If Trickle Down Economics Really Worked, Wouldn't We Know It By Now?

This from Business Insider:

Sorry, Folks, Rich People Actually Don't 'Create The Jobs'

As America struggles with high unemployment and record inequality, everyone is offering competing solutions to the problem.

Laborers Wanted

In this war of words (and classes), one thing has been repeated so often that many people now regard it as fact.

“Rich people create the jobs.”

Specifically, by starting and directing America’s companies, rich entrepreneurs and investors create the jobs that sustain everyone else.

This statement is usually invoked to justify cutting taxes on entrepreneurs and investors. If only we cut those taxes and regulations, the story goes, entrepreneurs and investors can be incented to build more companies and create more jobs.

This argument ignores the fact that taxes on entrepreneurs and investors are already historically low, even after this year’s modest increases. And it ignores the assertions of many investors and entrepreneurs (like me) that they would work just as hard to build companies even if taxes were much higher.

But, more importantly, this argument perpetuates a myth that some well-off Americans use to justify today’s record inequality — the idea that rich people create the jobs.

Entrepreneurs and investors like me actually don’t create the jobs — not sustainable ones, anyway.

In the last 15 years, almost all of the income gains have gone to the richest Americans.

Yes, we can create jobs temporarily, by starting companies and funding losses for a while. And, yes, we are a necessary part of the economy’s job-creation engine. But to suggest that we alone are responsible for the jobs that sustain 300 million Americans is the height of self-importance and delusion.

So, if rich people do not create the jobs, what does?

A healthy economic ecosystem — one in which most participants (the middle class) have plenty of money to spend.

Over the last couple of years, a rich investor and entrepreneur named Nick Hanauer has explained this in detail. Hanauer was the founder of online advertising company aQuantive, which Microsoft bought for $US6.4 billion. Hanauer has recently annoyed all manner of rich investors and entrepreneurs by explaining that rich people like him do not ‘create the jobs,’ even if they found and build companies that eventually employ thousands of people.

What creates the jobs, Hanauer explains, is a healthy economic ecosystem surrounding the company, which starts with the company’s customers.

The company’s customers buy the company’s products. This, in turn, creates the need for the company to hire employees to produce, sell, and service those products. If those customers go broke, the demand for the company’s products will collapse. And the jobs will disappear, regardless of what the entrepreneurs or investors do.

Now, again, entrepreneurs are an important part of the company-creation process. And so are investors, who risk capital in the hope of earning returns. But, ultimately, whether a new company continues growing and creates self-sustaining jobs is a function of the company’s customers’ ability and willingness to pay for the company’s products, not the entrepreneur or the investor capital. Suggesting that “rich entrepreneurs and investors” create the jobs, therefore, Hanauer observes, is like suggesting that squirrels create evolution.

Or, to put it even more simply, it’s like saying that a seed creates a tree. The seed does not create the tree. The seed starts the tree. But what actually grows and sustains the tree is the combination of the DNA in the seed and the soil, sunshine, water, atmosphere, nutrients, and other factors that nurture it. Plant a seed in an inhospitable environment, like a desert or Mars, and the seed won’t create anything. It will die.

So, then, if what creates the jobs in our economy is, in part, “customers,” who are these customers? And what can we do to make sure these customers have more money to spend to create demand and, thus, jobs?

The customers of most companies, Hanauer points out, are ultimately the gigantic middle class — the hundreds of millions of Americans who currently take home a much smaller share of the national income than they did 30 years ago, before tax policy aimed at helping rich people get richer created an extreme of income and wealth inequality not seen since the 1920s.

She’d like to create jobs. But she can’t afford to anymore.

The middle class has been pummelled, in part, by tax policies that reward “the 1%” at the expense of everyone else.

It has also been pummelled by globalization and technology improvements, which are largely outside of any one country’s control.
But aren’t the huge pots of gold taken home by “the 1%” supposed to “trickle down” to the middle class and thus benefit everyone? Isn’t that the way it’s supposed to work?
Yes, that’s the way it’s supposed to work.

Unfortunately, that’s not the way it actually works.

And Hanauer explains why.

Hanauer takes home more than $US10 million a year of income. On this income, he says, he pays an 11% tax rate. (Presumably, most of the income is dividends and long-term capital gains, which carry a tax rate of about 20%. And then he probably has some tax shelters that knock the rate down the rest of the way).

With the more than $US9 million a year Hanauer keeps, he buys lots of stuff. But, importantly, he doesn’t buy as much stuff as would be bought if his $US9 million were instead earned by 9,000 Americans each taking home an extra $US1,000 a year.

Why not?

Because, despite Hanauer’s impressive lifestyle — his family owns a plane — most of the $US9+ million just goes straight into the bank (where it either sits and earns interest or gets invested in companies that ultimately need strong demand to sell products and create jobs). For a specific example, Hanauer points out that his family owns 3 cars, not the 3,000 cars that might be bought if his $US9+ million were taken home by a few thousand families.

If that $US9+ million had gone to 9,000 families instead of Hanauer, it would almost certainly have been pumped right back into the economy via consumption (i.e., demand). And, in so doing, it would have created more jobs.

Hanauer estimates that, if most American families were taking home the same share of the national income that they were taking home 30 years ago, every family would have another $US10,000 of disposable income to spend.

That, Hanauer points out, would have a huge impact on demand — and, thereby job creation.

So, if nothing else, it’s time we stopped perpetuating the fiction that “rich people create the jobs.”
Rich people don’t create the jobs.

Our economy creates jobs.

We’re all in this together. And until we understand that, our economy is going to go nowhere.

This from The Nation by way of Business Insider:

The gap between the top 0.01% and everyone else hasn't been this big since the Roaring Twenties

1 / 16

This chart shows average income of the top 1% as a multiple of average income of the bottom 90% (via The Nation).

Hat tip to John.

Rothstein, Carnoy, and Tucker on International Test Scores

This from Diane Ravitch's blog:

Last January, Richard Rothstein and Martin Carnoy released a report on international test scores, arguing that American students perform better than is generally believes. Since many people are deeply invested in the conventional claim that American students lag the world on international tests, their report led to a flurry of controversy. This post by Rothstein and Carnoy responds to Tucker’s criticism of their report.

On the other hand, Marc Tucker wrote an excellent article on his blog in which he made some important points.

First, he reviewed Eric Hanushek, Paul Peterson, and Ludger Woessman’s book Endangering Prosperity. He agrees with them that American performance on international tests is terrible, even among our best students. But he disagrees with their solutions: reliance on market forces via charters and vouchers, smashing teachers’ unions, test-based evaluation of teachers. He sees no evidence that these strategies have worked anywhere in the world.

Tucker writes:

My objection to these strategies has nothing to do with ideology. It is pragmatic. First, after years of implementation, as I have written elsewhere, there is still no evidence that market solutions will produce results superior to the results that we have been getting, certainly not the kind of results we would have to have to overcome the gigantic deficiencies that Hanushek, Peterson and Woessmann document in this book. The authors are correct in saying that teacher quality is the most important factor in improving the performance of our schools, but, as far as I know, they can point to no country in the world that has used the strategies they advocate to get decisive improvements in teacher quality. There is, in short, no evidence that the strategies they want the United States to bet on will work.

He points to Shanghai, visited recently by New York Times columnist Thomas Friedman, as a high-performing nation that uses none of these strategies. What works in Shanghai?

Shanghai did not get to where it is by creating charter schools or issuing vouchers. It did not get there by sorting out teachers by the scores their students get on standardized tests and then weeding out the worst. They have been more successful than any other country in the world at developing the teachers they already have, focusing relentlessly on teacher training, embracing the system and its teachers, rather than driving the best away with punitive accountability systems.

I find this an admirable statement.

My only disagreement with the debate about our international performance is that I am not persuaded that test scores on TIMSS or PISA predict what will happen to our economy 10 or 20 or 30 years from now. I recall that in 1983 “A Nation at Risk” said we were doomed because of our international test scores. Didn’t happen. The international tests show which nations have students who get the most right answers on multiple-choice tests. I fail to understand why that is a leading economic indicator. The Chinese-American scholar Yong Zhao has argued that the test-based education systems are least likely to promote creativity, innovation, and entrepreneurship. I am inclined to agree with him.

We Must Prepare Ph.D. Students for the Complicated Art of Teaching

If the United States is ever to regain a significant economic advantage 

from the education of its people, 

it will have to come through the quality of instruction that our undergraduates receive 

and not just from the quantity of college degrees being offered.  

--Derek Bok

This from Derek Bok in the Chronicle:

Graduate study for the Ph.D. in the United States presents a curious paradox. Our universities have developed thousands of distinguished scientists and scholars. More than half the winners of Nobel Prizes in the sciences and economics from 1997 to 2007 did their graduate work in this country, continuing a pattern that has persisted since the end of World War II. Students all over the world come here for graduate training, and universities in many other nations have expanded and reformed their doctoral programs to resemble our method more closely.

At the same time, graduate schools can justly be condemned as the worst-designed and worst-administered of any major academic program in our research universities. There are far too many Ph.D. programs, many of them of mediocre quality. Dropout rates are embarrassingly high. More than 40 percent of graduate students fail to earn doctorates within 10 years, a number far greater than in other advanced degree programs. Students take too long to finish, with almost 30 percent in the social sciences and 40 percent in the humanities lingering for more than seven years before earning their degrees.

The most glaring defect of our graduate programs, however, is how little they do to prepare their students to teach. Doctoral candidates have long had the chance to assist professors in large lecture courses by leading weekly discussions among small groups of undergraduates. Yet only a minority of those assistants report that they receive adequate supervision by the faculty member in charge of the course. In fact, professors often tell their graduate students not to spend much time on their teaching duties, lest it distract them from the all-important task of writing a thesis.

Some improvement has occurred in recent years with the spread of centers to help graduate students learn to be teaching assistants. Still, participation in those centers is typically voluntary and rarely offers graduate students more than an orientation program, an occasional workshop on a specific topic, and perhaps a chance to have their teaching videotaped and critiqued by a member of the center staff. Although such assistance is helpful, it is far from adequate to prepare aspiring professors for the challenges they are likely to face once they embark upon an academic career.

There are reasons that departments have been unwilling to do more. Most professors are not convinced that teaching is a skill that requires formal preparation. Rather, they are inclined to regard it as an art that one acquires naturally and improves through practice over time. After all, that is how they learned to teach. Besides, with Ph.D. candidates already taking so long to complete the programs, why add new requirements to existing programs?

These reasons have never been convincing, but they have gradually become increasingly untenable. Over the past two or three decades, research about learning has yielded useful insights about teaching that graduate students need to know. Much has now been discovered about cognition, motivation, and the relative effectiveness of different methods of instruction.

New research about the behavior of students has also revealed compelling reasons to make full use of this knowledge. Among the recent discoveries, investigators have found that college students are not making as much progress as most people have assumed in mastering essential skills such as writing and critical thinking. Other findings suggest that undergraduates are less engaged by their courses, and that they are spending much less time studying than they did 40 years ago. Those problems will not be solved by simply continuing to teach in the same way as in the past. Professors will need to make use of the growing body of knowledge about teaching and learning in order to succeed.

Meanwhile, more than six million undergraduates are taking at least one course per year online. Carnegie Mellon University has developed computer-assisted courses in several subjects that allow students to master the subject matter in much less time than in regular classes. The emergence of massive open online courses (MOOCs), enrolling huge numbers of students, is causing many prominent professors to take an interest in teaching online. Graduate students clearly need training in the uses and misuses of technology to be adequately prepared for the classrooms of tomorrow.

Technology changes the nature of teaching in several ways. Developing an online course is a collaborative venture in which instructors work with technicians and media experts. Teaching, then, becomes less intuitive and more of a collective, deliberative activity. In addition, technology can produce a record, not just of what instructors say, but of how students respond to questions and homework problems. As a result, professors can discover what material gives students difficulty and try to adjust their teaching accordingly. Once again, however, professors will have to know more than they have in the past to make the most of these intriguing developments.

In short, pedagogy has become a much more complicated process that has evolved from an art that one can acquire by oneself to a subject requiring formal preparation.

The need for such training is all the more urgent because of the conditions that many graduate students will encounter in their professional careers. Only one-quarter of the recent Ph.D.'s seeking academic careers are finding jobs in research universities. Most of the others obtain positions in institutions with students who tend to be less motivated and less prepared for college than the undergraduates their teachers knew, and teaching them successfully will be a greater challenge.

Many students today are also multitasking, looking at their email during class and listening to music or texting friends while they study. Undergraduates are using much of the time previously spent on homework communicating via social media, surfing the web, and playing computer games. Therefore, whether they know it or not, professors everywhere are now competing with Twitter, smartphones, computer games, and much else for the time and attention of their students. In this environment, doctoral candidates planning on an academic career will need to know more to figure out how to engage their students in the learning process.

Graduate students are unlikely to receive the preparation they need if academic departments continue to have almost complete control over Ph.D. programs. The problem is not just that faculties resist change. Professors in departments of English literature or economics or chemistry are simply not trained to offer instruction on the applications of cognitive psychology and motivation theory, or the findings of researchers concerning the relative effectiveness of different methods of instruction, or the skills required for developing online courses. If such material is ever to become a part of preparing graduate students, then provosts and deans will have to take the initiative, not only to persuade the faculty that change is needed but also to recruit instructors from across the university who are capable of teaching graduate students what they need to know.

It is not entirely obvious just when and where the necessary instruction should take place. One's instinctive response is to make room within the graduate program itself. The problem with this approach, however, is that one-third to one-half of all new Ph.D.'s do not pursue academic careers but find jobs in industry, government, or some other field of employment. So it is hardly fair to force all graduate students to take instruction in pedagogy. Graduate schools could and should require prospective teaching assistants to receive enough training to carry out their assignments effectively. But any further preparation for teaching will have to be offered on a voluntary basis.

Some graduate students may not choose to acquire all the training they need, while other successful candidates for faculty positions will have received their doctorates from universities that offer little preparation for teaching. As a result, institutions wishing to equip their new recruits properly for duties in the classroom and as members of the academic profession will not succeed by merely offering a day or two of orientation.

Instead, to prepare their professors properly, colleges may need to give them a course that includes material dealing not only with pedagogy but also with ethical problems in teaching and research, the history of higher education, the principal schools of thought on the undergraduate curriculum, and the organization, financing, and governance of universities. If beginning instructors are thought to have too much else to do, they could be given a reduced teaching load for their first year. Any short-term costs should be more than compensated for by the improved preparation given to new recruits to fulfill their responsibilities as teachers and faculty members.

It would be hard to overestimate the importance of instituting these reforms. One of the legitimate complaints against colleges and universities is that they have been exceedingly slow to change their methods of education. Lecturing is still the most common way to teach, even though it has long been shown to be ill-suited to the task of developing the capacity for critical thinking, a competence that almost all professors regard as the most important goal of undergraduate education. Feedback to students continues to be skimpy and late in coming despite its importance to learning. The basic division of the college curriculum into majors, electives, and general education has likewise remained pretty much the same over many decades despite its many weaknesses and unsubstantiated rationales.

Critics often say that the reason instructional methods change so slowly is that professors do not care about teaching and prefer to spend their time on research. This explanation is hardly convincing.

International surveys regularly find that professors in America care more about teaching and education than do their counterparts in virtually any other country in the world. Even in research universities, faculty members spend much more time on teaching than on research when classes are in session. Studies also have found that prolific researchers are no less successful or conscientious in the classroom than are their colleagues who rarely publish.

A more plausible reason for the sluggish pace of reform is the scanty preparation given to graduate students for their role as educators. Lacking such training, newly minted Ph.D.'s naturally begin their teaching by trying to emulate the professors they respected most during their student days. While there is something to be said for this practice, it hardly encourages innovation in the classroom. Rather, it tends to produce an uncritical, conservative attitude toward teaching, quite at variance with the way most faculty members go about their research.

Continuing this approach is likely to prove even more costly in the future than it has been in the past. President Obama has called for a significant increase in the number of Americans graduating from college by enrolling hundreds of thousands of new students every year. Many of these young people will be less prepared for college work than the average student today and, hence, more difficult to teach.

Even if colleges manage to meet the president's goal (and that will be a tall order indeed), America will never regain the huge lead in educational attainment that helped to make it the world's most prosperous nation from 1870 to 1970. Now that a dozen or more countries have made the transition from an elite to a mass or nearly universal system of higher education, it will be all that we can do simply to keep up.

If the United States is ever to regain a significant economic advantage from the education of its people, it will have to come through the quality of instruction that our undergraduates receive and not just from the quantity of college degrees being offered. Such instruction will surely be slow to arrive without a faculty trained to bring to its teaching the same ample store of background knowledge, the same respect for relevant data, and the same questioning, innovative spirit that professors have long displayed in carrying out their research.

Three Studies Show NY Performance Pay Generally Makes Things Worse

This from the Institute of Education Sciences:

New York City's Schoolwide Performance Bonus Program

What are these studies about?

The What Works Clearinghouse (WWC) has reviewed three studies of New York City's (NYC's) Schoolwide Performance Bonus Program (SPBP). These studies contain samples with overlapping school years and grade levels and use different levels of analysis for examining the impact of the program. A description of the program is provided below.

Context for the Program

In 2007, as part of its accountability system, the NYC Department of Education set school-level goals for student academic performance and growth for each school. Each year, it awarded Progress Report scores to schools based on three components: increased student achievement on state reading and math exams (25% of score), yearly student progress (60% of score), and measures of the learning environment (15% of score). The program operated in high-need schools from school years 2007–08 through 2010–11, with schools randomly assigned to either an intervention or a comparison group in 2007–08. 

Under the SPBP, school staff could receive bonuses based on their schools’ Progress Reports. If a school was randomly selected for the program, it then had to secure votes in favor of program participation from 55% or more of its full-time union teachers in order for the school to be eligible for bonuses. Participating schools that reached 100% of their school-level goals could receive lump-sum payments of $3,000 per union teacher; those that reached at least 75% of their goals received $1,500 per union teacher. A four-member, school-level compensation committee decided in advance how to distribute payments among teachers and other staff. 

The three studies of the NYC Bonus Program that were reviewed by the WWC are listed below. One study examined the effect of the program on individual student test scores; the other two looked at school average scores. Each of them included an “intent to treat” analysis, in which all study students and schools are included in the analysis, based on whether the school was initially assigned to the program. Two of the studies also included a “treatment on treated” analysis, which examines the effects based on which schools actually implemented the program. 

Study	School Years	Grade Levels	Analysis Level	Analysis Type
Fryer	2007–08, 2008–09, 2009–10	Elementary, Middle, and High	Student	Intent to Treat and Treatment on Treated
Goodman	2007–08, 2008–09	Elementary and Middle	School	Intent to Treat and Treatment on Treated
Marsh	2007–08, 2008–09, 2009–10	Elementary, Middle, and High	School1	Intent to Treat

1The study also examined academic achievement outcomes measured at the student level. However, the report did not contain enough information to determine a study rating for that portion of the study.

  Report Details

Grades Examined:	Kindergarten, 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12
Topic:	Teacher Incentives
Review Protocol:	Single Study Review

• Download Review
  • Fryer (108 KB)
  • Goodman (197 KB)
  • Marsh (109 KB)

Citations

Fryer, R. G. (2011). Teacher incentives and student achievement: Evidence from New York City Public Schools (NBER Working Paper No. 16850). Cambridge, MA: National Bureau of Economic Research.
Rating: Meets WWC evidence standards without reservations
Release Date: September 2013
Protocol: Single study review protocol

 

Goodman, S. F., & Turner, L. J. (2010). Teacher incentive pay and educational outcomes: Evidence from the New York City Bonus Program. New York: Columbia University.
Rating: Meets WWC evidence standards without reservations
Release Date: October 2012
Protocol: Single study review protocol

 

Marsh, J. A., Springer, M. G., McCaffrey, D. F., Yuan, K., Epstein, S., Koppich, J., Kalra, N., DiMartino, C., Peng, A. (2011). A big apple for educators: New York City's experiment with schoolwide performance bonuses. Final evaluation report. Santa Monica, CA: RAND Corporation.
Rating: Meets WWC evidence standards without reservations
Release Date: September 2013
Protocol: Single study review protocol

Colo. School Board Member: Transgender Students Need 'Castration' Before Using Bathrooms

This from the Huffington Post:

A Colorado school board member is facing criticism after she said that transgender students would need to be castrated before the student could use the school bathrooms that fit their gender identity.

KREX-TV in Grand Junction, Colo. was the first to report on Delta County School Board member Katherine Svenson's comments about transgender students during an October meeting.

 

"I would like to pass out something that shows people what is going on in the rest of the country," Svenson said at the school board meeting. "Massachusetts and California have passed laws relating to calling a student, irrespective of his biological gender, letting him perform as the gender he thinks he is, or she is. I just want to emphasize: not in this district. Not until the plumbing's changed. There would have to be castration in order to pass something like that around here."

Svenson refers to a groundbreaking bill recently signed by California Gov. Jerry Brown that allows transgender youth to use whatever bathroom and participate in whichever sports team they believe matches their gender identity.

When questioned about her controversial comments by KREX, Svenson was unapologetic.
“I don’t have a problem if some boys think they are girls, I’m just saying as long as they can impregnate a woman, they’re not going to go in the girls' locker-room,” she said.

Other Delta County school officials have said that they do not agree with Svenson's point of view on the issue.

On her district bio page, Svenson describes herself as the founder of an evangelical Christian ministry in northern India and volunteer teaches at a local Sunday School and Bible camp.

Back in June, Colorado's Civil Rights Division ruled in favor of a transgender students having the right to use the restroom for the gender that they identify as. The ruling involved the case of 6-year-old Coy Mathis, a suburban Colorado Springs girl who was prevented from using the girls' restroom at her school by school district officials.

Last year Vice President Joe Biden said that transgender discrimination is the "civil rights issue of our time," and transgender rights continues to be a new issue for school boards across the nation.

Seventeen states, including Colorado and the District of Columbia, now outlaw discrimination against transgendered people.

Happy Thanksgiving

In 2001, the War in Afghanistan began and was quickly followed by the War on a concept – Terrorism. By 2003, after brief excursions in Yemen, the Philippines and CÔte d’lvoire, U.S. forces were in Iraq. Then came Liberia, Georgia, Djibouti, Kenya, Ethiopia, and Eritrea. Drone strikes began in 2004. Strikes occurred next in Haiti, Pakistan, Lebanon, Somalia and Libya. Beginning in 2010, the number of troops in Iraq was reduced to 50,000. Osama Bin Laden was killed in Pakistan in 2011. Military activities were undertaken in Somalia, Uganda, Jordan, Turkey, Chad, Mali, and Somalia again. North Korea lurks.

Since about 2007 I have been posting some version of the following piece most years. My thought at the start was that I would keep posting it annually until America was no longer at war, then I'd move on to something else. At this point, it looks like I'll be posting it for the foreseeable future.

In September 1862, President Abraham Lincoln was increasingly concerned by the tremendous growth in the number of causalities in the Civil War. Following the disastrous loss at the second battle of Bull Run, he wrote a Meditation on the Divine Will in which he expressed the quandary of God’s presence.

“The will of God prevails. In great contests each party claims to act in accordance with the will of God. Both may be, and one must be, wrong. God can not be for and against the same thing at the same time.”

But to most Americans - north or south - God was on their side. Union and Confederate soldiers both prayed to the same God. Both read the same Bible. Both invoked the same God to aid him in battle against the other side.

Lincoln’s thoughts read like an ancient philosopher’s argument.

“By his mere quiet power on the minds of new contestants, He could have either saved or destroyed the Union without a human contest. Yet the contest began. And having begun He could give the final victory to either side any day. Yet the contest proceeds.”

In a country split and ravaged by war - truth, for Lincoln, had begun to dawn. God was not at America’s beckoned call. America was at God's...

By October 1863, with the Union victory in the Civil War all but assured, Lincoln was looking for a way to reunite the country. He proclaimed a national holiday to be spent in reflection – a day of thanksgiving.

The proclamation, written by his Secretary of State William Seward, called upon each citizen to regard America’s vigorous growth despite the long war.

“No human counsel hath devised nor hath any mortal hand worked out these great things. They are the gracious gifts of the Most High God, who, while dealing with us in anger for our sins, hath nevertheless remembered mercy. It has seemed to me fit and proper that they should be solemnly, reverently and gratefully acknowledged as with one heart and one voice by the whole American people.”

America remains at war – not a civil war - but one that divides us spiritually nonetheless.

As we pause to celebrate Thanksgiving 2013, and acknowledge our blessings, let us also remember our disobedience and “commend to His tender care those who have become widows, orphans, mourners or sufferers” in our present conflicts.

Let us become peacemakers.

The End of the Public University?

This from Jeffrey Selingo at LinkedIn:

About 8 out of every 10 college students attends a public college or university, from the local community college down the street to the massive flagship university in the middle of the state usually known for its football team. Of those students who go to public universities, most of them—some 70%—go to smaller, regional public colleges that train a majority of our teachers, nurses, and local business leaders.

The vastness and popularity of our public colleges and universities typically surprises audiences when I mention them in talks about my book on the future of higher ed. After all, only two of the top 25 national universities as ranked by U.S. News & World Report are public institutions, and the first one of those (University of California at Berkeley) doesn’t appear until #20. And if you pay attention to the national media, most of the attention is showered on universities such as Harvard, Stanford, Princeton, or small liberal-arts colleges such as Amherst and Williams.

Public universities rarely get much attention unless they reject your son or daughter, raise their tuition, or if their football team wins a national championship.

But given how many Americans are educated at public universities, especially at a time when a college degree is about the only ticket left to the middle class, we all have a stake in their future health. And right now, the signs for the health of many of these public institutions are not good.

Just this past week, Moody’s Investors Service, which rates the debt of mostly stable colleges, reported that 72% of four-year public universities are experiencing essentially flat or declining net-tuition revenue. That’s the money these colleges have left over after giving out financial aid to invest in buildings, academic programs, and faculty. In other words, most of these colleges are either treading water when it comes to new revenue or losing money every year.

“Public universities have not experienced such poor prospects for tuition-revenue growth in more than two decades,” the report said.

Now, if you’re a student or parent paying tuition at one of these colleges, you’re probably wondering why they are crying poor when your bill goes up every year even as it gets more difficult to enroll in the classes needed to complete a degree.

The problem is that these institutions have been raising tuition year after year to make up for declines in dollars from the state. Since 2008, 41 states have cut funds to higher education. At just 1 in 10 public universities do state funds make up the largest proportion of the university's budget; in 2003, states made up the largest provider at half of the public universities.

Not all of these institutions, of course, are innocent victims in this tale. Even after years of budget cuts, many are still inefficient in their operations and in desperate need of adopting more innovative business models. But such changes can only go so far before the core of the academic product suffers.

As the numbers from Moody’s seem to indicate, public colleges and universities don’t have much pricing power left to raise tuition to make up for cuts in state aid. So unless they get infusions of cash from elsewhere, what’s likely to happen is what is already occurring in places like California, where public colleges are turning away qualified applicants and where current students find it more difficult each semester to get into the classes they need to graduate.

What’s happening to public higher education is reaching crisis proportions. So as you cheer for State U. in the big football game this weekend, be thankful for the system we have that has educated generations of Americans because it might not be around much longer, at least in its current form.

Pope Francis Strafes Libertarian Economics

This from Matthew Yglesias at Slate:

Pope Francis' latest apostolic exhortation covers a number of topics, but really lights into libertarian economics. There's a lot of stuff about Jesus in his thinking that I can't really sign on to but here's a great point about media priorities and the declining marginal value of income:

How can it be that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points? This is a case of exclusion. Can we continue to stand by when food is thrown away while people are starving? This is a case of inequality. Today everything comes under the laws of competition and the survival of the fittest, where the powerful feed upon the powerless. As a consequence, masses of people find themselves excluded and marginalized: without work, without possibilities, without any means of escape.

But importantly, he follows up with a specific invocation of the need for state action rather than simple trust in the beneficence of the powerful:

In this context, some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts, expresses a crude and naïve trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system.

And, again, not a call for charity or goodwill toward the poor but specifically for economic regulation and democratic supervision of the capitalist system:

While the earnings of a minority are growing exponentially, so too is the gap separating the majority from the prosperity enjoyed by those happy few. This imbalance is the result of ideologies which defend the absolute autonomy of the marketplace and financial speculation. Consequently, they reject the right of states, charged with vigilance for the common good, to exercise any form of control. A new tyranny is thus born, invisible and often virtual, which unilaterally and relentlessly imposes its own laws and rules.

And on externalities:

In this system, which tends to devour everything which stands in the way of increased profits, whatever is fragile, like the environment, is defenseless before the interests of a deified market, which become the only rule.

Again, a call for political change:

A financial reform open to such ethical considerations would require a vigorous change of approach on the part of political leaders. I urge them to face this challenge with determination and an eye to the future, while not ignoring, of course, the specifics of each case. Money must serve, not rule! The Pope loves everyone, rich and poor alike, but he is obliged in the name of Christ to remind all that the rich must help, respect and promote the poor.

I've heard a number of conservative Catholic commentators remark numerous times that it's silly for left-wing people to be highlighting Pope Francis' thoughts on economic policy because all this stuff has been Catholic doctrine for a long time. I think this misses the point. Obviously a new pope isn't going to make up a new religious doctrine from scratch. But when you have a corpus of thinking and tradition that spans centuries, it makes a great deal of difference what you emphasize.

I remember very clearly having been an intern in Chuck Schumer's office and attending with the senator, some of his staff, and a wide swathe of New York City political elites an event at St Patrick's Cathedral to celebrate the posthumous award of the Congressional Gold Medal to Archbishop John O'Connor. His successor, Archbishop Egan, delivered an address that went on at length about O'Connor's charitable work, but on a public policy level addressed almost exclusively the Church's support for banning abortion, for discriminating against gay and lesbian couples, and for school vouchers. That was a choice he made about what he thought it was important for people to hear about. Pope Francis is making a different kind of choice.

Ohio Supreme Court Upholds Dismissal of Science Teacher

This from the School Law Blog:

The Ohio Supreme Court has upheld the termination of an 8th grade science teacher for refusing to remove religious displays from his classroom and continuing to inject his personal religious views in instruction after being told by his supervisors not to do so.

The state's highest court on Nov. 19 upheld the Mount Vernon City School District's dismissal of John Freshwater. The court's decision came after the district's board of education voted in 2008 to fire the teacher on four grounds: an incident in which Freshwater shocked a student with low-level electrical currents through a "Tesla" coil; his failure to adhere to the established curriculum; issues with his role as supervisor of the Fellowship of Christian Athletes; and disobedience of orders.

Freshwater sought a hearing before a state referee, who heard testimony from more than 80 witnesses in 38 days over 21 months. The referee sustained the termination on two of the grounds: failure to adhere to the curriculum, and disobedience of orders.

In its 4-3 decision in Freshwater v. Mount Vernon City School District Board of Education, the state supreme court upheld the termination solely on the disobedience charge.

Because there was "ample evidence of insubordination to justify the termination decision," the court said it "need not reach the constitutional issue of whether Freshwater impermissibly imposed his religious beliefs in his classroom."

Freshwater had argued that the district violated his First Amendment free speech rights based on the content or viewpoint of his curriculum-related materials with his students and his use of supplemental materials. Court papers show that Freshwater gave religious handouts to his students, showed videos on creationism and "intelligent design," displayed religious materials in his classroom, and referenced the Bible.

Administrators repeated[ly] advised Freshwater not to display religious materials and have particular religious discussions in class.

"Freshwater not only ignored the school district's directive, he defied it," Chief Justice Maureen O'Connor said. "After he was directed to remove the items, Freshwater deliberately added to them, incorporating the Oxford Bible and Jesus of Nazareth into the classroom. He then refused to remove his personal Bible from his desk, and refused to remove a depiction of former President George W. Bush and Colin Powell and others in prayer from his wall."

O'Connor said the court recognized "that this case is driven by a far more powerful debate over the teaching of creationism and intelligent design alongside evolution."

"The United States Supreme Court and at least one other federal court have held that teaching theories of creationism and intelligent design in public schools violates the Establishment Clause because they convey 'supernatural causation of the natural world' and therefore are inherently religious concepts," the state supreme court said, citing the U.S. Supreme Court's 1987 decision in Edwards v. Aguillard and the famous 2005 federal district court ruling in Kitzmiller v. Dover Area School District.

But the U.S. Supreme Court also held in Aguillard that teaching creationism is not prohibited in public schools as long as it is done "with the clear secular intent of enhancing the effectiveness of science instruction," the Ohio high court noted.

"Here, we need not decide whether Freshwater acted with a permissible or impermissible intent because we hold that he was insubordinate, and his termination can be justified on that basis alone," the state supreme court said. "Freshwater is fully entitled to an ardent faith in Jesus Christ and to interpret Biblical passages according to his faith. But he was not entitled to ignore direct, lawful edicts of his superiors while in the workplace."

Writing for the dissenters, Justice Terrence O'Donnell said the case was not one of "simple insubordination" but about "a veteran science teacher singled out" by the school district "because of his willingness to challenge students in his science classes to think critically about evolutionary theory and to permit them to discuss intelligent design and to debate creationism in connection with the presentation of the prescribed curriculum on evolution."