February 18th, 2014 § § permalink
The Heritage Action for America organization held its first ever Conservative Policy Summit on Monday, February 10, 2014. The daylong conference brought together nine conservative politicians from all over the country to discuss a new reform agenda that will hopefully be pursued in the coming years.
Heritage Action is a newly formed policy advocacy organization that works with activists across the country in order to support conservative legislation in Congress. Protecting privacy, transforming the welfare state, and higher education were all included at the Summit, as well as the overarching theme that “America will not prosper under managed decline and other European-style policies.” Senators Ted Cruz, Tim Scott, and Matt Salmon all spoke.
Despite the Summit’s noteworthy Republican speakers, the Heritage Action’s influence in Congress has been rapidly diminishing. In fact, the Conservative Policy Summit was partly enacted in response to House Speaker John Boehner’s comment that the organization had “lost all credibility.” It’s hard line mission to defund President Obama’s health care reform law at all costs resulted in the disastrous government shutdown last year, and in response, many conservative congressmen have been walking away from the organization’s wishes.
Heritage Action created their power in Washington by developing “scorecards” that rate lawmakers on how they vote on key legislation. However, as of late, lawmakers say the threat of a low rating is no longer an effective scare tactic.
‘“I don’t look at them,” said Rep. Devin Nunes (R-Calif.), who received a 39 percent rating from Heritage Action. “More and more members need to understand, they represent their constituents, not outside groups.”’
“Their influence has waned since they became such a political arm. When they were a think tank, when it was Heritage Foundation, I think a lot of us read their material, listened to it, went to it for advice,” said Rep. Mike Simpson (R-Idaho). “Since they became so political, a lot of people said: ‘I don’t need that anymore.’”
This movement away from the Heritage Foundation’s political branch represents a newfound commitment to working across party lines in order to pass legislation. Though Republicans have the majority in the House of Representatives, there is still a democratic Senate with whom to negotiate. ‘“The problem is that [the Heritage Action] isn’t ‘educating’ the grass roots, they’re misleading them,” a GOP leadership aide said. “For example, by telling them we can defund Obamacare with control of only one House in Congress. And when it turned out they didn’t actually have a plan to win in the Senate, let alone get President [Barack] Obama to sign anything into law, the only effect was to damage the party and disillusion committed conservatives across the country.”’
Heritage Action contradicts itself by tying Republican legislators’ hands and encouraging government inaction all in the name of preserving conservative values. However, conservative congressman have finally realized the only way for Republican ideas to make it through both houses of government will be a bipartisan compromise.
February 2nd, 2014 § § permalink
Recently, two University of Michigan Economists, Jeffrey Smith and Chris House, have voiced their opposition to a petition to raise the minimum wage. This petition was released on January 14, 2014, and was signed by over 600 economists, including six University of Michigan professors. The petition called for a hike in the minimum wage from $7.25 an hour to $10.10 an hour by 2016. Since then, several Michigan politicians met with Ann Arbor business owners at Zingerman’s on Thursday in support of a higher minimum wage. So what gives? Is a higher minimum wage actually a good thing?
In the petition, there are two main arguments for a higher minimum wage: higher wages and therefore higher incomes for low wage workers, and a small stimulative effect to the economy due to more disposable income from low income workers without much effect on employment. A higher minimum wage would lead to higher incomes for workers currently below the proposed minimum wage, $10.10, since employers would be obligated to pay higher wages and for workers just above the minimum wage as employers would have to compete to keep higher skilled workers. This would then lead to more money in the pockets of workers that they would then spend, helping to improve the economy.
However, anyone who has taken an introductory economics course will realize that this violates the law of supply and demand. As the price of a good or service goes up, demand for the good tends to fall. Thus, a higher minimum wage would lead to lower employment or fewer hours worked by these low wages workers. Given this, why do so many economists support this petition?
The petition cites “important developments in the academic literature on the effect of increases in the minimum wage on employment,” and they claim that “the weight of evidence now [shows] that increases in the minimum wage have had little or no negative effect on the employment of minimum-wage workers.”
However, Professor Smith argues that these results, while interesting, focus too much on the short-run effects or lack thereof of a higher minimum wage. Thus, while the short-run effects, namely lower employment or fewer hours, may be small, the long-run impact of a higher minimum wage on employment are quite large as employers invest more in labor saving technology to reduce labor costs.
In addition, both Professor Smith and Professor House argue that a minimum wage hike is poorly targeted. Some programs, such as the Earned Income Tax Credit, provide a tax credit to lower income households. However, a higher minimum wage raises the wages of not just low-income households, but also other workers, such as college students or second earners who may not come from low-income households. Finally, as Professor House points out, if businesses raise prices in response to a higher minimum wage, it may actually hurt low-income households who are required to pay more, as a result.
Thus, even if a higher minimum wage might lead to higher incomes for low-wage workers in the short run with minimal costs in the long run, it is likely to reduce the employment of low-wage workers. There is “no free lunch,” which implies that higher wages for workers have to come from somewhere, either profits of the business or higher costs for households (who may be low-income). If the minimum wage is going to be a program to help lower income households, why not target them directly?
February 2nd, 2014 § § permalink
This past December, members of the American Studies Association, the United States’ oldest and largest academic association dedicated to the interdisciplinary study of American history and culture, passed a resolution endorsing a boycott of Israeli universities. In the election that led to this endorsement, which drew the largest number of participants in the organization’s history, an overwhelming 66 percent of members voted in favor of the boycott. According to the ASA’s website, its endorsement stems from “Israel’s violation of international law and UN resolutions; the documented impact of the Israeli occupation on Palestinian scholars and students; [and] the extent to which Israeli institutions of higher education are a party to state policies that violate human rights…”
In passing such a resolution, the ASA has joined the growing international ranks of left-leaning academic associations and individuals who have condemned Israel for its treatment of its Palestinian population. Some within this movement, including former U.S. President Jimmy Carter, have even drawn parallels between Israel and Apartheid South Africa. These condemnations have drawn consistent and impassioned criticism from a variety of fronts, notably academic and political, which have continued their criticism by reacting to the ASA’s recent boycott.
In the month and a half that has followed the resolution, at least five institutions have withdrawn their membership from the ASA while several current and former presidents of prominent American universities, including Amherst and Princeton, have condemned the ASA’s resolution. In doing so, they have cited general opposition to academic boycotts for their negative impact on academic speech and exchange as well as displeasure with what they perceive as a double standard in the ASA’s decision. Furthermore, two Democratic state assembly men from New York have indicated plans to introduce legislation that would remove state support from any public or private college that participated in the ASA or any other group involved in a boycott of Israel.
Though such reactions may appear rash, they make sense when one considers several basic facts. Firstly, it is interesting to note that the ASA has not endorsed the boycotting of universities in countries with far worse human rights records than Israel’s, such as Iran or China. Following the ASA’s rationale that violations of human rights and international law by a country’s government merit repercussions against that country’s educational institutions, it is illogical and unfair that Israel’s universities alone should be singled out for boycott. The ASA’s decision to narrow its resolution to Israeli universities is thus logically inconsistent and, more importantly, intellectually dishonest.
The ASA ignores Israel’s tangible achievements in human rights as the strongest democracy in the Middle East, with free and open elections and minority representation in parliament. It also ignores Israel’s strides in reducing inequality of opportunity between Jews and minorities by instituting a comprehensive affirmative action program. Such a program has led to high minority enrollment at institutions such as the University of Haifa, where over 30 percent of the student body is Arab (with Arabs comprising roughly 20 percent of Israel’s total population). Rather than unfairly single out Israel by endorsing university boycotts that adversely affect the flow of ideas and the empowerment of a group of people on whose behalf the organization is claiming to act, the ASA should withdraw its support for the boycott and promote proactive policies that further assist Israel’s Palestinian population. It should also distribute its criticism more evenly and hold Israel’s neighbors to the same standards.
February 1st, 2014 § § permalink
By Andrew Craft
President Obama delivered his State of the Union address on Tuesday and laid out many agenda items for the upcoming year. But one key word kept creeping into the 56 minute long speech: inequality. The pervasive use of the word set a strong theme throughout as the President outlined reforms to close the gap between the rich and the poor. He focused on jobs and employment for a lengthy part of the address, emphasizing the crucial necessity of extending unemployment insurance in 2014 (something he himself could have overrode Congress on). But what was so markedly characteristic of the speech was the President’s emphasis on unilateral action that he will be taking this year. As if President Obama hadn’t already used more executive orders than any president before him, why should we be so shocked? He says, “America does not stand still and neither will I.” Sounds like the same self-aggrandizing language we’ve heard before. Bypassing Congress on instrumental reforms will surely maintain the divisive nature between Congress and the President. In addition, President Obama mentioned almost every hot button issue at the moment from renewable energy to immigration, from emphatically denouncing climate change deniers to vocally decrying wage disparity among females. He hit all his bases, in that respect.
The tone of the speech, however, seemed nebulous and disparate. President Obama at one point seemed to be out of breath from all the shout outs and recognitions he was giving to living examples of failed reforms and/or successful policy changes. Did he sound desperate for approval or merely raucous and lively to begin a new year? The jury is out. Cracking jokes about the healthcare website was just an example of a both very awkward comedic relief and weird political hilarity.
I enjoy watching the State of the Union to feel the pomp and circumstance of every branch of our government in the same room and seeing all the famous officials. There’s an eloquence and tradition about it that is indisputable. However, the content of the speech was nothing the American people hadn’t heard before. I won’t call it fluff, because it was constructive and hefty, but it was nothing nuanced or novice that was new. However, Politico Playbook put it best. “Things are actually starting to work. We have a budget, we have a farm bill, and there won’t be a white-knuckle debt-limit staredown. Both sides are at least flirting with immigration compromise. Both Obama and House Republican Conference Chair Cathy McMorris Rodgers gave upbeat speeches in hopes of keeping this hint of momentum going. This is no grand bargain. But it’s no longer grand dysfunction.” For that, I am somewhat optimistic and I hope every American watched the President’s address. In a sense, I find it to be a quasi-duty as a participating citizen. Know what’s going on around you because politics affects you in many ways, whether you like it or not.
February 1st, 2014 § § permalink
(Photo courtesy of mlive.com)
Martin Luther King, Jr. once said, “Peace is not merely a distant goal that we seek, but a means by which we arrive at that goal.” On January 20—the day we honor his life and celebrate his work towards transforming civil rights through non-violence and love—another group, Being Black at UM (BBUM), incited its own message of change. They vowed to use “physical action” if their demands were not met. So I ask: what is the first thing you think of when you hear the words “physical action”?
Imagine a right-leaning group declaring it would take physical action if their demands were not met. Every administrator and group on campus would denounce them for promoting violence. Most would probably even think that was a declaration for gun violence or a bomb threat. I would love to see a liberal defend their word choice because the double standard is truly amazing. As the past-president of a conservative group on campus, I understand the power of words and the impact they have—these words were meant to bring images of violence to mind.
Some scoff and say the list of demands is nothing serious. BBUM gave the University of Michigan seven days to give them more money, renovate the multicultural center, and increase the quota of blacks in the student body to 10%—or else. A group that purports to be for equality wants more financial support for tuition and astronomical Ann Arbor housing—issues that I assure you affect every student here. Rather than demand fairness, they want special treatment and further differentiation. Since the controversy, the University has met with the students over their demands (I would love to know just how many groups the University has ever met with in response to such outrageousness), and has decided to spend a whopping $300,000 on renovations for the multicultural center.
While that is astonishing, what is more frightening is how many people found this rhetoric usage acceptable. If Martin Luther King, Jr. was alive today, I cannot imagine how ashamed he would be if he saw these types of words being used. He was a religious man who used Jesus as an example to promote peace. He worked for equality by forcefully, but civilly making his wishes heard, and in the meantime gained the respect of his community and his adversaries.
Rhetoric. It’s a tricky thing. When used correctly, it is a powerful tool. BBUM wanted attention, but negative attention is not necessarily the good kind. This group thought thoroughly about how to make their message heard. They go to Michigan; they are smart enough to know the words “physical action” instill fear and images of violence in people’s minds. It is a tactic, but it does a greater disservice to this group than anything else. Intimidation and threats will go nowhere in society. BBUM complains their group has been ignored since the 1970s. Any look into the University’s history assures you quite the contrary, but with actions such as these, is it any surprise?
January 24th, 2014 § § permalink
(Courtesy of www.heritage.org)
By Benjamin Park
As of January 23, 2014, the US national debt was seventeen trillion, two hundred seventy-six billion, five hundred eighty-two million, one hundred seventy thousand, three hundred forty-seven dollars and seven cents. The National Debt has continued to increase an average of $2.52 billion per day since September 30, 2012. To put that into perspective, the United States population is approximately 313.9 million, and each of us would need to provide $54,414.23 in order to pay off this debt.
Still don’t get it? If we were to fill up the Big House with hundred dollar bills, that still wouldn’t cover the US debt. If we were to stack crates of hundred dollar bills, we would be able to rebuild the Empire State Building, the Twin Towers and the new Freedom Towers with the money and still have cash left over. If we were to stack one-dollar bills, we could make a direct line a little past Uranus, which is 1.98 billion miles away.
Let’s think about that for a second. If we think about the universe and the entirety of life, we, as humans, are often considered a small speck in the infinite universe. And yet, the impact that we’ve had financially, as a nation, can be compared to the distance from Earth to a planet that we have yet to reach with our advanced technology. This isn’t just another issue; this is, perhaps, the biggest issue.
Then why is it that we seem to be doing nothing?
Is it because it’s larger than life? Is it because it doesn’t affect us? I can assure you that even though we don’t see the immediate effects of the fiscal policies in the United States, it will affect us eventually. And if we don’t do anything about it, I can assure you that each and every one of you will feel the hit.
As the United States continues to have much controversy surrounding the United States’ fiscal topics, such as social security, health care, education and defense, we have spurned away the idea that the debt, policies and budget of our nation is a fiscal issue. We’ve turned it into a social issue. It’s no longer about solving the problem for the most fiscally responsible solution, but for politicians, legislators and representatives to argue for their own agendas. We are continuing to spiral into a bipartisan government, where one side advocates less taxation and the other presses on for more spending. It doesn’t take an economics major to know that spending more and taxing less will lead to the government increasing its debt.
As part of the Up To Us campaign, I believe the voices of students have been lost. When asked about the current state of US fiscal policies, many students are unsure of their answers and admit that they feel unqualified to answer because of their lack of knowledge. It doesn’t help that these issues are clouded by vague concepts and legalistic terminology that is not easily understood by the everyday American.
We cannot stand for that. This rising debt doesn’t show any signs of slowing down. Soon, it won’t be our parents’ problem, but instead, our problem. We will be working endlessly to make ends meet, and trying to fix the problems that could have been fixed had we been more proactive. I’m challenging all students to become more informed. Learn why the US debt has occurred, where the money is going, and what your representatives’ stances are. If you don’t like the direction we’re taking, petition to the government! Contact your congressmen and senators! Raise your voice! In the end, this is going to be our problem. And it’s up to us.
January 23rd, 2014 § § permalink
(Photo courtesy of Salon.com)
- Salon is at it again, spewing out their extreme progressive sentiments. This time, they’ve gone as far as suggesting we nationalize the media. The most recent article is somewhere between painful and laughable to read. But hey, it’s all in the name of liberty, equality, and fraternity, right? This one reads like, “let’s tear down the long-established institutions of America, disregard our traditions, and replace them with a well-proven system” a la the French Revolution. But they were probably high during high school history so don’t hold it against them.I wonder if the editors of Salon had a straight face when they chose to publish an excerpt from a book about turning America into a socialist country – either way they did it. The excerpt, entitled “Let’s nationalize Fox News: Imagining a very different media” by Fred Jerome, outlines how socializing America’s media would better facilitate our democratic principles.
Read it for yourself here. After a while the article starts to sound like it was taken from the pages of 1984 or a flashback to the honorable system the Soviets had in place prior to the fall of communist Russia. But if you’re into that kinky stuff, you’ll like this article.
You know who else nationalized their media? The numerous tyrannical administrations throughout history that committed crimes against humanity. They propelled their crimes through the propaganda that their state-owned media networks spewed out. But we already knew progressives are historically illiterate.
It is important to note that my purpose is not to argue against socialism in the commencing sentences, but keep in mind, as Thomas Sowell once said, “Socialism in general has a record of failure so blatant that only an intellectual could ignore or evade it.”
Like everything else socialist or progressive, when you can’t beat them, legislate against them. Pull the successful down, to your (Salon’s) level. When you can’t compete with Fox News, promote legislation that is in your favor. This isn’t about democracy – it’s about Salon trying to propel themselves ahead, or catch up to, the media outlets they can’t compete with. Or they’re still doing those drugs.
“Imagine a world without the New York Times, Fox News, CNN, the Wall Street Journal, and countless other tools used by the 1 percent to rule and fool. In a socialist society run by and for the working people it represents, the mega-monopolies like Walmart, Halliburton, Exxon-Mobil, and the corporations that run the tightly controlled “mainstream media” will be a thing of the past,” Jerome writes.
Yes, the media market is an oligopoly in the sense that a handful of corporations control the market. But those corporations also employ literally millions of people. So what would a socialist world look like? Try mass unemployment (much more severe than we have ever seen) fueling poverty and induced by a highly centralized government which would eventually usurp their powers and victimize the people they claim to protect.
Despite such concentration in the media business, America still has one of the freest and most diverse media markets in the world. Ranging from Fox News on the right to MSNBC on the left and everyone in between. Not to mention the Internet – and literally the millions of news sites and independent blogs on the web (some credible, some not).
After stating, “it’s online media that have the potential for wider than ever public participation and exchange of views” Jerome says, “A democratic, accessible-to-all media will move to center stage in a socialist USA.” I don’t know if Mr. Jerome is too old for the Internet, but any Google search will prove that our online media is already democratic, facilitating a very diverse exchange of views that anyone with Internet access has at their fingertips. Although Jerome does go on to acknowledge that the media is already being democratized on the Internet, he believes Democratic Socialism is necessary to control the media and influence culture.
America has always valued free speech and freedom of the press. In such a system, media biases, media credibility, and just plain crappy journalism are unavoidable. In the case of media biases, they should be brought to light (also by way of journalism). But when legislation is required to address media bias, the government becomes tyrannical and is thus restricting free (although biased) speech. Same goes for media credibility or the practice of honest reporting. As for crappy journalism (like the junk Salon often spews) we must simply tolerate it – while still being critical of their work.
However, Mr. Jerome does have a legitimate grievance with advertisements: “in a society that has erased corporate control, the articles in newspapers and magazines and online will not be filler between ads for teeth whiteners and weight-loss pills. There won’t be TV commercials for Coke, cars, or million-dollar condos. There will be no private corporations to create and sponsor the news.”
I think most would agree that advertisements are annoying and at times inconvenient but they are a lesser evil than government owned media. In Jerome’s socialist America, instead of corporations employing millions, the government would employ everyone (of course).
Without advertisements, “In a socialist society, where money is allocated based on assessed social need and not on projected profits, government will subsidize many salaries in social, economic, political, and educational areas” according to Jerome. Instead, funding for the media would be similar to how unions today “pay for the publication, including staff salaries, of many union newspapers.” But eliminating corporations is both impractical and utopian.
Jerome fails to acknowledge that all those promotional ads help to fuel consumption in our economy. An economy that does not consume also has no use to produce. And no production means no jobs. In short, taking ads out of media would just be killing jobs. But in a socialist economy, someone else will foot the bill, right?
A viable solution to the obnoxious advertisements problem would be to make the media more like any other good or service, make people pay for the news even more so than they already do. Charge readers or viewers for the news, this way the news would not have to be subsidized by advertisements. This would also encourage journalistic quality since people would only pay for what they want to see or read, still allowing the free market to work its course and avoid both advertisements and Jerome’s nationalized media. But even this type of media would be quite pragmatic and require too-significant reforms.
As the article progresses it becomes even more absurd; Jerome continues to assume a majority of Americans will be union members in his “Socialist America.” These unions would also form “social justice committees” that will “dig up and root out capitalist, racist, and sexist weeds that continue to grow.”
Jerome’s response to media bias and what the media covers is to “democratize” it by allowing the news to “come from working people themselves.” This way the news given would be more relevant to the everyday working class people. Jerome’s concern for the democratization of the media is heartfelt and legitimate, but he thoroughly underscores the fact that the Internet is already heavily democratized, exemplified in the millions of independent news sites and blogs.
In an interesting twist towards the end of his article, Jerome notes that the injustices of past American capitalism should be thoroughly featured in ‘“never forget” stories…describing battles waged previously during life under capitalism: tent cities for homeless families, “stop-and-frisk” police policies that singled out young black and Latino men, and the experience of unemployment and long-term joblessness. But “Never Forget” would also feature stories about fighting capitalist oppression through strikes and marches and heroes of past struggles.
Ironically, this description Jerome gives fits the image of what I would imagine a socialist America would look like. Jerome also fails to see the incompetency of government-run systems; need I mention the Obamacare roll-out?
A media “for the people” and without advertisements sounds all nice and peachy when Jerome claims such reforms in the name of “democracy.” But, as eerily as our society has been falling to the left, when you add “socialist” to democracy, people retreat in fear. In short, I have enough faith in our society that we will not go to the extremes of “democratic socialism,” not enough people are that delusional to make socialism truly democratic in our highly pluralistic society.
Luckily for Americans, democratic socialism is primarily prevalent in academia. And good thing academia does not accurately reflect real, practical America. Remember, according to Sowell, only an intellectual could be so blind to the failed record of socialism.
All in all, Jerome’s vision of a nationalized media based on a socialist America is absurd and utopian – a bad fantasy. It’s neither practical nor would it be successful; such drastic reforms would never be accepted without extreme government coercion. I would imagine the rest of the book from which Jerome’s article was taken would contain much of the same nonsense. But if there is one thing Jerome’s article proves, or reinforces, it is that there is no other political system known to man that is more envious than socialism masked.
This article was originally published in The College Conservative.
December 2nd, 2013 § § permalink
Many seniors are graduating this fall or next winter. It is a good time to be retrospective and evaluate whether they have a fruitful undergraduate study. A question one could ask is: is my undergraduate degree a good investment?
One way to answer this question is to look at the employment data as a reflection of market evaluation. According to a report by PayScale on College Salary, both the starting salary and mid-career salary are showing that undergraduate degrees in liberal art are correlated with relatively less salaries, compared to undergraduate degrees in engineering, actuarial math or statistics. Two liberal arts degrees that have the best employment data are Government and Economics. The starting salary is $42,000 for Government and $48,500 for Economics, and the mid-career salary is $95,600 for Government majors and $94,900 for Economics majors. However even those two degrees are unsatisfactory compared to Electrical Engineering (starting salary of $63,400 and mid-career salary of $106,000) and Computer Science ($58,400 and $100,000) not to mention Petroleum Engineering ($98,000 and $163,000).
Let’s take University of Michigan as an example to factor in the costs. Let’s assume a student enters U of M and study for four years (4 fall term plus 4 winter terms), enters job market immediately after graduation, gets same salary increase every year, reaches mid-career salary after 3 years, and continues to get salary increase at the same rate. We further assume the discount rate is 5% and apply a discounted cash flow analysis to six different majors: two best paid liberal art majors, Government and Economics, two typically paid liberal art majors, Psychology and English, and two typically paid engineering majors, Electrical Engineering (EE) and Computer Science (CS), and here are some results:
- It takes about 2.5 years (after graduation) for EECS majors to earn their full tuition back, 3 years for Government and Econ majors, and 4 years for Psychology and English majors.
- The salary gap is big at the beginning, but quickly shrinks as you stay at industry and accumulate working experience.
The analysis does make the employment situation for recent liberal arts college graduates looks a little bit better, but it is still counterintuitive. Aren’t the skills most wanted by employers, such as communications, critical thinking, and presentations, exactly the focus of training in a so-called traditional liberal arts degree? Why college graduates holding an undergraduate degree of liberal arts are earning less salaries both in the entry level, and in mid-career? What exactly made the difference between employment of a liberal arts student and his friend graduating from the department of engineering, math or statistics?
First of all, curriculum design is an important reason. Education and training in an engineering degree do a better job to prepare students for future engineering jobs. College of Engineering puts weight on projects in addition to theories. Some course projects are even sponsored by firms from industry, and thus very well recognized by other firms in the same industry. On the contrary, an essay or a term paper in a liberal arts class can hardly be a convincing experience to recruiters. To make up the gap between theory and practice, liberal arts majors need to participate in research assistantship, internships and well recognized competitions.
Secondly, the job market are in increasing demand of interdisciplinary talents, which puts liberal arts majors at disadvantage. For journalists to cover energy, they need to have at least basic knowledge in energy forms, generation and transformation; for public policy makers to design technology-promoting policies, they have to understand technologies; for lawyers to win patent infringement litigation in the Smartphone War, they have to understand all different things about smartphone as well. Nowadays, there are plenty of pure hard-science jobs but there are not much pure liberal arts jobs. It is easier for a pure hard-science major to gain skills trained in liberal arts education but it is much more difficult for a pure liberal arts major to do so vice versa.
Third, the standard deviation for salary is larger for a liberal arts degree than for an engineering degree, because engineering and statistic students learn hard skills that meet hard demand, for example how to master a software. Thus engineering and statistics students depend less on the reputation of their college, while liberal arts students rely more on signal effects of their college. Since PayScale constructs its report on 10,000 colleges and universities, the employment situation would be better for liberal art fresh graduates from top universities, for example University of Michigan.
In respond to the reasons are suggestions for current liberal arts majors to maximize the benefit from a liberal arts degree. First, try to build on soft skills such as critical thinking, team work, leadership and so forth through internships and extracurricular activities. Second, have a second major, or minor, or even some courses on mathematics, statistics and hard-science. Third, get into a good college or university because signal matters sometimes. Finally, despite our focus on employment in this article we want to make it clear that university education is not just about employment. A liberal arts degree helps student understand history and culture which will benefit students in the long-run and the benefit cannot be captured by employment data or salary numbers. After all, university students need to find out their own interests and passions, working hard not just to look for a job, but to find a career.
December 1st, 2013 § § permalink
On October 1, Healthcare.gov, launched to a resounding thud. The core element of Obamacare is that many people can buy health insurance through a national healthcare exchange. Healthcare.gov was designed as the platform for people to do this. On the opening day, the marketing of the plan was so successful, that there appeared to be voracious demand. However, from its launch, Healthcare.gov was plagued with errors. This meant “a mere 1 percent of the 3.7 million people who tried to register for a federal exchange in the first week were actually able to enroll” according to Millward Brown Digital, a consulting firm.
These failures have led Ezra Klein, one of the foremost proponents of Obamacare, to dub Healthcare.gov a “failure”. Additionally, it has led Obama and many of his key officials to publicly apologize. Despite these apologies, Healthcare.gov is still not operational. What went wrong and what are the ramifications?
According to David Auerbach, a software engineer, who wrote a piece in Slate, the failure of the Healthcare.gov was a failure to assign ownership of the “end-to-end experience”. In other words, no individual or individual contractor was responsible for making sure the entire system worked effectively. Thus, instead of a full-scale comprehensive test of the system, individual pieces were tested separately without any idea of how the system would work as a whole. Worse, when the system failed, it was unclear who was liable and how the problem should be resolved.
In response, President Obama has called in the “Best and the Brighest” to fix the problem, which is ironically the title of a book of how “a bunch of smart guys blundered the country into the Vietnam War” (Matt Yglesias). This ignores the implications of another famous book entitled The Mythical Man Month, which states that in a complex software projects adding manpower oftentimes only makes the project more complex. Despite a “tech surge”, the website remains broken with hope of it being fixed “by the end of November”. However, despite these problems the initial fallout has been limited.
During the launch of Healthcare.gov, America was in the middle of its first government shutdown since 1995. Thus, the government shutdown was the main story, instead of the failures of Healthcare.gov. While both parties took a hit from the shutdown, the Republicans approval ratings fared far worse. This provided Obama with a cushion.
As part of Obamacare, many plans in the individual market were no longer legal, as they provided insufficient coverage or were no longer profitable for insurers. This meant that many individuals who bought healthcare directly from insurance companies were notified of the cancellation of their healthcare plans, despite Obama’s promise that “If you like your [healthcare] plan, you can keep it”. Had the exchange been operational this would have only been a minor problem, since people would’ve been able to replace there existing plan. However, many individuals who trusted Obama felt worried and betrayed.
What have been the ramifications for this catastrophic failure? Not much. While Obama’s approval ratings and the approval ratings for Obamacare are down, the failure of Healthcare.gov did not have major ramifications on the 2013 Elections. For example, some claimed that this failure nearly cost the Democrats and Terry MacAuliff, the gubernatorial race in Virginia, but he still won. However, while the fallout so far has been limited, Obama and his new health care plan cannot afford any more failures.
December 1st, 2013 § § permalink
In May 2010, the state of Michigan raised $178 million through leases to extract minerals on public land, the majority of which was natural gas. This amount nearly totaled how much the state of Michigan raised in the previous 82 years. Given Michigan’s recent economic woes, it’s obvious why fracking is attractive. The main mechanism for extracting this gas is called hydraulic fracturing, colloquially known as “fracking”, which has revolutionized the natural gas industry in the US and has led some to refer to the US as the “Saudi Arabia of Natural Gas.” However, as hydraulic-fracturing has become more mainstream, environmental and health issues have surfaced in lay and scientific media, the most high profile of which was a documentary, Gasland. Michigan organizations, such as letsbanfracking.org, have decided to campaign for a ballot initiative to impose a moratorium on hydraulic-fracturing. Given the benefits of fracking, a moratorium is not the answer, but these concerns cannot be dismissed. Therefore, while fracking in Michigan has and will continue to have tremendous benefits on the local economy, the environmental and health concerns cannot be neglected.
As is detailed in Gregory Zuckerman’s excellent book, The Frackers, fracking is the synthesis of two drilling processes: horizontal drilling and hydraulic fracturing. Horizontal drilling allows drilling companies to reach natural gas wells in shallow beds of rock far below the ground. Hydraulic fracturing involves injecting wells with a “mixture of water, sand and some chemicals” to fracture rock. This allows for the ability to extract natural gas from several smaller wells along the bed of shale rock. Both of these techniques have been used in isolation for decades. Over the past 10 years, these two processes have been combined to create what is now known as “fracking”, a technique, which has revolutionized US domestic natural gas production.
As recently as 2006, Cheniere Energy, predicting that the US was running out of natural gas, made a $1.5 billion bet on a natural gas import terminal. However, over the past 7 years, production in the US has increased by nearly 30% and the price has plunged from $5.84 per million BTUs in October 2006 to $3.59 per million BTUs in 2013. The company has since reversed course and is building a terminal at great expense to export natural gas. Additionally, in 2009, Exxon Mobil acquired XTO Energy, one of the largest natural gas producers at the time, for $31 billion. Clearly, major players see a lot of potential in this industry. After the bankruptcy of Detroit and the major auto companies, Michigan is looking to cash in.
Fracking benefits the Michigan economy through three main channels – jobs and investment in Michigan, royalty payments to landowners, and royalties, fees and taxes to the state government. According to the a report by the Graham Sustainability Initiative, natural gas production and servicing employs approximately 2,000 people in Michigan. These jobs tend to be higher skilled jobs paying above-average salaries. The majority of the firms that frack in Michigan are Michigan-based and tend to buy many of their inputs, particularly those who are servicing wells, in Michigan.
In exchange for the right to drill on an individual’s property, natural gas firms are required to pay lease fees and royalties to the private landowner. While it is not broken out explicitly for natural gas, in 2010, royalty and lease payments to private landowners for all mineral rights were $81.5 million. Finally, the state of Michigan receives money through royalties, which are “one-sixth of revenue on gas sales,” fees and rent for leases on wells that are on private property, and a 5% tax on drilling on private leases. The most lucrative year on record for the Michigan government was 2010, during which time these brought in over $270 million for all natural resource extraction.
Despite these benefits, people worry about the costs of fracking, which generally include the environmental and health-related costs. Some of the environmental costs include contamination of drinking water and methane emissions. The documentary Gasland shows evidence of people who are able to light their tap water on fire, which the documentary claims is due to fracking. In this case, the water is not safe to drink, and individuals are required to drink bottled water. However, there still is not definitive evidence of whether this is caused by fracking. In addition, people worry about the potential of the chemical compound, often referred to as the “cocktail” in fracking to pollute groundwater. There is not much evidence that this is happening on a widespread basis, however it remains a concern.
Methane emission is a more concerning byproduct of fracking. While natural gas has half of the carbon emissions of coal and a third of the carbon emissions of oil, leaks of natural gas, methane, are 25 times as damaging as carbon. These leaks are primarily due to old piping infrastructure that hasn’t been properly maintained and the excess natural gas that firms aren’t able to use that they can’t burn off or “flare”, particularly given the current low price of natural gas. According to a recent report by the Environmental Protection Agency, natural gas is still better for the environment than coal, however the evidence is not conclusive.
Fracking will continue to have a transformative effect on the Michigan and American economy. While there are clear benefits to fracking in terms of jobs and money, the costs need to be taken seriously. Thus, while prices remain low and until there is concrete evidence that the benefits of a dramatic surge in fracking in Michigan clearly outweigh the costs, growth in fracking should be limited. There is no rush.