 2010, 10:21am

Yesterday, I posted a link to a sober analysis about the potential of various Social Security reforms.  Today, I'm linking to an article that is the exact opposite of sober analysis.  It's misleading, demagoguery that frankly should be embarrassing to the author-a United States Senator.  In Politico, Vermont's Bernie Sanders writes:

The White House deficit commission is reportedly considering deep benefit cuts for Social Security, including a steep rise in the retirement age. We cannot let that happen.

First, let's be clear: Despite all the right-wing rhetoric, Social Security is not going bankrupt. That's a lie!

The truth is that the Social Security Trust Fund has run surpluses for the last quarter century. Today's $2.5 trillion cushion is projected to grow to $4 trillion in 2023. The nonpartisan Congressional Budget Office, experts in this area, say Social Security will be able to pay every nickel owed to every eligible beneficiary until 2039.

Got that? In case you don't, let me repeat it. The people who have studied this issue most thoroughly and have no political bias report that Social Security will be able to pay out all benefits to every eligible beneficiary for the next 29 years.

Yes, Mr. Sanders, it is true that there is something called a Social Security Trust Fund that will technically allow Social Security to continue paying all promised benefits for decades, but the Trust Fund does nothing-absolutely nothing-to change the pressure Social Security will place on the budget and ultimately on taxpayers.  I wrote an op-ed explaining the uselessness of the trust fund:

For decades, Social Security payroll tax revenues exceeded required benefit payments. The Social Security Administration (SSA) took this extra revenue and loaned it back to the general treasury, receiving in return government bonds that accrued interest. ....

The real limitations of the Trust Fund became clear this year when Social Security's balance sheet turned negative. Instead of running a surplus, Social Security actuaries predict that payroll tax revenue won't be enough to cover benefits in 2010. Social Security will have to use its famed Trust Fund assets to cover the shortfall. Taxpayers are now learning once and for all that those assets are of no comfort: Congress will have a new line item in its budget, and will have to either issue new debt, raise taxes, or cut other spending to pay SSA back. That's exactly what would have happened absent the Trust Fund, unless politicians wanted to do the unthinkable and cut current Social Security benefits.

It's completely misleading to suggest to taxpayers that they don't need to worry about Social Security's finances because the Trust Fund exists.  Real choices are going to have to be made: either taxpayers are going to have to cough up a lot more to prop up the current system, the government is going to have to issue trillions in additional debt, or Social Security will have to be changed to reduce the cost of future benefits.  It shouldn't be unthinkable to consider changing the growth of future benefits so that someone like me-in their mid-thirties with plenty of time to plan for retirement-gets less than under current law.  It's pretending that real choices don't have to be made which is the real lie. 

Docs: Vote to Repeal

by Charlotte Hays
September 1, 2010, 9:25am

"Facing a nationwide backlash, Democratic congressional candidates have a new message for voters: We know you don't like ObamaCare, so we'll fix it," writes Dr. Hal Dr. Scherz in today's Wall Street Journal.

Scherz is a pediatric urological surgeon at Georgia Urology and Children's Healthcare of Atlanta and he serves on the faculty of Emory University Medical School. Dr. Scherz is also president and cofounder of Docs4PatientCare.

Fix the system that was forced through Congress without public approval?

This is a ploy to save the administration's health care legislation from repeal. Dr. Scherz is worried that it could work:

"As a doctor I know something about unexpected recoveries, and this latest attempt to rescue ObamaCare from repeal needs to be taken seriously.

For Democrats who voted for ObamaCare, this tactic is an escape route, a chance to distance themselves from the president with a vague promise to fix health-care reform in the next Congress....

Because the issue this election is so stark-literally life and death for millions of Americans in the years ahead-we are this week posting a "Dear Patient" letter in our waiting rooms.

You should read the whole column, which includes chunks of the impressive letter the docs are sending to patients.

Social Security Realities

by Carrie L. Lukas
August 31, 2010, 9:38pm

One of the biggest challenges our country will face in the coming years (in addition to undoing the damage caused by the new health care law) will be fixing Social Security. Social Security expert Andrew Biggs provides a sobering look at the options that will be available to policymakers in this piece on National Review. While Biggs supports incorporating personal retirement accounts into Social Security, he warns that retirement accounts alone won't fix the system's problems.

He writes:

Here's the problem: Personal accounts are a valid choice, and one I've supported in the past and continue to support. But accounts aren't exclusive to tax increases or benefit cuts; they don't, as I'll explain, reduce the need for these other choices. One problem for the Bush administration's reform drive in 2005 was that many congressional Republicans had bought into the idea that accounts reduce or eliminate the need for tax increases or benefit cuts. Finding out they don't may have taken some wind out of their sails. Because of this, combined with some pretty shameless demagoguery from the left, Bush's reform ideas didn't even come up for a vote....

Also unchanged would be the program's financing shortfall, even assuming that account holders gave up a share of their traditional benefits. A pay-as-you-go program like Social Security is always in the hole, such that each generation honors the benefits of the preceding one while hoping their own claims will be honored by the following generation. No generation can break away from this cycle without either ponying up extra cash (tax increases) or defaulting on its promises (benefit cuts). Neither solution is costless.

It's important that Americans understand this reality-there is no magic way to spare ourselves from the pain of bringing Social Security's finances into balance. Incorporating personal retirement accounts into the system will be important so that we can leave the next generation with a better, more financially sound system, but they aren't a panacea for our current predicament.

Title IX and Tennis

by Allison Kasic
August 31, 2010, 1:19pm

Our friends over at the College Sports Council released a new study today looking at collegiate tennis in the proportionality era (for background on Title IX and its main enforcement mechanism, proportionality, see this primer).  Men's tennis is down (sadly not a surprise) while women's tennis has largely remained stagnant (so much for Title IX benefiting all women):

As the attention of sports fans turns to the U.S. Open, a new report reveals tennis opportunities shrinking at the highest levels of the college game, NCAA Division I.

Contrary to popular perception, Title IX's gender quota has failed to boost womens tennis while it has stripped away men's tennis teams, according to analysis of NCAA data by theCollege Sports Council (CSC).

"This new analysis reveals that women's college tennis is similar to women's gymnastics in that it hasn't benefited from the proportionality compliance test for Title IX," said Eric Pearson, Chairman of the CSC. "Gender quota advocates always profess that Title IX has unquestionably benefitted all womens sports, but when you break it down sport by sport frequently the data tells a different story," Pearson said.

In 1996, the US Department of Education issued a clarification of Title IX's regulations that declared the proportionality prong of the three-part test to be a 'safe harbor.' The CSC's analysis tracks the percentage of tennis teams sponsored by NCAA Division I schools since 1996.Women tennis players have more teams (311) to compete for than male tennis players (258) in NCAA Division I, but the percentage of NCAA schools sponsoring women's teams has not increased since the 1996 policy clarification (96.4% in 1996 vs. 93.4% in 2009) and the percentage of NCAA Division I schools sponsoring mens tennis teams has declined by more than 14 percent (91.8% in 1996 vs. 77.5% in 2009).

More info here.

Fewer Women In Congress Isn't A Setback For Women's Equality

by Sarah Walters
August 31, 2010, 12:30pm

I've seen a couple of doom and gloom headlines recently concerning the number of women that may be voted out of Congress this year.  Yes, many have been trumpeting the "Year of the Republican Woman," but if the polls are right, this isn't shaping up to be quite the "Year of the Woman Politician."  In fact, it's likely that we'll experience a net loss of women in Congress this year-- down to 80 members from the current 90 - after all is said and done in the mid-term elections.  This is the first time since the 1970's that we've been faced with a decline in congressional membership of women, but is this something to really fear?  

Some left-wing groups want you to think that.  The National Organization for Women (NOW) leadership is in disbelief, claiming that the prospect of fewer women serving in Congress next year is a setback for women's equality.  (Truly, it's more of a setback for their radical liberal agenda since the most likely female candidates to lose their seats are liberals.)  Of the current 90 women members, 69 are Democrats and 21 are Republicans.  It's no secret that there's a backlash against the party in power, the Democrats, and even some moderate "establishment" Republicans are being ousted in the primaries.  Female politicians are not immune from disgruntled constituents, and they shouldn't be if their legislative record does not satisfy voters.      

As The Daily Beast notes, "Women have historically done better in years dominated by Democrats, but the GOP is insisting that its likely success in November will not hurt the cause."  I agree.  Americans will not necessarily lose out because ten Democrat women are replaced by male Republican men in the House of Representatives.  (Republican women candidates are set to oust some Democrat men in November!)  Members of Congress, both men and women, must effectively promote the interests of their female constituents.  A true setback for equality would be continuing the bad policy adopted by current members of Congress that is damaging prospects for future prosperity in America. 

Women should be serving in Congress in great numbers, but their candidacy should be part of the solution to the many challenges facing our country.  To do that, we need to recruit excellent candidates, committed to the cause of promoting liberty and opportunity in America instead of keeping out of touch politicians-regardless of their gender-- in place.

Arizona and the U.N.

by Charlotte Hays
August 31, 2010, 7:14am

What on earth is the meaning of dragging the Arizona immigration law into the United Nations and encouraging such paragons of freedom as Libya to set in judgment on the United States?

As described in Politico:

In a required report to the United Nations Human Rights Council, the State Department said the federal government's challenge to the Arizona law that requires police to check the immigration status of anyone they stop or detain was an example of how the United States is protecting human rights.

"A recent Arizona law, S.B. 1070, has generated significant attention and debate at home and around the world," the report read. "The issue is being addressed in a court action that argues that the federal government has the authority to set and enforce immigration law. That action is ongoing; parts of the law are currently enjoined."

A federal judge blocked much of the law from being implemented after a legal challenge from the Justice Department. Brewer has appealed the decision.

The government's challenge to the Arizona law was listed in the 30-page report as one of about a 100 steps it has taken to uphold human and civil rights in the U.S.

I am speechless.

Arizona Gov. Jan Brewer is not:

"The idea of our own American government submitting the duly enacted laws of a state of the United States to ‘review' by the United Nations is internationalism run amok and unconstitutional," Brewer wrote. "Human rights as guaranteed by the United States and Arizona Constitutions are expressly protected in S.B. 1070 and defended vigorously by my administration.

If you like the idea of Libya reviewing our laws, you're gonna love this.

If I Had a Hammer...

by Charlotte Hays
August 31, 2010, 6:33am

A surefire applause line in any presidential speech is to promise more grants to send more people to college. But is college all it's cracked up to be?

Camille Paglia, a college professor with a way of stirring things up, thinks that a liberal education ain't what it used to be. Paglia says that the "humanities have been gutted by four decades of pretentious postmodernist theory and insular identity politics."

She sees college as job preparation (something we liberal arts devotees have always eschewed in favor of joining the "fellowship of educated men and women" first and assuming that this will give you the skills to work)and that alone:

Jobs, and the preparation of students for them, should be front and center in the thinking of educators. The idea that college is a contemplative realm of humanistic inquiry, removed from vulgar material needs, is nonsense. The humanities have been gutted by four decades of pretentious postmodernist theory and insular identity politics. They bear little relationship to the liberal arts of broad perspective and profound erudition that I was lucky enough to experience in college in the 1960s.

Having taught in art schools for most of my four decades in the classroom, I am used to having students who work with their hands-ceramicists, weavers, woodworkers, metal smiths, jazz drummers. There is a calm, centered, Zen-like engagement with the physical world in their lives. In contrast, I see glib, cynical, neurotic elite-school graduates roiling everywhere in journalism and the media. They have been ill-served by their trendy, word-centered educations.

Most interestingly, Paglia calls for more emphasis on the kinds of jobs middle-class kids have been taught to spurn:

Jobs, jobs, jobs: We need a sweeping revalorization of the trades. The pressuring of middle-class young people into officebound, paper-pushing jobs is cruelly shortsighted. Concrete manual skills, once gained through the master-apprentice alliance in guilds, build a secure identity. Our present educational system defers credentialing and maturity for too long. When middle-class graduates in their mid-20s are just stepping on the bottom rung of the professional career ladder, many of their working-class peers are already self-supporting and married with young children.

Along these lines, I highly recommend Matthew Crawford's excellent book, Shop Class as Soulcraft.

Do we need a second stimulus?

by Hadley Heath
August 30, 2010, 12:46pm

No - please - anything but that!

In policy debates, it's commonplace to see two different interpretations of historical events as part of opposing arguments about what to do next.  The $787 billion stimulus package of 2009 is hardly old enough to be called a "historical event," but already reports vary about its effects.

This weekend the New York Times ran an op-ed by Laura Tyson - a member of Obama's Economic Recovery Advisory Board - about how great the first stimulus was and how a second stimulus is the answer to our stagnated growth and unemployment problems.  She writes:

There is too much worry about the size of government, and too little appreciation for how stimulus spending has helped stabilize the economy and how more of the right kind of government spending could boost job creation and economic growth.

I must say, I really disagree.  Too much worry about the size of government?  Try telling that to our Founding Fathers.

While Tyson makes the case (like President Obama did on "The View") that the stimulus "saved" thousands of jobs and kept a much-worse alternative from coming true, I wonder how many more jobs were never created because of the widespread uncertainty that businesspeople have faced under this administration.  Tyson argues for government-created jobs.  But the nature of these jobs, in the works-progress-administration-type system she suggests, is temporary, unsustainable, and a bad use of tax dollars.

Tyson writes, "Two forms of spending with the biggest and quickest bang for the buck are unemployment benefits and aid to state governments. The federal government should pledge generous financing increases for both programs through 2011."  Yet it seems the real solution to unemployment is employment, not asking the unemployed to continue to put government benefits back into the economy through spending on necessities just to make ends meet.  That's unfair to the unemployed, who lose important skills while they are unemployed, and ignores the reality that providing transfer payments to the unemployed means government has to take money out of the private sector - from taxpayers and would-be entrepreneurs.  How does that help job creation?

It is true that state governments are facing budget problems.  But have Tyson and Obama considered the impact that the Patient Protection and Affordable Care Act will have on states?  Funding this federal program will cost states big bucks.  Maybe the best "aid to state governments" would be a repeal of this legislation!

The argument for a second stimulus is based on the idea that the first stimulus was successful.  We should be careful before trusting politicians and their mouthpieces who promise rosy outcomes.  After all, during this "summer of recovery," we've heard a lot of "disappointing," or "unexpected" realities that differ from the predicted outcomes.  The real stimulus the economy needs will come from individuals who are free to invest and spend without the government's interference.

You Can't Help But Run Into Our Too Big Government

by Carrie L. Lukas
August 30, 2010, 9:27am

Tea Partiers are hit with a lot of criticism that's unjust, but this latest one from Howard Fineman strikes me as particularly wrong-headed. He writes:   

They are shouting "NO!" as loudly as they can [to the Obama agenda], even as they rely on their Social Security and their Medicare, on their Interstates and tax cuts and credits, on student loans and weather satellites and air-traffic-control-systems and research earmarks.

The implication is that Tea Party participants are somehow hypocrites because they uses services of the state while arguing for more limited government-it's a charge that most libertarians and conservatives have heard before. But it makes little sense, because people have essentially no choice but to rely on the state for these services, because government has crowded out the private sector.

There is no meaningful private market for health insurance for seniors, which means that only the ultra-wealthy can afford to opt out of government's near monopoly on senior health services.  Even with Social Security, Americans have been forced to fork over 12.4 percent of their earnings to Uncle Sam to "save" for their retirement. After paying, on average, another quarter of earnings in other taxes, many Americans have little left to put away for retirement on their own. They are left to depend on Social Security for much of their retirement income in part because government created a system that forced them to do so. And now, the federal government has essentially wiped out the private student loan industry-can you really fault students for using the only option that's left available to them?

Economist Henry Hazlitt's highlighted a key principle in economics: you can't just look at how resources are used, but you have to consider how else resources might have been used. A brick thrown through a window may be good news for the window maker, but it's bad news for the other business owners who were hoping the home owner would spend that money in their stores.

This is also an important principle when it comes to government. Yes, we all may have to depend on the federal government for weather satellites, but what might have happened if government hadn't been supplying that service? Another service-and we are talking about government programs, probably a more efficient, effective, service-would likely have developed.

Government has been increasingly taking over all aspects of American life. Therefore, you really can't fault people for accidentally using government services, even as they argue for their elimination.

Compassion and Common Sense

by Charlotte Hays
August 30, 2010, 8:05am

I've already written about my own personal adventure with unemployment benefits.

The Wall Street Journal has a piece today that provides the policy ballast to what I wrote about my own experience. I observed that benefits soften the blow of being laid off, but that, when the benefits are coming in, you search for the ideal job rather than a mere job. The WSJ makes this point:

The unemployment-insurance program involves a balance between compassion-providing for persons temporarily without work-and efficiency. The loss in efficiency results partly because the program subsidizes unemployment, causing insufficient job-search, job-acceptance and levels of employment. A further inefficiency concerns the distortions from the increases in taxes required to pay for the program.

Author Robert Barro, a Harvard economics professor and Hoover Institute fellow (now there's a combination), argues that during a recession, when poor employment numbers reflect weak economic conditions rather than a decision in favor of leisure, it's okay to extend benefits somewhat. But not as long as the administration wants to!

Barro  writes:

[W]e have never experienced anything close to the blanket extension of eligibility to nearly two years. We have shifted toward a welfare program that resembles those in many Western European countries.

The administration has argued that the more generous unemployment-insurance program could not have had much impact on the unemployment rate because the recession is so severe that jobs are unavailable for many people. This perspective is odd on its face because, even at the worst of the downturn, the U.S. labor market featured a tremendous amount of turnover in the form of large numbers of persons hired and separated every month.

For example, the Bureau of Labor Statistics reports that, near the worst of the recession in March 2009, 3.9 million people were hired and 4.7 million were separated from jobs. This net loss of 800,000 jobs in one month indicates a very weak economy-but nevertheless one in which 3.9 million people were hired. A program that reduced incentives for people to search for and accept jobs could surely matter a lot here.

Moreover, although the peak unemployment rate (thus far) of 10.1% in October 2009 is very disturbing, the rate was even higher in the 1982 recession (10.8% in November-December 1982). Thus, there is no reason to think that the United States is in a new world in which incentives provided by more generous unemployment-insurance programs do not matter much for unemployment.

Another reason to be skeptical about the administration's stance is that generous unemployment-insurance programs have been found to raise unemployment in many Western European countries in which unemployment rates have been far higher than the current U.S. rate. In Europe, the influence has worked particularly through increases in long-term unemployment. So the key question is what happened to long-term unemployment in the United States during the current recession?

Glass Ceiling Meet Glass Box

by Charlotte Hays
August 30, 2010, 7:35am

All issues are women's issues. That's a mantra the IWF embraced long ago.

Not so with many so-called women's groups.

Minnesota Rep.  Laura Brod learned just how narrow many of these groups are recently when she considered a run for governor of her state:

What particularly caught my eye was a questionnaire from a "Women's" group. What were the questions? The majority of them were about abortion, gay marriage, and how much we should expand big government spending.

In the midst of the deepest recession in living memory and international uncertainties, those don't strike me - or most people - as the issues keeping women (or men) up at night.

Where were the ideas of economic freedom and economic opportunity? Where were the questions about challenges that women business owners face in small business start-ups which are the mainstay of Main Streets throughout the country? Where were the questions about the national debt and its impact on our children's future? Where were the questions about how we best educate the children of our country so that we have a qualified and well positioned workforce? This list goes on and on.

In her must-read piece, Brod notes that for eons women have talked about the "glass ceiling." But Brod says that she is more concerned about "the glass box that liberal feminists have placed women and ‘women's issues' in, all tied up with a pretty pink bow. That glass box is all about keeping women and ‘women's issues' firmly in their place on the left side of the political spectrum."

Brod is onto something.

With the emergence of women like Nikki Haley, Carly Fiorina, Meg Whitman, and (yes) the Momma Grizzly herself, isn't it time to redefine "women's issues?

More Economics 101

by Hadley Heath
August 27, 2010, 6:15pm

I recently explained how the government can sometimes collect more tax revenues at a lower tax rate.  Although this might at first sound counterintuitive, it makes sense once all the factors are considered. 

Another economics lesson that might merit further explanation is the impact that imports have on GDP.  Today's the Washington Post headlines a story, "Economic Growth Slowed by Trade Gap."

It's true that the most recent reports indicate that, yes, growth is slowing, and yes, the trade gap is widening.  But it's important to realize that not all the goods imported to the United States are consumer goods.  Sure, some Americans might enjoy French perfumes or Belgian chocolates, but more than half of imports to the United States are capital goods for producers - who use those goods, like machinery or raw materials, to create and distribute consumer goods here at home.  This type of import to the U.S. is good, because it should make us more productive.  To see U.S. imports by their end use, check out this table from U.S. Census Bureau. 

So before we get bent out of shape about the trade gap and start blaming it for our slowed growth, we should step back and examine all the variables at work.  The focus of our efforts toward economic growth should be on keeping resources in the private sector, not blaming the trade deficit.

No-Fault Living

by Charlotte Hays
August 27, 2010, 7:42am

Thomas Sowell has a great piece this morning on how government handouts change behavior.

He starts with a few examples of how we behave differently if there are no consequences for our actions. The government has pretty much alleviated the costs of making bad choices in so many realms of life.

It's a must-read column:

Although "moral hazard" is an insurance term, it applies to other government policies besides insurance. International studies show that people in countries with more generous and long-lasting unemployment compensation spend less time looking for jobs. In the United States, where unemployment compensation is less generous than in Western Europe, unemployed Americans spend more hours looking for work than do unemployed Europeans in countries with more generous unemployment compensation.

People change their behavior in other ways when the government pays with the taxpayer money. After welfare became more readily available in the 1960s, unwed motherhood skyrocketed. The country is still paying the price for that - and the money is the least of it. Children raised by single mothers on welfare have far higher rates of crime, welfare, and other social pathology.

San Francisco has been one of the most generous cities in the country when it comes to subsidizing the homeless. Should we be surprised that homelessness is a big problem in San Francisco?

My hope is that things have finally gotten so bad, with a rotten economy, high unemployment, and a housing bust, that we are finally ready to rethink many of the no-fault policies that brought us to this pass.

Economic Crisis as the New Katrina

by Carrie L. Lukas
August 27, 2010, 7:36am

Five years ago, Americans were horrified to witness the destruction of Hurricane Katrina, which ripped through the Gulf Coast and put New Orleans underwater. Afterward, IWF held an event  in which experts considered what had been learned from the disaster, and the problems that the Hurricane exposed.

It's interesting, because I read some of the commentary summing up what the analysts identified--the problem of poverty, and policies and a culture hat had facilitated a destructive dependence on government--I'm struck by how a similar assessment could be made of what's happen since the economic crisis of 2008.

Turns out it isn't just what was referred to as an "underclass" that has grown dependent on government, but bankers, home owners and a business world that assumed that government would be able to save them: either by direct bailouts or by pumping government money into the economy to re-inflate whatever bubble popped. It's increasingly apparently that the manipulating the economy isn't so easy.

From the oil spill to Katrina, Americans have witnessed government's inability to address disasters. From the first stimulus to the latest stimulus, we've also seen that government isn't so good at solving economic problems either, and often creates many new problems in the process. Instead of promoting the idea that government can act as everyone's savior, policymakers should try to refocus government on performing the few tasks that its actually intended for and encourage greater self-reliance among individual Americans, as well as businesses.

"Peace-Loving" North Korea

by Charlotte Hays
August 27, 2010, 7:19am

It's hard not to feel good about the release of Aijalon Mahli Gomes, a U.S. citizen, from a North Korean prison. But I don't feel entirely good about it: It's a victory for a cruel regime that, once again, has used a former American president for a picture op in exchange for a prisoner.

Here is a description of what happened from the Washington Post:

North Korea's state-run news agency described the pardon as "a manifestation of [North Korea's] humanitarianism and peace-loving policy."

According to the news agency, Carter apologized for Gomes's behavior. In January, Gomes illegally entered North Korea from China. He was fined $700,000 and sentenced to eight years of hard labor.

U.S. State Department spokesman Philip Crowley said in a statement that "we welcome the release of Aijalon Mahli Gomes and are relieved that he will soon be safely reunited with his family. We appreciate former President Carter's humanitarian effort and welcome North Korea's decision to grant Mr. Gomes special amnesty."

Crowley added that "President Carter's trip was a private, humanitarian, and unofficial mission solely for the purpose of bringing Mr. Gomes home."

Does anybody believe that even a wild card like Carter would have gone without the administration's sanction? I want the U.S. to fight for its citizens, but with the Carter visit, we just increased the likelihood that we become valuable, pr-rich targets for capture by rogue regimes.

Sometimes really, really bad things happen. Mr. Gomes's misadventure was one of these really, really bad things. I'd hate for a U.S. citizen to spend eight years in a prison in North Korea. But for citizens of North Korea, except for a favored few, daily life is like being in a prison.

Jimmy Carter just bolstered that regime.

Washington's Overspending Is a Joke

by Carrie L. Lukas
August 27, 2010, 5:07am

 Just how absurd is Washington's wasteful spending? So absurd that many Americans can't tell what is a really government-funded project from something that's made up. Watch this video and laugh (or cry).

The EPA's Anti-Poor Agenda

by Sarah Walters
August 26, 2010, 9:19am

The Environmental Protection Agency sometimes gets it really, really wrong.  In the name of protection, the EPA implements policies that actually harm some of society's most vulnerable, the urban poor.  You may have heard disgusting reports about the rise of bed bug infestations in New York, Detroit, Philadelphia, and other places across the country.  (When the reporter starts to mention it, I usually switch the radio station and say a quick prayer that I'm never confronted with the problem!)  These infestations - the biggest since WWII - are completely preventable, but the EPA has banned effective household cleaners that would eradicate the problem.  Then a member of the Clinton Administration, Obama's Climate Czar Carol Browner oversaw the ban of bug-killer Dursban in 2000, touting corrupt science and ignoring experts. 

Writing in The Michigan View, political commentator Henry Payne reveals,

                But despite widespread protest in the scientific community, EPA Chief Carol Browner erased Dursban from the shelves. "EPA has gone to great lengths to present a highly conservative, worst case, hypothetical risk based in large part on dubious extrapolations . . . and exaggerated risk estimates," said Michigan State University toxicologist J. I. Goodman in a typical response.

Even Dr. Alan Hoberman, the principal researcher whose data Browner cited, told the Detroit News he disputed the agency's interpretation of his findings.

Such critics were also ignored by the press -- as was evidence that the nation's urban poor would be most vulnerable to a ban. Children insect-bite allergies and cockroach-induced allergens outnumber pesticide poisoning by 100:1. "Hardest hit will be lower-income families in cities like Detroit, who can ill afford a weekly house call from the Orkin man," warned News writer Diane Katz, now with the Fraser Institute. "Yet that is precisely what the EPA is recommending as a substitute for a couple squirts from a can of bug spray."

It just isn't reasonable to expect that poor families can pay the hundreds of dollars it costs to hire exterminators.  In the name of protection, zealots promote a flawed agenda that actually harms poor Americans.  We need to seriously re-evaluate the role that these supposed protectors play in helping or harming our society.

You May NEED Mom and Dad's Policy

by Charlotte Hays
August 26, 2010, 8:57am

A big selling point of healthcare reform was that you could stay on Mom and Dad's policy until you had become a grandparent-just kidding. The cut off age was 26.

Well, now it looks like that may be more important than you thought. The new healthcare bill may make it impossible for many students to get healthcare insurance!

The Wall Street Journal notes:

Along comes word that the bill "could make it impossible for colleges and universities to continue to offer student health plans." That's how the American Council on Education and a dozen other higher-ed lobbies put it in a recent letter to the Obama Administration, warning that the insurance coverage they offer may get junked by ObamaCare's decrees.

Between 4.5 million to 5.5 million students annually are insured by short-term plans sponsored by their schools, which are tailored to upperclassman who have aged out of their parents' coverage or to international and graduate students. These plans are very low cost because the benefits are designed for generally healthy young people and often organized around campus health services and academic medical centers.

All of which means these plans aren't likely to qualify under ObamaCare's "minimal essential coverage" rules that mandate rich benefit packages, even if colleges have the flexibility to make exceptions for special needs. And given that insurance must now be sold anytime to everyone, colleges may be required to continue to cover students after they've graduated-leaving this type of coverage unaffordable.

It doesn't help that the regulations governing student health plans are as carelessly written as the rest of the bill, and the uncertainty is holding up insurance contracts and plan design for the coming academic year. Not surprisingly, the colleges are asking federal regulators for a blanket ObamaCare waiver. (Can everyone else apply too?)

 What I want to know: Is anybody going to benefit from the new healthcare system?

New Ideas Welcome in New Orleans

by Hadley Heath
August 25, 2010, 3:17pm

New Orleans came in first place in a study by the Thomas B. Fordham Institute of cities that are most open to education reform.  The study measured human capital, financial capital, quality control, political environment, openness to charter schools, and the district environment.

At the Independent Women's Forum, our scholars have long argued that the road to reform should include alternative certification programs for teachers.  Our position is only supported by the findings of this new study.  In the category of human capital:

The top four cities all have significant penetration by "brand-name" alternatively prepared teachers and administrators (limited for our purposes to the largest national alternative certification programs: Teach For America, The New Teacher Project, and New Leaders for New Schools). San Francisco posted the highest marks on both counts, and is the only city in the sample where brand-name alternatively prepared administrators make up more than 10 percent of school leaders.

Furthermore, the overall grades of the thirty cities provide an interesting perspective on the influence teachers' unions have on reform:

Every city that receives a D or an F in this analysis is in a collective-bargaining state. Meanwhile, two-thirds of the top nine scorers (cities receiving a B) are located in right-to-work states.  All of the cities located in right-to-work states included in this study received a B or C, and none received a D or F.

Well, that's ironic!  The authors of the study also point to the failure of teachers' unions to reorganize after Hurricane Katrina as one of the reasons that the human capital element is so strong there.  Here's what they had to say about the winning city:

The charter environment thrives in New Orleans. Louisiana state law places no cap on the number of schools that can operate, and it provides for adequate funding of both charters and authorizers. The Louisiana Charter School Start-Up fund also provides zero-interest loans for charter schools to use for facilities-an element of charter funding that many states ignore. New Orleans leads the country in its percentage of students in charters at 57 percent.

Congratulations to the Big Easy.  This week marks the 5-year anniversary of the devastating Hurricane Katrina.  It should be an inspiration to cities and towns all over the country to see New Orleans rebuild an educational system open to new ideas and headed for success.