Friday, June 29, 2012

Republicans, Romney, Education Vouchers, and the Religious Right

Diane Ravitch has provided a review of a white paper issued on education by the Romney campaign.

A Chance for Every Child: Mitt Romney’s Plan for Restoring the Promise of American Education
a white paper by the Romney campaign, with a foreword by Jeb Bush
34 pp.

Ravitch’s article appeared in the New York Review of Books: In Mitt Romney’s Classroom. Ravitch concludes that Romney’s plan, and that of the Republicans, is, ultimately, to destroy the public education system in this country. She may have underestimated Romney and the Republicans; they could be plotting something even more sinister than that.

Consider these quotes from Ravitch’s article.

"Romney claims that school choice is ‘the civil-rights issue of our era,’ a familiar theme among the current crop of education reformers, who now use it to advance their efforts to privatize public education."

"He takes a strong stand against certification of teachers—the minimal state-level requirement that future teachers must pass either state or national tests to demonstrate their knowledge and skills—which he considers an unnecessary hurdle."

Consider now that Romney and the Republicans are strongly in favor of providing public funds in the form of vouchers that children can use to finance their education at a school of their choice. A compliant school accreditation system, and lax standards for what might be called a "teacher," would mean that just about anyone can hang out a shingle and soak up those public funds. That would give free rein to the for-profit schools that have already caused so much grief. Ravitch suggests that this "liberal" view of education can lead in other directions as well.

She provides Louisiana as an example.

"In Louisiana, where Governor Bobby Jindal’s education reform legislation was enacted in mid-April, the new law declares that students in low-performing schools are eligible to take their share of state funding—about $8,500—to any accredited private or religious school. About 400,000 students (more than half the students in the state) are eligible...."

Consider some of the schools that are scheduled to receive students and funding.

"....the Eternity Christian Academy, which currently has fourteen students, has agreed to take in 135 voucher students. According to a recent Reuters article, students in this school

"....sit in cubicles for much of the day and move at their own pace through Christian workbooks, such as a beginning science text that explains ‘what God made’ on each of the six days of creation. They are not exposed to the theory of evolution."

"The pastor-turned-principal explained, ‘We try to stay away from all those things that might confuse our children.’ Some of the other schools that have been approved to receive state-funded vouchers ‘use social studies texts warning that liberals threaten global prosperity; Bible-based math books that don’t cover modern concepts such as set theory; and biology texts built around refuting evolution’."

Every dollar that goes to this type of school is subtracted from the funds available for the public education system. Is this the kind of education that tax-payers should be supporting?

Ravitch has revealed the tip of an iceberg. This is no quaint exception; this is a type of education that is popular among evangelicals and is growing rapidly. And now they have figured out a way to get the public to pay for it.

We discussed some of the issues associated with the evangelical base of the Republican Party in Religious Extremism—U.S. Style. Let us return to Joe Bageant and his experiences with fundamentalism and this class of citizen as detailed in his book Deer Hunting with Jesus: Dispatches from America’s Class War.

"Middle of the road Jews, Unitarians, Protestants, and Catholics, not to mention the secular humanists among us, cannot imagine how complete a lifestyle the cultish fundamentalist churches provide. This self-referential culture is so focused on religion and conviction that it was bound to come to see the larger secular society as its persecutor and all authority other than God’s, especially that of the government, as corrupt."

For many, the goal is to establish a theocracy in which all citizens would adhere to biblical laws. To accomplish their goals they have established their own school system. Once homeschooling was a means of avoiding racially integrated schools, now it is a means of indoctrinating children with conservative ideals, and avoiding contact with people having other beliefs.

"Fundamentalist strategists make it clear in their writings that the purpose of homeschooling and Christian academies is to create the right-wing Christian cadres of the future. The goal is to place ever-increasing numbers of believers in positions of governmental influence."

"The training of Christian cadres is far more sophisticated than nonfundamentalists realize. By now, most informed people probably know that the homeschoolers have a university network, with dozens of campuses across the nation, each with its own smiling Christian pod people, each school a clone of Jerry Falwell’s Liberty University in Lynchburg, Virginia. But how many outsiders know the depth and specificity of political indoctrination in these schools?"

"For example, Patrick Henry College in Purcellville, Virginia, a college exclusively for Christian homeschoolers, offers programs in strategic government intelligence, law, and foreign policy, all with a strict, Bible-based ‘Christian worldview’."

These comments may seem a bit over the top, but we learned in The Tea Party Unmasked that those citizens who would be considered the Tea Party core are concerned not so much with small government, but rather with the need for "putting God in government."

Let’s consider what happened the last time the Republicans controlled the White House.

"Seven percent of all internships handed out by the Bush administration went to Patrick Henry students, and many more went to graduates of similarly religious rightist colleges. The administration also recruited from the faculties of these schools, appointing right-wing Christian activist Kay Coles James, former dean of the Robertson School of government at Pat Robertson’s Regent University, as director of the U.S. Office of Personnel Management. What better position from which to recruit fundamentalists?"

If the Republicans regain control, this "Christianization" of the government will resume. The Christianization of society will be buttressed by pouring large amounts of taxpayer dollars into what are fundamentalist madrassas.

Romney has bought into this process—anything that will get him the presidency.

Thursday, June 28, 2012

The Advantages of High Taxes and the Disadvantages of Low Taxes

Republican legislators often offer themselves up for ridicule by being steadfast in their denial of well-established findings in fact-based areas of study such as the sciences and history. An article by Brian Chappatta for Bloomberg is the latest to poke fun at their strange beliefs. His focus is on the insistence of Republican governors like Sam Brownback of Kansas and Mary Fallin of Oklahoma that cutting state income taxes will lead to greater economic prosperity. Chappatta utilizes data presented in a study by the Institute on Taxation and economic Policy (ITEP).
"The findings show cutting state income taxes to stimulate growth relies on ‘flawed analysis’ based on the theories of economist Arthur Laffer, said Carl Davis, a senior analyst at ITEP in Washington and author of the report. Laffer’s work was cited by Republican Governors Sam Brownback of Kansas and Mary Fallin of Oklahoma as a reason to cut income taxes as a way to stimulate job growth and attract business."

It seems that Brownback has launched his own corollary to the low-tax theory: general cuts in taxes should be combined with an increase in tax for the bottom quintile.

"Kansas passed legislation this year that would cut taxes by more than $760 million a year, though the poorest 20 percent of Kansans, with an average income of $11,000, will have taxes increased, according to a separate ITEP report."

If the governors were correct one might expect low-tax states to fare better economically than high-tax states.

"Nine states have no personal income-tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming. The nine states defined as "high rate"by ITEP were California, Hawaii, Maine, Maryland, New Jersey, New York, Ohio, Oregon and Vermont."

How did these states fare over the period 2001-2010? Note that the Great Recession was captured in this interval. Consider median household income:

"Median household income declined an average 0.7 percent among the nine "high-rate" states, compared with a 3.5 percent drop in the nine states without such a levy."

And as for economic activity during this period:

"Per-capita economic output increased an average 10.1 percent in the nine "high-rate" states....The average growth rate for the nine no-tax states was 8.7 percent."

These two comparisons are not terribly dramatic. They suggest that cutting state income taxes might be counterproductive, but keep in mind that state income taxes are not expected to be the prime factor in determining overall economic health. The point being made is that the governors’ contention is not based on fact, but on faith.

Chappatta provides a fitting summary of faith-based economics:

"’Those who don’t believe in Santa Claus or the Easter Bunny anymore, and actually look at facts and data, recognize that since supply-side economics has been implemented in America, the complete opposite of what supply siders had promised has occurred,’ Martire said."

While state income taxes are not likely to dominate the character of a state, they do have a role to play.

"’States that have higher overall taxes have better capacity to weather economic downturns,’ Martire said. ‘Then they can maintain their spending on the salary of workers, who then go out and spend their paychecks on the local economy’."

It might also be argued that states with a higher revenue base have more options in providing an environment where people and companies will want to come and live: better infrastructure, good schools, a healthy environment, cultural charms..... In fact, dynamic economies will demand these things and apply pressure for increased revenue. States that think starvation brings health have few options and see little need for any.

Tuesday, June 26, 2012

The Charitable Contribution Deduction: Who Benefits?

A dictionary definition of charity might be: the giving of money or help to those in need. That is certainly a noble gesture, and most would agree that it is appropriate for the government to encourage acts of charity by making them tax deductable. How this form of encouragement works out in practice is rather disheartening. Bruce Bartlett provides a nice discussion of this tax deduction in his book on tax-related issues: The Benefit and the Burden

Bartlett tells us that there is a lot of money involved in the charity business.

"The deduction for charitable contributions is a large tax expenditure. Its size is a bit confusing because the Treasury Department lists it under three different categories: those for education, those for health care, and all others. The total revenue loss was $53 billion in 2012."

That means that we, the general tax payers, subsidized the activities of supposedly charitable individuals to the tune of $53 billion in one year. One should hope we are getting our money’s worth.

As with most tax expenditures the people who are most able to benefit are the ones in the high tax brackets.

"In 2009, 55 percent of the tax savings from the charitable contributions deduction went to those making more than $200,000; another 26 percent went to those making between $100,000 and $200,000. Less than 5 percent went to those making less than $50,000."

Many of the lower income people who make charitable contributions are ineligible for the saving because they are not in a position to itemize deductions on their tax return.

And what do people consider charitable contributions?

"According to surveys, 66 percent of contributions by those with incomes below $100,000 goes to religious institutions; only 7 percent goes to institutions focusing on health education or the arts. By contrast, among those with incomes over $1 million, 66 percent of contributions goes to health, education, or the arts; only 17 percent goes to religious organizations."

Religions, education, health, and the arts are the beneficiaries of charitable giving. What does this have to do with our definition of charity? How much of this ends up in the hands of the needy? In the view of the Internal Revenue Service, that is not even an appropriate question to ask. To them charity is any contribution to an organization that has attained tax-exempt status.

Religions perform charitable acts, but most of the tax-deductable contributions are more a form of dues; contributions are intended to cover the general operating costs of the religious institution. Fine, but why should the general taxpayer subsidize the operation of religious institutions?

If a wealthy person wants to contribute $10 million to create an endowed chair in some field at a university and thus have his name immortalized, what does that have to do with charity? And why do we have to reimburse him $3 million for his self indulgence.

Bartlett discussed the most irritating of the charitable abuses—one few appreciate—think tanks. Think tanks are those mostly conservative organizations that spend their time promoting their biases. Institutions with an original intent that was loftier, have become mouthpieces for those who can afford to promote their political philosophies.

"...deductible contributions to think tanks and related organizations are substitutes for nondeductible political contributions."

This is how it works:

"For example, in 2010 the conservative Heritage Foundation, which is tax exempt under section 501(c)(3) of the tax code, set up a parallel organization called Heritage Action for America which is not tax exempt and is organized under section 501(c)(4) of the tax code. This reorganization permits Heritage to be more active politically on the issues of concern to its contributors without jeopardizing its tax exempt status."

This dodge allows outfits like Heritage:

" be openly partisan, endorsing candidates, running advertisements, making campaign contributions, and so on."

Perhaps even more perverse is another version of this tax dodge.

"Conversely, many political groups and trade associations have 501(c)(3) affiliates for those that need tax-exempt status to receive funds from a foundation, an estate, or someone in need of a tax deduction."

And what does this political chicanery have to do with charity?

What a mess! It would be better to eliminate the charitable deduction entirely than to condone these abuses. People would still support their churches and the churches would still pursue their charitable activities. People have always found ways to contribute to the truly needy. As Bartlett points out:

"Many countries do not allow such a deduction and don’t appear to suffer as a result. These include Austria, Finland, Ireland, Italy, Sweden, and Switzerland."

Ideally, one could redefine "charity" to be actual charity, but, of course, nothing will change. The needy have no political voice; the non-charitable special interests can speak loud and clear.

Monday, June 25, 2012

Containing Healthcare Costs: A Commercial Integrated Care Model That Works

Accountable care organizations (ACOs) are being encouraged for Medicare recipients by the recent healthcare reform legislation. These are groups of providers who band together to take advantage of economies of scale, and agree to share both financial risks and financial gains in meeting health and cost metrics defined for Medicare recipients. The agreement to share risk is critical. It raises the incentive to save costs throughout the system, rather than casually passing them on to another provider. A physician is motivated to be consciously thinking of how to be efficient in his/her own activities, but must also worry about excessive use of hospitals, specialists, medications, and diagnostic tests. In other words everyone has skin in the entire operation. 

ACOs were discussed in Healthcare Costs, Accountable Care Organizations, and Kaiser Permanente. Kaiser, a fully integrated service provider, with its own physicians, hospitals, pharmacies, and clinics, was cited as the type of organization likely to be most efficient as an ACO. It is likely that many versions of integration will be put forth in the quest for greater efficiency.

A recent article posted on the Health Affairs Blog by Glenn Melnick and Lois Green discusses an experiment in integrated healthcare delivery that was initiated entirely in the commercial sector, and had its origins before the call from government for ACOs. In 2007, the projections of healthcare costs in California were already recognized to be unsustainable.

"Located in the competitive Sacramento market of northern California, the program has been receiving national attention as an example of an innovative shared savings model involving a large insurer—Blue Shield of California; a purchaser—the California Public Employees Retirement System (CalPERS); a physician group—Hill Physicians Medical Group; and a hospital system—Dignity Health (formerly Catholic Healthcare West). The population served by the virtually integrated health organization includes approximately 42,000 CalPERS employees and their families covered by Blue Shield."

After two years of planning, the program began to function in 2010. The commitment was made to deliver to CalPERS a zero percent 2010 premium increase by the participants with no decrease in the quality of service. They all agreed to share the risk if the metric was not reached, and they all agreed to share any profit if the goal was exceeded. The team kept existing cost structures in place and focused on efficiencies and on saving costs through better healthcare outcomes. Each participant also contributed to the upfront costs associated with generating this partnership.

This type of organization refers to itself as a virtual integrated service provider. It focused on five strategies to attain the necessary savings:

"....integrated discharge planning, care transitions and patient engagement, creation of a health information exchange, patient repatriation, and evidence-based variance reduction."

How successful was the first year of operation?

"The project has produced impressive year-one clinical, quality, customer and financial outcomes, including reductions in readmissions, inpatient utilization, and cost savings of approximately $20 million, $5 million above the target."

To put this in perspective, California insurance companies had been raising their premiums by about 11% per year. This experiment succeeded in cutting costs by more than 11% in one year.

What might the future hold? Daryl Cardoza, CEO of Hill Physicians Medical Group, provides this perspective:

"We’re not done yet. Halfway through the second year we were achieving similar results in an environment where we thought we were already best in breed. This tells you that there is more to get and what can be attained by working in a care-coordinated system....But it gets tougher to keep getting more and more savings. Though we sustained our gains in the second year and actually improved upon them some, the big initial gains are tougher to achieve at the same order of magnitude in subsequent years. That said, we do anticipate sustaining a moderated trend."

This type of organization can only squeeze out so much cost and diminishing returns soon set in. But the expectation is that a long-term lowering in the growth of healthcare costs will be attained.

This program was interesting in a number of ways. It demonstrated that "virtually" integrated groups of providers could attain significant cost savings at relatively little up-front cost; its methods and results will stand as examples for other organizations that might choose to follow; and it demonstrated that the commercial community could respond without an imposed mandate from a government agency.

One might be tempted to ask: What was the motivation of these providers to band together and address the cost and quality issues? One can be sure that being good citizens was part of the reasoning, but that is probably not enough motivation on its own.

True market-based solutions are not always appropriate when society’s requirements are involved, but healthcare has long been in need of some market pressure. The main motivation of the participants seems to have been the traditional market approach of lowering cost in order to recover income via increased volume. Juan Davilla of Blue Shield of California provided this input:

"If providers are to sacrifice margin and do the hard work to improve affordability, then they need market share for it to make sense."

"Blue Shield and its partners gained more than 1,500 members in the Sacramento market, which we attribute to the success of the integrated model."

Perhaps one should watch what one wishes for. True market competition will eventually drive down costs until near monopolies are formed and eliminate the market. If we had a true healthcare market, providers’ fees, salaries, and wages would be the next thing to cut. It is doubtful that anyone plans on going that far, but once you choose to play the market game you put yourself on a slippery slope.

Let us take our good news where we find it, and congratulate the participants on a job well done—so far.

Sunday, June 24, 2012

The United States Relinquishes Debt’s Dubious Crown—to Canada

It is not often that one hears praise for the economic behavior of the United States and its citizens. Two recent articles indicate that the country is capable of sober and responsible actions—at least for short periods.

The McKinsey Quarterly provided a short piece highlighting the progress of the US in decreasing the level of the household debt it is carrying: Global deleveraging scorecard—US takes the lead.

"Americans steadily increased their debt levels for a good six decades, but it wasn’t until the turn of the millennium that the ratio of household debt to income really soared. Yet by the second quarter of 2011, three years after the start of the global economic crisis, the US ratio had fallen 11 percent from its peak. At the current rate of deleveraging, it would return to trend as of mid-2013...."

McKinsey uses Sweden as a benchmark. Sweden experienced a similar financial crisis in the 1990s.

If Sweden represents a historical norm then there is still a long way to go, but at least we are well on our way and have managed to get this far without falling back into a recession.

An article in The Economist illustrates the different paths being taken by the US and Canada since the Great Recession: Canada’s housing market: Look out below.

"When the United States saw a vast housing bubble inflate and burst during the 2000s, many Canadians felt smug about the purported prudence of their financial and property markets. During the crash, Canadian house prices fell by just 8%, compared with more than 30% in America. They hit new record highs by 2010."

World economic conditions kept interest rates low in Canada, feeding a very hot housing market.

"In response, Canadians have sought ever-bigger loans for ever-costlier homes. The country’s house prices have doubled since 2002."

"Speculators are pouring into the property markets in Toronto and Vancouver. "We have foreign investors who are purchasing two, three, four, five properties," says Michael Thompson, who heads Toronto’s economic-development committee. Last month a modest Toronto home put on the market for C$380,000 ($381,500) sold for C$570,000, following a bidding war among 31 prospective buyers."

Riding an increasing real estate market requires taking on additional debt.  Canadian households have been doing this with gusto, although not as wildly as the US did at its worst.  Nevertheless, the US has finally been exceeded in the debt race.

Accumulating debt in order to follow escalating housing prices has traditionally led to a bursting bubble. While not inevitable, it is certainly a concern.

Meanwhile, we, south of the border, are happy to relinquish the debt crown to our neighbors.

Friday, June 22, 2012

Romney’s "Friends:" I’m Mormon, Not Christian; Extreme Wealth Inequality is Good

It is always beneficial for a politician to have many friends. Friends can contribute money or advice; they can be comforting in trying times; and like kids, they can say the darnedest things.

Mitt Romney has been on the defensive about his Mormon faith, not because of his Democratic adversaries, but because the Evangelical Christians who make up so much of the Republican base have a habit of referring to Mormonism as a "cult."

A recent opinion piece in the New York Times by David V. Mason may not have been viewed as helpful. He chose the provocative title: I’m a Mormon, Not a Christian. The reference to Mason as a "friend" was made with tongue firmly planted in cheek. There is no known connection between the two people, other than their Mormon religion.

Mason provides this perspective:

"For the curious, the dispute can be reduced to Jesus. Mormons assert that because they believe Jesus is divine, they are Christians by default. Christians respond that because Mormons don’t believe — in accordance with the Nicene Creed promulgated in the fourth century — that Jesus is also the Father and the Holy Spirit, the Jesus that Mormons have in mind is someone else altogether. The Mormon reaction is incredulity. The Christian retort is exasperation. Rinse and repeat."

So far so good, but then Mason proceeds to say he is tired of theological hair splitting, and implies that Christianity is unworthy of his membership.

"Being a Christian so often involves such boorish and meanspirited behavior that I marvel that any of my Mormon colleagues are so eager to join the fold."

He believes that Mormonism stands on its own as an equal to Christianity, each being based on Abrahamic origins.

"....I rather agree with Richard D. Land, the president of the Ethics and Religious Liberty Commission of the Southern Baptist Convention, who calls Mormonism a fourth Abrahamic religion, along with Judaism, Christianity and Islam. Being set apart from Christianity in this way could give Mormonism a chance to fashion its own legacy."

Mason then leaves the reader with this memorable quote:

"Whatever happens in November, I hope Mormonism eventually realizes that it doesn’t need Christianity’s approval and will get big and beat up all the imperious Christians who tormented it when it was small, weird and painfully self-conscious. Mormons are certainly Christian enough to know how to spitefully abuse their power."

Did he just say that Mormons are going to take over and when they do they will abuse their power and beat up "imperious Christians?" I think he did.

Adam Davidson provided a fascinating article in the New York Times about Edward Conard: The Purpose of Spectacular Wealth, According to a Spectacularly Wealthy Guy. Given that Conard is a former colleague of Romney at Bain Capital, and is one of his largest doors, the appellation "friend" is appropriate. Davidson tells us that Conard’s wealth is "most likely in the hundreds of millions."

Romney is not really very good at projecting himself as just a normal guy who happens to be wealthy. While not ashamed of his wealth, he does not go around bragging about it. He would probably be happy if the issue of wealth never came up. Being friends with Conard may make that difficult.

"Unlike his former colleagues, Conard wants to have an open conversation about wealth. He has spent the last four years writing a book that he hopes will forever change the way we view the superrich’s role in our society. "Unintended Consequences: Why Everything You’ve Been Told About the Economy Is Wrong," to be published in hardcover next month [June} by Portfolio...."

And what is Conard’s contribution to Romney’s political messaging?

"....[he] aggressively argues that the enormous and growing income inequality in the United States is not a sign that the system is rigged. On the contrary, Conard writes, it is a sign that our economy is working. And if we had a little more of it, then everyone, particularly the 99 percent, would be better off. This could be the most hated book of the year."

Conard argues that the economy is driven by people willing to take risks. The greater the payoff in wealth, the more likely people will be willing to take extreme risks.

"....’When I look around, I see a world of unrealized opportunities for improvements, an abundance of talented people able to take the risks necessary to make improvements but a shortage of people and investors willing to take those risks. That doesn’t indicate to me that risk takers, as a whole, are overpaid. Quite the opposite.’ The wealth concentrated at the top should be twice as large, he said."

And then there is this observation:

"Conard....insists that even the dodgiest financial products must have been beneficial or else nobody would have bought them in the first place. If a Wall Street trader or a corporate chief executive is filthy rich, Conard says that the merciless process of economic selection has assured that they have somehow benefited society. Even pro-market Romney supporters take issue with this."

And, finally, one more politically incorrect comment:

"The financial crisis, he writes, was not the result of corrupt bankers selling dodgy financial products. It was a simple, old-fashioned run on the banks, which, he says, were just doing their job."

"With friends like these....who needs enemies?"

Thursday, June 21, 2012

Amphetamines, Good Grades, ADHD, Addiction, and Drug Abuse

Alan Schwarz has provided a troubling article in the New York Times: Risky Rise of the Good-Grade Pill. Schwarz investigates the growing practice of teenagers who feel threatened by academic expectations to turn to amphetamines and methylphenidates as study aids.
"....there is no reliable research on how many high school students take stimulants as a study aid. Doctors and teenagers from more than 15 schools across the nation with high academic standards estimated that the portion of students who do so ranges from 15 percent to 40 percent."

The drugs of choice are the ones dispensed for children deemed to be suffering from ADHD (Attention Deficit Hyperactivity Disorder). That suggests a partial explanation for this datum:

"The number of prescriptions for A.D.H.D. medications dispensed for young people ages 10 to 19 has risen 26 percent since 2007, to almost 21 million yearly, according to IMS Health, a health care information company — a number that experts estimate corresponds to more than two million individuals."

The phenomenon of students turning to dangerous drugs in order to enhance their academic success is a story of considerable moment, and that is where Schwarz turns his focus. But like all good reporters he provides needed background information.

The drugs the students have chosen to use are, for good reasons, controlled substances.

"The D.E.A. lists prescription stimulants like Adderall and Vyvanse (amphetamines) and Ritalin and Focalin (methylphenidates) as Class 2 controlled substances — the same as cocaine and morphine — because they rank among the most addictive substances that have a medical use. (By comparison, the long-abused anti-anxiety drug Valium is in the lower Class 4.) So they carry high legal risks, too, as few teenagers appreciate that merely giving a friend an Adderall or Vyvanse pill is the same as selling it and can be prosecuted as a felony."

Schwarz also contributes this observation:

"While these medicines tend to calm people with A.D.H.D., those without the disorder find that just one pill can jolt them with the energy and focus to push through all-night homework binges and stay awake during exams afterward."

Schwarz seems to have bought into two conclusions, each of which would border on the miraculous if true. If you have trouble believing in one miracle, two coincident miracles will definitely be hard to accept.

The first is the notion that there is a distinct difference between the response of the brains of people supposed to be suffering from ADHD and those assumed not to be suffering from ADHD. The issue of ADHD and the drugs prescribed for the condition has been discussed in Psychiatrists, ADHD, Teachers, and Ritalin: The Path to Mental Illness. A drug like Ritalin performs as a dopamine reuptake inhibitor. The brain is constantly issuing and absorbing certain chemicals such as dopamine. Ritalin inhibits the re-absorption, thus causing an elevated dopamine level. This is the exact same response the brain has to cocaine, which helps explain why Ritalin can also be highly addictive.

One might say that ADHD children have a dopamine deficiency, or some related chemical imbalance that would cause a different response to a drug like Ritalin. That may be true, but psychiatrists have been searching for such a connection for decades and have yet to prove chemical imbalance is associated with mental illness. But that has not stopped them from making the claim.

It is time for a brief aside on the state of psychiatric science. If you give someone a pill that increases the dopamine level in a person’s brain and a beneficial behavior modification occurs, then you can assume that the condition causing the unacceptable behavior was caused by a deficiency of dopamine. If that logic makes sense to you, you have all the qualifications necessary for a successful career in modern psychiatry. If a person has a fever and you give him aspirin and the fever diminishes, then you can assume that fevers are caused by a deficiency of aspirin in the body. If that does not make sense to you, then you have flunked and will have to seek a less remunerative career.

The second miracle is only implied by Schwarz. He mentions how dangerous these drugs are for the students who would use them, but he says nothing about any danger to all those children described as suffering from ADHD and who take them continuously for years—as if they are somehow protected from ill effects. If addiction is limited to only those who take the drug under false premises, and is harmless to "true" ADHD sufferers, that would indeed be a miracle.

Wow! Does that mean that ADHD renders you safe from cocaine addiction as well?

Drugs like Ritalin do seem to help children focus on simple tasks, particularly those involving repetition? There does not seem to be any long-term academic benefit. In fact, there is evidence of diminished capability when complex reasoning is required. That is consistent with the drug helping students to focus on studying for a test, but it would be interesting to see if mental function is actually enhanced—or diminished—or students merely study longer than they would otherwise.

Children who try to stop taking Ritalin often suffer withdrawal symptoms making their behavioral mannerisms worsen. If they continue to take the drug for years their condition also worsens. What a curious position in which to put a child.

Many of the students that Schwarz writes about have ended up in drug rehabilitation. Uncontrolled use of addictive drugs inevitably leads to a crash.

It is perhaps too early to know what the controlled use of addictive, brain-altering drugs for many years will have done to our children.

Wednesday, June 20, 2012

Who Are These Public Workers, and How Much Do They Cost?

The Center on Budget and Policy Priorities has provided an article by Elizabeth McNichol: Some Basic Facts on State and Local Government Workers. This paper provides a tally of what roles these workers perform, how many there are, and how large is their compensation compared to the private sector.

By far, most public workers are in the business of providing education services to our children. The next largest category is protective services, which includes police officers, fire fighters and correctional officers.

The number of public employees has not changed much over time as a fraction of the population. What growth has occurred has been in the area of educational services.

McNichol provides this summary:

"....the number of non-education workers remained about the same relative to the overall population until declining somewhat after 2008. Since August 2008, the total number of state and local government employees has declined by 662,000."

Nothing is more contentious and confusing than the wild claims made about public employee wages and total compensation. The actual situation seems rather simple and unsurprising. Even with benefits included, public-sector workers earn less than private-sector workers with similar education, job experience and other characteristics. The public sector unions do what they do best and protect the lower income workers from having wages that fall too low, but the higher income workers do not keep pace with their private-sector counterparts.

"The Center for Retirement Research at Boston College, widely recognized as an authoritative source on retirement income issues, recently found that total compensation for public-sector workers — including the value of benefits — is 4 percent less than that of comparable private-sector workers."

It is not surprising that wages and benefits make up a significant fraction of state and local budgets.

"Wages and salaries make up about one-third of state and local governments’ general spending, on average, according to Census Bureau data. States spend a considerably smaller share (about 15 percent) than local governments (41 percent)."

"Spending on benefits such as health insurance and retirement is not reported to the Census but can be estimated using data from the Bureau of Labor Statistics. Adding these costs brings the total costs of compensation for state and local workers to about 44 percent of state and local spending. Some 20 percent of state spending is for employee compensation, compared to about 55 percent of local government spending."

So, benefits, including retirement, add 5% to state budgets and 14% to local government spending. On average, benefits add about 33% of the wage to the compensation of the typical worker. This seems rather tame in a fiscal sense. So what is the big problem?

The big problem is that states and local governments are probably not contributing enough to the employee pension plans to cover the cost of future retirement payouts.

While there are exceptions where greed and poor management have allowed situations to get out of control, the problem mainly arises because commitments were made at a time when potential earnings from traditional investments in stocks and bonds were much higher. Most pensions are based on anticipated earnings of 7.5-8.0%. Consider this chart provided by The Economist.

Over a span of nearly 40 years, pension funds could obtain earnings near their targets merely from investing in government bonds. Now returns from government bonds are bouncing around in the vicinity of 2%. Couple this with equity markets that have been essentially flat for over the last decade and one recognizes the problem: where are the earnings going to come from?

We discussed this issue of pension plans and earnings in Pension Plans and the Quest for Earnings: CalPERS and Canada. There we reported that any admission that future returns on investment would fall below the targets leaves the plans vastly underfunded. A change in CalPERS’s earnings target from 7.75% to 7.5%, seemingly minor, has tremendous leverage on state and local budgets. For example, that would translate to a 12% increase in pension costs for Santa Clara County in California.

The problem is further exacerbated by the fact that the plans have not been meeting their mark in recent years, and governments have chosen not to, or have been unable to, increase contributions to cover the shortfall.

Where does this leave us? Wishful thinkers believe the pension plans can up their earnings sufficiently by pursuing ever riskier investment strategies. In a world of winners and losers some may succeed, but it is likely that most will not, and the situation could become even worse. The private sector is rapidly eliminating defined benefit pension plans in favor of defined contribution plans such as 401Ks. This is truly a cop-out because they do not pay enough into the plans themselves to provide a significant benefit, and few people have enough extra money to salt away in the plans to make a difference.

Most governments seem to have responded by keeping their plans in place, but cutting retirement benefits and raising required contributions by employees. This is a reasonable approach if pursued with fairness in mind.

If one steps back and puts public employees and their diminished retirement prospects in context with private-sector workers and their diminished retirement prospects, one can only conclude that we, as a country, are in deep trouble. Forcing people to work longer until they retire is not good for the economy when youth unemployment is such a large problem, and it is probably not good for productivity. People will have to retire and they will have to have enough income to support themselves. Social Security is not adequate as a source of retirement income.

The obvious conclusion is—we need a National Pension Plan to supplement Social Security.

Monday, June 18, 2012

Globalization, Oligarchs, and Confused Politicians

David Runciman has produced an interesting discussion of globalization and the concentration of wealth and power in an article in the London Review of Books: Confusion is Power. The occasion for Runciman’s discussion is a new book by Ferdinand Mount: The New Few, or a Very British Oligarchy: Power and Inequality in Britain Now. Mount’s concerns are driven, as the title suggests, by the ever increasing concentration of wealth in the hands of a few and its potential consequences. The discussion is focused on Britain, but the same issues are at play in the United States; only the names are changed.

Runciman begins by reminding us what an actual oligarchy looks like by describing Russia.

"In Russia the basics are easy to understand: people use money to get power and power to get money. The country is ruled by a narrow, self-serving elite who go through the motions of holding elections and transferring power. No one is fooled."

He contrasts the simple politics of Russia with that of countries like the US, the UK, and the EU, and concludes they are still true democracies because their politics are sufficiently complicated as to leave the observer baffled as to how anything gets accomplished. He seems to agree with this assessment by Mount:

"....we are not really ‘a full-blown oligarchy’ but ‘a flabby, corroded type of liberal democracy in which the oligarchs have been enjoying a free run’."

Runciman provides an interesting perspective on the changes that have come with growing inequality.

"This has not been a power grab by a bunch of ruthless operators. It’s more like an embarrassing accident. The people who are running the show seem as confused as anyone about how we got here. They didn’t mean it to turn out like this and they would quite like to do something about it. They just don’t know how."

He describes politicians as having become not so much corrupt as incompetent and weak.

"The politicians are just following the line of least resistance. Standing up to people with vast reserves of wealth and the power to make your life more difficult than it might otherwise be takes a certain amount of effort; certainly more effort than playing along with them does. And playing along with them is more fun. So if no one is going to insist on your doing the difficult thing, why bother?"

The discussion then turns to examining factors that have made the current circumstances different than previous periods. The most obvious occurrence is the rise and dominance of globalization. Runciman provides two ways to view the effects of globalization.

"One says that globalisation has simply exposed societies like ours to the hard winds of global competition. This has driven wages down at the bottom but driven rewards up at the top, because in the hyper-competitive global market for executive talent, success is at a premium."

He views this as a bit of a myth because the phrase "executive talent" often seems to be an oxymoron.

"The problem with that argument is that executive rewards are insufficiently correlated to success or even to obvious signs of talent: too many of the new rich seem to have had the money given to them regardless of what they do. Their reward is for being in the right place at the right time."

He then provides a less conventional—and more interesting—way to view the effects of globalization.

"The more convincing story is that globalisation is a cover story for indecision and fear. It does not drive the concentration of power and wealth according to rational measures of market forces but it sows enough confusion and uncertainty to make decisive action look like too much trouble. Politicians who suspect that they don’t know what they are doing are reluctant to do anything that might confirm it."

A state of "confusion and uncertainty" has been deliberately fostered by the aggressive greed of the financial sector.

"....knowledge is not always power. Sometimes, confusion is power as well. The finance executives don’t really know what they are doing, as we have discovered in the last few years. But they have created a world that no one else understands either, which gives them all the freedom they need."

Globalization also provides the wealthy with a club they can brandish to strike fear in the timid and the confused: the threat to leave and to take their wealth with them.

"In Britain the politicians are terrified that footloose international finance will relocate if they assert themselves. They see globalisation as squeezing their room for manoeuvre, not enhancing it. But they also see it as excusing their relative passivity in the face of rising inequality, since it creates the impression that there are forces out there beyond anyone’s power to control."

Runciman’s conclusion:

"Ours is, as Mount says, not a true oligarchy, but a frightened, complacent liberal democracy in which the....[wealthy and powerful].... have been given too much room to breathe."

Particularly striking is Runciman’s view of globalization as not a stage where the exceptional can see their talents richly rewarded, but as a complex environment that leaves politicians confused and unable to understand or to try to respond. He suggests that this complexity has been enshrined as "forces beyond our control" and is used to justify inaction.

Runciman’s discussion reminds us that we should not be viewing globalization as a force of nature that will go where it wishes as if operating under some form of natural law. Globalization is what those playing in that field can make of it; there are no natural laws at work. It was created by enterprising individuals and it can be tamed, if necessary, by enterprising individuals.

We just need to replace "frightened, complacent" politicians with smarter, stronger ones.

How hard could that be?

Saturday, June 16, 2012

Liberals vs. Conservatives: Sixty Pages vs. One Page

Daniel Akst provided an interesting article in the Wilson Quarterly: A Manifesto at 50. The occasion for his piece was the fiftieth anniversary of the issuance of the Port Huron Statement by sixty members of a group that called itself Students for a Democratic Society (SDS). It should be kept in mind that in 1962 there was not yet a war in Vietnam to protest against, and the radical turn that some members would take was far into the future. 

The SDS had gathered together to establish what might be called the "New Left." What is most interesting about Akst’s article is the way in which he contrasts the gathering of the left to fashion a manifesto to the gathering of the right to do the same thing only two years earlier. Akst refers to this second document as the Sharon Statement. While the 1960s are often remembered as an era of leftist agitation and political evolution, there was just as much planning and plotting underway on the right.

"In September 1960, just a few months after the very first meeting of SDS and nearly two years before the Port Huron conference, more than 100 young conservatives from 44 colleges and universities descended on the estate of conservative author and editor William F. Buckley Jr., in Sharon, Connecticut. The meeting was inspired by a suggestion from Senator Barry Goldwater, the up-and-coming Arizona Republican who was helping transform the GOP, that America’s youthful conservatives set up a national organization. Goldwater, don’t forget, was a ruggedly handsome and outdoorsy former fighter pilot who, for a while at least, was a magnet for young activists—including Joan Didion and Hillary Rodham [now Hillary Rodham Clinton]."

The meeting sites of the left and the right were clearly indicative of where their hearts resided.

"At both events, excitement was in the air. Idealistic young Americans gathered to reshape the future and reveled in being among like-minded people. While the SDS folks would retreat to a United Auto Workers camp to formulate their manifesto, the conservatives in Sharon brought forth not just a statement, but an organization—Young Americans for Freedom (YAF)—at Great Elm, the Buckley family’s 47-acre country seat, where parts of the vast main house dated back to 1763."

Interestingly, both groups were driven by distress over an overly powerful government.

"Above all else, the Huronites were determined that Americans should gain control of their own destiny through a democratic process that would supersede the power of government bureaucrats and corporations alike. Their own fervent deliberations embodied the group’s obsession with participatory democracy...."

The document of the right was just as ambitious.

"....the Sharon Statement was perhaps no less utopian. Its tightly ordered vision of free people and free markets, with the role of government limited to protecting individual freedom ‘through the preservation of internal order, the provision of national defense, and the administration of justice,’ narrows the public sphere almost to the vanishing point."

The Huronites had set for themselves the much more difficult task. The left had issues like, the Cold War, civil rights, corporate power, and nuclear weapons to worry about. These are all issues that require the active participation of government to address. They had to figure out how to use government wisely, and how to prevent government from becoming unwieldy and distanced from the citizens who nominally control it. In other words they had problems that needed solving and only the blunt tool of participatory democracy at their disposal.

Akst captures the differences between liberal and conservative philosophies beautifully as he notes that the Port Huron Statement ran to 64 pages, while the Sharon Statement required only a single page.

"The great economy of the Sharon Statement simply reflected its much clearer message: the less government, the better. The basic idea was to let people take care of themselves, a viewpoint not very difficult to elaborate then or now."

If you are a liberal you are faced with complex problems in a complex world, where solutions are often difficult and uncertain. It is the duty of citizens and their government to address problems, as required, in search of improvement in the common good. That is rather hard to fit on a bumper sticker. The liberal message is often murky and ill-defined because liberals tend to be an assembly of people with a variety of priorities. The nation has many problems that need addressing; not everyone will agree on which has the highest priority.

If you are a conservative, life is simpler. The notion that government is the problem is as seductive as religion. Just believe this one thing and all will become clear; there will be no more decisions to make; there will be no more uncertainty.

Joan Walsh published an article in The American Prospect discussing the tribulations of those who would consider themselves liberals: Our Battle Scars. It is an interesting read, but we visit it here merely to cherry-pick some excellent and relevant quotes she provided.

"....liberalism is more temperament than ideology. As Jacques Barzun said of the great mid-twentieth-century liberal Lionel Trilling, we’re the people who answer every query with ‘It’s complicated’."

This one is even better.

" Robert Frost put it, ‘A liberal man is too broad-minded to take his own side in a quarrel’."

Friday, June 15, 2012

New York City: Better Governance Leads to Better Health

We recently discussed the growing health issues from non-communicable diseases (NCDs) in developing countries (The Growing Global Threat from Non-Communicable Diseases). The issue arises because child mortality is decreasing, leading to longer-lived adults, but the healthcare systems and regulatory agencies are not yet in place to address the activities that can be deleterious to adult health. The NCDs are generally preventable. They include cardiovascular disease, cancer, diabetes, stroke, and respiratory illnesses. The discussion ended with this conclusion:
"The international community can do much to address this issue, but, ultimately, the responsibility lies with the developing countries themselves. Just as better governance led to the improvements is child mortality mentioned at the beginning, better governance will be required to address the more subtle issues associated with NCDs."

Natalie Wolchover provides an article that supports this notion using New York City as an example: Want to Live Longer? Move to NYC. She uses information provided by the University of Washington’s Institute of Health Metrics and Evaluation (IHME).

"While life expectancy in many parts of the United States is dropping, it has increased by 10 years in Manhattan since 1987. Researchers largely attribute that rise — the fastest in the nation — to a crackdown by the New York City health department on unhealthy behaviors."

"Manhattanites can now expect to live to the ripe old age of 82, and the average life expectancy across all five New York City boroughs is 80.6 years. That's three years beyond the national average, and a striking turnaround since the city's low point in 1990, when life expectancy there trailed the U.S. average by three years."

Most of the improvement in longevity can be attributed to improvement in individual health.

"Mirroring the national average, some 87 percent of deaths in the Big Apple result from noncommunicable diseases — preventable ailments such as heart disease and lung cancer — but the number of yearly deaths from those causes is steadily falling. The IHME researchers determined that more than 60 percent of the increase in New Yorkers' life expectancy since 2000 can be attributed to reductions in heart disease, cancer, diabetes and stroke."

And how were these reductions attained? It required aggressive good-governance actions by city officials.

"Lead researcher Ali Mokdad said the reduction is largely thanks to aggressive efforts by city health officials to simply take away unhealthy choices from residents. The health department has, for example, banned trans fats, prohibited smoking in public spaces and hiked taxes on cigarettes. It has also rolled out hundreds of miles of new bicycle lanes, mandated the use of calorie labels on menus in chain restaurants and plastered posters up in subways with information about the risks of obesity and the benefits of preventive health services."

NCDs are not only life threatening, they are expensive to deal with because they often lead to chronic conditions that require continual medical care.

The IHME data base provides data on life expectancy at the state level and at the county level for each state up through 2009. It is interesting, and disturbing, to note the amount of variation that exists within the states. Utah has the highest value of 78.8 years, while Mississippi comes in last at 71.8 years. In general, the states with the highest life expectancy tend to be what might be described as "activist government" states. Utah seems to be an interesting exception. The poorest performers tend to be "small government" states, mostly located in the South.

Wolchover uses data provided by the CIA World Fact Book to locate the US as a whole at number 50 worldwide in life expectancy. If Mississippi were a country it would be ranked 133, just below the Philippines. In Quitman or Tunica Counties in Mississippi, where the life expectancy is a mere 66.1 years, the rank would be 166 and fall just below Pakistan.

While these numbers are a source of embarrassment, they should also remind us that poor health costs money, and the states that insist on the right to allow their citizens to die young, are really depending on a subsidy from the other states in order to maintain their bad habits.

Perhaps "big" government and "small" government are the wrong categories. How about "good" government?

Thursday, June 14, 2012

Higher Education: Supply Finally Responds to Demand?

There was an interesting article by Tim Sprinkle on the Yahoo Finance Blog, The Exchange: What’s Next for the Overcrowded Job Market? Fewer Graduates. It carried this lede:
"It's simple supply and demand: too many graduates, not enough jobs."

Sprinkle mainly focused on the well-known glut of law school graduates. He pointed out that a number of top schools were beginning to limit the number of admissions they would accept. That action was in response to facts like these:

"According to the National Association for Law Placement (NALP), we're in the middle of the worst job market for legal grads in nearly a generation. The overall employment rate for the law school class of 2011 fell to the lowest level since 1994 — just 85.6 percent — and is down two percentage points from the year prior. In fact, the law school employment rate has been dropping steadily since peaking at 91.9 percent in 2007."

"What's worse, only 65.6 percent of law graduates last year found jobs that even required bar membership in the first place, suggesting that their law school careers were very challenging, very expensive three-year vacations from the real world."

Sprinkle then pointed out that similar cutbacks were occurring at institutions offering other professional degrees such as MBAs, and at those offering doctoral programs in the humanities and the arts.

Sprinkle finished with this intriguing comment:

"Even undergraduates are starting to get the message that there may not be a high-paying job at the end of their higher education rainbow. According to the U.S. Department of Education's National Center for Education Statistics, enrollments at degree-granting institutions spiked 38 percent between 1999 and 2009, from 14.8 million to 20.4 million, but students these days are increasingly focusing on more "job market ready" fields. According to enrollment statistics from UC San Diego, for example, declared majors in science/math are up 94 percent since 2001, while biology and engineering jumped 51 percent and 21 percent, respectively. On the other hand, arts majors are down 26 percent in that time."

To one who thinks the country would be in better shape if it produced more scientists and engineers, these numbers sounded promising. Could it be that college is now viewed as a place to go and accomplish difficult tasks such as graduating with a degree in science and engineering? Could it be that the fact that high paying jobs are available to those who are willing to make the investment is finally having an effect?

An investigation of the UC San Diego (UCSD) numbers was not as conclusive as Sprinkle’s comment suggests. In the case of engineering, the UCSD numbers did increase by 21% over 10 years, but overall enrollment increased by 32%. Consequently, the fraction of students enrolled in engineering programs actually fell—not good news. On the other hand, all of the increase in engineering enrollment took place over the last three years—possibly great news. Data from one university is too easily biased by changing priorities within that institution itself. Other sources of data were needed.

Better than enrollment data are graduation data. The National Science Foundation (NSF) provides data on enrollment in science and engineering (S&E) and on degrees awarded in those areas. Consider the nation’s engineering enrollment.

There seems to be an uptick in participation when the economy is in bad shape. Of particular interest is the surge that occurred starting in 2007, about the time the economy began to unravel. This data stops at 2009. Hopefully, the trend continues.

The NSF also provided this chart of bachelor’s degrees granted over the last decade.

There are no obvious trends evident yet in engineering, mathematics or the physical sciences. Not surprisingly, there has been significant and consistent growth in the biological and social/behavioral sciences. The most obvious example of supply and demand arises from the number of computer science degrees awarded. That field grew rapidly during the 1990s, driven by the dotcom bubble. After the burst, and the realization of how easy it was to offshore computer programming, enrollment in this area dropped just as rapidly.

The NSF database provides information on degrees grated between 2000 and 2009. Over that period the total number of bachelor’s degrees granted increased by 29%. Degrees in all of S&E increased by 27%, and only by 18% in engineering. If, as Sprinkle and the UCSD data suggest, there is a surge of people moving from other majors into S&E, it is too early to show up in the degree data.

Let us be cautiously optimistic.

Monday, June 11, 2012

The Growing Global Threat from Non-Communicable Diseases

There is an article in The Economist that carries this lede:
"Africa is experiencing some of the biggest falls in child mortality ever seen, anywhere."

The author produces this graphic to illustrate the point.

Mortality is falling in most countries, often far faster than the 4.4% per year that is the millennium development goal (MDG). This is good news of course, but there is another health trend underway that seems to indicate that the children who are avoiding mortality in youth are most likely to succumb to diseases in the prime of adulthood. The source of these illnesses will likely be non-communicable diseases (NCDs) such as diabetes, cardiovascular disease, and respiratory problems—threats that are usually associated with the lifestyles found in more-developed countries.

Another article in The Economist provides this graphic:

The point being made is that in the developing world, the threat of non-communicable diseases is large and it is growing. It is also interesting to note that the United States, even though it spends much more on healthcare than any other country, does not make it into the rank of "developed" countries via this metric.

Thomas J. Bollyky provides an article in Foreign Affairs that addresses the global issues associated with NCDs: Developing Symptoms: Noncommunicable Diseases Go Global.

Bollyky describes the situation with NCDS as an epidemic.

"NCDs in developing countries are occurring more rapidly, arising in younger people, and leading to far worse health outcomes than ever seen in developed countries."

While progress is being made in combating infectious diseases and the causes of childhood mortality, the overall healthcare systems in many countries cannot keep up with the problems being encountered in adulthood.

"This epidemic results from persistent poverty, unprecedented urbanization, and freer trade in emerging-market nations, which have not yet established the health and regulatory systems needed to treat and prevent NCDs."

Bollyky tells us that this is not only a problem for the individual countries; it is a major threat to global economic development as well.

"A recent report by Harvard University and the World Economic Forum projects that over the next two decades, NCDs will inflict $14 trillion in economic losses on the developing world."

"According to the World Economic Forum's 2010 Global Risks report, these diseases pose a greater threat to global economic development than fiscal crises, natural disasters, corruption, or infectious disease."

Bollyky also provides a different perspective on the data of the previous chart.

"According to the World Health Organization (WHO), 80 percent of deaths from NCDs now occur in low- and middle-income countries, up from 40 percent in 1990. People with NCDs in middle-income countries are more than twice as likely to die before age 60 as those in high-income nations, and people in low-income countries are four times as likely to do so."

"NCDs that are preventable or treatable in developed countries are often death sentences in the developing world. Whereas cervical cancer can largely be prevented in developed countries thanks to the human papillomavirus vaccine, in sub-Saharan Africa and South Asia, it is the leading cause of death from cancer among women. The mortality rate in China from stroke is four to six times as high as in France, Japan, or the United States. Ninety percent of children with leukemia in high-income countries can be cured, but 90 percent of those with that disease in the world's 25 poorest countries die from it."

He follows up with this prediction:

"By 2030, NCDs will be the leading cause of death and disability in every region of the world."

The WHO predicted back in 1996 that the health issues associated with NCDs were a problem for developing countries and would soon dwarf concerns about infectious diseases. However, there has been little appetite for action.

"Global health donors and institutions remained preoccupied with containing infectious diseases and improving maternal and child health. According to a 2010 report by the Center for Global Development, between 2004 and 2008, 70 percent of total funding for NCDs came from just three sources, by far the largest of which was the WHO itself. That same report found that in 2007, programs devoted to NCDs received less than three percent of the nearly $22 billion spent on global health."

Concern has now been raised to a level at which it was possible to generate a meeting at the UN General Assembly last September. Little emerged from that meeting other than pronouncements. There were the expected constraints on funding in a weak economy, and the lobbying efforts of those who benefit from helping create illnesses, but Bollyky blames the lack of progress on a strategic problem.

"As a class, NCDs have little in common other than being the diseases that become more prevalent as a population reduces the plagues and parasites that kill children and adolescents. NCDs are, in short, the diseases of those with longer lives."

"Trying to address these diseases as a single class and on a global level has both broadened opposition and diffused support for effective action. On one hand, addressing NCDs as a single category has united a wide array of otherwise disconnected industries, from agriculture to pharmaceutical companies and restaurants, against global targets to reduce NCDs and their risk factors. On the other hand, it has made it difficult to mobilize states and sufferers of NCDs worldwide around a specific and meaningful policy agenda."

Bollyky suggests focusing on a few high payoff approaches with attainable goals.

"Tobacco offers a good place to start. According to the WHO, tobacco use already kills more people annually than HIV/AIDS, tuberculosis, and malaria combined. In the coming decades, it is projected to debilitate and kill hundreds of millions more, largely in low- and middle-income countries. Tobacco use is the only leading risk factor common to all the major groups of NCDs: cancer, diabetes, cardiovascular illness, and respiratory dysfunction. By increasing support for tobacco control in developing countries, the international community could help reduce one of the most significant threats to global health today."

There are efforts in place in some countries to regulate and discourage tobacco use. These should be extended to all developing countries. Success with tobacco could lead to similar regulations and controls on the intake of alcohol, salt and trans fats.

The collaboration of the advanced countries would be required. While they think it is appropriate to discourage tobacco use in their own lands, they seem willing to encourage its use in other countries.

The international community can do much to address this issue, but, ultimately, the responsibility lies with the developing countries themselves. Just as better governance led to the improvements is child mortality mentioned at the beginning, better governance will be required to address the more subtle issues associated with NCDs.

"Accordingly, the fundamental challenge in this new era of global health is not necessarily new medicine but better governance."

This last conclusion applies as well to the developed countries.

Sunday, June 10, 2012

Is There a Future for Labor Unions?

There is an excellent article by Bruce Western and Jake Rosenfeld in Foreign Affairs: The Decline of Labor and the Future of the Middle Class. It provides a concise history of the labor movement in the US from the postwar years to the present. They suggest that there is still a vital role that it might play in society and in the economy. Given the concerns about growing income inequality, it should have the opportunity to find a new constituency among those who see themselves losing ground in an economy that appears rigged against them. However, the labor movement cannot recreate the past; it will have to define a role for itself that offers something attractive to management as well. The UAW and its recent efforts will be used as illustration of an approach that might prove valuable to both workers and management.

The authors provide some necessary background.

"By 1954, more than 17 million American workers, around 35 percent of all wage and salary earners, were union members. In Indiana, Michigan, Pennsylvania, Washington, and West Virginia, unionization was 40 percent or higher. Even in the South, where the labor movement met the greatest resistance, union membership got as high as 20 percent of workers in Alabama, Kentucky, Louisiana, and Tennessee. U.S. union members were disproportionately male blue-collar breadwinners working lifelong jobs in large firms. As organized labor helped secure the economic well-being of this group, the American middle class prospered and the country entered a golden age of income equality."

The authors point out that the legislation that solidified the labor movement’s rights, also provided the mechanism for its ultimate decline.

"Although the National Labor Relations Act was initially a boon for unions, it also sowed the seeds of the labor movement's decline. The act enshrined the right to unionize, but the system of workplace elections it created meant that unions had to organize each new factory or firm individually rather than organize by industry. In many European countries, collective-bargaining agreements extended automatically to other firms in the same industry, but in the United States, they usually reached no further than a plant's gates."

Initially, in the postwar years, the rate of union membership declined because the mechanics of organizing and certifying a union could not keep up with the rapid job growth.

"Between 1950 and 1979, the labor force nearly doubled, adding around 45 million new wage and salary earners. Union membership increased by only half in the same period, however, from 14 million to 21 million workers, shrinking the percentage of union members in the labor force from 30 to 20 percent. By the 1970s, new organizing could annually capture only about one-third of one percent of the nonunion labor force, which itself was growing at three percent a year."

The 1970s and 1980s brought fundamental changes in the economy and in the political environment. Management viewed unions as costly and troublesome entities that it would rather do without. It became popular for economists to conclude that the higher wages and the work rules desired by unions were a drag on the economy. The antiunion sentiment was supported by business-friendly political leaders who allowed companies to bend the rules in fighting union certifications.

The authors believe that the "burden" of unionization was exceeded by the benefits it provided.

"In fact, unionization imposes only a modest drag on the economy. The economists Richard Freeman and James Medoff have calculated that in 1980, when a quarter of the work force was covered by collective-bargaining agreements, organized labor reduced the gross national product by just one-fifth to two-fifths of one percent."

"The social and economic benefits of unions outweigh such costs. For one, research shows that union membership in the private sector increases a worker's compensation by 10-20 percent."

A separate study indicated that the decline of the labor movement contributed about 20% to the growth of income inequality for male workers.

At its peak in influence, the labor movement was interested in more than just the wages of its union members; its efforts in improving wages and working conditions would become models to be applied to nonunion workers as well. It was an influential voice in all political discourse. The authors claim the union leaders must strive to recreate a dual political and economic role for themselves if they are to stem the decline and turn things around.

"Rebuilding the power of working people -- if it is still possible -- will need to involve reviving labor's dual economic and political role. Unions must start by speaking up on behalf of those most hurt by wage stagnation and rising inequality. Economically, unions must contribute more actively to the prosperity of firms and communities struggling with the effects of the recession and global competition."

Given the traditional rules of engagement between management and unions, the battle is over. Management has the resources and political support to negate just about any unionizing effort if it chooses to. As the authors suggest, the path forward must include a means of convincing employers that having union representation of its workers is a benefit. But how does one do that?

Perhaps the most important person in the labor movement is one whose name is not often heard in all the political chatter emanating from Washington: Bob King, President of the United Auto Workers (UAW). King made a big slash about a year ago, before even renegotiating the contracts with GM, Ford and Chrysler, when he announced that he thought it was possible to unionize the international auto assembly factories in the US. The Japanese, Germans and others have mostly located their plants in low-wage, anti-union sentiment states in the South. In fact, the low wages paid in these regions have become the standard for auto workers throughout the country. What could King possibly have to offer to these outfits that would convince them to accommodate a union?

King is a smart man. When he negotiated his contracts with the US auto manufacturers he gave management a valuable concession on wages. He agreed to terms that would allow for workers’ pay to be a combination of a base wage, and a component that was comprised of bonuses and profit sharing. This may not have been popular with some of his members, but it was necessary to move negotiations out of a mode that was continually confrontational. This move allows companies to lower labor costs when business is slow and increase worker benefits when profits are high. This degree of freedom is probably the most important one for an auto manufacturer.

If the UAW and the auto companies can once agree on an appropriate share for workers in company profits, they can focus their interactions on more mutually beneficial areas—areas in which the union can help improve productivity. There is a traditional role in establishing fair and efficient work rules, but something more is needed in order to make a significant difference.

Training is an area in which the UAW and other unions should be able to assume an important role. Recent studies have warned that the US manufacturing sector is in danger of imploding if it cannot obtain enough trained workers to meet its needs. Surveys indicate that domestic manufacturers are constantly reconsidering their options as to where to locate operations. A dominant—and often deciding—factor in keeping factories in the US is the inability to find enough trained workers. This issue is discussed in
Manufacturing, Education, and the Future of the US Economy.

The UAW, which represents workers in probably all known crafts, could begin to assume the responsibility for training workers in the areas in which it has responsibility. But the big payoff for the nation would be for unions to assume the responsibility for training industry-wide. Who better to be a trainer than a skilled union craftsperson? Who better to define the skills needed than industry itself? A three-way partnership between unions, industry and government could benefit the national economy and redefine the nature of the labor movement.

Meanwhile, King continues his Sisyphean task. A recent article from Yahoo/Reuters announces that the UAW has set its sights on a specific factory, a Nissan plant in Canton, Mississippi. The strategy is to first create a level playing field by using the labor agreements with the US auto manufacturers to convince the international outfits that a union representation is not the threat they have always assumed.

"King's organizing push is founded on the belief that if car companies refrain from actively opposing a UAW organizing push, workers will enthusiastically join the union. After given access to workers at auto parts supplier Dana Holding Corp , workers approved union membership in 2007, including a plant in Kentucky that had overwhelmingly voted the union down four years earlier."

King seems to be focusing on issues other than wages in attracting the interest of the workers. An approach that stresses worker participation in the workplace and civil rights seems to resonate with the workers.

"Analysts said the union would be smart to rally workers around issues like having a voice in the workplace because high wages and ample pension plans that were once enjoyed by UAW members have been eroded."

"’By reinventing themselves as a civil rights movement - that's the right way to go,’ said Gary Chaison, professor of industrial relations at Clark University in Massachusetts. The UAW can say, ‘We can give you something that is very important and that's a voice in the workplace. For workers who are seldom asked what they want, that means an awful lot’."

We wish King and the UAW well. The labor movement needs to redefine itself. They are at least making an effort.

Saturday, June 9, 2012

Motherhood: The French Way and the Threat of Motherhood Fundamentalism

While there is no specified wrong way or right way to approach motherhood, there is a definite French way, and according to Elisabeth Badinter, it is under siege by motherhood fundamentalists. Badinter is an influential French intellectual who has written extensively on issues related to feminism and French society. For those who are interested, Jane Kramer has written a profile of her in the New Yorker: Against Nature: Elisabeth Badinter’s Contrarian Feminism. Kramer tells us that at least one publication designated her as the "most influential intellectual." Such a ranking provides one with rock-star status in France.

The topic here is a review of the English translation of Badinter’s latest book which appears in the New York Review of Books and is authored by Diane Johnson: Mothers Beware! Badinter titled her work Le Conflit: La Femme et la Mère. In English it emerged as The Conflict: How Modern Motherhood Undermines the Status of Women. A more explicit title seems appropriate for English speakers who may not yet be aware of the conflict—perhaps because we rarely pay attention to our intellectuals, or are even aware of their existence.

Badinter became famous for a book she wrote that was translated into English as Mother Love: Myth and Reality (1981). Johnson summarizes the thesis of that text as

"....[she] contends that the maternal instinct is not innate but a learned cultural response, at least in France."

That statement is worthy of extended discussion on its own merits, but here it serves merely to provide context for Badinter’s views as expressed in the latest book. She was moved to produce that work by

"....the fear that young Frenchwomen have been sacrificing their hard-won claims to social equality by falling for attempts to convince them that they have no higher calling or more satisfying accomplishment than motherhood."

Badinter argues that

" forces—parents and in-laws, psychologists, doctors, the Church, crusaders, society in general—are redoubling their attempts to make women feel guilty if they choose careers over motherhood, or if they go back to work after they do have children, or if they use day care, or don’t breast-feed the children they have. Badinter further argues that these social pressures to return to an age-old view of women’s proper place are a reaction, mostly but not entirely from male institutions, to recent feminist struggles for such things as child-care centers for women with careers—struggles that have been effective in France, which has some of the most women- and children-friendly social policies in Europe."

The "French way" of motherhood has characteristics that are in direct conflict with the wave of motherhood fundamentalism. One variation, attachment parenting, emphasizes breastfeeding (years in duration), close and continual contact between mother and child, mothers and infants sleeping in the same bed, and the rule that infants should never be allowed to cry. Attachment parenting was discussed and disposed of in Maternalist Fundamentalism: Attachment Parenting.

The French women apparently have little interest in spending 24 hours a day with their children and even less interest in breastfeeding.

"Where frequency of nursing is concerned, the French are at the bottom of the chart (only the Irish are worse), having resisted it, according to Badinter, in the name of freedom: ‘French mothers balk at playing the role expected of them, and successive governments over the last thirty years have dragged their feet in bringing the country into line with the WHO requirements’ that see breast-feeding as desirable. She says this proudly of her countrywomen and is fearful they may be softening on the issue."

Badinter has a really dim view of breastfeeding.

"One particular issue has seized Badinter’s attention: "The irony of this history is that it was precisely at the point that Western women finally rid themselves of patriarchy that they acquired a new master in the home." She means the breast-fed baby, symbol of women’s oppression."

As for creating well-behaved children, the "French way" seems to work well by using a strategic approach to crying children. Pamela Druckerman has written a well-received book: Bringing Up Bébé: One American mother Discovers the Wisdom of French Parenting. From it, Johnson provides this explanation:

"I hesitate to reveal one of her major conclusions without saying "spoiler alert," lest people think they don’t need to read the rest: French babies sleep through the night, and French children don’t throw food, because their parents train them to wait for the things they want, even just for five minutes for a hungry infant ("the Pause"), longer for older children, always with an explanation of why the adult can’t instantly gratify the kid’s wishes. She compares this to American parenting theories that teach that infants will feel rejected if they experience an instant of frustration."

Badinter says the threat to the French way, and the threat to women everywhere, arises from the renewed effort by men to take back control of the fertility of women. There are many reasons why men developed a need to control their women and the offspring they might produce; all involve the notion that women are valuable property—too valuable to be let out of control.

"....there are many signs that the nostalgic antifeminism Badinter sees approaching in France is already well installed in the US. Nearly a thousand bills have been proposed and sometimes passed in Congress and state legislatures, since 2011 alone, against the inclusion of contraception in health plans, mandating intrusive vaginal ultrasounds before abortion, requiring counseling and other medical measures designed to discourage having one, repealing other protections for women, and redefining rape and personhood."

Johnson indicates Rick Santorum as an example of how far motherhood fundamentalists are willing to go in order to control a woman’s fertility.

"....on one occasion the Santorums, rather than terminate a pregnancy when it was known that it would not result in a baby that could live and might kill Mrs. Santorum, chose to endanger her life, hardly a choice most Americans would make, but one he did not hesitate to say he would impose on other American families."

Johnson concludes that the trends that are only on the horizon for Badinter and her Frenchwomen, are already bearing down on women in the US.

"Until recently, I would have said breast-feeding in most American circles was something of a settled issue, and had lost its heavy significance; for Americans, I thought, breast-feeding is more or less a preferred option whose benefits of convenience and health are rarely disputed and failure to do it carried no opprobrium—women either do or don’t nurse their babies depending on a constellation of factors—job, pediatrician, local custom, and so on without incurring reproach if it isn’t possible. But now that conservative legislators and priests have shown themselves eager to interfere with women’s most intimate medical issues, a climate of guilt and dissent has been reintroduced."

"....the idea that only motherhood determines a woman’s status in society is a sinister and regressive one that religious and fundamentalist forces are concerned to promote, not only in our country."

Johnson’s wish:

"Perhaps the most seriously useful decision society could make might be that men—politicians or priests and possibly doctors—would not have the power to decide on things particular to women, beyond their own roles of fertilization and cooperative child-rearing."

We owe much to the French. We should be thankful to Badinter for alerting us to problems that we might not be taking seriously enough. But that bit about crying and teaching children to wait for what they want—why couldn’t they have shared that with us years ago?
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