Never-Never Land

You can’t turn around today without someone talking about how great the economy is.  Low unemployment and low inflation.  What could be better?

In fact you don’t have to look far to know something’s wrong.  For once this is less a matter of lies than of myopia.   We’re living in an artificially-created bubble, and while we don’t know exactly when it will end, this is never-never land.   We’ll go through it step-by-step:

– The bubble

We incurred $985 B of deficit this fiscal year as short-term stimulus to an economy already at full employment.  That’s a monumental $300 B over last year—in good times. As in every other such case, the tax cuts are NOT paying for themselves.  During the year we had a small reduction in unemployment from 4. 1% to 3.7%, but at no faster rate than last year and with no increase in inflation-adjusted wages (one-time bonuses from the tax cuts were negligible in the statistics).  You might ask why we would do such a thing—$1 T is a lot of money—but one thing the deficit certainly delivers is that much more economic activity in an election year.  The same people who starved recovery from the 2008 crisis to help with the 2016 election gave themselves a big boost for this one.

You might also ask how long we can continue doing it, and the following budget chart makes that unmistakably clear:

deficit3a

We’re running up unimaginable deficits in good times, with consequences we’ll talk about in a minute.  And the chart actually understates the situation.  The underlying figures come from a CBO report written in April, when their estimate of the 2018 deficit was $805 B. With a final 2018 deficit of $985 B, the situation now looks considerably worse. The CBO report said that we would reach deficit = $1T by 2020 and then reach the sinister milestone of debt = total GDP by 2028.  With the current deficit, we have reached the $1 T value in 1/3 the time, so that second milestone looms sooner now too.

The stock market is a similar case. The corporate tax cuts went directly to company bottom lines, raising price/earning ratios and stock values. What’s more corporations turned around and used all that money for stock buybacks, increasing demand for stocks and further enhancing stock prices.

None of this is sustainable.

– The deficit

Much discussion of deficits seems theoretical, but the consequences of our current deficits are real.  Republicans are already talking about cuts to Medicare and Social Security as counterpart to last year’s tax cuts.  Just imagine now we’ve reached a downturn in the economy—not even necessarily as bad as 2008.  We’ll have the massive deficit-induced debts shown in the prior chart, and now—on top of that—tax receipts that have just collapsed with the economy.  In that case we’re not talking about changes around the edges of Medicare and Social Security, we’re talking about no money for it and “taking the hard choices we just have to do.”   That means dramatic change in what it means to be living in this country.

Further (as noted in the CBO report) the deficit is a time bomb.  As interest rates rise in good times, the yearly cost of financing the deficit rises accordingly.  We’re already talking about deficit finance costs higher than the defense budget.  And it will just continue up, eating into available money for healthcare, education, opioid crisis even before a downturn.  There are good reasons not to incur deficits in good times!

– Our economy

With all Trump’s talk about the private sector and relief from regulation you might think that the country has been liberated from misguided government meddling with private enterprise.  But you’d be wrong.  The current executive-imposed tariffs and trade wars constitute the most extreme government intervention in the economy within memory.

The steel tariffs hit anyone building anything out of steel—basically forcing export-directed activities off shore.   The new USMCA regulations have already caused layoffs at Ford (and the touted benefits to labor are so far from clear that the unions can only wait and see).  The trade war with China disrupts values chains of any corporations not sufficiently well-connected to get exemptions.  The government is choosing winners and losers in the economy based on impulse (coal and steel sound good) or lobbying (the Apple watch).  And established companies have been winning out over newer, innovative ones (net neutrality) any time the issue comes up.

All of that, together with xenophobia and lack of support for education, augurs poorly for the state of our economy going forward.  And we’re even waging economic war with the largest, most rapidly growing economy in the world—in the name of protectionism!

– Our population

Since the subject is the economy, we’re talking here about the related topics of personal and national economic success.  It is of course a truism that the world economy is changing.  Good jobs, and the jobs that maintain our national standard of living, are changing.  Very many of them require more and different training.  (One list of the top ten growing job categories is given here.)  Economists going back to Adam Smith have recognized the responsibility of government to educate the population.

However with the tax cuts we took a very different tack, essentially trusting private sector prosperity to raise all boats.  There is no evidence that works.  The tax cuts went primarily to stock buybacks (see the mind-boggling level of buybacks below), leaving issues such as education (including the student loans crisis), infrastructure, and healthcare up for grabs.

stock buyback2c

For now, protectionism is the solution to job retraining, consequences of automation are unaddressed, and instead of preparing people for good jobs we’re busy fantasizing about the past.

– Climate Change

Climate change belongs on this list, because inaction will just make the economic effects worse.  Climate change may have morphed into a partisan issue, but nature isn’t fooled.

Consequences will be in many forms—severe weather, changes of temperature and rainfall, sea-level rise.   Turning around today’s carbon-based economies takes time, so if we don’t start acting now, we’re talking many trillions of dollars of expenses for repair and to forestall truly disastrous consequences.  The recent IPCC report found more serious effects than previously recognized by 2040.   As the following chart shows, the US currently generates twice the per-capita CO2 of any other major player, so we have a long way to go.

s12_Top_FF_Emitters_percapita

For now we are doing worse than nothing.  Climate change is an issue where international unity of purpose is extremely important, because cheaters—with cheap coal—can prosper.   We have not only endorsed coal for ourselves but actively encouraged cheating.  Further our departure from the Paris Agreement process—and in particular our disavowal of the whole idea of rich countries helping poorer ones act in our common interest—leads directly to dangers such as Brazil abandoning protection for the Amazon.

Ignoring climate change means more damaging effects of warming, and more drastic (and expensive) action in the end.   Furthermore, as a purely economic issue, by denying the issue we are sidelining our own companies’ participation in this necessary multi-trillion-dollar enterprise.  The day will soon come (we’re now talking just 20 years to get off coal, oil, and gas) when this moves to page 1 of the news, and stays there.

 

Our never-never land economy is good only so long as we keep our eyes closed.  But if we don’t open them soon, we won’t recognize what we’ll find later.

It’s Always the Elites and the Foreigners

6778135275_62a99f3616_z Surian Soosay

A recent book serves as a reminder of what happened in the economic collapse of 2008.  Lessons from 1929 were learned, and the world pulled itself back a few inches from the brink.  Major economies, principally the US and China, pushed enough money into the world financial system to keep it going.   We didn’t have a depression, and ten years later we’re doing well enough that we seem ready to forget.

Who were our friends in 2008?  The Chinese and the competent people who knew what they were doing.  Who won out?  Opportunists of various stripes who saw the near-depression as an opening.   And their villains were the usual suspects:  elites and foreigners.

Elites and foreigners are always convenient scapegoats, but scapegoating these days seems to dominate all political discourse.  That is a problem for both the left and the right.  Let’s start with “elites”.

On one side there is multi-millionaire Trump, who has never wanted for anything or hidden his blatant self-interest, but who has nonetheless successfully portrayed himself as a warrior against elites!  From his inaugural address: “a small group in our nation’s Capital has reaped the rewards of government while the people have borne the cost.”  On the other side I’ll quote a recent email article from Robert Kuttner admiring Trump’s trade war against China and decrying how “the corruption of ruling U.S. elites created a vacuum that opened the door to Trumpism.”

When you come down to it, in both cases the elites are charged with the crime of turning the US into something that doesn’t look like a rose-colored picture of the 1950’s and 60’s, when America was “great.”  It’s convenient to find someone to blame for those changes, but the world is not the same.

You can argue about trade policy (and why it happened), but you can’t wave away the accelerating effects of technology and globalization (itself fueled by technology) with scapegoating.  No nation today can isolate itself behind tariff walls or anything else and maintain its standard of living.  We’ve done a bad job of solving problems of transition for the current real world, but trivializing those problems doesn’t help.  In Trump’s case we have the craziness of reducing support for education and research while promoting coal mining instead.  His trade wars are more a publicity stunt than a solution to the problems of the working class.

There’s another issue too.  As a nation we are in desperate need of elites:  the people who make our economy go and who understand how things work.  Who kept us out of depression following 2008.  But those aren’t the only elites in the picture.  There’s Trump. There are the ultra-rich behind the Koch organization who want to maximize their profits and bring back the not-so-great gilded age.  There are the politicians and lobbyists in Washington.  There are even the sinister invisible elites we keep hearing about behind the scenes.  Accusing “elites” mixes up the picture.  It creates innocent targets as a mask for not solving real problems such as education, wages, economic dislocation, racism, financial and geographic inequality…

With “foreigners” the problem is if anything worse.  It is worth remembering our common interest with the Chinese in 2008.  Despite the current trade war propaganda, China is neither friend nor enemy.  China is a major partner in worldwide, technology-fueled growth that has made the world and us richer.  They are a major player with a common interest in dealing with climate change.  You can’t deny their effect on the domestic economy, but we also contributed to the pain.

We have specific issues that need to be addressed—e.g. intellectual property, opening of markets in a now richer China—however the main challenge from the Chinese is that they are good at what they do.  American high-tech companies have had trouble making headway in China largely because of real competition.  As China grows, we need to remain at the top of our game and to adapt to a world where we are not the largest and richest market (already true).  That could be quite a good future with new products and new markets, or we could all strangle in trade (and possibly real) wars.

The divisions in this country are deep, but it is perhaps encouraging that it is less about issues than about scapegoats.  If we could just remember that it is NOT all about ill-defined elites and foreigners, we could get quite a lot done.

 

 

If Not Now When?

2331754875_e6a2a81429_z

We are ten years into the current business cycle.  We have not repealed the law of gravity.  The cycle will end, and history says sooner than we would like to think.

It’s important to recognize what that means.  Very simply we have to be realistic about what we’ve put off for tomorrow.  If we’re not serious about something today, there is a fair chance that tomorrow isn’t going to come any time soon.

Let’s make a short list of what we’re not serious about:

Education:  Funding for education has never recovered from the 2008 crash.  This affects all aspects (building, salaries, equipment) and all levels.  It directly contributed to the student loan crisis.  It affects the well-being of young people and our competitiveness as a nation.

Infrastructure:  Both candidates raised the issue in the election, but nothing serious has been done.

Opioid crisis:  This is a monumental problem that has thus far received only lip service.

Wages:  Businesses got a huge tax break with the Trump tax plan, but nothing has shown up in wages.  We can’t even talk about raising the minimum wage from its historic (inflation-adjusted) lows.

Medical coverage:  ACA has been deliberately crippled with nothing coherent to replace it.

Climate change:  We can pay now or pay more later, but we won’t be able to run away from it.  Thus far we’ve just closed our eyes, but the changes will be non-trivial.  Carbon capture—the least drastic path in the most optimistic estimates—would be at least 5-10 Trillion dollars a year worldwide.

 

In these good times we’ve chosen not to address any of those issues.   Tax cuts for businesses (now turned into stock buybacks) took precedence.

Unless something changes soon we should recognize that we have chosen to live with all of those problems—for as long as anyone can see.

Learning from Apple

2214058583_662164fd7f_o

On the occasion of Apple’s rise to become the first $ 1 T company, the NY Times had a good article with graphic displays showing the size of Apple (as well as Google, Microsoft, Amazon, and many others) in the US economy.  There are a number of lessons to be drawn from this.

1. The surprisingly dominant role of Apple—together with the other three just mentioned—shows the importance to this country of technology leadership. That’s what supports our standard of living and always has. Railroads, steel, automobiles were all high-tech in their day.  We cannot pretend that even behind high tariff walls we can build a successful economy out of staying put.

Our challenge is to seize the opportunities and bring everyone along.  One important positive from this story:  much of what these companies sell didn’t exist twenty years ago, which says a lot about opportunities for the future.

2. It’s worth recognizing that (despite all the fuss) China’s rise has been a good thing for Apple and for the US economy generally. The iPhone is a prime example of why trade deficit arguments are wrong.  One of the most profitable American products ever is a loser in the trade deficit, because profits are declared in Ireland for tax purposes!  Are we really going to tell China: “Don’t send us any more of those cheap iPhones that we sell everywhere at 300% markup until you can buy more yourselves”?

For the future, now that China is richer, East and West are actually joined at the hip.  Continued growth has to be collective, so the last thing anyone needs is a trade war.   Sure they tried to copy us—we should do something about that, but the bigger challenge is that they’re good at it.  To be successful we need to play to our strengths:

–  A skilled workforce.  Implies support for education.

–  Equality of opportunity, so that we can use all talents and ideas.  Education is a big part of it, but healthcare and other contributors to family stability are important too.

– To be the place where people with entrepreneurial ideas will want to come realize them.  Google (with an immigrant founder) and Apple (Steve Jobs’ father was a Syrian immigrant) are convenient and far from exceptional cases.

– Creating a global environment for trade and cooperation where we can be successful.  That means international engagement on rules for all.

3. Apple is also emblematic of the high-ticket corporate welfare we are now practicing. It’s hard to argue that Apple, of all companies, needed a huge tax break on $252 B of repatriated profits plus a current-income tax break, all yielding $100 B of stock buybacks. US companies were doing fine before the new tax plan, and stock buybacks have been the primary result of their tax savings.  In other words, companies have decided the best thing to do with their tax cut money was just to give it back—for the benefit of the rich people who own them.

The other side of that policy is our current inequality of wealth and opportunity.   We have refused to help our population move to the increasingly high-tech future—and created a cast of bogey men to blame for it. We won’t spend money on education, infrastructure, or people—despite the difficulties of transition.  We’ve fought unions and anything that gives workers clout. But it’s the Chinese, or the Europeans, or the liberals, or the immigrants who are to blame.

 

We’re moving toward a worst of possible worlds: a capitalist mal-distribution of wealth combined with socialist top-down economic policy.  We’re fighting tariff wars so senseless that even the Kochs are complaining, because Trump feels empowered to decide which sectors of the economy ought to be winners.

Apple’s success shows what happens when we build to our strengths.  We know how to do that.  We did it for a long while.   But for now we’d rather shut our eyes to the opportunities, and pretend we can bring back the good old 1950’s.

 

Instead of Trade Wars

3067527866_b13ca1137a_b

It tells a lot about our current economic policy to compare it with China’s own plan for their economy.  They want to move up the value chain—to be Apple with the big profits instead of a hardware supplier in a highly-competitive business.  They want to do that across the board in all technologies.  They aren’t afraid of automation’s impacts; they want to push it as hard as they can.  Having transitioned their economy to free market concepts, they are ready to transition their workforce to what it takes to win.  They want to be us!

Except that we don’t want to be us anymore.  We don’t like Apple, Google, Facebook, etc. because those companies don’t hire very many people without technical skills.  We need to set tariffs to bring back the 1950’s, so that those people can have jobs.  And our country is a disaster area until we do that.  So we need trade wars to be great again.

There are a number of problems with that logic.

1.You can’t support our standard of living on non-competitive businesses. To be rich you need to be on top of the value chain.  That involves a number of factors, such as

–  A skilled workforce.  Implies support for education.

–  Equality of opportunity, so that we can use all talents and ideas.  Education is a big part of it, but healthcare and other contributors to family stability are important too.

– To be the place where people with entrepreneurial ideas will want to come realize them.  Google (with an immigrant founder) and Apple (Steve Jobs’ father was a Syrian immigrant) are convenient examples.

– Creating a global environment for trade and cooperation where we can be successful.  That means international engagement.

If we want to maintain our standard of living, these items are primary and we should be doing everything necessary to be successful.  There is not necessarily just one winner, but you have to be playing the right game.

2.The well-being of the population requires separate attention. The problems today are not because business is hurting.   It isn’t.  The population is not prospering as it should from our financial success, because we (through our government) have chosen NOT to make it happen. We have blocked investment in the population and the public good, and just given more and more of the created wealth to the wealthy.  That’s why we can’t fund education or infrastructure.  The new tax plan is a recent and extreme example.

It says a lot about the political climate that Trump can make a statement like “cash-strapped cities cannot hire enough police officers or fix vile infrastructure” (in rejecting the Paris Climate agreement) and get away with it.  The statement is true, because he and others like him have made it that way.

3.Tariffs are not a miracle solution; they are a tax. Tariffs are designed to raise the price of the products sold internally, so as to protect domestic businesses. That means that non-competitive businesses are supported at the expense of others (businesses or individuals) that use those products (e.g. steel).  The markup is effectively a tax.   You can do some of that, but just as with any other tax you have to look at who gets hurt (e.g. anyone who builds with steel or buys steel products).   The effect is not all that different from using taxes to support public works.  And with public works projects you at least know what you get.   Rather than subsidizing companies and hoping for the best, they pay people for necessary work that the private sector won’t do.  Education and infrastructure are only under-funded because we choose it that way.

It should be noted that protected companies have little incentive to make themselves more competitive on an international scale, so the tax is usually forever.  Also companies that need tariffs to compete are by definition highly cost-sensitive, so wages need to be tightly controlled.  Tariffs—like other presents to businesses—are a way of dealing with exceptional or temporary issues (e.g. real national security or bankruptcy), and they certainly don’t help with automation.  They are not a miracle tool for recreating the 1950’s.

4.Isolating ourselves behind trade barriers is conceding the game to China. Compared to Europe, the US had a much bigger domestic market than any other player, and that helped the US to evolve for financial success.  China already has a bigger domestic economy than we do, and they’ve just gotten started.  They’re putting money into infrastructure and education.  Their AI systems have bigger databases to learn from.  They’ve taken over our leading role for technologies of climate change.

With trade barriers, and xenophobia, and intellectual property paranoia we risk losing our edge.  China’s industrial espionage is a problem that requires continuing attention, but the effects of our new isolation policies may make matters worse.

 

That’s where we’re going.   What’s especially bad about it is that we’re making a mess of what is actually a promising situation.  The rise of China is at this point an opportunity, and we’re missing the boat out of sheer greed and ego.  What has to happen is

1. We need to open the Chinese market. China is now rich enough to be significant as a market.  One way to think of the opportunity is the enormous recent increase in the number of Chinese now traveling abroad.  Those people are our potential market and even the Chinese government has to listen to them.  Further, the US plus Europe represents 36% (18 + 18) of the Chinese output.  With that kind of leverage we don’t need a trade war (as emphasized by the Business Roundtable of corporate CEO’s), we just need to use it for the situation we’re in.  Instead we are stuck with two trade wars, because in Trump’s world we’re fixated on being the only winner—a good way to make sure that everyone loses.

2. We need to do everything possible (including all points noted earlier) to support the economic strength of the country in the current technological world—as opposed to the world of the 1950’s.

3. We need to go back to translating economic success into well-being of the population. It is to our benefit to get everyone on-board with what it takes to be successful.  Furthermore, we need to remember that there is an important place in the economy for public works—and not just roads and bridges.  There’s no shortage of work that needs to be done, and we just gave companies $1.4 T to not do it.  Even Adam Smith knew that not every job that needs doing will be magically performed by the private sector.

It’s a simple as that.  Most wars are fought out of stupidity.  Including trade wars.

 

Figure Skating and Math Textbooks

Biellmann-spin_svg.svg

This odd coupling of topics links two separate frustrations which seem to come from the same core problem.

For figure skating the problem is one particular feature of the new scoring system—the extra points given to jumps in the second half of a program.  There’s no question that those are harder to do—anything is harder to do when you’re dead tired.  The question is why that extra stamina should be rewarded as an achievement!  In the last Olympics, those extra points were primarily an opportunity to game the system.  What was missing in artistic achievement could be made up in pure stamina.  The winner of the woman’s gold medal had all of her jumps in the second half of the program.

The fundamental problem is that from within a system, people are tempted to put a value on anything hard, regardless of whether or not it means something to the outside world.  People who have spent their careers doing and teaching figure skating have a tendency to think that any hard jumps are achievements.

Having just had reason to work my way through a high school algebra textbook, I have to say (based on an admittedly small sample) that the textbook publishers have that problem in spades.  The book was filled with minutia that need to be memorized for exam questions.  Getting through all of that is certainly hard, but it’s not the stuff that will make kids confident and successful in mathematics.  And that certainly won’t make them like it or remember it.  (One more reason it’s tough to be a teacher!)

It seems to me that high school math has a pretty good story to tell.  Core algebra is based on a really brilliant idea, that an answer you are looking for can be handled just like a number.   That lets you create a simple kind of manual computer.  If you can write down the problem, then the manual computer can solve it.  Sort of like doing your taxes with turbo-tax.  The core ideas are simple and don’t need to become a challenge.  From there it’s straightforward to do linear systems, which are part of the vocabulary in science, engineering, finance, or just about anything else.  “Vocabulary” is actually the right word.  For most students, mathematics is a language in which they need to gain confidence and fluency.

Then with quadratic equations you hit a wall.  All the techniques you just learned fail.  But you’re saved by another really good idea you would (probably) never have come up with yourself.  You do a few exercises with that idea, working toward an answer that is basically all you need to know—the quadratic formula.  Any further messing around with higher-order polynomials and rational functions is only supplementary, examples of what you can do with other kinds of problems you might run into.  No more rules to learn.

Going beyond that you have topics with really exciting applications.  Conic sections are geometrically interesting and tied to the whole story of the Copernican revolution, Kepler’s laws (“equal areas swept out in equal time”), and Newton’s gravitation.  (You don’t need calculus to tell the story.)  Sequences and series cover ideas behind every financial analysis students will see.  Permutations and combinations are important for probability and statistics and introduce the first non-trivial example of a group.  Modular arithmetic is a useful feature of every programming language.   Trigonometry is important but can become unnecessarily confusing.   Sine and cosine functions are important parts of the vocabulary, but you can get lost forever in trigonometric identities and formulas.

Mathematics shouldn’t be a drag.  There are few core principles and very little actually to memorize.  You get to see some remarkable solutions to tough problems.  One famous mathematician said that mathematics should be “like floating down a river on your back.”  My father-in-law put it differently: “Mathematics is for people too lazy to do real work.”

Steven Pinker’s Enlightenment Now

enlightenment

There haven’t been any book reviews on this site before, but Steven Pinker’s Enlightenment Now is something of a special case.  This is a political book with a message that doesn’t quite fit into the current political environment, and it includes a large body of relevant history.  Not surprisingly, Pinker finds Trump antithetical to the Enlightenment precepts he is defending.  But he also finds plenty of guilt to go around.

To start with, the book seems to have two competing objectives:

  1. Validating the fact of human progress and documenting how it has been achieved. This is really a call to action based on humanistic goals.
  2. Providing reasons for optimism about the future. This is different—good things that are going to happen for reasons such as demographics, outside the scope of specific human actors.

On the face of it, a reader expects the first subject to be primary, if only because (at this point in time) you expect any political book to end up with recommendations for what to do.  But that’s not quite where Pinker is going.  He’s trying to view history not just as a demonstration of what works, but also as a way to understand where things are going longer term.  Since the two objectives are different, it helps to treat them one-by-one.

On the first subject, Pinker does a remarkable job of demonstrating the successes that humanity has achieved—In the longer term, in the last century, and in the past few decades. This involves health, security, standard of living, and many other quantitative measures of human welfare.   Much of this is unfamiliar because, as he says, this kind of thing just doesn’t make news.  The book is worth reading for this part alone.  Pinker does a good job of demonstrating progress and what is responsible for that progress:  science, rationality, and a broad-based desire to create a better world for everyone.  It is hard to argue with the historical fact that prosperity is not a zero-sum game.

In passing Pinker tries to dispose of past arguments against enlightenment humanism.  As examples:  Humans are inherently irrational (except when they want to make a point).  Humanism is a white racist production (its advocates were on the anti-imperialist side).   Science ignores human values (just plain not true).

Predicting the future is harder, and overall I’d say that Pinker is not well-served by his desire to make things look positive.  He tries to say that nuclear war is improbable, but we know that just one outlier is bad enough.  He treats the climate change movement as a kind of hysteria, because science will just take care of it in time (based on mostly anecdotal evidence).  He views the populist phenomenon as a brief episode of backsliding until more liberal generations take over from the ones now on the verge of dying out.

So in the end it seems a shame that the future predictions tend to dominate discussions of the book, when it’s the first part—the defense of progress—that is its greatest contribution.

And then there is the question of the call to action.  What Pinker espouses is humanism—the broad-based, rational process that has delivered progress.  The problem is that humanism doesn’t have a political party.

Pinker points out that much of the political process just doesn’t work:  Issue-based movements systematically deny progress for fear of losing momentum (even though that means they frequently get caught in the bind of asking for more money to continue going nowhere).  Discussion of issues is based on faulty statistics and dishonest patterns of argument.  Democracy as a whole is not as rational or responsive as we would like to think (the chapter on that subject is well worth reading).  He gives plenty of examples of bad behavior on both the left and the right.  Both sides contributed to the grim view of reality that was instrumental in producing Trump.

So where do we go from here?  Individuals can learn to be more rational in their behavior and in their evaluation of what they see and read.  They can work with the flawed organizations that are fighting bad actors such as Trump.  They can involve themselves with specific issues and help to push them along.  All told—incremental change but no miracle solution.

That’s actually the optimism of the book.   There’s no silver bullet, but the process has worked thus far.  And hopefully we will keep it going.

Political Correctness, False News, and the Attack on Education

5443213875_2d178e4dc4_b

This is a tough time for colleges and universities.  Many of them—particularly the public ones—are being squeezed for money, and they’ve all got to deal with conflicting standards for sexual harassment, trigger warnings, and political polarization of the student body.

And then there’s “political correctness”.  It’s a difficult issue, with arguments on multiple sides, and with something quite sinister lurking in the background.

On one hand there is the classic liberal argument for universal openness.  Constraints on the intellectual environment are bad, because truth can be unpopular.   Furthermore, once you allow constraints you never know who is going to do the deciding.

It’s hard to argue with that position in an ideal world, but the real world makes the situation less clear.

First there is the question of safety or feelings of safety for the student body.   You can’t allow some people to attack others they don’t like, and the only question is how far that prohibition goes.  In the real world, the university must guarantee that every student is safe and valued.  That has to apply to all groups, religious beliefs, and sexual attitudes (liberal, Christian, or anything else).  That’s not a simple criterion to enforce, but universities cannot be faulted for setting such rules.

A second problem is harder.  Today we’re dealing with an environment where not all ideas have an equal chance, as more and more intellectual discourse is bought.  The prime example is the Koch organization, that has plowed hundreds of millions of dollars into institutes that promote their ideas.  Everyday examples are the American Enterprise Institute, the Cato Institute, and the Mercatus Center at George Mason.  People working for these institutes (e.g. Charles Murray) can do legitimate research, but they are paid for reaching correct conclusions, and their ideas are heavily promoted to serve their masters.  This isn’t exactly false news, but any implication of unbiased research is certainly false.

In such cases it is understandable that some students feel that their ideas are being squashed by the power of money—a feeling that is particularly acute in a time of Citizens United and Trump.  But it’s also true that the student intellectual environments are prey to their own fads, with self-righteous acts directed at others. (I personally remember unbridled enthusiasm for Chinese communism and Mao’s little red book.  I also remember reading Simon Leys’ Chinese Shadows, with the comment that Western fascination with Mao was proof of how little anyone really cared about China!)

So there is some justice in decrying political correctness, but that doesn’t mean that student concerns about speakers are wrong.   Any opinions can be expressed (subject to valuing all students), but it also seems that sponsors of a speaker should be required to enforce standards for on-campus speech and also to make clear the nature of the institutions represented.  And it should be part of everyone’s education to understand how intellectual discourse is bought.  With the profusion of institutes and representatives, it’s not simple to keep track of all the Koch tentacles!  Even when the subject is government, people aren’t reminded frequently enough that Pence, Pruitt, and Pompeo are all Koch creations.

However, we have not yet reached the crux of the issue.  Thus far we have treated political correctness as a real issue where there can be legitimate areas of disagreement.   That’s true for some of the discussion, but certainly not all.  You have to go back to the core Koch motivations:  shrink government, shrink controls, and above all shrink taxes.  Colleges are expensive and turn out liberals.  The Koch’s attack on political correctness is actually just a pretext for a full-bore attack on college education overall.  The whole system has to go.

A recent best-seller on Amazon could not be more explicit—“The Case against Education: Why the Education System Is a Waste of Time and Money”.  College education teaches nothing useful, it’s just a game to certify the capabilities of students to potential employers.  It teaches people things they don’t want to learn and will just forget anyway.  In particular nobody needs to know history, because no one is going to get a job as a historian.  Scrap the whole thing, save a fortune, and give people some useful vocational education to get a job!

The author is an academic from a reputable institution, nominally talking about what he as a teacher really thinks needs to be done.   Almost all reviews on Amazon take that at face value.  You have to know that he comes from the Mercatus Institute at George Mason, where Charles Koch sits on the board!

The argument is of course self-serving.  There’s no question about the value of education—both financial and personal—to those who complete it, and also no question about what kind of education people with money will chose for their own children.   The “just a game” story ignores the value of intellectual activity—the real goal of education—and focuses on memorized facts.  In the end the proposal comes down to a two-tiered educational model, where the world is wide open to children whose parents can afford the real thing, but not to the rest.   The Kochs are willing to pay for the basics needed to produce employees and nothing more.  Just like the good old days.

Nonetheless the argument has a scary amount of currency.  Mainstream Republicans are hostile to education in general and college education in particular (but richer ones send their kids to college anyway).  Identity politics and vilification of liberals have convinced some people against their interests to keep their kids from being corrupted by education.   Some state governments (Wisconsin, North Carolina) have deliberately attacked their state universities.  Trump’s State of the Union speech pointedly talked about “vocational education” only.  (A more recent NY Times college education overview is perhaps scariest of all in the amount of Republican rhetoric it swallows whole in its effort to be even-handed.)

We can’t claim all colleges have always paid enough attention to getting their students jobs, but the value of education has been undeniable and increasing.  Further, broad-based college education has always been one of the major strengths of this country, and the rest of the world has learned its value as well.  College at its best prepares students for a world where they will have to adapt continually to changes and opportunities, whatever those might be.  A two-tiered system would be a nightmarish step backward both for students and for the country.

Education is one of the most important battlegrounds where our collective future will be won or lost.