Brief Relfections on Safety Nets

Of all the conservative philosophies, that which pertains to safety nets is most frequently misunderstood. Most critics wrongly believe that conservatives are opposed to "social security and other safety nets," which is rarely the case. In fact, I and most conservatives believe in the necessity of strengthening multiple, concentric levels of safety nets. The overemphasis on federal programs has inadvertently eroded other safety nets, leading to greater social insecurity. In a more ample and dynamic system, the first resort would be to utilize the rich tapestry of family, community and civil society and then local government, only turning to federal solutions as the last resort.

The first level of social security comes from fostering self reliance, a strong work ethic, the value of thrift, planning and pursuit of education. Government policies and philosophies that foster dependence, passivity and a sense of victimhood leave individuals more vulnerable.

The next and perhaps most essential safety nets are family and friends. In the absence of viable government programs, Mexicans, Indians, Chinese and other groups have developed an impressive level of familial support and cooperation. Rather than rely on government sponsored daycare, working families relied on aunts, uncles and grandparents. And until recently it was considered unthinkable in most cultures to outsource the care of elderly parents to private and (especially) to public institutions; that was the job of children. And what of individuals who could not afford housing? With the absence of section-8 and other such subsidies, most families understood that it was their duty to at least temporarily take in family members of limited means. And of course they understood that the good graces of their family implied that they had to contribute their labor and limited wealth to that household. Sadly, the introduction of many immigrant families to government programs have eroded cooperative behavior.

To this day, there exists communities in which a high degree of mutual assistance exists between neighbors, which serves as an important concentric level of social & economic security. In addition, churches and charities are expected to assume a central role in assisting the downtrodden. This is most often found in communities bound by shared values and culture and less prevalent in culturally diverse communities.The best examples being the remarkable degree of cooperation seen among Amish, Mennonites & Orthodox Jewish communities.

Next, we come to local and state government. Although they can be just as corrupt and inefficient as the federal government (welcome to Illinois!), their social programs tend to be more adaptive and accountable. Much of this reflects the fact that unlike the federal government they cannot print money or endlessly borrow from the Chinese. But, as the federal government's role has increased, more individuals have become indifferent to local politics.

And last we come to social security and other federal safety nets. I believe that they should exist, but as last resorts, after an individual has fallen through the other concentric levels of social & economic security that we just discussed. But, more than anything I question the wisdom of mandatory, universal entitlements that applies to the rich, middle class and the poor. To take care of the poor is a noble endeavor, but to mandate that economically productive middle and upper class families place their wealth and welfare in the hands of a federal ponzi scheme, rather than save & invest for their future defies common sense and basic economics. This poses a moral hazard in which many families who would have saved and invested opted not to based on their belief that their welfare was ensured by the federal government. Furthermore, this diminished the incentives of many individuals to "invest in"  the multiple, concentric safety nets that we discussed. These safety nets do not exist in a vacuum; in order to have your family, friends, neighbors, church and charity support you during hard times, you must cultivate positive relationships with them during the good times. A wise and frugal federal government would seek to strengthen, rather than usurp the role of these essential facets of social and economic security.

Ask a Russian! (part I)

I have had the pleasure of studying and working with many immigrants from the former Soviet Union. I encourage my progressive readers to chat with a Russian, many will offer you a unique perspective on social and economic life in United States that comes from being outsiders. Having lived in a society in which the state controlled economic and social life, few have a positive opinion about the path that we as a nation are headed down. What we call "change," is old and familiar to them.

Perspective Of A Russian Immigrant (No. 4)


By SVETLANA KUNIN

Posted 12/08/2009
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IBD Exclusive Series:

Perspectives of a Russian Immigrant

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I look at the people who support the transformation of America in disbelief: They are destroying the very land that gave them so much opportunity.

Groomed, well-fed and educated, comfortably living in a prosperous society, they need a mission to give meaning to their lives. These "fighters for the less-fortunate among us" glaze over the fact that hundreds of millions of people from around the world desperately try to come to this country for all it offers, regardless of their economic status, race, class, or gender.

Immigrants rightly see this country as the best place to obtain a decent life for themselves and their families.

When I immigrated to America in 1980, I was overwhelmed with the amount of food and goods available at any store, at the numerous charitable organizations helping the needy, and even the government programs that helped people to obtain necessary skills to find a job.

Later, I realized that the country was in the midst of a deep recession. Compared to where I came from, it seemed like the pinnacle of prosperity.

As a secular Soviet Jew, my first Christmas in America was amazing. The proud display of religious symbols was a celebration not only of the holiday, but of a population free to express their beliefs without fear of oppression.

I understand why at the beginning of the 20th century Jewish immigrants in America wrote many beautiful Christmas songs; these songs were born out of grateful hearts. Churches and synagogues coexist without issues. Nobody is forced to practice or not practice a religion.

Soon, however, I noticed darker aspects underlying life in America. Political correctness had seeped into everything like cancer. Under the pretense of multicultural diversity, suppression and intolerance of uniquely American traditions such as liberty, private property, and e pluribus unum (out of many, one), became not only acceptable, but necessary in supposedly enlightened society.

Under the pretext of helping the needy, liberals eliminate people's drive to better themselves and their families. Instead, they obsess about events of the past and exacerbate the victim mentality in the very people they claim to help.

The stranglehold of political correctness has only grown stronger. I see in today's governmental policies a replication of the very things I escaped from.

In the USSR, representatives of the Communist party — partorgs (literally: party organizers) — were ingrained into every aspect of civilian, official and military life. These political organizers controlled public order by observing the behavior and speech of every citizen.

People who wanted a more secure and privileged life found it necessary to join the propaganda machine. In order to survive, citizens were silent out of fear of retaliation by the authorities.

Government-controlled medical care and poorly compensated medical personnel stimulated corruption at every level of service. People had to resort to bribery in order to get the help they needed, and underpaid medical personnel were open to the payouts.

Those who could not pay had to beg for help. The only hospitals comparable to American hospitals were in Moscow and a few other cities, where government officials were treated. In the rest of the country, medical care was substandard. This was the reality of free health care for everyone.

No one can dispute that America has issues with its medical system, and here too, some people struggle to get the help they need. But the solution to the problem is not more bureaucratic control. The quality of medical care will inevitably decline for everyone.

I came to this country in the middle of a recession, and I saw the economy revive and prosper when the government eased the tax burden on people and businesses. People were free to use their talents without the interference of central planning. Today the opposite is taking place, and we see the opposite results because central planning results in wasteful spending, corruption and the suppression of initiative.

I am afraid these transformers of America are destroying the future of our children. I hope the free spirit of America triumphs.

• Kunin lived in the Soviet Union until 1980. She now lives in Connecticut

The Jimmy Carter Prize for the Advacement of Douchebagery: Toni Preckwinkle

And the winner for the Jimmy Carter Prize for the Advancement of Douchebagery goes to Cook County Board President Toni Preckwinkle!

Preckwinkle plans $43,000 raise for campaign backer


By Lisa Donovan Staff Reporter/ldonovan@suntimes.com Mar 14, 2011 12:24AM

Cook County Board President Toni Preckwinkle is recommending the board approve a substantial pay raise — of more than $43,000 — for one of her newest hires, a high-ranking staffer who’s been a regular contributor to Preckwinkle’s campaigns.

Mary Laraia, tapped by Preckwinkle in December to be second-in-charge at the Cook County Forest Preserve District, would see her salary rise from $111,908 to $155,172, under Preckwinkle’s plan.

Commissioner Liz Gorman, a suburban Republican, questioned the nearly 39 percent pay boost.

Forest Preserve General Supt. Arnold Randall responded that Laraia’s duties are expanding beyond the “executive assistant to the superintendent” job title of Laraia’s predecessor in the No. 2 post and that her pay and new title — expected to be deputy superintendent — will reflect that.

“We want to make some significant changes and reforms to the district, and, frankly, Mary Laraia, with her experience in finance and administration, brings a whole new level of expertise to the role,” Randall said in an interview.
Laraia formerly was Cook County’s head of capital planning and also was executive director of the Metropolitan Planning Council.

Laraia contributed $2,250 to Preckwinkle’s campaign for Cook County Board president last year, according to campaign-finance reports.

Laraia’s husband, Andrew J. Mooney, appointed by Mayor Daley last year as the acting Commissioner of the Department of Community Development, contributed $3,250 to Preckwinkle’s campaign for board president, plus another $581.65 to cover the catering tab at a campaign event last year, campaign-finance reports show.

Laraia and Mooney also contributed to Preckwinkle’s aldermanic campaigns during her 19 years on the Chicago City Council.

“It makes you wonder: Are longtime contributors being rewarded?” Gorman said.

In an interview, Preckwnkle responded by saying: “I’m not excluding people who contributed to my campaign from working for the county. She’s a very smart and intelligent person. We’re lucky to have her.”

© 2011 Sun-Times Media, LLC. All rights reserved. This material may not be copied or distributed without permission. For more information about reprints and permissions, visit www.suntimesreprints.com. To order a reprint of this article, click here.

Obama And The College Question

President Obama has expressed his belief that the United States must increase the number of college graduates if we are to improve our economic competitiveness. Mr. Obama is mistaken; at least from an economic perspective, our focus should be on the quality rather than the quantity of degrees.

To start off with, the emphasis on quantity has led to significant degree inflation, in other words, the cost of obtaining a liberal arts degree has significantly increased, while the employment opportunities that such a degree offers have declined. The unintended consequence of this quantitative (but not qualitative) increase is that a host of employers now seek degree holders for low paying administrative and service industry positions. This has led to a massive increase in student debt and loan defaults. Those unable or unwilling to incur such debt will face diminishing job opportunities, which will lead to decreased economic and social mobility within the United States. This has also encouraged more graduates to seek their fortunes in an already bloated public sector and the near bankruptcy of federal, state and local governments means that fewer individuals will be able to pursue this option.

If Obama were to think outside of the quantitative box, he would focus on increasing the number of Americans obtaining degrees that are vital to economic competitiveness, such as mathematics, engineering & physics. He would ask questions like why so few native born Americans pursue their studies in these fields, as demonstrated by the increasing number of foreign born doctors, engineers & scientists. I must emphasize I am in no way attacking these economically vital immigrants, rather I am troubled by the cultural factors that I believe had lead fewer Americans to pursue an education in engineering and the sciences.

Economic reason dictates that rather than redistribute wealth (via expanding federal entitlements) towards the surplus of low skilled workers, we should focus our efforts on shifting workers to fields that face real labor shortages, such as engineering. And those who are not willing or able to pursue this path should be encouraged to seek employment in relatively high paying blue collar jobs that do not require a 4 year degree, such as plumbing and carpentry. For this to occur, Mr. Obama and his team of "experts" will have to undergo significant changes (that we could believe) in the way they envision the causes of and solutions to the educational and economic challenges that we face.

Bad Students, Not Bad Schools??? (part II)

In a previous post we briefly touched upon Professor Robert Weissberg's thesis that educational outcomes are determined much more by the quality of students than the quality of schools. More specifically, he believes that the performance of individuals and groups are more reflective of the value that they (as well as their families & communities) place in learning, rather than shortcomings of the schools. In the piece "Demand, Not Supply Drives Educational Achievement" he explores the essential, but rarely asked question:

"to what degree do students in failing schools utilize the resources available to them, such as free tutoring?" 

And he presents data that indicates that only a small percentage do. For example, in California only 5% of students utilized free afterschool tutoring. And during the time I spent in low achievement schools, the primary issue that I encountered was not a lack of resources, but a lack of discipline and motivation among students. Good teachers spent much of their time and energy maintaining order and and pushing students to attend to the light homework requirement, in other words most students did not utilize the resources that were available to them. So, while I believe that for ethical reasons the issue of inequitable funding must be addressed, I am skeptical that this would have a major impact on educational outcomes of failing students and poor performing schools. On one hand this is quite depressing, because it implies that the power of government policy to improve academic performance of individuals and groups is quite limited. On the other hand, it is an empowering vision, because it implies that individuals and families do have the power to direct their educational destiny.

Of course it would be unfair and logically unsound to compare the performance of students that languish in poor urban schools to their wealthy suburban counterparts and strictly attribute the vast disparities to the "values" and "efforts" of the students. It would be far more revealing to analyze the relative performance of similar students within the same school. It would ask questions like "what are the common characteristics among the top 25% of students within poor, mostly African-American schools?" I am certain that the answer is that relative to their lower performing peers, they place a greater value in education and are more disciplined. I believe that these factors are also highly relevant when we analyze the common characteristics of individuals and groups (such as the African-American middle class) who have achieved upwards socio-economic mobility. This is obvious to all but the most dogmatic progressives. Sadly the chance of these achievement oriented students influencing their peers is slim, while the risk that the negative environment will hinder their performance is significant. The policy implications is that we must do whatever we can to expand options available to education oriented students, even if this means that we will "skim the cream" from poor schools.

This leads us to the question: what can the government do to promote values, habits and norms that lead to educational achievement and upward socio-economic mobility? I, am skeptical of the power or wisdom of the state to engage in social engineering, but a first step would be to cease promoting narratives that emphasizes the role of individuals and communities as "helpless players' whose destiny is primarily determined by "complex socio-economic factors" rather than the values they hold and the choices that they make.

Demand, Not Supply Drives Educational Achievement

April 26, 2009


By Robert Weissberg

Free market conservatives passionately insist that school choice will solve America's education woes. So as schools proliferate and competition heats up, academic achievement will soar just as fierce market competition has delivered better and cheaper computers and TVs. This seductive analogy is, unfortunately, hardening into unchallenged dogma. Worse, it misdiagnoses the problem. It is demand, not supply that drives academic attainment. In economic terms, Say's Law -- supply creates demand -- is wrong and Keynes -- demand creates supply -- is correct. If youngsters and parents truly desired academic excellence, the market would happily supply it. Absent demand, no amount of supply, regardless of price, can whet appetites for learning.
This misdiagnosis is also a recipe for wasteful political futility, for an uncertain benefit. Why lobby legislatures to permit charters or vouchers when after-school tutoring facilities can be created cheaply, and be economically self-sustaining to boot? Ironically, free-market reformers mistakenly believe that only the state can permit free-market solutions. Capitalism, not government permits free-market choice. As Yogi Berra said, you can see a lot by looking around. The market already overflows with school choice, none of it dependent on government authorization, much of it free or low cost for those craving academic excellence. Moreover, options are exploding independently of pressuring legislatures. Piling on additional options will not reverse academic apathy.

The current choice option menu is staggering. In New York City hundreds of so-called "cram" academies populate Asian neighborhoods and elsewhere, often catering to recent immigrants forgoing worldly pleasures to buy grueling lessons for their college-obsessed offspring. Most are Spartan storefront operations hiring teachers as needed and easily firing incompetents. A quick web search for New York City's "trapped parents" uncovers A+ Home Tutoring, Forde's Professional Tutoring, ClubZ!, Home Tutoring Services, among countless others. Many advertise of a willingness to accommodate customers with special needs or meeting pupils at community centers. Add national chains like Stanley Kaplan and Sylvan Learning that offer after-school coaching for state-mandated tests (especially reading and math), and given that parents demand results for their out-of-pocket fees, Kaplan's pedagogy (and technology) is constantly updated. Sylvan Learning Centers have more than 1100 locations in the US and Canada, with after school, evening and week-end hours, offering various courses, including study skills.
The Internet has greatly expanded parental options nationally. An internet learning program typically costs less than a basic cell phone plan or cable TV. SMARTHINKING since 1999 has provided over a million lessons on multiple subjects. Blackboard likewise offers web-based interactive instruction between students and teachers. Parents unhappy with local math lessons can help junior by logging on to artofproblemsolving.com for advanced math for grades 6-12 (as of February 2008 there were 37,000 registered users). The site also lists math books, competitions and a gateway to mathematics organizations. MIT provides K-12 science courses (including video) free to students nationally via the web.

Tutoring is now even out-sourced to non-US experts. TutorVista (tutorvista.com) offers 24 hour online instruction from K-12 plus college in nearly all academic subject as well as preparation for all the standardized tests. Unlimited sessions begin at $99.00 per month. Lessons begin by assessing each individual's current knowledge to create customized study plans, and this service includes voice and instant messaging, an electronic whiteboard and a toll-free fax number. Instructors all have college degrees or teaching credentials, undergo weeks of intensive training, and adhere to US state requirements, and by 2008 it had 10,000 subscribers worldwide. On Oct 21st 2008 Brightstorm announced that it had secured $6 million in financing to launch a new online tutoring service targeting teens with expert video lessons provided by star teachers across the entire US. Besides lessons on all usual high school subjects and standardized tests, each student can choose his or her own teacher and preferred teaching style.

For those not inclined to web-based technology, the home schooling industry supplies a plethora of help, and parents need not withdraw junior from school to take advantage of these resources. Just shut off the TV and insist that the lessons be done. Those who have not looked into this burgeoning industry will find the variety and subjects covered are amazing. It is a genuine marketplace where approaches range from the highly traditional, including religious-themed, to the most cutting edge. Lessons can be geared from those lagging behind to budding geniuses. Again, it is just a matter of investing the time and energy, and even those overwhelmed by jobs and housework can arrange local cooperative ventures in which parents take turns instructing small groups (many private schools began as these "living room" academies and expanded as local kids showed up).

Naturally choice movement defenders will insist that these bountiful options (and we mention only a tiny handful) are still inadequate since they cost money and may be inconvenient for harried poor families. This is willful blindness -- options are there if wanted and reasonably affordable. Public libraries often supply free Internet service and professional librarians regularly teach school-related subjects (perfectly rational client-building). Surely even the computer illiterate can request the librarian to find home school options and help with ordering materials.

But if there is a decisive argument about insufficient demand, not supply, being the culprit, it was the utter failure of No Child Left Behind's free tutoring, including the same high-quality tutoring available to ambitious students. Until late 2008 NCLB permitted low-performing schools to spend up to 5% of their federal grants on outside tutoring, more if necessary (this program may soon be restored, however).

With "free money" waiting, one would predict a rush to find enrollees. No such luck. Even illegally bribing students and school officials failed to generate business. Nor did holding classes in the student's own school help. One would guess that ample NCLB money would have encouraged tutoring firms to invent ways to lure struggling students.

This version of Say's Law was a disaster and school actually returned unspent funds. The national average for eligible students enrolling was 12% and even these dreary figures exaggerate enthusiasm since many (perhaps most) of the enrollees never completed the course.[i] In New York City's struggling schools, as of late 2002, only 10,000 of the 240,000 eligible students had signed up for free tutoring.[ii]

The news from Detroit was worse -- "only a handful" out of 51,237 had signed up as of early 2004[iii]. But even this exceeded the percentage in Pittsburgh where zero of 2900 sought free help.[iv] California in 2004 had some 397,000 eligible students and 20,000 -- 5% -- sought assistance, or at least signed up.[v] In New Orleans during 2003 some 7,500 public school students were eligible and 500 signed up -- 6.6%.[vi] After all, why should slackers suddenly be energized by hearing the same old boring stuff yet one more time? These figures are typical and it appears the worse the school system, the lower the enrollment for free help, and this help could come from any number of competing tutoring firms.

A powerful message lies here for free-market-oriented philanthropists anxious to invest millions to bring quality education to those lagging behind. Spend a few thousand dollars instead. Rent a second-story suite of offices month-to-month; buy a few Internet-ready computers and some used furniture; peruse off-the shelf teaching materials from the home school marketplace; hire some moonlighting teachers or university graduate students by the hour, but only as needed; advertise in local newspapers or church bulletin boards and if rivals are successful with their methods, just knock them off since none of this is protected by patents or union rule. Now, almost in an instant, help for those anxious to learn is available. This broken shoe string operation will provide exactly what education-obsessed parents offer their children denied a decent public school education. No political battles, no confrontations with the teachers' union and barely any capital outlays. If demand is insufficient and tinkering with services and prices is futile, just close up after a year versus pouring yet more money into supplying what is not wanted. This is real market-driven education innovation.

The problem is upping appetites for learning, an extraordinarily difficult task in a society subordinating the acquisition of knowledge to non-academic pursuits. Compared to lighting these fires, lobbying a legislature to pass a charter school or voucher law is a snap and this, unfortunately, may explain the unthinking embrace of Say's Law. Giving the proverbial horse a greater selection of expensive bottled waters will not cure the lack of thirst.

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[i] Saulny, Susan, "Tutor Program Offered by Law is Going Unused," New York Times, February 12, 2006. Late edition, final edition, online version.


[ii] Goodnough, Abby, "Free Tutoring Fails to Draw Many Students," New York Times, November 15, 2002. Late edition, final edition, online version.

[iii] Associated Press State and Local Wire, "Thousands of tutoring spots for Michigan Students Going Empty," February 21, 2004. Online version.

[iv] Associated Press State and Local Wire, "Thousands of students missing out on free tutoring," October 18th, 2004. Online version.

[v] Associated Press State and Local Wire, "Only 4 percent of those eligible apply for free tutoring," May 17th, 2004. Online version.


[vi] Associated Press State and Local Wire, "Free Tutoring: 7,500 eligible, 489 sign up," October 15, 2003. Online version.

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Keeping Oil Profits In Perspective

A great uproar has emerged over record profits by oil companies. Of course I do not approve of government subsidies and I believe that the industry does not merit some criticism, but when we rationally consider this issue, we should keep in mind the following:

1. Global supply (which have been reduced due to conflicts in the Middle East and the Gulf Spill) and demand (which has risen primarily due to economic growth in China and India) are the primary factors that drive prices.

2. While speculation is a factor, American Petroleum firms (to the best of my knowledge) are not allowed to engage in it. Furthermore, speculation is largely a response to anticipated drops in production.

3. Government taxation must be taken into account; rapacious Chicago has the highest cost of gas in the country, $4.27 versus the national average of $3.88. So, why do so few people complain about "greedy government"? And when the government institutes price controls to make gasoline "affordable," shortages always ensue.

4. Although there may environmental benefits to limiting where we can drill, this limits the growth in supply, which results in higher costs. Whether this equals a net benefit or net burden is up to each individual to decide.

5. I did the math and if we take the conservative estimate of $1.00  for a 12 ounce bottle of water, the cost of bottled water is $10.65 per gallon! Keep in mind that some firms fill their bottles with tap water, whereas the gas in your car must be: drilled (from miles beneath the earth) from a field using very costly equipment, transported hundreds or even thousands of miles, refined and then once again transported to the gas station.

6. For various reasons a company's or industry's profit margin is more relevant than the actual profit. Surprisingly, the petroleum industry was ranked 7th among profit margins. On average "greedy" oil companies" earned an 11.5% margin, whereas "progressive" railroads earned 12.6% and telecommunication equipment firms enjoyed a whopping 20.4%.

7. Rising costs provide firms the incentive, as well as the capacity to invest billions in exploring new sources of petroleum to meet rising demand.

8. Rising stock prices and dividends of petroleum firms have kept many pension and retirement plans solvent.

9. As the cost of gas rises, so do incentives to: purchase fuel efficient and environmentally friendly cars, use public transportation, choose a smaller home that is closer to work (rather than a McMansion in the distant suburbs) and  (last but not least) to develop viable alternative sources of energy.

10. History shows that just as oil costs and profits rise, so shall they fall.

The heated rhetoric of politicians and misguided state intervention may sway voters, but they do nothing to ensure the continued flow of petroleum that is vital to every segment of the American Economy; that is the job of the "evil oil companies."

Putting Defense Spending In Context

Those who are familiar with our blog are aware that I am no great fan of massive military spending and I do favor its reduction. However, those who believe that the primary solution to our spiralling debt is slashing defense spending are mistaken. As high as it may be, if we calculate it as a percentage of our GDP it's still at a historical low. On the other hand, since 1965, entitlement spending as a percentage of our GDP, has grown nearly 4 fold. It is and will continue to be the main engine that drives our growing national debt. If we do not get this under control:

It will continue to squeeze resources available for available discretionary spending, which means less money will be available for education, the environment, research and development, infrastructure, etc.

Eventually defense spending will be squeezed.

Taxes will go up, placing a greater burden on productive citizens and sectors of the economy.

Interest rates will be pushed upwards.

Any politician, be they Republican or Democrat, who is not willing to take the necessary steps to address the trillions in unfunded liabilities that await us, should under no circumstance receive your vote.