Occupy UC Davis, with the unfortunate pepper-spray incident, has focused the state and, indeed, the world on the crisis of public higher education in California and the risks that it will spiral out of the range of affordability for middle-class Californians.
In the meantime, the Davis School District met last week, and Associate Superintendent Bruce Colby presented some – shockingly enough – bad economic news.
Mr. Colby would remind the school board, “We are in our fifth year of budget reductions, without any (upward) adjustment for inflation. We have also had staff reductions for five years in a row.”
As we all know, it could have been worse, as Mr. Colby put it: “Davis is a great community, the school district has received grant money, local voters approved an emergency parcel tax, there were staff concessions.”
Here is the shocking part, “We would be operating at about $6,514 per student if there had been no state cuts. Our actual funding now is about $5,227.”
This is shocking to me, because I recognize in that $5200 figure, something very close to what we were operating at when I ran for school board as a young man in San Luis Obispo 20 years ago.
Indeed, if you look at per pupil spending in Davis in 1998-99 it was $5373. That figure rose as high as $8506 as recently as 2008-09. That figure in 2008-09 was about middle-tiered, and now we’re near the bottom.
Think about that long and very hard.
I just happened to be reading Peter Schrag’s latest column in the California Progress Report.
He makes the point that the Education Coalition, which is comprised of “State School Superintendent Tom Torlakson, the teacher unions, the association of school administrators, the school boards, and the PTA” is making a case against education cuts, particularly cutting school transportation funds, which they argue “will hit the state’s poorest and neediest students the hardest.”
Most importantly, here is the next point that Mr. Schrag makes: “Once again a single interest group is alone, pleading its cause. At other times in the ongoing budgetary bloodletting of the past three or four years, it’s been the University of California or the faculty unions at the California State University, or the students or, as in the past few months, the amorphous group of Occupy protestors, which of late seems to be hitting the working men and women in our cities and ports harder than the plutocrats on Wall Street.”
Things may be changing, as Mr. Schrag notes, “At last week’s press event, Torlakson, in answer to a question, said he was having conversations with UC President Mark Yudof and CSU Chancellor Charles Reed about some form of joint action.”
Mr. Shrag notes that one of the few areas where people are inclined to support tax increases is if they are directly targeted to education.
Here is where I am going with this: “A generation ago, in 1988, UC President David Gardner and the regents made the fatal mistake of refusing to join the school lobbies in supporting a ballot measure to revise the severe state spending limit that had been on the books since 1979.”
Mr. Schrag adds: “In effect, they made a separate peace with then-Gov. George Deukemjian to protect their own little slice. That brought Proposition 98, through which the California Teachers Association state school superintendent Bill Honig sought to lock up some 40 percent of the general fund for K-12 schools and community colleges.”
He then writes, “The upshot was a wave of go-it-alone efforts by the university, which has talked off-and-on about running its own Proposition 98, and by local governments, which have in fact managed to lock away their own little slice of state revenues. Each further reduced legislative discretion – already severely curtailed by tax limits and other ballot measures — and intensified the distrust among groups that should be working in common cause.”
The bottom line here is that the division in the education ranks has allowed the legislature to, in many ways, divide and conquer. Instead of facing all of the groups listed above combined with UC and CSU and all of the students in UC, the faculty, staff, etc., they get one group each of K-12, UC and CSU.
The next point that Mr. Schrags makes continues to baffle me. In fact, he underplays it, because the Chamber of Commerce has been a frequent opponent of raising education spending.
“But the most puzzling element in this history is the gap left by the business community, which, as much as any major group in California, ought to have an intense interest in the maintenance of good research universities and quality education generally; in safe streets and safe schools; in an efficient, high quality transportation system, in well maintained parks and other public amenities, and in a high standard of living generally,” writes Peter Schrag.
He adds: “But except for its frequent complaints about California’s bad business climate, and, occasionally, bad schools, California business, many of whose leaders were beneficiaries of UC or CSU, has been AWOL. When Torlakson (or Yudof or Reed) issue their well-justified kvetches about how they’re getting screwed in Sacramento, business should be standing with them.”
Damn right. This is what I do not get. The lack of quality education is going to hurt business in the next generation more than any other factor and they have continued to be silent on this point, at least statewide.
They get it in Davis. There is a press release that the Coldwell Banker-Doug Arnold Real Estate in Davis has given $5000 to Measure C – which is the next parcel tax.
“Coldwell Banker is excited to recognize how much our amazing Davis schools contribute to the fabric of our community and the quality of life we have here in Davis,” said Cary Arnold, director of marketing and agent services at Coldwell Banker Doug Arnold Real Estate, in a news release.
“We feel privileged and lucky to be a part of this community, and we encourage other businesses and individuals to support Measure C in recognizing the important role the parcel tax plays in keeping Davis schools great. All of us who work here recognize the state budget situation and the lack of funding for our schools. We hope to make a difference in showing our support for Measure C.”
In Davis, the business community has been strongly supportive of local schools, but not so statewide and so, as the education spending continues to plummet, local businesses and statewide businesses, particularly research and development firms and spinoffs at universities, are going to be negatively harmed.
For all of the bellyaching about the tax rate driving businesses out of state, how are lawmakers who are sympathetic to those claims going to respond to the education gap driving businesses out of state within the next five to ten years, as the latest group of students cycles through, likely with diminished outcomes and achievement?
I am still waiting to see what happens when reality catches up with us.
—David M. Greenwald reporting
It is time we stop with the class warfare and start being honest about the root cause of our government funding problems that are impacting education. Related to this, we also need to start being honest about our inability to continue to fund K-12 and higher education as designed.
Beginning with the class warfare myths from the left and media…
[quote]According to the IRS, people making more than $500,000 accounted for 27% of the nation’s income in 2007. In 2009, the latest year available, their share fell by nearly half, to 14%, due largely to income declines at the top.
Those making $200,000 saw a similar decline. In 2007, they accounted for 41% of the nation’s income. By 2009, their share had shrunk to 26% — the same level it was in 2000.[/quote]
The rich are not getting richer. The reports of a growing wealth gap are based on per-recession economics. Besides the idiocy of chasing more wealthy and business out of the state and country, raising taxes on the wealthy at this time will decrease the amount of wealth to tax, and establish even more funding volatility as income drops are more precipitous at the higher levels (“The bigger they are the harder they fall.”)
Now, looking at what the US spends per student for K-12. We are forth from the top.
[img]http://www.cscdc.org/miscjeff/SpendPerStudent.jpg[/img]
Looking at higher education costs – from 1985 to 2011, the average college’s total budget per student has risen a staggering 498%. During this same period, the Consumer Price Index increased 116%. College costs have increased over four times the rate of inflation over the last 26 years.
So…
– For K-12 we spend as much or more than most industrialized nations and our outcomes are near the bottom in the subjects that matter.
– Our college costs have spiraled out of control for decades.
– Non-defense spending (with the exception of war spending) at the national level, and social spending and entitlements spending at the state level has exceeded the rate of inflation by orders of magnitude for decades, and have caused deficit spending even during economic boom years.
– Pay and benefits of public-sector employees exceeds the private sector and the gap continues to grow.
– Public sector pension costs are looming as the next economy-crashing bubble; yet little is being done to curtail it from occurring.
– Government business is bloated and inefficient, continuing inflation of “cost per unit” of service while private industries continues to discover ways to do more with less so they can compete and survive.
– Businesses and wealthy taxpayers are leaving the state in droves.
Add this all up and the solution is clear…
1.We need to grow the state and national economy to grow our tax revenue. To do this we should lower taxes and decrease regulation.
2.We need to reverse the trend of government spending by cutting and demanding that all agencies do more with less. We should be spending less per GDP, and banking a reserve that will carry us through the next inevitable recession.
3.Education must be completely reformed to be a customer-focused enterprise that competes for success and survival.
4.College research and the funding mechanisms should be completely separate from the business of educating students.
5.To this end, instead of sending state moneys to the institutions, we should start providing vouchers to give choice and power to the students who can then hold administrators and teachers responsible for providing the best education value.
“It is time we stop with the class warfare and start being honest about the root cause of our government funding problems that are impacting education. Related to this, we also need to start being honest about our inability to continue to fund K-12 and higher education as designed.”
We were able to fund education prior to the economy tanking, so I think the root cause argument is difficult to sustain.
[i]”We were able to fund education prior to the economy tanking, so I think the root cause argument is difficult to sustain.”[/i]
So, then why did we need a parcel tax for Davis schools?
Also, related to college being sufficiently funded, how do you explain the following:
[img]http://www.cscdc.org/miscjeff/StudentDebt.jpg[/img]
Jeff: “[i]It is time we stop with the class warfare…Beginning with the class warfare myths from the left and media…”[/i]
What in David’s column was class warfare? Maybe it’s time for conservatives to retire that particular canard.
California Budget Growth
Year Billions
1990-91 51.4
1991-92 55.7
1992-93 57.0
1993-94 52.1
1994-95 57.5
1995-96 56.8
1996-97 61.5
1997-98 67.2
1998-99 71.9
1999-00 81.3
2000-01 99.4
2001-02 103.3
2002-03 98.9
2003-04 98.9
2004-05 105.3
2005-06 117.3
2006-07 131.4
[quote]California’s state spending has ballooned in the last decade at a rate much higher than the rate of inflation and rate of population growth in the state. According to Tom Campbell, California’s finance director in 2004-2005, if the 1999-2000 budget of former California governor Gray Davis had been increased over the next decade by a factor representing the inflation rate and California’s population growth in that time, California would now be experiencing a budget surplus, rather than a deficit even with the recent revenue decline due to the state’s economic recession. Instead, California has had a 50% spending increase over the past five years.[/quote]
Our current budget problems have absolutely nothing to do with the wealthy not paying enough… it is completely the result of politicians spending us into insolvency.
“So, then why did we need a parcel tax for Davis schools?”
Because Davis schools and taxpayers wanted more than what the basic ada provided by the state could afford. Since then, the district has passed further parcel taxes to avoid more cuts.
I think your subsequent post is out of date, you show the growth of the budget, but not the subsequent decline the last five years. Our current budget problems have to do with the decline of the economy.
Don:
From David’s article: [i]”Mr. Shrag notes that one of the few areas where people are inclined to support tax increases is if they are directly targeted to education.”[/i]
The reason voters in this state say they will support tax increases are:
1) Most of them will not be immediately or directly impacted by the tax increases,
2) They don’t understand what the indirect and longer-term impacts will be from tax increases,
3) They are ignorant about the real root cause of our education funding imbalance.
4) They have current political leadership and the media playing up the “great wealth gap”… which is exactly class warfare.
Jeff: wouldn’t most those point apply to any subject area and render the voter’s views as moot? Politics remains the art of the possible.
[i]”Education must be completely reformed to be a customer-focused enterprise that competes for success and survival.”[/i]
Medwoman (and perhaps others) have asked several relevant questions relating to this “customer-focused” model of education, which have so far gone unanswered on this blog by proponents of a non-public education system.
There is not a 1:1 correspondence between student and customer/consumer, and to pretend that there is will cement more thoroughly in the minds of students the idea that since they pay to attend a university, they are “entitled” to a particular grade.
The customer-focused model breaks down because businesses usually do not turn you away because you do not provide some kind of expected input to the purchasing transaction, or because you do not meet some kind of criteria for engaging in that purchase.
Good bit of an article from the April issue of the Economist:
[quote]According to Mr Mockler, it was Proposition 111 that finally made the overall structure for education funding incomprehensible. It multiplied by six the “data sets you need to know” to calculate education spending, he says. He compares the resulting package of legislation to the general theory of relativity, quantum physics and the federal tax code in complexity, and reckons that he is currently one of ten people alive who understand Californian school finance. In a typical budget season, the state’s nonpartisan legislative analyst dutifully produces tomes analysing whether “test 1” or “test 3” applies, and whether the “maintenance factor” might kick in. Nobody really knows what that means, as the legislative analyst concedes in the official primer.
There is a lot to contemplate in this tale. First, what made voters think that they understood enough to pass any of these initiatives, given that nobody understands their results? Second, why did voters not become concerned about the ever denser thicket of unintended consequences? As Mr Mockler says, the need for Proposition 111 arose only because of Proposition 98, and the need for 98 arose only because of 13.
The unintended consequence of that overall bundle has been to invert the stated purpose of Proposition 98. Originally designed to be a floor under school financing, it has instead become a ceiling. No legislature will nowadays raise school spending any more than necessary, because the formulas would then require even greater increases the following year. (Journalists usually take a shortcut through all the calculations and simply say that Proposition 98 requires “about 40%” of the general fund to go to schools.)[/quote]
I largely agree with this; however, what is missing is the larger point that we have to find way to provide a higher quality education at a lower cost per unit (student). We cannot overturn these intiatives, and we cannot increase taxes, and we cannot seem to reduce the size and scope of state and local government so that we can direct more dollars to education. This things being our relality, we have to learn to do more with less. This is a concept clearly foreign to the existing education system.
[i]”I think your subsequent post is out of date, you show the growth of the budget, but not the subsequent decline the last five years. Our current budget problems have to do with the decline of the economy.”[/i]
David, my point was to show the hyper inflation before the recession. Did you not read the post? If we had held spending to inflation plus the increase in population we would have had a state budget surplus going into the recession.
But we would likely be in the same predicament today.
Regardless the analysis is lacking, because it fails to take into account need as well as whether we had underspent previously and finally it doesn’t take into account whether he had/ have adequate funding mechanisms.
Jeff: “[i]1) Most of them will not be immediately or directly impacted by the tax increases…”[/i]
The governor has proposed an increase in the sales tax as well as increased taxes on the wealthy. Everyone pays sales tax. Everyone would be immediately affected by the tax increase.
[i]2) They don’t understand what the indirect and longer-term impacts will be from tax increases, [/i]
Perhaps we are doing a cost-benefit analysis. The cost of continued cuts to local education, vs. the possible longer-term impact from tax increases. Perhaps we are weighing that, and accepting the adverse impact in order to preserve local school programs. I assume you are making your decision based on your values, just as we are, and coming to different conclusions.
[i]3) They are ignorant about the real root cause of our education funding imbalance. [/i]
Sometimes I assume people I disagree with are ignorant. Usually, though, I assume they value different things.
[i]4) They have current political leadership and the media playing up the “great wealth gap”… which is exactly class warfare. [/i]
Michelle Bachmann believes everyone, even the lowest income among us, should pay income tax. Is that class warfare?
COLBY: [I]”We are in our fifth year of budget reductions, without any (upward) adjustment for inflation.”[/I]
For what it is worth, we have had (almost) no CPI inflation in our region over the last 3 years, since the economy tanked. The CPI index for our region was 225.824 in October, 2008. It stood at 235.331 in October of this year. That is a growth in prices of only 4.21%. On a compounded annualized basis, that is 1.38% per year. Without checking the individual components of the CPI, I would guess that gasoline and grains are the two things which have had the most inflation over the period. Everything else is probably close to zero inflation or negative inflation.
Don: [i]”Michelle Bachmann believes everyone, even the lowest income among us, should pay income tax. Is that class warfare?”[/i]
When 50% of the “lowest income” people pay zero federal income tax, and a politician advocates that they pay something, that is not class warfare. However, when politicians point to a wealth gap and private jets to make a case that a particular economic class of “wealthy” people (those who have already seen their shared contribution of total tax revenue go up substantially), then it is absolutely class warfare.
The point Bachmann and others make about ALL Americans paying some income tax is about ALL Americans having some skin in the game of government spending and taxation. Otherwise you have nothing to lose voting to tax your neighbor and it becomes tyranny of the majority and taxation without enough representation.
All Americans pay taxes, Jeff. Most of those in the lower incomes pay more regressive taxes than those in the higher incomes via the sales tax. And everyone who works pays Social Security tax.
Apparently to conservatives, “class warfare” (talk about hyperbole) only goes in one direction. All Americans have “some skin in the game” because of the outcomes of government spending programs, and the uses to which taxes are put. We are all affected by defense and education spending, for example. The whole notion of making low-income Americans pay income taxes is bizarre to me. They already pay taxes.
[url]http://www.cbpp.org/cms/index.cfm?fa=view&id=3505[/url]
[i]”The customer-focused model breaks down because businesses usually do not turn you away because you do not provide some kind of expected input to the purchasing transaction, or because you do not meet some kind of criteria for engaging in that purchase.”[/i]
K. Smith, I don’t really don’t understand your point here. Can you point me to some existing business that refuses service to a customer with money?
First, you cannot be discriminated against for race, religion, gender or sexual orientation. If you are a student with a voucher, a private school should welcome your business and want to retain your business by providing you a quality service. If you are not a good choice-customer for the business (for example, you have certain learning disabilities or developmental challenges not covered by the business), then you would have choice to attend another school.
I and other voucher supporters would be fine with a voucher that is 75% of the per-student nut so that the remaining public school retains 25% and can use this to increase funding for any special-needs kids that cannot find a suitable private school alternative. Middle class parents can subsidize the cost with the help of the voucher. Schools could offer scholarships to a limited number or lower income students. I would not have a problem setting some regulation that requires private schools accepting vouchers to use a percent of profit for this.
Those that resist this concept saying that it is not fair for these developmentally challenged kids or poor kids, identify themselves as caring more about unionized teachers than the students. If the public schools are so superior, then you would think this would be a fantastic situation that these kids get to stay and receive all the quality instruction and attention at a higher spending-per student level.
If Davis schools are so fantastic, what do they have to fear from private school options? Shouldn’t almost all of the voucher money return to the public schools? IMO, opining that we should hold ALL kids captive to an inferior public education is cruel.
Related to this topic, I think a concern from academics on the left is that the narrow “GPA focus” today may be replaced by other more comprehensive testing of developmental accomplishment and capability to advance that academically-gifted folk are less gifted with advantage to pass on to their offspring. Today, in the captive-customer public school model, the deck is stacked in their favor.
As an example, with my high school GPA in 1978 combined with my athletic achievements, I could have attended almost any college I could afford to attend. Today, with my now meager GPA I would not be accepted at UCD and some of the CSUS campuses. There are several reasons for the change, but much of it has to do with the inflation of GPA by those with genetics, parents and resources to help them Ace classes. These teachers of these classes continue to cater to their capacity for rote memorization and bookishness.
The missing link I am referring to is creativity. Namely, engaging, inspiring and rewarding creativity. Also, encouraging creative ways of educating and learning. The public schools have deflated their capacity and use of creativity. More kids are diagnosed with ADD and learning disabilities because they cannot be forced to fit in with the easier “gifted” student template the old and tired public school prefer. Within this large population of kids being left increasingly behind there are many highly intelligent, creative and capable individuals. The public schools are failing them in droves.
I think the people that continue to defend the current public school model are of three camps:
1) Work in the system or have family working in the system.
2) Have confidence they can supplement their kids’ public school education to give the advantages they require to win the parental ego war of their kids being accepted in a prestigious school.
3) Think it is good enough (i.e., Don’t get the vision for how bad it is relative to how much better it can be, should be and needs to be.)
[i]”K. Smith, I don’t really don’t understand your point here. Can you point me to some existing business that refuses service to a customer with money?”[/i]
Apparently I phrased that poorly. No business does this–that was my point. In higher education, just because you have the money to pay for an institution does not mean that you will get accepted into that institution/program. Hence, my point that the “customer-focused” model of education can break down.
[i]”We are all affected by defense and education spending, for example. The whole notion of making low-income Americans pay income taxes is bizarre to me. They already pay taxes.”[/i]
Don, if we are talking about raising tax on income and wealth, but 50% of the population do not pay those taxes, then there is no downside to voting to increase those taxes… there is only upside.
What the lower income people do not understand very well is that taxes are just another expense to business that will be passed on as increased prices. So, in that mechanism, you are correct that the poor are impacted. However, they often don’t undertand the corelation and are already prone to accepting short-term gain for long-term pain. It would be better if everyone paid something so that the immediate pain is completely shared and transparent. That way we would have less tax-payer class separation.
Nobody making income should pay zero tax in my opinion unless all are paying zero tax. It is bad for the country. You need a stake in the arguments for what government spends and taxes. Otherwise your pursuit of self interest will destroy our common interests.
What you clearly don’t accept is that lower income people already pay taxes. [b]Nobody pays zero tax.[/b] Nobody. Whether the taxes are paid on consumer goods, on gasoline, on income, on investment, on property: [b]everybody pays taxes. [/b]
It is rare for the public to vote directly about a tax increase. Gov. Brown has given the voters the opportunity to tax themselves for a specific purpose. Yet you probably oppose that, even though they have “skin in the game” and will be directly affected by their own votes.
By your own logic, you should support Gov. Brown’s proposal
W[i]hat the lower income people do not understand very well is that taxes are just another expense to business that will be passed on as increased prices. [/i]
Why do you assume what “the lower income people do not understand?” Everybody knows what a sales tax is. Anybody voting on a sales tax knows that everyone will pay it. And no, higher income taxes on high-income taxpayers will not be passed on as increased prices in most cases, unless I’m missing something about your point here.
Don: You keep ignoring my point about income tax, and keep twisting back to sales tax.
Let me at least conceed your point that sales tax provides skin in the game for everyone.
However, a vote is not guaranteed. It was only a poll. Polls about taxes are nothing to hang your hat on. First, the taxpayer advocate groups have not put any muscle into the campaign against it. Second, it is much easier to open your wallet in a pre-election survey than at the voting booth.
Also note that we are a state fully in the hands of liberal Democrats. 78% of Dems support it, but 54% of Republicans oppose it. One data point I will give you… 39% of Republicans support it… I find that surprising and concede that it does indicate a difference in what we have seen before related to taxation. It may be the sales tax / income tax compromise… as in “I get taxed, we all get taxed”.
Personally, I don’t support any tax increases. I think they are stupid and destructive at this point. We have a spending problem not a tax problem. For every dollar any new tax brings in, it will chase out dollars. People will be more motivated to find ways to avoid paying sale tax. They will not purchase some expensive goods or will select less expensive goods (e.g., cars) because of the added tax expense. Increasing income tax will send more wealthy out of the state. It will also impact business startups and retention since small business finance tends to mingle with owner finance and higher income tax rates will impact cash flow and profitablity. In the end we will be lucky to see $.10 in real revenue for every additional tax dollar extracted. However, the long-term impacts will be a shrinking of our state’s private economy and wealth.
The way we should be seeking to fix our budget mess is to grow the state’s economy. But it is clear that with Democrats in charge of state government, and the country, we won’t be doing that.
[i] In the end we will be lucky to see $.10 in real revenue for every additional tax dollar extracted.[/i]
I doubt you could provide any evidence of a 90% reduction. Asked about the Laffer Curve effect on higher income taxes on the wealthy, David Stockman (Reagan’s budget director) said he figured you would get 70 cents on the dollar. The effect is real, but very much exaggerated by conservatives and anti-tax advocates.
The reason I broaden the discussion to include all forms of taxation is two-fold:
1. Brown proposed more than one type of tax. Everyone is affected.
2. The schools in California are no longer primarily funded by just one tax source.
I will vote to increase my own taxes in order to sustain public school funding. I will also support the parcel tax increase in Davis (I pay it, even though I don’t vote on it — how’s that for skin in the game?) to sustain the programs that make Davis schools exceptional.
Your interesting ideas about how to make public education better mostly seem to involve privatizing it. I have nothing against vouchers on a limited basis; I love charter schools and special options like Da Vinci and DSIS. But I also tend to make my political decision in the realm of the possible. I also don’t share your beliefs about how horrible the schools are. Could they be better? Sure. Will cutting the funding achieve that? I doubt it very much.
[i]”In higher education, just because you have the money to pay for an institution does not mean that you will get accepted into that institution/program.”[/i]
K.Smith, That is the way it exists today. How do vouchers and privatization change that? Colleges can legally discriminate admissions based on their set of selection criteria. Only until recently they could even discriminate based on race. Private business cannot legally discriminate based on race. And, with a check in hand, most businesses are motivated to find ways to attract you and retain you as a customer. Otherwise you and your check will go to the competition.
Public K-12 also discriminates. Students have to try out for sports, music, drama… all sorts of activities. Teaching styles are also discriminatory in that they favor a narrow learning template. So public schools have to let ALL kids in the door… why is that such a big deal given they are failing to engage and educate a large percentage of those kids?
Let’s be honest here… is the concern that religious schools will develop and gays will not be able to attend? I would support the requirement that any school taking voucher money cannot discriminate based on sexual orientation.
The only real issues I see are these:
-[b]Kids with learning disabilities and/or behavior problems[/b]. However, for this, I think there will be private schools that can rise to the challenge. For example, kids with behavior problems may require a boot-camp type school with more physical activity. Maybe a boarding school where they have to work and they keep half of what they make and the rest goes to pay for their room and board.
-[b]Low income kids[/b] This is a problem if private schools accepting vouchers have tuition rates exceeding the value of the voucher. I think this can be mitigated just like colleges do today. Offer financial assistance for more needy students. It can be funded by private donation and/or a percentage of school profit. However, if there are no private school options, the public school still take 25% of the total revenue provided by the private school students in the area. They should be able to use this to improve education for the remaining students.
Again, there is nothing that says public schools have to go away. In fact, I see a need for always having public schools as an option. If they can compete with the private schools to attract and retain students, then great. However, they should always be made to compete at some level or else provide education services not otherwise available by private providers.
[i]”Asked about the Laffer Curve effect on higher income taxes on the wealthy, David Stockman (Reagan’s budget director) said he figured you would get 70 cents on the dollar.”[/i]
Maybe, but then maybe 10 cents on the dollar. You cannot easily calculate the lack of economic activity resulting from taxation.
I know how many businesses in my loan portfolio are living on the razors edge of solvency. It will not take much to push them over the wrong side.
It is not just the marginal increase in tax money paid that is the decision driver for how capital and wealth moves in and out of the state. It is the aggregate total expense.
Using a hypothetical, let’s add 1% of additional income tax on Tiger Woods $100 million per year. That is $1 million. This seems reasonable that a guy worth a billion dollars and making $100 million a year could afford another $1 million to give to our poor starving public sector employees, right? However, Tiger and his accountant don’t look at it that way. They take the existing 10.3% ($10,300,000) in taxes paid get the new figure of $11,300,000. That is the figure now used to decide if it makes sense for him to move to another state. And when he moves, he takes all his economic activity with him.
Now take the business owner thinking about expanding. He is willing to take the risk. His expansion will create jobs. However, the government increases his rate of taxation. When he runs the numbers again, he sees that the project no longer pencils out… he would be taking too much risk based on the drop in returns resulting from the increase in taxation.
Now take the wealthy person thinking about expanding her home. She would hire several professionals and laborers to design, plan and build the expansion. But, the government increased her tax rate and she decides now is not the right time. She is not sure how her customers and clients will respond to the tax increase, and she is projecting a drop in sales for her company. She also decides to keep her old Mercedes another year or two.
Right now there are a stack of new business projects being looked at. If you increase any tax, more of them will end up on the “NO” pile and fewer will end up on the “YES” pile. Keep doing this and you get stuck in an Argentinean spiral down of increasing taxes to make up for lost economic activity.
I am guessing that Texas businesses will help fund the campaign to vote yes on any Brown tax increase.
Jeff,
Perhaps those with means will continue to have incentive to chase the golden carrot, even if reduced in size due to tax increases as much as 1-3% on profit levels over a few hundred thousand, by comparing their lot with the standard of living of those 50% who pay no federal or state income tax…
[quote]1.We need to grow the state and national economy to grow our tax revenue. To do this we should lower taxes and decrease regulation.
2.We need to reverse the trend of government spending by cutting and demanding that all agencies do more with less. We should be spending less per GDP, and banking a reserve that will carry us through the next inevitable recession.
3.Education must be completely reformed to be a customer-focused enterprise that competes for success and survival.
4.College research and the funding mechanisms should be completely separate from the business of educating students.
5.To this end, instead of sending state moneys to the institutions, we should start providing vouchers to give choice and power to the students who can then hold administrators and teachers responsible for providing the best education value.[/quote]
1) Decrease regulation? How about enforcing the regulations we already have? The abysmal failure of the SEC (mortgage meltdown) and the agency that regulates the oil industry (Gulf oil spill) come to mind. Furthermore, the new regulations are not even addressing some of the most egregious problems, such as the banks involved in robo-signing; Wall Street being allowed to slice/dice subprime loans and sell them off quickly to unsuspecting investors.
2) Cutting gov’t spending sounds good. But invariably what happens is that low level workers are cut, not administrators. Those lower level workers cannot then find work in this abysmal economy, and therefore cannot pay taxes or pay their mortgages. Unemployed people/foreclosed houses contribute to the recessionary spiral. Frankly, at this point, the safer approach might be to freeze gov’t, so it doesn’t grow any bigger. Then try and right the economic ship first, before slowly paring down gov’t. But any paring down should be done carefully and rationally. Cut the waste, not basic programs that are woefully underfunded. But what tends to happen is the gov’t keeps the frills and cuts the basics – thereby creating the rationale that the money needs to keep flowing…
3) Education needs reformation, but I don’t know that the private enterprise model is necessarily the way to go. I think I prefer the idea of charter schools and perhaps vouchers in areas with notoriously bad public schools.
4) Too simplistic. Research and education can still go hand and hand as research can often better fund education if allowed to. But research should not be elevated ABOVE education, which happens all too often IMO.
5) I’m certainly intrigued by the idea of vouchers, but not certain we need to go to an ALL VOUCHER SYSTEM. I prefer less drastic alternatives first, and see how it goes – perhaps pilot programs. But I’m all for offering some vouchers particularly in poor areas of the country that have bad public schools and I very much like the idea of charter schools.
Elaine,
Good points. On regulation, I’m not in favor of doing away with all regulations, but do you know how difficult it is to start and maintain a business in this state?
On the gulf spill, I laugh about the view that stronger regulations would have prevented the spill. Yes, if the regulations prevented the drilling in the first place; but no if you are thinking that we can hire enough talented people to proactively ensure zero risks in every bit of enterprise. The incentives for private companies to prevent a problem like the gulf oil spill are already substantial and adequate. Look at the amount of money BP has paid and is paying for their errors. This alone has done more to improve drilling process and technology more than ALL the regulations we can dream up. Note that both (financial pain & regulations) are reactionary mechanisms because people cannot think of every risk. We need both, but this armchair quarter backing to scream for more regulations as a reaction to every problem or every potential problem is killing free enterprise in this state.
On the bad business practices related to the sub-prime mortgages and robo-signing… you do realize that these were derived from government regulations don’t you? Neither practice would have existed without the government regulatory actions to make them happen. There is a law of unintended consequences and it is generally well exercised every time bureaucrats in federal and state government decide they are the smartest people in the room and can engineer some social or economic outcome based on the strength of their Ivy league education and law degree.
[]”But research should not be elevated ABOVE education, which happens all too often”[/i]
I agree with this. But how do you prevent that from happening if you don’t separate the two resource-competing business functions? There is more personal return for educators gravitating to research. They will always give instruction second priority.
JB: [quote]Now, looking at what the US spends per student for K-12. We are forth from the top.[/quote]
First, what´s the source of your data?
Second, if we are going to accept this data for purposes of argument, then all of the other countries you list have lower rates of child poverty than the U.S. On average it costs more money to educate kids from lower income classes. But the benefit is that if you do, then you have a larger educated native population which is less of a drain on future social programs.
Third, if you correct for poverty rate in the standardized assessment samples,
the U.S. scores the best of all ([url]http://nasspblogs.org/principaldifference/2010/12/pisa_its_poverty_not_stupid_1.html[/url]), and that poverty correction even suggests that the U.S. might be more efficient in what it spends on education than those other countries. Jeff, I see that you have lost your sense of American exceptionalism when it comes to public education.
JB: [i]1.We need to grow the state and national economy to grow our tax revenue. To do this we should lower taxes and decrease regulation.[/i]
And cut funding to K-12 education?
JB: [i]3) Think it is good enough (i.e., Don’t get the vision for how bad it is relative to how much better it can be, should be and needs to be.) [/i]
Present a working example of what Davis schools should emulate.
JB: [i]Public K-12 also discriminates. Students have to try out for sports, music, drama… all sorts of activities.[/i]
In Davis schools there are non-audition alternatives for all branches of the music program. This is also the case in every California high school that I have inquired about — that there is a non-audition music class offered before an audition group is offered. As far as drama, the model I´m familiar with is that the major roles tend to be up for audition.
JB: [i]So public schools have to let ALL kids in the door…why is that such a big deal given they are failing to engage and educate a large percentage of those kids?[/i]
Public schools educate larger percentages of children from lower income families than do private schools. On average it costs more educate children from lower income families. Lower income families tend to have fewer resources to take advantage of choices as they become available. Examples in other places have shown that when you go to a “competition-business” model of education, you end up concentrating children from lower income families into the remaining neighborhood public schools, which have to operate at an inadequate cost-per-student rate to give a good education to the remaining children.
wdf1: [i]”what´s the source of your data?”[/i]
I got it here: [url]http://www.nationmaster.com/graph/edu_spe_per_pri_sch_stu-spending-per-primary-school-student[/url]
I’m not familiar with any arguments against this point. Most concede that US education spending is on the high side.
wdf1: [i]”And cut funding to K-12 education?”[/i]
Cut something else and direct the savings to education. Liberals and Democrats these days don’t seem to understand the thing “choice” unless it is someone elses choice. Cut programs, cut agency budgets, reward those that figure out how to do more with less.
wdf1: [i]”Then all of the other countries you list have lower rates of child poverty than the U.S.”[/i]
This point takes us full circle to another topic. That of immigration. I and other make the point that the substantial flow of poor and uneducated illegal immigrants from our southern border over the last several decades that tend to pop out offspring at over twice the going rate is bankrupting the state. You and others claim this isn’t the case… you make the point that illegal immigrants provide us benefits commensurate with, or even greater than, their costs. Well here is a great example of how we cannot afford to care for so many poor and uneducated people from other countries. You admit it here that they are more costly to educate. 40% of California students are first or second generation Hispanic, and over 50% of them speak English as a second language.
I’m sorry, but deportation to reduce the student population and shrink the footprint of schools would solve most of our education funding problems. So what if the cost of labor goes up as a result. Raise wages by 20% and put the damn unemployed college protesters to work. I would rather pay more for my products and services than to give nanny government one more dime that will enable them to make another 15 cents in spending committments.
We cannot afford our own bleeding hearts at this point in time. Raising taxes will just percipitate the spiral downward to ever greater budget deficits.
wdf1: [i]Public schools educate larger percentages of children from lower income families than do private schools. On average it costs more educate children from lower income families. Lower income families tend to have fewer resources to take advantage of choices as they become available. Examples in other places have shown that when you go to a “competition-business” model of education, you end up concentrating children from lower income families into the remaining neighborhood public schools, which have to operate at an inadequate cost-per-student rate to give a good education to the remaining children.[/i]
You are ignoring responding to my point to voucher a percent of the total per-student tax revenue and retain the rest for the public school. For the sake of argument, let’s say the per-student revenue from state and local taxs for a given year is $7500. The voucher would be $5000 and the public schools would retain $2500. If the public school is good, then many parents would leave their kids there and not absorb any additional cost of a private school. However, if the school is not good (and I have to ask in this case why you would be for keeping ANY kid captive in a bad school), then the voucher provides midddle class parents enough help for them to afford a private school. The private schools could be required to provide low income scholarships like higher education does. Also, private donations could also help provide scholarships. However, for those kids that remain in public schools for whatever reason, the per-student revenue would rise with each student going the private school route. In a school of 2000 students with revenue of $7500 per student, 500 of those students use vouchers, it would result in 1500 students @ $9000 per student in revenue. The public school can shrink in size and offer greater teacher-student attention and more choice and service.
This all sounds like a win-win… unless your real beef is the public sector unionized teachers that would lose their jobs teaching in a crappy school because of the shrinking student population.
So you’re a Davis parent and you get your $5K voucher. Where are you going to send your child? Just curious.
[i]40% of California students are first or second generation Hispanic, and over 50% of them speak English as a second language. [/i]
…. and a majority of them are “fluent-English-proficient.” You should be proud of their assimilation.
[i]teaching in a crappy school [/i]
Which schools in DJUSD do you think are crappy?
Jeff Boone
.” It would be better if everyone paid something so that the immediate pain is completely shared and transparent. That way we would have less tax-payer class separation.
Nobody making income should pay zero tax in my opinion unless all are paying zero tax. It is bad for the country. You need a stake in the arguments for what government spends and taxes. Otherwise your pursuit of self interest will destroy our common interests.”
I would agree with you if it were the case that the immediate ” pain” we’re in anyway comparable. But what ” the pain” may entail for the lowest paid worker may be the pain of choosing whether to adequately feed his children, or provide needed medication for himself, his wife or dependent parents, or keep on the heat. Compare that to “the pain ” of perhaps having to forego that third pair of Banolos or to buy this years party dress at Nordstrom’s instead of Nieman Marcus. You see “class warfare ” as being only the poor being envious of the rich. I see “class warfare” as a two way street where the truly wealthy ( whether through their own hard work or through inheritance having done nothing themselves but leech ) benefit from the subsistence labor of others.
Your comments on previous posts that there have always been rich and poor does not make this a desirable state of affairs any more than saying that because there has always been murder means that it is a moral act. Your implication on previous posts that there is nothing inherently wrong with being poor is in my opinion misguided. There is nothing noble about hunger, or lack of medical care.
I also find of interest your comment about the ability of the pursuit of self interest having the ability to destroy the common interest. You see this as being the case only for those who do not pay taxes due to poverty. I see it as even more true for those whose wealth and power allows them to effectively dictate the terms of others lives by choosing to move their businesses to “more business friendly locations” to further enrich themselves and their stockholders. What is this, if not personal greed? The entire philosophy of Ayn Rand , who you so admire ,is based on the pursuit of individual, not common, best interest. The idea that the society as a whole will benefit from the unimpeded greed of a few individuals who have managed to gain enormous wealth seems to me to be belied by the economic events since 2008 regardless of which set of the rich and powerful one wants to blame based on one’s political philosophy.
JB: [i]This point takes us full circle to another topic. That of immigration. I and other make the point that the substantial flow of poor and uneducated illegal immigrants from our southern border over the last several decades that tend to pop out offspring at over twice the going rate is bankrupting the state. You and others claim this isn’t the case… you make the point that illegal immigrants provide us benefits commensurate with, or even greater than, their costs.[/i]
I´m actually more ambivalent on what our appropriate immigration policy should be. Immigration (legal/illegal) is the achilles heal for free traders and those who push too much for free markets and all. If it´s desirable to allow for the free flow of goods across borders, I´m a little puzzled why proponents wouldn´t solidly extend the argument to allow for the free flow of labor.
I do think that it is immoral to have employed immigrant farm workers, custodians, construction workers, nannies, landscapers who work and support their families in this country and then refuse to educate their children.
I also disagree with the stronger arguments that the problems with our country are solidly attributable to immigration. It seems like a cheap excuse to rationalize that “it´s not my fault that the economy is in a sh*thole”.
wdf1: Where you and I seem to continue to get caught up in conflict is that I see the Great Recession as only expediting the inevitable day of reconing for a state spending itself into insolvency. You seem to ignore this and link the need for tax increases only to the recession. We have been talking school funding problems for many years prior to 2008.
We simply have spent ourselves into a hole that we are stubbornly refusing to accept. We cannot afford what we have committed ourselves to. Education funding problems are only a symptom of the larger state budget problem, but it also include the sentiment that we need to care for every person that manages to illegally set foot on US soil. They fill our hospitals, they fill our prisons and they fill our schools. They work hard, and do jobs that are difficult, dirty and often dangerous. However, like when my debt becomes too high or my income drops, I start mowing my own grass and cleaning my own gutters. Americans… especially Californians… need to understand that the gravvy train is long gone. No more ways to extract another $1 to buy union political favors by spending $1.50 of it. We have to turn back the clock on our spending and send people back to their country of origin unless they are here legally.
Here is an idea… how about taking all the retired and pensioned college professors and have them donate their time teaching math and science to high school kids?
Jeff
I’ll bet that many native Americans would have shared this sentiment with you as they were being stripped of their lands.
JB: [i]We have to turn back the clock on our spending and send people back to their country of origin unless they are here legally.[/i]
Do you think that the cheaper labor and corresponding economic benefits (mainly lower consumer prices) of an immigrant workforce offset any added social cost (in this case, education)?
On what basis would you take your position? Just curious…
[quote]12/15/11, Huffington Post: The Three Horsemen of Arts Education ([url]http://www.huffingtonpost.com/nick-rabkin/the-three-horsemen-of-art_b_1147351.html[/url])
There’s never been a golden age of arts education in American schools. Back in 1930, less than a quarter of 18-year olds had taken classes or lessons in any art form. There was much progress after that, but by the early 1980s more than a third still had none. And for the last thirty years, arts education for American children has declined sharply again. By 2008, fewer than half of 18-year olds had any arts classes or lessons, about the level of the 1960s. Most of the decline has been concentrated in schools that serve low-income black and Latino students. Many of their schools have become veritable arts deserts. Why have the arts been so marginalized in education? There are three big reasons. We might think of them as the three horsemen of arts education, just one short of an arts education Armageddon….[/quote]
[quote]1/5/12, Huffington Post: Jerry Brown’s Budget Revealed: Schools Will Face Cuts If Tax Plan Rejected ([url]http://www.huffingtonpost.com/2012/01/05/jerry-browns-budget-revealed_n_1187510.html?ir=Education[/url])
SACRAMENTO, Calif. — California faces a smaller budget deficit in the coming fiscal year but will require nearly $5 billion in cuts to public education if voters reject Gov. Jerry Brown’s plan to raise taxes in the fall, the governor said Thursday in releasing its budget proposal for the 2012-13 fiscal year.
The governor’s office projected the state’s budget shortfall for the fiscal year starting July 1 at $9.2 billion, much more manageable than the $26.6 billion deficit the Legislature closed for the current year. Brown said the budget cuts he enacted this year, combined with additional cuts and his call for temporary tax increases in the coming fiscal year will all but end the massive deficits that have defined California’s fiscal planning for years.
He also noted that the state is being helped by an improving economy, which has led to a slight increase in tax revenue….[/quote]
[quote]1/4/12, Huffington Post: No Child Left Behind Turns 10 Facing Mixed Results And Uncertain Future ([url]http://www.huffingtonpost.com/2012/01/04/no-child-left-behind-10-year-anniversary_n_1184616.html[/url])
When President George W. Bush joined congressmen John Boehner, George Miller and Edward Kennedy to sign the No Child Left Behind Act in January 2002, he touted the moment as a bipartisan victory for America’s children.
“Today begins a new era, a new time in public education in our country,” Bush proclaimed in Princeton, N.J., as he signed the bill into law on Jan. 8, 2002. “As of this hour, America’s schools will be on a new path of reform, and a new path of results.”
But 10 years later, results matching Bush’s rhetoric haven’t yet arrived — and the law itself is unlikely to change any time soon….[/quote]
[quote]1/5/12, Sac Bee: Calif.’s Brown releases new budget ([url]http://www.sacbee.com/2012/01/05/4166660/califs-brown-releases-new-budget.html[/url])
SACRAMENTO, Calif. — California Gov. Jerry Brown released a new budget Thursday that would slash health and welfare programs for the poor and ask voters to pump nearly $5 billion back into education through higher taxes.
Brown framed his $92.6 billion spending plan as an either-or decision dependent on his $6.9 billion initiative to increase taxes on sales and the state’s high earners.
If voters approve his taxes, he suggested, the state can begin paying down years of debt and reverse recession-era cuts to K-12 schools, which have stuffed more students into classrooms and shortened the instructional calendar to save funds.
“With the tax program, we will eliminate the budget deficit finally, after years of kicking the can down the road,” Brown said.
If voters reject his plan, schools may have to cut deeper and prolong a patchwork of borrowing to maintain their operations.
For K-12 schools and community colleges, the tax measure would provide nearly $4.8 billion more than they received this fiscal year, roughly a 10 percent increase. Department of Finance Director Ana Matosantos suggested losing that money if voters reject taxes would be “equivalent to” cutting three weeks of school, though education experts believe such drastic measures would be unnecessary….[/quote]
JB: [i]When 50% of the “lowest income” people pay zero federal income tax, and a politician advocates that they pay something, that is not class warfare.[/i]
Some added context from this recent story:
Over Two-Thirds Of Corporations Pay No Federal Corporate Income Tax ([url]http://www.huffingtonpost.com/2012/01/10/corporations-pay-no-tax_n_1196875.html[/url])