College Costs and Kids These Days

This is a reblog from tumblr.

At $10 an hour you’d have to work 1,250 hours to cover the UW’s $12,500 tuition (more, once you take out taxes). In a 12-week summer, that’s more than 100 hours a week.

What really made me feel ancient is that the 1981 UW student guide shows the Med school charged only $1,029 a year back then. Today: $28,040!

Now, I didn’t go to the UW. But I’m going down Husky memory lane because last week The Seattle Times featured a crop of harried UW students looking rueful and broke. The story said skeptical state legislators often say how “they worked their way through college. And then they ask: Why don’t students do that today?”

Of all our delusions, we old farts cling to this bootstrap one the most. We worked our way up on sweat and chicken grease, we say. Can’t this generation? What’s wrong with them?

What’s wrong is that after we got ours, we cut it off for them.

The reason a summer at KFC could pay for a year of UW med school in 1981 isn’t that we were so hardworking and industrious. It’s that taxpayers back then picked up 90 percent of the tab. We weren’t Horatio Algers. We were socialists.

Today, the public picks up only 30 percent of UW tuition, and dropping.

Roseanne Tells It Like It Is

Roseanne scores a home run in this YouTube video when she has a chat with her state representative.  The doorway exchange sums up a lot.  Check it out.

You Need More Than Jobs

I guess you need more than jobs after all for shared prosperity and an end to the recession.  Today the OregonCenter for Public Policy published a report which draws several disturbing conclusions about changes in poverty – and jobs – in Oregon.

The official poverty line was devised in 1960 and is an overly optimistic estimate of what it takes to make ends meet in 2013.  But with that benchmark, families in Oregon (with children and at least one parent working full-time all year) have increased from less than 5% of families in 2006 to more than 6% in 2011 – more than a 20% increase in five years.

Job vs. no-job is not the primary determinant of poverty among Oregon families.  In most families in poverty – 69% - at least one parent is working either full time or less than full time.

The report said, “Full-time work was less likely to be enough for a parent to lift her or his family above the poverty line in 2011 than it was in 2010 and in 2009, the year the recession officially ended.”  The percentage of children in poverty-stricken families increased by about 24% from 2009 to 2011.

            In a final graph, the report illustrates the stark differences in poverty rates between working single mother households and working single father households.  Unsurprisingly, single moms fare much worse than single dads.

            Here are the unfiltered conclusions of the report:

 Lawmakers can help make work pay for families living in poverty. First and foremost, they should renew and strengthen the Oregon Earned Income Tax Credit. The credit allows low-income working families to keep more of what they earn to cover basic needs.

Second, lawmakers can better fund work supports for poor working families. For example, the Employment Related Day Care program, which subsidizes child care for low-income working families, is so poorly funded that eligible parents must first be on a waiting list.

Third, lawmakers can better fund the Job Opportunities and Basic Skills (JOBS) program, an employment and training program for very poor families with dependent children.

The majority of families with children living in poverty in Oregon are working families. Oregon can do more to help ensure that work pays for families who are poor despite their work efforts.

Inequality video

Be sure to check out this short video on economic inequality in America.  It is from the Economic Policy Institute and is narrated by Robert Reich.

Old News on Right to Work

     A guest editorial in the Oregonian  today opined about the trampled rights of union workers who have to pay union dues and how much greener the grass is in the Right to Work states.  The arguments themselves are pretty shop-worn.  What’s important is that they bubble to the surface every now and then.

      Well, the replies are also pretty standard by now.  Here’s one recently by President Obama: “These so-called right to work laws, they don’t have to do with economics. They have everything to do with politics. What they’re really talking about is giving you the right to work for less money.”

      … and another from that fanatical bastion of liberalism, the Wall Street Journal:  “The median private-sector union member made $878 a week in 2011 compared to $716 for nonmembers, a nearly 23% premium. (The premium was somewhat smaller in the manufacturing sector: $836 per week for union members for $780 per week for nonmembers.) Such comparisons have limited value since there are numerous other variables that affect wages. But to the extent there is a union wage premium, the added cost of dues doesn’t appear to negate it.

 “Then there’s the question of benefits: 94% of private-sector union members have access to health-care benefits, versus 67% of nonunion members, according to the Bureau of Labor Statistics.  And employers cover on average 83% of health insurance premiums for union members and their families versus 66% for nonunion members. Union members are also more likely to get paid vacation and sick time and retirement and life insurance benefits.”

     If you're jealous of the unions, join one.  If you're in one, support it.  There are many who are working very hard to "restore your rights."

“DC-like Gamesman” or Populist Stalwart?

On June 17, The Oregonian nailed  Sen. Chris Edwards, D-Eugene, for casting votes with Senate Republicans, thereby defeating SB 5519.  Edwards was roundly criticized – by the Governor on down - for scuttling an attempt to navigate a compromise between Republicans, who want further cuts to Public Employee Retirement System benefits and Democrats who want to find extra revenue to spend on education.  The Oregonian added that “lawmakers had a chance to approve a $6.55 billion K-12 budget that, combined with $200 million in already approved pension savings, would give schools about $1 billion more to spend over the next two years.”  The Governor called the defeat of the bill “DC-like gamesmanship.”

Suspend, for the moment, any discussion that the legislative formula for the full funding of schools in 2013-2015 biennium – the lost and forgotten QEM Model – calls for a spending level of $8.75 billion.  The vaunted compromise represented by SB 5519 funds schools at 75% of the amount determined by the legislature-commissioned QEM Model.  This is not enough to re-hire the teachers laid off in the last four years nor lower class sizes effectively.

Suspend, for the moment, any examination of what exactly those “pension savings” are:  cuts to the contractually defined benefits of currently retired Oregon public service workers.  These “savings” if passed into law, will absolutely be challenged in court by the targets of those “savings” and if history is a guide, the courts will be sympathetic to their grievance.  The attempted “savings”, after litigation, may end up being a net loss for Oregon taxpayers.

Instead, what does Senator Edwards have to say for himself:  "For my hometown, this budget isn't good enough."  The Oregonian reports, “even with a school spending package worth $6.75 billion, the Eugene School District faces more teacher layoffs, fewer classroom days and other cuts, Edwards said. Falling enrollment, property tax limits and a lack of reserves have squeezed the district more than others, he said.”

Politics may be the art of compromise.  But compromise is not  an end in itself.  As we see here, compromise can throw a lot of people under the bus.  All Senator Edwards declared was the obvious but he can be commended for declaring that the Emperor has no clothes.    

The Money Is There

The Oregon Congress failed to pass a proposed school budget today.  It’s not the end of the road.  As pointed out by the Oregon Education Association, the budget is being “held hostage” to gain more cuts to the Public Employee Retirement System.

The core issue, of course, is that the available revenue is assumed to be constrained and that “tough choices” need to be made about what to fund or where to achieve other “savings”.  This is a ready-made formula for showdown partisan politics that is, ultimately, beside the point.

The choices are “tough” because most agree that state services – among them education, human services and prisons – are underfunded and revenue is scarce.  The revenue is available.  There is a vast, bubbling pool of untapped wealth that has been protected for years by lobbying, propaganda and social conditioning. 

Oregonians have decided through their votes and their choices what they want to fund, and even at what level.  They have to take the next responsible step and that is to fund the services at an appropriate level.  It is demonstrably false that the resources are unavailable.  The machinery exists to pry them loose.  Putting that machinery in motion is an act of will by the legislature or the electorate.  Tax the people responsibly, equitably and adequately.

Best Face: Oregon Among Least Regressive

            The Oregon tax environment is not progressive.  The best one can say is that it is one of the least regressive.  A “Distributional Analysis of the Tax Systems in All 50 States” (and DC, too) done by the Institute on Taxation and Economic Policy compares the taxes paid as a percent of income by the poorest 20% and the wealthiest 1%.  In Oregon, the poorest 20% pay 8.3% and the wealthiest 1% pay 7.0% of their respective incomes.   Washington, DC is the least regressive with near parity – 6.6% for the poorest and 6.3% for the wealthiest.  The dubious honor of most regressive goes to Washington state where the poorest pay 16.9% and the wealthiest pay 2.8%.

            ITEP aggregates personal income, property and consumption (sales and excise) taxes in each state to make the comparisons.  The table mostly bears out their conclusion that “In almost all states, the poor pay a higher proportion of their income in taxes than wealthy residents do.”   Actually, according to the data in the report, not one among the 50 states and the District of Columbia shows the progressive profile of the rich paying a higher share of their income than the poor.

The Tax Climate in Oregon

            I read recently that legislators in Oregon want to raise taxes and that this is scandalous.  Ostensibly, people and companies are leaving the state because the state taxes are some of the highest in the nation and Oregon is not business-friendly.

            The Tax Foundation has calculated a State Business Tax Climate Index for 2013.  The ranking is based on five component taxes which are corporate tax, individual income tax, sales tax, unemployment insurance tax and property tax.  For the detail oriented, the indices for our corporate tax, individual income tax and unemployment insurance tax are relatively high and respectively rank us 31^st, 32^nd and 37^th.  Apparently that was offset significantly by our rank on sales tax (4 – why not one? I don’t know) and 10 on our property tax.  Bottom line:  our overall rank is 13^th out of 50;  not number one but not the stuff of scandal either. 

            The same report showed the State Revenue per Capita for Fiscal Year 2011.  We ranked 27^th out of 50.  Rather than portending a treacherous raid on us poor taxpayers, it appears our tax burden would be well within national norms if we increased it to match our needs.