I shot a note out to Rep. Steve Gottwalt after seeing that he had missed the vote on the smoking ban (something he was voting for) and the tax debate about which he was passionate. I worried something was not OK. Saturday night I found out that his mother-in-law had passed away on Friday unexpectedly. The funeral is here in St. Cloud tomorrow. Our prayers are with Steve and Paula.

Labels: Gottwalt, St. Cloud

Today I had lunch with a friend whose other friend, whom I'll call Bill, stopped by our table. Bill had a small business in a St. Paul suburb. Over the years he'd hired and paid between 5-10 workers annually. The business was his life. His dream was to sell it and retire on his life's work. He sold it just fine. But then the government stepped in: MN took 12% in taxes, the Federal Government took another 40%. Why should anyone, anyone, work for 40+ years to give the government over 50% of a life time's efforts?

Second blow - he also owns property in downtown St. Paul. For years, no one paid any attention to him. Now, seems like the city wants the property. "We never knew this building was here," commented the inspector. Duh - do you read tax records, property records? They didn't tell him why, just that the city was interested in his property. He won't make any money on this sale for sure.

Third example. Though a small business, he's required to place a sign on the door that says "door shall remain unlocked during business hours" and another displaying his right to be where he is. Well, these were missing - sloppy, yes! Over $600 in fines, NO. But then, a bureaucrat must keep busy.

So why are these three, small examples important? See, the owner, the one who took all the risk, the one who worked for over 40 years to provide for himself, his family, his retirement, the one who provided jobs for others, paid all his taxes, etc. ends up getting used by the government. Not only did the government take a huge chunk of his hard-earned money, but the jobs he provided will be gone. MN got their pound of flesh and then some. But they won't get any more.Why? He's moving to a lower tax state and taking jobs and money with him. He's also taking his work ethic and entrepreneurship and ideas and enthusiasm and energy, etc. with him.

Try to explain the fallacy of "taxing the rich" to an anti-business, socialist minded legislator.

Labels: economics

This graph shows the level of state income tax paid per dollar of income earned by income classes in 2006. This is the product of a new study by the Minnesota Taxpayers Association. It reports that we have been passed by other states in terms of lower income taxes. For example while we've fallen from 23 to 26 in the rankings of income taxes paid by households with $50,000 income (1 being highest, 42 being lowest), we have gone from 18th to 13th for families with $100,000 income. For single individuals with $50,000 income, we've gone from 11th highest in 2003 to 8th highest. For families with $500,000 inocme, we have risen from 10th to 9th already. Alas, for the DFL that's not enough -- the House proposal would take that to sixth, and under the Senate we would be #1.

Our state in 2004 has the fifth highest total taxes (state and local) per capita, and fourth highest per $1000 personal income. (The study notes that these numbers change depending on assumptions about the composition of income earned between capital gains, wages, and other income sources.)

The upshot -- we already have a more progressive tax system than most other states, with a great deal of generosity in tax treatment of lower income families. Executive Director Lynn Reed said in this press release:

Minnesota’s income tax system remains mostly competitive since the cuts of 1999 and 2000 for incomes up to $100,000. However, no state can afford to ignore how its taxes rank compared to other states. It is commendable for the Legislature to be considering the regressivity of Minnesota’s entire state and local tax system, but relying solely on increases to higher income households to balance the rest of the system runs the risk of violating not only the competitiveness principle of sound tax policy, but also the principle of visibility, by concentrating tax increases on very few taxpayers to pay for benefits to millions.

Labels: legislature, Minnesota, taxes

This is the death certificate that House Republican Leader Marty Seifert waved at lawmakers while speaking on the floor of the Minnesota House last Friday. His efforts may have been helpful in peeling off 11 DFL legislators -- including St. Cloud Rep. Larry Haws -- from supporting the DFL income tax increase (not "shift in tax burden" as the DFLTribune published Saturday morning.) Seifert has a press release that most papers covered, but you have to read the text of what he said on the House floot to get this. Seifert's office sent this to me a little bit ago. While realizing this is a little long it is an excellent summation of the House Republican position, so here it is:

"Madame Speaker:

"If you didn't get the message today, I will repeat it one last time.

"A $2.2 billion surplus ought to be enough. A 9.8% increase in spending ought to be enough.

"The average person out there has figured it out. But the Democrats in this chamber have not.

"And we are trying to figure out if this bill is shameful or shameless in all of its tax increases.

"Madam Speaker, we have a Certificate of Death for this bill before us today. It is frankly a waste of our time, as Rep. Pelowski has said, in marking up a bill that is going to meet the fate of a veto.

"Every single member of this Caucus will sustain it, and I would suspect that some folks on the other side of the aisle, in the Democratic Caucus, would be very uncomfortable in voting for an override as well.

"You are asking for $784 million in new taxes while we have a budget surplus.

"You are asking for a new gift tax to go after dead people. Thank you, Rep. Joe Mullery of Minneapolis.

"You are raising taxes by hundreds of millions of dollars on job providers. You get less of what you tax and more of what you subsidize. You are going to tax job providers more, so you will have fewer of them in this state . . . and fewer jobs.

"You have people on the Democrats' side of the aisle who say they are pro-jobs, but they are going to vote against job providers today. That is like saying you are pro-egg, while you are voting against the chicken. Where in the world do you think jobs come from? They come from job-providers, from growing markets.

"You are asking for $18 million more in tobacco taxes.

"You are asking for $4 million more in taxes on contractors.

"You are asking for millions more in a tax on snowbirds, as I call them.

"And of course, you put back in the tax on hockey tickets after we debated that for hours the other night and found another way to fund the hockey museum. You just couldn't help yourselves, could you? We shamed you into removing the tax the other day, and you snuck it back in. Congratulations. The 10-year-olds who are going to hockey games get to pay higher taxes because the Democrats need more of your money. I didn't know all those 10- and 15-year-olds around the State of Minnesota who are going to hockey games were "rich" people.

"Don't try to fool the people of this State, riding into town with your square wheeled wagons and trying to sell the elixir of high taxes.

"The elixir of high taxes is not selling. If it was, you would see 90 plus votes on the board for this bill. You will be lucky to get 72 votes [not a bad piece of forecasting; the bill got 75 --kb] , because people are not buying the elixir of high taxes.

"Where are the DFL moderates? Where are the people who campaigned as fiscal moderates last year? Was it just rhetoric, or was it reality? Let's look at some quotes, shall we?

"Rep. Paul Gardner of Shoreview was quoted as saying "I don't envision suburban Democrats going for an income tax or sales tax increase." Indeed, he won't be in office two years from now if such tax increases take place. It was a pleasure to serve with you, Rep. Gardner. Your Caucus is going to throw you under the bus wheel of tax increases.

"Speaker Kelliher, you were quoted at the Chamber dinner as saying "we can do it with what we have."

"Mike Hatch was quoted at the State Convention as saying "we can do this without raising taxes."

"Rep. Tony Sertich said the $530 million in additional money the new DFL programs would need "is well within the growth of the state."

"At the State Fair, Rep. Sertich and then-Minority Leader Kelliher said no tax increases would be needed, although they promised to push for collecting currently-unpaid taxes.

"Gary Eichten on Minnesota Public Radio asked the Speaker "other than a possible gas tax increase, do you see any need to raise taxes in the next couple of years?" Madam Speaker, you answered "No."

"Madam Speaker, at another event, you said "increasing taxes is not a top priority." You also said "I don't foresee any major changes in our taxing structure on business."

"Two days after the election, Speaker Kelliher also said that she did not expect Democrats to try to raise the state income tax, which House Republicans succeeded in cutting twice shortly after they took control of the House in 1998. Madam Speaker, you said "we are a fiscally moderate caucus."

"Oh, really? What's the definition of "fiscal moderates" these days?

"We get $1 billion of tax increases proposed by the Speaker and the House Democrats.

"The voters of the state voted for one thing last fall, and now we're being sold a bill of goods, and they're not buying it.

"Here is the language of the new DFL tax form: "How much money did you make last year? Now please send it in."

"You are offering unsustainable spending increases.

"You are offering unsustainable tails, or spending in future years.

"You are offering unsustainable budgets.

"And now you are offering unsustainable tax increases.

"You are living in a fantasy land. You are living on Gilligan's Island, and you are trying to figure how to get off. And it is not working. The people are not buying it.

"Our positive agenda in saying no to the tax increases today will result in more good-paying jobs, growing our economy, and letting people keep more of their hard-earned money.

"I know that he who promises to rob Peter to pay Paul will always have the support of Paul. The robbers are here today.

"But you are robbing people from throughout the state to make government bigger. You are robbing St. Peter to pay St. Paul.

"But you are also robbing Minnetonka, Rep. Maria Ruud and Rep. John Benson.

"You are also robbing Woodbury, Representatives Julie Bunn and Marsha Swails.

"You are also robbing Rochester, Representatives Kim Norton, Andy Welti, and Tina Liebling.

"I think all of you Representatives are good people and wonderful personalities. But at the end of the day, you are empowering liberal leaders to take more money out of your constituents' pockets.

"At the end of the day, you are empowering liberal leaders who said one thing last November, but are doing something terribly different today.

"It is not fair to the voters.

"You are simply taking the tax ax to the golden goose that lays the golden eggs of jobs in this state.

"You are going to have one big feast of property tax reductions . . . not in this year . . . but surprise, surprise, in 2008, the election year.

"You're going to have a nice big feast at the expense of the taxpayers while jobs continue to move out, while people hide income, while people hide from the tax collectors. Unfortunately, many of the people who create jobs are frankly just going to move out of the state because of the policies that you people are setting up today.

"Madam Speaker, we heard a lot about bipartisanship last year. There is no bipartisanship in or for this Tax Bill. There is not one Member of the Republican Caucus who is going to vote for it. And the Governor is going to veto it.

"Madam Speaker, recently you and I spoke to the Citizens League at the Allianz facility in Golden Valley. Rep. Winkler was there, and so was Rep. Garofalo. We were asked on tape in front of the Citizens League "will there be more income taxes." There were lots of people there who make more than you or me. And the answer from the Speaker was "No."

"Madam Speaker, you were right when you said that there will not be income tax increases this year. But the reason is not because of the Democrats. The reason is in spite of the Democrats. The reason there will be no more income taxes this year is because of the Governor and the House Republicans. That is the second part of the answer.

"And I think everyone in this Chamber knows that. Rep. Pelowski knows that and he was wise enough to tell everyone.

"Don't waste your time. The Legislative session is over three weeks from Monday, and we are arguing about a tax increase that is not going to happen. It is not going to happen.

"Madam Speaker, we did not offer amendments to this terrible tax bill, and I will tell you why. You and I grew up on farms. I grew up on a hog farm and you grew up on a dairy farm. We know that you do not pay a veterinarian to come out to the farm to save a hog that is already dead. This tax bill is a dead hog. The Senate will push through one that is even worse, and the Governor will veto it.

"Members, this hog is dead. It is dead on arrival. Vote Red."

Labels: legislature, Minnesota, taxes

On Friday on Phi Beta Cons, David French posted the disappointing outcome of a suit he was trying to protect the rights of former Temple University student Christian DeJohn. French's version of the facts:

In late 2002, Christian was deployed overseas to serve as a peacekeeper in Bosnia. While overseas, Christian received a series of anti-war messages from a university listserv. While Christian didn’t dispute the right of professors or anyone else to protest the war in Afghanistan or the (at that time imminent) war in Iraq, he also didn’t want to receive such messages while in a hostile fire zone. At trial, Christian testified that he wrote back to his department chair and asked to be removed from the e-mail list.

When Christian returned home from Bosnia, he found that he had been expelled from the university. When Christian challenged the expulsion, the university re-admitted him, claiming computer error. What Christian didn’t realize (at the time) was that the attitude of two key professors – his department chair and academic advisor — had dramatically changed towards him.

In university e-mails, these professors variously described him (among other things) as a “fool or liar,” a “gnat,” “mentally unstable,” and “trained to kill by the U.S. Army.” The department chair hoped he’d “self destruct,” and his academic advisor (in a later message that attempted to justify his actions against Christian) claimed that Christian was “obsessed” with “liberal bias.” One of his professors even went so far as to urge the department chair contact key Temple alumni (individuals who would be in a position to hire Christian after he graduated) and tell them that Christian did not represent Temple’s “best and brightest.”

The lawyer for the two members of the history department is quoted in the Chronicle of Higher Education (temp link, permalink for Chron subscribers) as finding Mr DeJohn a "marginal learner, barely passing" and that his masters thesis "flabbergasted" the faculty. So while French is certainly trying to bring out the worst of DeJohn's professors' behavior, they aren't exactly hiding their dislike for the student.

Two facts also bear notice: First off, Mr DeJohn was called a "peacekeeper", which I guess is the word of art for a sergeant in the National Guard who pulls overseas duty. So this is potentially retaliation against a member of our military. Second, Mr. DeJohn was someone who testified at Temple during the hearings surrounding Pennsylvania's inquiry into political bias and the possible need for an Academic Bill of Rights.

The judge threw this case out, though. He said there was no evidence that the chair had retaliated against the student -- a finding that I can't judge based on the information received -- but this from the Chronicle raised my eyebrows:

And the judge said that, while the jury may have discerned some evidence that Mr. Urwin had retaliated against Mr. DeJohn, the professor deserved "qualified immunity," which means that he behaved toward Mr. DeJohn in a way that could reasonably be seen as within his rights.

Excuse me? It is within one's rights to retaliate against a student? So if a student is retaliated against by a faculty member and can prove it in a court of law, a faculty member may nevertheless have some kind of immunity from prosecution for violating a student's due process rights?

French has indicated he may appeal the ruling. One hopes the rights of students will be upheld.

Labels: higher education

After the shootings at Virginia Tech (VT), along with millions of Americans I thought about the 2nd Amendment to our US Constitution, the right to bear arms. Contrary to the wishes of many on the left, the United States Court of Appeals for the DC Circuit ruled that this right is for individuals, not just the various branches of our US military. (It will most likely go to the US Supreme Court.)

So, just why is this right to bear arms important?

One of my former college students was an immigrant from Addis Ababa, Ethiopia. He is a very bright, articulate young man. As with most of my African students, he fluently speaks three languages, one of which is English. He shared the following stories with me.

As a teenager attending junior high school in Addis Ababa, he and his friends were often pursued by what he called the government "goon squad" on their way home from school. If they did not outrun the thugs, they were kidnapped and sent to the mine fields between Ethiopia and Eretrea - where they were forced to walk the fields to trigger mines set by enemies. As he said, the only time his friends returned alive was when they were missing an arm, a leg, an eye, etc. He was lucky, he was always able to outrun the thugs.

Part two of the story was this. His father kept a loaded handgun with him at all times in their home. His dad's logic was that even if the goon squads entered their house, he (the dad) could take out one or two of the thugs before being murdered himself.

In spite of our problems, in spite of many of the leftist, control obsessed politicians, we do live in a safe country - just ask a legal immigrant. Our 2nd Amendment is one of the key reasons we are free.

The Strommer is on his back in hospital, and the Taxpayers League has called up the minor leaguer. The great thing about Taxpayers League Live is that the TPL staff gets great guests. This will be no different. I get to interview state representative Kurt Zellers from Maple Grove, a Republican likely shellshocked from his treatment to the marauding band on the House Tax Committee. He'll be on after 9:15. Then it is my honor to interview not one but two U.S. representatives, John Kline and Michele Bachmann after 10am.

If you miss that, you get the usual dosage of the Final Word at 3pm. (The interregnum of John, Chad and Brian at 11am, and Mitch and Ed at 1pm, will allow me respite to get my NFL draft fix and a chance to watch Ed burn his Brady Quinn ND jersey after he miraculously becomes a Detroit Lion.) Michael probably has all there is to know about the Swanson Mutiny, and I got a thing or two about this smoking ban thingy that I need to get off my chest.

Four hours? Heck, I eat four hours for breakfast.

Be sure to listen in at AM1280 the Patriot (also online.) And if you miss all that, archives for NARN and TPL are available.

Labels: NARN

The first quarter GDP figures are out, and a 1.3% growth rate looks pretty bad, almost half of the previous growth rate. But what interests me is the breakdown in contributions to GDP growth. Personal consumption held its own, contributing 2.6 percentage points to GDP growth this quarter versus 2.9 last period. So household spending has been fine. Residential investment knocked off almost 1.0 percentage points from that, but that's less than was in the fourth quarter. Business investment contributed a little more of the decline. Much of the news seems to be focusing on housing.

What really caught my eye was the contribution of net exports, which swung from contributing 1.6% to growth in the fourth quarter last year to knocking off 0.6% this year. Reuters at least touches on that. That swing had more to do with slowing exports than increased imports. This may stay the hand of the Fed in raising interest rates any time soon (higher interest rates increase exchange rates and make our exports less competitive.)

Worth noting: When this number is revised (and there will be two such revisions) the trade figure is the one that changes the most. So I expect this GDP estimate to be rather volatile to trade revisions.

Labels: economics

"Those who deny freedom to others, deserve it not for themselves; and, under a just God, can not long retain it." -- Abraham Lincoln.

"Minnesotans have asked for this because they're tired of breathing smoke in public places," said Rep. Steve Gottwalt, R-St. Cloud. "The only way that this ban works is across the board with few exceptions. Across the board, make it even."

"Freedom is never more than one generation away from extinction. We didn't pass it to our children in the bloodstream. It must be fought for, protected, and handed on for them to do the same." --Ronald Reagan

"Today we're talking about the freedom to breathe for those people who do not smoke," said Rep. Dan Severson, R-Sauk Rapids, one of the bill's authors. "Forty years ago you could smoke anywhere. Twenty years ago they banned it out of airplanes. Ten years ago California put in a smoking ban. This is time for this particular bill."

Labels: legislature, Minnesota, smoking

Reading Peggy Noonan this AM:

We are frightening our children to death, and I'll tell you what makes me angriest. I am not sure the makers of our culture fully notice what they are doing, what impact their work is having, because the makers of our culture are affluent. Affluence buys protection. You can afford to make your children safe. You can afford the constant vigilance needed to protect your children from the culture you produce, from the magazine and the TV and the CD and the radio. You can afford the doctors and tutors and nannies and mannies and therapists, the people who put off the TV and the Internet and offer conversation.

If you have money in America, you can hire people who compose the human chrysalis that protect the butterflies of the upper classes as they grow. The lacking, the poor, the working and middle class--they have no protection. Their kids are on their own. And they're scared.

And they're in public schools. If you wanted to keep them safe and you had a school voucher, would you keep them there? Public schools have to accept all students, government education supporters would say, so it's not fair to make that comparison. But would it stay that way? If you could opt your kids out of that school thanks to vouchers, do we really believe the public schools would not do more to identify and isolate dangers in their schoolhouses?

Labels: education

That's the only way to answer the question of whether Curt Schilling really bled red that night in 2004. The sock is on display in Cooperstown. This suggestion came up on Mike and Mike, and it seems only reasonable. If it's positive for blood and not paint, Gary Thorne apologizes, and the Orioles can decide whether or not he keeps his job.

Lots more coverage linked from The Boston Sports Media Watch.

Labels: Red Sox, sports

Want to see how the DFL behaves in our state legislature? Michael has a video of one DFLer who is for against the smoking ban referring to another DFLer who is against for the ban "makes Saddam Hussein look reasonable." It takes a senior DFLer to stand up and rebuke the first fellow as "a little out of line, even for the customary standards of this house" and the first fellow offers a non-apology apology.

It is my hope that more YouTubing of the Minnesota Legislature would allow Minnesotans to see who currently represents them. And, with luck, recoil.

UPDATE: I reversed the roles of Rukavina and Huntley. Coverage made the StarTribune.

Labels: legislature, Minnesota

There is a proposal at the University of Illinois to create an online program that could scale up to 70,000 and avoid many of the costs of bricks and mortar ... and mortarboards.

When Global Campus was proposed, in May 2006, officials envisioned it as a corporation that would rely on part-time instructors, and be free of university regulations.

Administrators said the setup would reduce faculty expenses. Operations like payroll and other tasks could be outsourced, presumably allowing the Global Campus to run more efficiently than the regular university. The online institution would be nimble, responding to market pressures with frequent revisions in the curriculum. By comparison, proposed changes in the traditional university curriculum are vetted by many scholars in a time-consuming process.

Faculty members complained that the project treated them as irrelevant.

"It presented a huge danger, not only in and of itself but as a kind of model for the university of the future," says Cary Nelson, an English professor at Urbana-Champaign who is president of the American Association of University Professors.

Faculty members would have had no say in curriculum development or the hiring of instructors, he explains: "It was the development of a whole segment of the university completely outside faculty input and completely outside shared governance."

The university has relented and created a partnership with the faculty union. Yet there are online courses at some of its campuses, such as Springfield. (
Source, hat tip: loyal reader JW.)

What will become of these online programs and why would the universities of Illinois and Maryland, among others, push for them? We turn again to Richard Vedder, reporting from a conference studying collective bargaining in higher education:

The reality is that spending at American universities is not rising as rapidly as in the salad days of the 1950s or 1960s, but it is still growing. It is true that a smaller proportion of that spending is going to the professoriate. To the attendees of the ... meeting, on average, the solution is to get the taxpayers to fund higher education more generously, rather than to reallocate university funds back to historic proportions with respect to spending on instruction.

To be sure, there were pockets of realism and analytical thinking. Dan Julius, the Provost at Benedictine University, called for more serious academic research on labor issues, suggesting good ideas for studies. For example, has the spread in the use of part-time non-tenured ("contingent") faculty led to reductions in academic or instructional quality? What is the relationship between academic quality and unionization? Good questions, deserving serious scrutiny. And Ernst Benjamin, who runs the American Association of University Professors (AAUP), saw a potential dilemma. In pushing hard for higher salaries and fringe benefits for mostly tenure track full time faculty, unions increase the incentives for institutions to hire more adjunct faculty with low pay and fringe benefits. He came close to suggesting that unions are promoting the demise of their own membership by driving universities to lower cost substitutes for their services.

Which takes us to online learning.

Labels: higher education

Rich Vedder:

If Becker were right on the economics of higher education, one would expect spending on colleges by governments to positively impact growth rates. The work I am doing, now in conjunction with Tony Caporale and Whiz Kid Jonathan Leirer, convinces me that spending on higher ed by state governments has, at the margin, no positive growth effects whatsoever, and probably even negative ones. As to the other dimensions, do college graduates smoke less (and thus live longer) than non-college graduates because of what they learned in college, or because they are smarter and more disciplined? ...

If James Bryant Conant, former Harvard president, had gotten his way, we would today have perhaps five or at the very most 10 percent of the adult age population with college degrees. Would we be poorer, less healthy, etc.? Maybe, but to me the evidence is very far from clear. As Posner notes, many studies on these issues were based on K-12 results, and the marginal benefits of subsequent education may be quite different than that associated with basic literacy and numeric skills.

Links to Becker and Posner added. I'm hoping Vedder posts this paper of his soon.

Sorry to be shorter today, but a day from hell it was, and now the final papers for senior seminar come tomorrow. Rest is required, though one more blog may come from me tonight if I can extract it from the muse.

Labels: economics, higher education

Several posts by others today on the StarTribune's defense of Minneapolis Community and Technical College's purchase of foot-bathing facilities for its Muslim students. See for example PowerLine. Mitch asks a very good question hypothetically of MCTC's administration:

Since washing feet - the feet of others, in this case - has a tradition in Christianity that was practiced by Christ himself, I’m wondering; would I, a Christian, be able to wash feet in this foot bath (following Christ’s example, I’d be washing the feet of others rather than my own - a typically-Christian model of self-abnegation, if you know what I mean)?

I suspect I know the answer, and there'd be a way for MCTC to differentiate re-enactment of the Last Supper, an annual event, with the five-times-daily washing required of observant Muslims. So perhaps Christians would get access only on Maundy Thursday. To be frank, that'd be enough for me.

But the part that I've been wondering about is in the STrib editorial,

If MCTC were setting some unusual precedent, we might worry. But it's not. St. Cloud State University, the University of Minnesota-Duluth and at least a dozen other colleges around the country have installed small foot-washing facilities for their devout Muslim students -- at modest cost and often using student fees rather than state revenues.

If student activity fees were purely voluntary payments, distributed democratically by a student government, I might agree with the distinction the editors make. But this is a false dichotomy. It takes as little as 7% of the student body to impose fees, and student government elections are typically with less participation than that. After voting a fee, the university takes the money from students and deposits it into an account for them. So the state is involved in enforcing the fee, and the university does have oversight. I think the distinction between student fees and state revenues is less than one would believe.

At SCSU, there are Friday prayers for Muslims in the student union; it is my assumption that to do so requires the washing of feet, and perhaps a facility is provided. It's not clear to me if it is provided by the Muslim Students Association, or the Arab Students Association, or by student government more generally. There are 17 student organizations on campus that are religious, most of them Christian. The question of who paid for the washing basin is not terribly important. That it's just a few dollars, and it comes only from student activity fees, doesn't help us understand the lack of equal access to religious practice on our campuses. The question worth asking, like Mitch does, is whether each enjoy equal access to the fees collected by the state on behalf of a student government that would not pass the test of being representative even if you had Jimmy Carter judging them. I have not heard any reports like this, so I assume nothing has happened, but I do not know. (If you are an SCSU student with an opinion on this and wish to remain anonymous, drop an email at comments-at-scsuscholars-dot-com)

It's not an idle question. FIRE has a list of cases in its past that cover religious liberty on college campuses. Most, though not all -- LSU once tried to not recognize a Muslim student group because it had the requirement that its members be Muslim -- have pointed at restrictions on freedom of religious expression of Christianity. It is that backdrop that causes questions to arise when we find dollars spent on public university campuses in support of religious practices of others.

Labels: higher education, Minnesota, SCSU

John Stossel of ABC's 20/20 was in MN for a two-day college tour. King wrote about his talk at St. Johns, in Collegeville, MN on Monday, April 23. Tonight, Stossel spoke at Northrup Auditorium in Mpls.

The title of his talk: "Freedom and Its Enemies"

One can summarize his views as follows:
The touted belief/myth that the free market economy is so cruel and unfair that government must take over is simply wrong. Frauds avoid the rules and regulations. But, once it's apparent the fraud will lose, they move on to something else. In the meantime, creative people learn and comply with all the rules. This is creative time wasted; they get stifled by government regs. Companies in business for the long haul pay for all the regulations as do the consumers. Good companies that serve customers well, grow; those that don't, die.

Ralph Nader originated the idea that commercial TV would not do consumer programs because TV would lose advertisers. What happened? Consumer programs thrive on commercial TV and are non-existent on public TV because the PBS regulating boards are too scared to try anything.

People have been told by government and tort lawyers that business is a zero sum gain. In reality, business is a win/win. You buy a cup of coffee, you hand the server your money. You get your coffee, the server gets their money. "Thank you" and both of you are happy.

Free enterprise has lifted more people out of poverty than any other economic system.

Fearful and bad reporting encourage people to be fearful.

In summary, in addition to our military heroes, America's other heroes are free people, the inventors, entrepreneurs, the creative geniuses who design, develop and deliver innovation after innovation after innovation - not the government regulators.

Labels: higher education

A story of despair...

I was in the Cities this weekend and as fate would have it a StarTribune was in front of my hotel room door Sunday morning. I could have returned it for $.88, I was told, but decided to keep it. A Sunday morning with a good sports section during baseball season, and a hearty cup of coffee, is a pleasure even if the rest of the paper is crap.

Alas, my eyes insist on busyness at all times -- this will be their ruin, I know -- so eventually I got around to the editorial page, whereupon I found this.

Politicians often find it convenient to assert that taxes are paid by two kinds of entities -- businesses and people. Economists -- and this page -- don't buy it. We maintain that all taxes are paid by people.

Search the internet for "corporations are people too" and you get a lot of leftist bilge. But the editorial is correct -- all taxes are paid by people, since entrepreneurs are people too.

Tax a business' property, payroll or purchases, and to the best of its ability, that business is bound to pass the bill along to its customers and employees, in a way that bears little relationship to ability to pay.

So it only took the third sentence to go awry. Businesses don't pass along all their taxes. Some they do, but only by willingness to pay. In a free market, when you shift a tax onto me, I can say no. I don't because I value the good more than the money I give up including the tax (what Stossel referred to last night as the "weird double-thank-you", where each party to a transaction thank the other for completing it. That still happens with a tax, just less often, proof that some social welfare is lost when you tax goods and services -- there are fewer double thank-yous.)

Of late, some Minnesota politicians -- including Gov. Tim Pawlenty -- have been giving this argument an odd twist. They argue, in effect, that the one state tax that is clearly based on ability to pay -- the personal income tax -- is really a tax on business. For that reason, they say, the Legislature should not raise taxes on the state's highest earners, even though these taxpayers now pay state and local taxes at a lower effective rate than other Minnesotans. Those fortunate few are job producers, the argument goes, and making such businesses pay an equitable share of taxes would drive this flock of golden geese away.

"In effect" are weasel words. They know we don't really argue this, as they admit:

Their contention is grounded in this much reality: Small businesses, particularly sole proprietorships and partnerships, are typically organized in a way that allows their profits to be taxed only after they have been passed through to their owners, as income.

How many could this be? It's certainly many. Of the 2.4 million tax returns filed in Minnesota in 2000 (last year I could find online), 343,249 of them listed business income on their individual returns and thus would be eligible to pay the higher rate the DFL proposes. About 47,000 of them had business income over $100,000 that year, 9,000 more than a quarter million. By comparison, there were less than 30,000 100% Minnesota corporations in 2001. So it's not an insignificant amount.

But small businesses come in all sizes and profit margins. The vast majority of their owners report incomes well below the thresholds for the new top bracket being considered by House and Senate DFLers. What's more, to thrive, these business owners need the services that tax money buys: education, transportation, public safety and more.

"You can't do it without us!" When I arrived back home after the weekend and picked up my mail I got a copy of Frank Chodorov's "The Peddler as Hero." That peddler, the old middle class, had died by the time Chodorov wrote this in 1962:

The middle class, of the earlier period, was identified by something besides economic status; one thinks of them as a people motivated by certain values, among which integrity was uppermost. The middle-class man was meticulous in fulfilling his contractual obligations, even though these were supported only by his pledged word; there were few papers that changed hands, fewer laws covering contracts, and the only enforcement agency was public opinion. In the circumstances, personal integrity in the middle-class community was taken for granted; anyone who did not live up to his obligations was well advertised and lost his credit standing. Bankruptcy carried with it a stigma that no law could obliterate and therefore was seldom resorted to.

The life of the old middle-class man was, by present standards, rather prosaic, even humdrum, being enlivened only by plans for expanding his business. If he had dreams, these were concerned with getting ahead by means of serving his community better, of widening the scope of his enterprise. But, his personal life was quite orderly and quite free of eroticisms; rarely was it disturbed by divorce or scandal. His sense of self-reliance imposed on him a code of conduct that precluded psychopathic adventures and gave him stability. Orderliness in his personal life was necessary to his main purpose, which was to produce more goods or render more services for the market; that burned up all the surplus energy he had at his disposal.

It never occurred to this middle-class man that society owed him a living, or that he might apply to the government for help in the solution of his problems. The farmer is a particular class in point; the present day agriculturist, who must be included in our present day middle class in terms of income, holds it quite proper to demand of government, that is, the rest of society, a regularized subsidy, even a subsidy for not producing; the farmer of the early part of the century would hardly have thought of that.

The merchant or manufacturer located in the area served by the Tennessee Valley Authority has no hesitation in accepting electricity at rates that are subsidized by the rest of the country, and even demands more of that handout, without any hurt to his self-esteem. The pride of the peddler, the entrepreneur, has left the industrialist who now grovels before legislatures and bureaucrats in search of government contracts, while the independence that characterized the early banker has been replaced by a haughty obsequiousness of the modern financier in his dealings with government.

Indeed, it has become a "right" to demand a special privilege from the authorities – as, for instance, the urgency of professional athletic organizations for publicly financed stadia in which to display their wares; and the man who secures such a privilege does not feel humiliated by its acceptance, but rather holds his head as high as did the earlier entrepreneur who made his way on his own steam.

Perhaps the StarTribune editorialist is correct: We have raised a generation of middle class entrepreneurs that are willing to game the system, seek favors from government to line their pockets. If so, they have only themselves to blame. You now must share your wealth with the other guys in the bargain, and the other side has a monopoly on using the police to enforce their will. But there are certainly some that do not. Why are they to be punished by the force of taxation? The editorialist continues,

The argument that those who have profited most handsomely in the environment those services helped create deserve to pay a lower effective tax rate than other Minnesotans, including most other business owners, doesn't wash. Neither does the presence of business owners among the state's top earners, a group that includes ballplayers, CEOs and top professionals of all kinds, warrant a lighter tax burden for the lot.

No, you must all pay to Leviathan. Bow before your master.

What Pawlenty and other Republicans are invoking is trickle-down economics, a theory that has remarkable staying power in this country given how poorly it has aligned with experience.

And yet count the countries of Eastern Europe that have adopted a flat tax! These countries are run in many places by ex-communists. And it really fooled this guy:

Our true choice is not between tax reduction, on the one hand, and the avoidance of large Federal deficits on the other. It is increasingly clear that no matter what party is in power, so long as our national security needs keep rising, an economy hampered by restrictive tax rates will never produce enough revenues to balance our budget just as it will never produce enough jobs or enough profits… In short, it is a paradoxical truth that tax rates are too high today and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now.

This is not Reagan, but John F. Kennedy, 45 years ago.

The editorialist continues,

According to trickle-down notions, states with high taxes and progressive tax structures should be flagging economically. The evidence is otherwise. The state with the highest per capita taxes, Connecticut, had the highest per capita after-tax income in 2006; conversely, low-tax states such as Alabama and West Virginia also rank at the bottom in after-tax personal income.

This is of course the post hoc (or perhaps in this case post non hoc) fallacy. There's ample evidence to the contrary, if you wanted to look. In short, any paper that shows no effect of state tax rates on growth also shows no effect of state spending on growth, meaning all those "investments" the DFL wants to make have a zero return. Those things that made high-tax Connecticut grow also made Christine Whitman's New Jersey grow after she passed 30% tax cuts. The same can be said for southern states. This helps explain the last paragraph of the editorial:

But Minnesota doesn't have to look to other states for a model. It need only look to its history. Decades of higher-than-average taxes and spending on public services helped Minnesota become the most prosperous state in the Midwest in the 1990s. Only since big tax cuts began to squeeze those services in this decade has state income growth lagged behind the national average. That trend needs to be altered, and pinching public services in order to perpetuate sweetheart tax treatment of the wealthy won't do it.

There is no sweetheart tax treatment. Nominally, we've built in a good deal of progressivity; the "sweetheart tax treatment" is the ability of Minnesota businesses to shift taxes onto labor and consumers. I keep coming back to the same point -- raising the taxes to compensate for shifting only leads to more shifting. The only way to control shifting is to control prices and wages. That's been tried before, and the Soviet Union now lies in the dustbin of history.

The reason Minnesota is lagging behind the nation now is a shift in demographics and in comparative advantage. Minnesota used to have 16% of its workforce in manufacturing; now it has less than 13%. This is a national trend, but it hits Minnesota (and most of the upper Midwest) harder than it hits the rest of the nation, and St. Cloud harder than most of Minnesota. This is about 50,000 jobs lost in that region. What area is growing? Health care. You can say this about any state in the old Rust Belt. It has nothing to do with tax cuts or Ventura or Pawlenty or our own history. Welcome to the country that is getting older, particularly if we keep trying to keep immigrants out of it.

Those older people will remember the simpler time, and may be the people who are remembered by Chodorov,

And so it has come to pass, during the second half of the 20th century, that the ethic of the peddler class has been replaced by the ethic of mendicancy. I am inclined to the thought that the change indicates a deterioration of the American character; but, then, I am loyal to my youth, as is every older man, and may be prejudiced.

It may well be that social security is an advance over self-reliance, that the individual prospers better under the ministrations of the bureaucrat, that juvenile delinquency is a social rather than individual malady, that individual proficiency is a social curse, that freedom is indeed the right to feed at the public trough. The young people, those who were born or got their rearing during the New Deal era, do not question that concept of freedom, and the professors of economics, psychology, jurisprudence, sociology and anthropology write learned books in support of it. Therefore, it must be so.

Any attempt to revive the old concept of freedom – that it is merely the absence of restraint – would be a fatuous undertaking; it would be like trying to "turn back the clock."

Yet, one cannot help speculating on the future. When the present generation, well inured to the Welfare State, shall have grown old, will it not also write books on the "good old days," even as this book speaks lovingly of the ethic of the peddler class? And what new ethic – every generation has its own – will these books decry? Maybe it will be the ethic of the totalitarian state. Who knows?

I'll link again to Chodorov and to the StarTribune and ask, has that ethic already come to pass?

Labels: economics, Minnesota, StarTribune, taxes

I recall sitting in a cabin up north with Mrs. S one morning in August, 1991, and reading in the news of the tanks in the streets of Moscow and the guy who stood on top of them. Shortly after then, the Soviet Union collapsed and Russia's new leader was Boris Yeltsin.

The blogosphere is full of encomiums to Yeltsin, and I don't have a particular personal story to share about him. I have met several economists who worked with him but never the man himself. We know that when he said in October 1991...

We have defended political freedom. Now we have to give economic [freedom], to remove all the barriers to the freedom of enterprises and entrepreneurship, to give the people possibilities to work and receive as much as they earn, after having thrown off bureaucratic pressures.

...that he never really meant it, or at least he didn't know how to make it happen. As Leon Aron noted several years ago, from the moment Russia entered its own life out of the Soviet Union, Yeltsin the populist and Yeltsin the reformer were constant adversaries.

While in Ukraine in 1996 I watched Yeltsin's re-election; given up for dead by most observers early in the year, he rallied back from two heart attacks and a moribund political party by being the populist again, by claiming his own cabinet had not provided for social protections, handing out huge unsustainable increases in pensions, playing to nativist fears with Chechnya, etc. (I argue with people still that the Russian bond defaults in August 1998 were predictable consequences of Yeltsin's electoral largesse, and the West's loans to him the worst part of our relations with post-Soviet Russia to that time.) Who can forget the man who danced his way back into a race he was sure to lose? The populist was needed at that time in order to pull out the victory. Alas, the energy expended left Yeltsin the reformer too feeble to act if he had wanted to ... and we'll never know if it was because of that or his desire to feather his own bed on the way to retirement.

I've never been a fan of populists, and Yeltsin was at his peak as a populist and that's how most will remember him. However, the reforms he tried and failed to create, particularly in the Gaidar period, were a legacy that will endure well past the tapes of the dancing candidate. A flawed man who could not reform his own country, but good enough to provide a map other countries followed to successful transition.

Labels: Yeltsin

Readers might remember my trip to Armenia last January, in which I wrote:

The purpose of the conference I spoke at was to assess the economic and social consequences of opening the border between Armenia and Turkey, closed by Turkey as a response to the war between Armenia and Azerbaijan in 1993. Closing the border is a political decision. Now my job was just to talk about what the effect on foreign investment would be in Armenia if the border was re-opened -- the opening would be, in my view, a representation that the risk of external conflict was reduced in the region. But we were told that we could not talk about politics at all. There was the acting ambassador here to make sure we didn't and when he left the local USAID guy kept watch on the proceedings. The local community is upset that the issue cannot be raised. Worse, the Turkish scholars here -- who either didn't get the memo or weren't obeying it -- tried to say something about how to solve the political issue. For this, they have been hammered by the more nationalistic Armenians here. In one sense I feel bad for them, but frankly there's one that keeps putting his foot in his mouth, so to heck with him. Yet if the US government wasn't so nervous as to place an imperfect gag order, none of that would have happened. They would have debated, and at the end hopefully we all have food and drink.

A few weeks ago people believed Speaker Nancy Pelosi might bring a bill to the floor of the U.S. House that would recognize the massacres in 1915 in Turkey of Armenians as a genocide. Executive branches for years have begged Congress not to pass these rules, as Karoun Demirjian notes in today's Chicago Tribune, and this year is no different.

In a letter to Pelosi and House Foreign Affairs Committee Chairman Tom Lantos (D-Calif.) last month, Secretary of State Condoleezza Rice and Defense Secretary Robert Gates wrote that Turkey -- which borders Syria, Iraq and Iran -- is "a linchpin in the transshipment of vital cargo and fuel" to U.S. troops in the Middle East.

A negative reaction from Turkey to a resolution on the Armenian genocide "could harm American troops in the field, constrain our ability to supply our troops in Iraq and Afghanistan, and significantly damage our efforts to promote reconciliation between Armenia and Turkey," Rice and Gates wrote.

That letter included this remark:

Efforts such as the recent USAID-supported conference in Yerevan entitled "The Economic and Social Consequences of Opening the Armenian-Turkish Border," which was attended by both Armenian and Turkish civil society representatives, demonstrated that the U.S. approach to this difficult issue is, indeed, working.

That was the conference I was at. The board of the organizing research group (of which I am a fellow, but not a board member) responded that the letter was wrong,

With the full agreement and insistence of the U.S. government donor supporting it (USAID), all political issues were intentionally kept off of the conference agenda, and the proceedings were run in a manner to maintain an exclusive focus on non-political issues. Therefore, as an apolitical academic event that deliberately avoided the topic of Genocide recognition, the conference cannot legitimately be described as a component of a process of reconciliation. That process must fundamentally address a number of political issues for which the conference was not designed.

It's intriguing to get caught as a pawn in this game. But it's mostly sad. Today marks the 92nd anniversary of the day when 250 Armenian intellectuals were rounded up in Istanbul, marched out of the city and shot. The systematic massacres began the next month. (I note that my father's family roots by this time had left Turkey; my grandfather had fled to America for four years already, and my grandmother to a Beirut orphanage after losing her father in an earlier pogrom.) Regrettably the condemnation of Jewish Holocaust deniers has never been visited on a worldwide scale on those who deny the Armenian genocide (type the last two words into Google and you'll find denial sites quite easily.) Indeed, in the interest of Israeli-Turkish relations, even the Knesset has rejected a statement of recognition.

Regrettable even more is that a topic that should be left to historians and archaeologists has instead become a "process" that "must fundamentally address a number of political issues". Letting politicians decide history is how we got into this mess; hard to believe there's no other way out.

Labels: Armenia, politics

St. John's University/College of St. Benedict had John Stossel on its campus last night. I attended with about 250 other people. The talk was put on by the schools' College Republicans and the Students Fostering Conservative Thought.

If you watch most of Stossel's 20/20 specials, you probably know his views on economics, which was the focus of last night's talk. It was largely a blend of "Greed" and "Are We Scaring Ourselves to Death?" A few things I noted of interest to me:

1. He made a specific point to say "I'm not a conservative, I'm a libertarian." This meant he was in favor of gay marriage, mildly pro-choice, and anti-interventionist. On the other hand, he was not as libertarian on the estate tax (something to the effect of "a tax on wealth over $2 million upon death doesn't bother me") or on immigration (several references to "islamofascists" coming over the border trying to kill us.) So he has a very mixed view of Iraq, favoring a muscular presence in the region but doubtful of our abilities at nation-building. That view, by the way, is not far from mine.
2. His description of socialist economies was summed up by a picture of a Trabant. (This site is by a fan of the ugly little boy.) They are bad vehicles, but at least everyone had practice repairing one, making yours on the side of the road that much closer to running again.
3. He's a bit dry; his best side is taking questions -- fast and direct, gets through a lot -- and audience interview. For a guy who is probably a five-figure speaker, he doesn't look all that comfortable speaking.

If you're in the Twin Cities, you can catch him tonight at Northrup Auditorium at the University of Minnesota, at 7pm.

Labels: economics, Minnesota, Stossel

In his weekly signed editorial, St. Cloud Times editorial page editor Randy Krebs is asking what businesses are willing to pay for education.

For the past several years I have regularly heard from leaders of influential business groups that among the biggest challenges they face in Minnesota is a shortage of qualified workers.

Now it seems logical to me that this shortage must be at least partially due to the state's education system. After all, Minnesota businesses essentially hire people after they have had adequate education and training, the bulk of which comes from the state's birth-to-12 and higher education systems.

So if this system is not providing these workers, I would think businesses would be among the loudest voices calling for the state to amend its education system so that potential job applicants are qualified, so they can be hired, so those businesses can have the best chance at succeeding.

It is true that businesses complain about the lack of qualified workers. I've said it myself, both on this blog and in various issues of the Quarterly Business Report. (Full disclosure: Randy's paper publishes the report.) Though I again warn people that what businesses mean often when they talk about qualified workers includes problem-solving skills that don't come from formal education (a few manufacturers say they look for young people from farm backgrounds, where improvisation is a necessity), and often about basic skills like showing up for work on time, dressing neatly, etc. It isn't necessarily about K-12 education.

But surely part of it is. And businesses HAVE been among the loudest voices. And they do pay more. The problem is that what you want in return is accountability. Where is the evidence that these additional dollars spent (per student, inflation adjusted) have produced better results? If they haven't, why haven't they. Krebs asks,

And while I'm not so naïve to believe "more money" is the main answer to what ails education, I've also had enough recent school experiences to see that this state is trying to provide a 21st century education using a funding engine built in the 20th century.

Indeed, if businesses want to avoid a tax increase so badly, how come they are not lobbying so intensely (if at all) to amend state funding formulas to improve outcomes?

You know if their businesses had such problems they would make changes.

They would, but having devoted so much money to this outcome, they might have decided adding money isn't the problem. They might have chosen to reallocate dollars. Perhaps you will not find the analogy so apt, but I see this quite like Jim Souhan's piece on the Vikes and Wolves: You can't spend more money and hope that fixes the problem.

Businesses are willing to invest money to solve a problem when they are convinced that the money spent will actually solve the problem. We spend more and more dollars and get more and more mediocrity. At some point, like the Twins or the Wild, you decide that's enough and time to go in a different direction. Last I looked, those were the teams in the playoffs.

When you get results like this, the answer shouldn't be to bury an income tax increase in the education bill.

Labels: education, legislature, Minnesota, St. Cloud, taxes

Remember Senator Steve Murphy?

The proposed 10-cent-a-gallon gasoline-tax increase moving through the Minnesota Legislature could end up being higher than that, maybe more than twice as high.

Tucked away in a big transportation funding bill being fast-tracked to a Senate floor vote today are future increases in Minnesota's gas tax that could push it from 20 cents a gallon to more than 40 cents over 10 years, higher than any state's current bite at the pump.

"I'm not trying to fool anybody," said Sen. Steve Murphy, DFL-Red Wing, sponsor of the measure that would increase funding for roads and transit by $1.5 billion a year once it was fully implemented in the next decade. "There's a lot of taxes in this bill."

He seems to be doing a little more fooling these days, for example the article appearing in this morning's St. Cloud Times, arguing that it's fairer to pay for roads by raising gas taxes rather than by bonding as Governor Pawlenty proposes. First, let's remember what else Senator Murphy wishes to tax to pay for his roads, as written in the StarTribune piece I first linked:

• Higher registration renewal fees on future new car purchases, but no increases on currently owned vehicles.

• A half-cent rise in the general sales tax in the seven-county Twin Cities area, imposed without a voter referendum, plus a $20 excise tax on new vehicle sales in the metro.

• Local-option authority for half-cent sales-tax increases in the rest of Minnesota, subject to voter approval.

• Authority for all 87 counties in the state to impose a $20-per-vehicle annual wheelage tax. Three suburban counties levied the current maximum of $5 per vehicle last year.

The DFL has made a huge amount of noise over tax fairness, and what are they proposing to do. Referring back to the liberal's new Bible -- also known as the Tax Incidence Report -- we find the estimate that 44% of the gas tax is paid for by Minnesota businesses. This either raises prices on consumers, lowers the number of workers they can employ, or dries up business profits so that firms may move out of the state.

Second, the Suits index the report uses -- which is a measure of the progressivity of the tax system -- is -0.253. A negative reading on the Suits index means the tax is regressive. So Senator Kelley's preferred method for paying for roads is to tax the poor more. (The only tax more regressive than a tax on gas is a tax on cigarettes ... whoops!) A $20 wheelage tax is akin to the old poll or head tax -- $20 a car regardless of your income. The .5% sales tax is regressive as well. For a party that screams about making people pay their fair share, this should be criminal.

Last, the tax is neither a guarantee that the state won't borrow money later, and it's a shift of the costs of roads from the next generation to this one. If the roads are really "needed" -- and try defining need for me, Sen. Murphy, with something other than the statement of the people whose jobs depend on getting money to fulfill the "need" -- then our future income would be higher with the roads. Wouldn't it then make more sense for the people who will have higher income to pay off the bonds later rather than reduce the consumption and employment of the people who would pay for the roads now?

I'm not hiding anything -- there's little economic logic in the gas tax, particularly from those who use "the poor" as a shield for spending other people's money.

Labels: economics, legislature, Minnesota, taxes

For the first time, the John Bates Clark Medal has gone to a female economist, Susan Athey of Harvard. The Clark medal goes to the most promising economists under forty, and is only awarded every other year. Most people will know Freakonomics' Steven Levitt won the award in 2003; Daron Acemoglu, whose work I know much better than Athey's over even Levitt's pre-Freakonomics, won in 2005.

I was looking through some of Athey's papers and found this one quite interesting. Co-authored with well-known professors from other universities in the top five in our area, it is an attempt to predict success for economists based on their work in graduate school.

The Ph.D. admissions committee’s evaluation of a student predicts first-year grades and Ph.D. completion, but not job placement. First-year performance is a strong predictor of Ph.D. completion. Most importantly, we find that first-year Micro and Macro grades are statistically significant predictors of student job placement, even conditional on Ph.D. completion. Conditional on first-year grades, GRE scores, foreign citizenship, sex, and having a prior Masters degree do not predict job placement. Students who attended elite undergraduate universities and liberal arts colleges are more likely to be placed in top ranked academic jobs.

That last sentence is rather depressing. I remember one of my professors at Claremont, a Harvard-trained economist, telling me that if I placed back at a school as good as my undergraduate institution, I would be considered to have done well. The implication was that above that I could not go. But remember that the Athey et al. paper only surveys those coming out of top-five econ programs. I have no idea what these results would look like for the next 25 graduate programs; I rather doubt they'd be the same, particularly the conclusion that first-year grades in your core courses somehow determined where you would eventually place for an academic position.

Labels: economics

This afternoon I had the honor of attending a benefit for a real American hero, Neil Duncan. The Osseo American Legion Post was packed with those wishing Neil well and willing to help him as he comes back to civilian life. The benefit ran from 2:00 until 6:00 PM. The gentleman staffing the door stopped counting at 500 attendees - around 3:00 PM.

Who came? People of all ages: kids, grandparents, and everywhere in between. Patriot Riders were there in force. The food was great. There were many silent auction items as well as gift cards, There were t-shirts that recognized what Neil did and gave for his country and our beliefs.

Neil was injured in an IED explosion in Iraq. He spent the past year learning to walk and run again. He plans to play golf. This young man is everything an American hero is: strong, persistent, honest, hard-working, capable of making decisions under stress and true, red, white and blue. His attitude is upbeat, no victim thoughts here. He understands why we are fighting those who wish to destroy us; he understands the prices some will pay. We owe it to the Neils of this time to be there when they need us.

To learn more about Neil, go to this website. If you were unable to attend, you also can make a contribution.

God bless the Neils of this generation - they are our best!

ABC's Award-winning journalist John Stossel is coming to MN for two appearances:

Monday, April 23 - 7:30 PM - Pellegrene Theatre, St. John's campus, Collegeville, MN.

Tuesday, April 24, 7:00 PM - Northrop Auditorium, U of MN main campus.

Admission is free. See you there!

Labels: education, entertainment

The Minnesota House passed a whopping higher education budget last night that adds $168 million or 14% to the MnSCU base budget. The bill includes the provision that would permit anyone with three years in a Minnesota high school to get the in-state tuition handout from taxpayers regardless of their citizenship or immigration status (the DREAM Act.) Rep. Dan Severson of Sauk Rapids tried to get DREAM pulled out of the bill but his amendment lost 61-71. Rep. Marty Seifert is quoted as saying that provision will draw the governor's veto.

A note from our union's lobbyist in St. Paul included this:

A bipartisan amendment by Representatives Mary Seifert (R-Marshall), Gene Pelowski (DFL-Winona), Morrie Lanning (R-Moorhead), and others, to cut $6 million per year out of the MnSCU central office and use the saving to buy down student tuition, passed by a vote of 97-35. All of the MnSCU legislators, except the Metro State area legislators, supported the move. Needless to say, MnSCU officials are not happy.

Tuition increases were capped in the bill at 2%. Subsidize middle-class children or MnSCU officials? Hmmm, tough call there.

The bill goes to committee now, and we'll see if DREAM and the tuition caps stay in.

Labels: higher education, Minnesota

Someone asked me this earlier this week. I'm grading senior theses so the answer was "vaguely for now, will more later." Still going that way, but today's lead opinion in the Wall Street Journal might push it a little forward. I know no more than you do about the conflict-of-interest story and will wait to comment until I know more. But there's this paragraph screaming for commentary:

Finally, there is no question that many resent the tradition by which the nominee of the President of the U.S. becomes the president of the Bank. The resentment has been exacerbated by the staff's political preferences (roughly the same as that of most college faculty). Good philosophical arguments can be made for a more open presidential selection process. However, the same arguments can be made with respect to many other multilateral institutions such as the IMF; the African, Asian, European and Latin American multilateral development banks; and, last but not least, the U.N. The unproductive free-for-all that would be unleashed if all such understandings were abandoned would not be a pretty picture, nor, in my opinion, an improvement.

The first part -- that the average political preference of the World Bank's staff is equivalent to that of college faculty -- isn't altogether true. It's definitely left-of-center, no doubt, but most of these people are economists who happen to work in development. That group, by and large, is towards the left of the profession but still anchored by a deep respect for markets. You don't find that in the Department of the 3.7 GPA.

The second is quite reasonable. There has always been a tacit understanding of how posts in various multilateral agencies are divided between the G-7 or G-10 or G-whatever. If the EU would like to trade us the World Bank for the IMF, that's one thing. But the current push is just an attack on the US, which provides a large part of the funds for these organizations and therefore has paid for its position at the table. You might want to ask the Wolfowitz detractors if they would be willing to replace US funding of the multilaterals in return for the right to pick the WB president.

There's a running commentary on this blog, which appears not to favorable to Wolfowitz.

Labels: World Bank

Courtesy Residual Forces, here's the webpage at the University of Minnesota that lists internships for its political science majors. Andy calls it "the monster.com of the DFL". How come Norm Coleman or Jim Ramstad or John Kline internships aren't on this list?

Labels: higher education, Minnesota

The term paper for my class, Management Information Systems (MIS) is somewhat unique. The student must evaluate a software application installed within the last five years. There are 18 potential subtopics of which the student must select 10-12 to have the paper considered for an "A", less for a "B", "C", etc. The student must also interview four stakeholders, one of whom can be the student.

In addition, the paper is to be written in third person, past tense along with additional grammar requirements. Some students have difficulties with these conditions but most manage to get there.

Papers were due last week, returned last night. One student sent an email today wondering why her paper was a "B" when she had done all this work. I checked my notes and discovered she'd only considered eight subtopics, hence an "A" was impossible. I reviewed the requirements, the page in the syllabus where the specifics were defined, etc.

Shocking response from her - instead of whining, moaning, and complaining, she simply said, "Oh, my gosh.. it's completely my fault."

Wonder how many protected students in today's grade-inflated college environment would have the maturity to admit they simply blew it???

Labels: education

The most depressing thing to me about the minimum wage bill that the Minnesota Senate passed yesterday is that the lessons of their harm are so well known. (Readers of this blog have seen a whole stream of lessons.) Here we are surrounded (except for Wisconsin) by states that have a minimum wage equal to the Federal rate. We are already above that at $6.15, but the Senate believes that fairness requires raising that rate to $7.75. Why? Stay ahead of Iowa?

Here's where state minimum wage laws are

State	Wages
MinnesotaDFL	$7.75
Connecticut	$ 7.65
Washington	$ 7.63
Massachusetts	$ 7.50
Oregon	$ 7.50
RI	$ 7.40
Vermont	$ 7.26
Hawaii	$ 7.25
Iowa 08	$ 7.15
Alaska	$ 7.15
NJ	$ 7.15
NY	$ 7.15
DC	$ 7.00
Michigan	$ 6.95
Maine	$ 6.75
California	$ 6.75
Illinois	$ 6.50
Florida	$ 6.40
Arkansas	$ 6.25