Monthly Archives: July 2014

What Can Realistically Be Done About Inequality?

boat11 copy

Lifting All Boats, Even This Little One?

An important opinion piece on the Inequality issue by Joseph Blasi ought to get more exposure, because it makes a good faith effort to propose something realistic that could be done about it.  How refreshing!   Blasi suggests we look at ways to help workers at the middle and bottom of the income/wealth distribution acquire (a lot) more capital, and receive more capital income, via forms of shared corporate ownership.

This is the type of approach Democrats don’t think about much.  And it has a “collectivist” tone for many Republicans, depending on how it’s couched.  But it’s not a bad idea, especially in comparison to the puny (e.g. minimum wage adjustments),  grandiose (e.g., “rethinking free trade”), or delusional (e.g. repealing state “right to work” laws) ideas.  Most of  of the grandiose ideas,  not surprisingly, lack detail.

The famed Microsoft employee stock options (in addition to good salaries) is a leading example of what Blasi is talking about.  Microsoft Millionaires got that way not by inching up the career ladder at the company, or climbing the steps in the personnel department’s salary schedule, but by cashing in their stock options.  That’s not a realistic possibility for all companies and workers, and the Microsoft model doesn’t immediately translate to a medium sized restaurant establishment, but there is a lot more room for this sort of approach in the U.S. economy, enough to make a real dent in the income and wealth distribution.

Ownership sharing, with a reasonable apportionment of risk, has a lot more potential to move the needle than tweaks to the minimum wage. It has a much less catastrophic downside than “targeted protectionism.”  And it’s just a wee bit more pragmatic than constitutional amendments to overturn (anti union) “right to work” laws in the states, or restoring marginal tax rates to pre 1970s levels.

It’s also more realistic than Thomas Picketty’s international tax on wealth, while (in effect) accepting his theory that capitalism tends to produce gross inequalities over time because capital (right now owned by the few) reproduces itself much faster than ordinary income.  This is not to say, that disparities can’t get so great, with devastating effects on the overall economy, that more radical ideas won’t ever be palatable.

The “free market” on its own isn’t likely to deliver more sharing of profits and stock with workers. It would require, as Blasi says, “restructuring the tax code in ways that encourage a broader range of companies to embrace low-risk profit-sharing and employee ownership programs, perhaps even making such programs a condition for receiving federal corporate tax deductions.”  It’s hardly a slam dunk that liberals and conservatives could come together on this with just a little negotiation; but it’s a lot more likely than a consensus around wage regulation, higher taxes on the rich, or demolishing “free trade.” .

Employee ownership is not a panacea and can be bad for workers, depending on how its done.  Microsoft offered stock options to employees in addition to high salaries. Many companies offer them in lieu of good wages; especially start-ups, which can’t afford (or won’t risk) paying high salaries. Since start-ups also have high failure rates, workers may spend a some years at barely above minimum wage, and are then left holding worthless stock when the company tanks.

Another caution: I am aware that the last time liberals and conservatives collaborated to create an “ownership society,” we wound up with horribly bad home loans, an abundance of junk level securitized mortgages, and the worst U.S. financial sector collapse since the Panic of 1873.  Always nice to end on a high note.

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D.C. Court Decision on Obamacare: Absurd Outcome Means Absurd Decision

Heading toward the Supreme Court?

Heading toward the Supreme Court?

A prescient article by Henry Aaron of the Brookings Institution in April, provides the sensible and legally correct answer to the question whether people receiving health insurance from federally run health care “exchanges” under Obamacare (also known as ACA) can receive the same subsidies as enrollees in the fourteen states which run their own exchanges. (This is course not the same Henry Aaron who broke Babe Ruth’s career home run record. But I bet he doesn’t mind being called Hammerin Hank).

Hammerin Hank’s article was buried at the time, but now has great relevance, after the D.C. Circuit Court of Appeals ruled (2-1) that, admittedly flawed, language in an isolated section of the ACA, alas, means that the plain purpose of the Act, to make health insurance affordable to all, is entirely negated. On the same day, another U.S. Circuit Court, by a 3-0 vote, issued an opposite ruling, setting up the possibility that the U.S. Supreme Court will ultimately hear the case.

Aaron’s article reminds us that centuries of western jurisprudence have upheld the notion that judges have an obligation to interpret law in a manner that doesn’t produce absurd outcomes; or render an Act worthless, ineffective, or inoperable. (See “Absurdity and the Limits of Literalism”)

As a 2008 Congressional Research Service (non partisan and authoritative) report on the Supreme Court’s interpretation of statutory law observes, “the one generally recognized exception to the [“plain meaning of the language”] rule is that a plain meaning is rejected if it would produce an “absurd result.”*

Is that plain enough?  I think so,  But nothing the High Court does would surprise me these days.

*See, for example, United States v. Granderson, 511 U.S. 39, 47 n.5 (1994) (dismissing an interpretation said to lead to an absurd result); Dewsnup v. Timm, 502 U.S. 410, 427 (1992) Justice Scalia, dissenting) (“[i]f possible, we should avoid construing the statute in a way that produces such absurd results”); Public Citizen v. Department of Justice, 491 U.S. 440, 454 (1989) (“[w]here the literal reading of a statutory term would compel ‘an odd result,’. . . we must search for other evidence of congressional intent to lend the term its proper Scope.”

Partisan (Gerrymandered) Re-Districting: Is the Florida Ruling a Game Changer?

Washington State Does It Better

Washington State Does It Better

A few days ago, a Florida Circuit judge ruled that Republican legislators had drawn state legislative district lines illegally, giving their party an unfair advantage in U.S. Congressional elections. He ordered them re-drawn. The judge ruled the Republican re-districting plan violated a 2010 ballot measure passed in Florida, called the Fair Districts Amendment, which tried to eliminate districts that purposefully favored one party over the other.

I am usually cautious about calling any single, confined legal event like this a game-changer, but this one has real possibilities. You can read about the details here and here. Even though the Florida ruling applies right now to just one state, and can still (of course) be overturned, it is hard to overstate its intellectual and symbolic importance.  It has been buried on page 7,  but not this Page Seven,

I would say the same thing if Democrats had been accused of rigging Congressional elections. And they have been. Newt Gingrich famously said D’s were able to retain control of the U.S. House of Representatives for decades (before his 1994 engineered revolution) with the help of districting schemes that favored Democrats.

Partisan redistricting is  (to me) so plainly unjust and a violation of the “equal protection clause” of the U.S. Constitution, and similar provisions in state constitutions, that it’s miraculous it has survived this long.  Former Justice John Paul Stevens agrees, but the High Court has never gotten into the fray. Even the “Warren Court,” which struck down insidious practices to rig elections using districts with blatantly unequal populations, stopped short of declaring partisan gerrymandering unconstitutional.

A main reason for that has been the reluctance of federal courts to take on the messy job of deciding whether or not state districting plans are biased; much less how to make them fair. One way for federal courts to address the issue without getting terribly enmeshed in politics or geographic information systems, is to require proof that the process of drawing district lines in a state has been insulated (to a reasonable degree) from politics.  That can be done if the lines are drawn by non partisan, independent commissions. California and Washington State perform redistricting in this manner. That’s not a perfect solution, but it sure beats D’s or R’s gathering in a hotel room in Kingsman, or a boat thirty miles out at sea,  to figure out how to screw the other party (and the voters).

Democrats have virtually no chance of winning back control of the House of Representatives in 2014. Chances are, they will lose additional seats. Democrats who think they will regain control of Congress in 2016 or (especially) 2020, after another decennial census is completed (triggering another round of re-districting), are also in fantasy land….unless something changes.

As along as state legislatures across the country hold onto their state Houses, and thus control over decennial census redistricting, Republicans will rule the U.S. House of Representatives for a very long time — or at least until demographic changes make some of the safe Republican districts created after the 2010 Republican landslide more competitive. This kind of control is self perpetuating, unless lawsuits, such as the one in Florida, are successful in state or federal courts.

If the issue ever reaches the current U.S. Supreme Court, we know how the vote of at least eight justices would turn out. It would again hinge on Justice Kennedy.  Justice Roberts could surprise, as he did in the Affordable Care Act (ACA) case. He would need to believe the reputation of the “Roberts Court” in history is seriously at stake.  Roberts’  switch in time in the ACA case succeeded in deluding at least one highly distinguished constitutional lawyer and historian, Laurence Tribe of Harvard, into believing there is much less partisanship on this High Court than most people think.  Huh?   See a review of Tribe’ new book here.  Sorry for the digression.

In any event, keep an eye on the Florida case and its progeny.

Aside from the toxic role of money in politics, the weakening of the 1965 Voting Rights Act, and the de (and non) regulation of the broadcast and print media, such that most Americans today receive “news” in the form of propaganda, there is nothing that undermines democracy more than the rigging of House congressional elections through gerrymandering.

No Vacation Goes Unpunished

Vacation Togetherness

Vacation Togetherness

American workers don’t receive much paid vacation time compared with workers in most other industrial societies.  Even with vacation benefits,  many workers take time off grudgingly,  with guilt; and later with remorse.   While on vacation, we spend a good part of our time “away” staying in touch with the boss and colleagues.  This isn’t family friendly, unless, perhaps, your spouse does the same thing.

Forbes Magazine and Blog write about the phenomenon every year or two, treating it as a conundrum; i.e., “why don’t Americans take vacations.?”   Big puzzle!  Forbes took on the issue again recently as summer approached, but instead of trying to explain why Americans don’t vacate, they marshaled evidence on why it’s healthy and productive to take time off from work.   The new approach didn’t seem to get as much attention as the conundrum articles, but it’s worth a read.

The social-psychology of American (non) vacations has often been studied in surveys, where it’s very hard to probe the deeper reasons for the behavior.  This is precisely the kind of issue that needs conversational focus groups with lots of introspection. This blog article tries to fill the focus group void a bit,   But, alas, it’s based mostly on my experience as both a manager and employee in a large, high performing government organization.  (Ah, I bet you think that’s an oxymoron).

My organization dealt with a lot of high stakes budget and finance issues; thus colleagues and I hardly ever took vacations, but we did talk about it. Thus, any insights and anecdotes are not mine alone.   I will call the agency XYZ, though you can of course easily figure out what it is by reading my blog profile or checking me out on Facebook.

We used to say that “no vacation goes unpunished at XYZ.”   We had good reason to think so. Here are some of the punishments that were meted out.

At XYZ, you often got called (“paged,” in those days),  while watching Yellowstone’s old geyser or lounging on the beach in Belize, with a frantic plea to answer a question from a critical customer, devise a formula, find a document, or locate a file on your computer back at the office.  Some very important policy decisions, affecting many lives, were made with these kind of “deliberations,” while at least one of the parties was on his third Margarita, and barely audible on a Blackberry,

Yes, I know, “why wasn’t there someone else available to answer those questions?” Or, “why didn’t anyone else know where the computer file was located?”   Good questions. As the years passed, we actually made efforts to plan for these contingencies.  But too often they didn’t work.  Or top managers didn’t want to mess with them.  Just call Joe, even if he’s in the hot tub or riding with his children on a carousel in the park.  It’s a lot easier and more direct to get Joe on the line.  After I moved over to the dark side, as a manager, I confess doing the same thing to my staff.

When you returned from vacation, you were immediately faced with several “crises” that weren’t handled while you were gone.  For at least one of those fires, invariably, the “drop dead” date to deal with it happened to be the day you returned.  So forget about being briefed quickly on all the (other)  things you missed.  And scrap the carefully crafted “to-do” list for the first day back.  Yes, I know, “why weren’t the responsibilities to put out the fires delegated before vacation?”   Well, in many cases they were.  But there was always that outlier,  with no designated handler, or where the proxy dropped the hot potato, or didn’t want to mess with it at all.    “Wait for Joe to get back from the Grand Canyon.”

More Togetherness

More Togetherness

When you returned from vacation at XYZ, you sometimes found that one of your buddies had stolen a part of your job portfolio;  not just subbed for you while you were gone, but moved the job from your to his job description.   Cute maneuver. Usually, the perpetrator was someone looking for recognition or a quicker, upward path at XYZ.  It worked.  Getting back your lost portfolio was difficult, because you were the one who had to whine about losing turf. The perp didn’t have to say a word.   It would sound small and catty to complain, so, more often than not, you let it slide.

Then there are reasons why Americans don’t take all their vacation time which have nothing at all to do with the culture of work in America,  lack of family friendly work environments, worker policies, or the atmosphere at XYZ.   I call this the Clark Griswold factor.  You may recall, Clark was the guy portrayed by Chevy Chase in the “vacation movies.”  The lampoon vacations we watched for years were too close to the truth.

My experience with vacations. usually to the Catskills, or once a decade to Florida, growing up in a working class, New York Jewish household in the 1950s, was not altogether positive.  Someone always got sick; was allergic to something in the hotel room  (I mean bungalow); left medicine behind; or had the dog shit in the taxi cab on the ride to the airport.    One time, the family arriving at the hotel in Florida found it was still under construction.  Clark Grisold was a WASP, so I was at least relieved to learn that dreadful vacations weren’t unique to being Jewish or “growing up stupid in Brooklyn.” (Travolta).

OK, so why don’t the French or Swedes, who take lots of vacation time, seem to not have the same issues at their XYZ companies?  Or,  with the Clark Griswold effect?  I don’t really have a solid answer for that.  They don’t go to Florida? They don’t have the equivalent of the Catskills?  Or, perhaps, workers in France or Sweden, except (I hope) the ones monitoring all those French Nuclear Power Plants, don’t give a rats ass if something fails at XYZ while they’re skiing in the Alps?   I vote for the latter as the best explanation. But that doesn’t explain why French and Swedish worker productivity and GDP growth are (nonetheless) not all that bad, compared with the U.S.   Hmmm.

“Bad Teachers” Are Not the Problem; Its the Ones Who Won’t Elevate Their Game

SONY DSC

Groping for Answers

Teacher Unions, their spokes people and arch defenders, like Randi Weingarten, Michael Hiltzik, and Diane Ravitch, consistently paint cartoonish pictures of their opponents in the school wars. They create straw men, then lampoon and pick them apart. Not an unusual tactic in verbal warfare.

Granted, the Teacher Union critics are not always clear about what they mean by “underperforming teachers;” or by using standardized tests to determine student proficiency; and further using them to (help) evaluate teachers. The advocates of these reforms do leave themselves open to criticism by virtue of incomplete staff work.

But taken together, the larger problem is Teacher Unions (and their supporters) too often saying and doing whatever it takes to preserve their power, with (seemingly) little regard for the consequences.  As I elaborate later on, this not only harms poor kids attending failing schools, but also undermines worthy and critical efforts to revive private sector labor unions. The Union movement is in deep trouble if has to depend on Teacher Unions to win back hearts and minds.

Here is my sense of how the Teacher Unions characterize (and caricature) their critics by putting words in their mouths. This is essentially what the opponents are accused of saying about teacher competence, student testing, and teacher evaluation; these are the straw men.

1. Regarding “bad teachers:”  “There are lots of ‘bad teachers. Tenure and other obstacles to removing them are the main reason why kids aren’t learning.

2. Regarding student testing “We need to test kids frequently (all the time, day in and day out) with simplistic, easily scored multiple choice tests that probe competencies not even in the curriculum.”

3. Regarding Test Scores and Teacher Evaluation: The student tests need to be the main method (yea, the only one) for evaluating teachers. Forget other considerations. And when a teacher’s kids score low, the teacher needs to be fired, as soon as possible.

How many critics of the Union policies really say or believe those things?  Almost none, outside the toxic blogs and propaganda radio talk shows. But to listen to Union reps, you would think school reformers, like Education Secretary Duncan, LA School Superintendent Deasy, or former LA Mayor Villaraigosa really believe or say these things?

Would they really like to see teachers just “teaching to the test?”  Or principals using only test scores to summarily fire teachers?  Or the architects of teacher evaluation methods ignoring student income, social factors, dysfunctional families, disruptive students, parental apathy, drug abuse,  and behavior problems the kids bring to school these days?  Is there anyone anymore who doesn’t understand that teachers today have to deal with vastly different challenges than Our Miss Brooks faced?

Sure, my own depiction of the cartoons Teacher Unions draw to characterize their opponents, are also caricatures to some degree.  But, take the time to read Ravitch and Hiltzik, two of the smartest and best credentialed representatives of the Union perspective, or listen to Weingarten, head of the national Teachers’ Union, and you’ll see that my satire is not too far off.  When teachers stoop to radio talk style assaults, we’ve done another form of  “destroying the village to save it.”

(BTW, Teacher Unions have been fighting local communities since at least the legendary 1968 school teachers strike in New York brought the City to the brink of civil war. That’s where Woody Allen’s great line about Albert Shanker, the Teacher Union head in that conflict, came from.  In Sleeper, one of Woody’s early, funny (not morose) films, Woody’s character, Miles, , was asked  “How did the world come to an end?”.  Miles answered: “They gave Albert Shanker the bomb”).

There isn’t the space here to fully address all the straw men Teacher Unions erect to attack education reforms. But I will say more about the so called “bad teacher” argument.

What the “bad teacher” argument is really about is not “incompetent” or “malfeasant” or “lazy” teachers, as Weingarten would have us believe.  Rather, it’s about teachers who can’t or won’t step up to dealing with the new (not really new, anymore) hand they’ve been dealt in public education. And the encouragement that this passive (aggressive) attitude receives from the Teacher Unions.

The teaching profession today needs people with the same zeal, energy, grit and commitment of the young peace corps volunteers of the 1960s or the 55+ senior corps volunteers of today.

Teaching today is not for the feint of heart or for folks who just want to mail it in. To listen to Weingarten, you’d think teachers are the only ones who have to struggle every day in their work to move the needle a bit, or who have to fight each day to get their basic job done. What do you think most workers face in their daily lives?

Of course students today are bringing problems and issues to the classroom that Our Miss Brooks never saw. Everyone agrees with Weingarten on that.  (Duh!) Where a growing number of people profoundly disagree, is with her near abject refusal to have teachers bear any responsibility for the solution…….unless, of course, they receive more money, smaller class sizes, more pre and after school and summer programs, higher teacher salaries, more paid time for professional development, “relief” from any form of objective/rigorous student testing, and certainly an exemption from being evaluated by someone else’s measures.  What a radical idea!

The problem isn’t with bad, incompetent, malfeasant, or lazy teachers; it’s with teachers who just can’t or won’t elevate their game; and Unions which plant and nurture these attitudes.

This is a really dreadful and non productive situation.  It has already split liberal democrats and made anti (teacher) union bed fellows out of liberals and conservatives. That’s really bad for teachers (and education) in the long run, because teachers do need to have a big voice in education decisions. And it’s even worse for efforts to resurrect unions in the private sector.

A perhaps unlikely quote from Albert Shanker (believe it or not) which eerily foreshadowed today’s situation.  Randi Weingarten, take heed:

“It’s dangerous to let a lot of ideas out of the bag, some of which may be bad. But there’s something that’s more dangerous, and that’s not having any new ideas at all at a time when the world is closing in on you.” (Albert Shanker Speech to the AFT QuEST Conference, 1985)