Category Archives: Business

The College-Industrial Complex

…takes a blow:

Let’s see. Where is a teenager more likely to learn the basic and transferable virtue of showing up every day and on time, not to mention how to get along with a boss and fit into an organization — as a communications and binge-drinking double major at Missoula State University, or as a mechanic fixing broken rig equipment? Too many high-school graduates are reflexively going to college as it is, without a clue what they are doing there or how to take advantage of higher education. Mandatory stints in the private economy before college enrollment could do wonders for study skills. If, by deferring or maybe even skipping college entirely, students were foregoing their one hope for immersion in Western civilization, there would indeed be grounds for regret. But colleges’ own curricular decisions have long since destroyed their right to present themselves as a gateway for precious knowledge of the past.

No kidding.

A lot of people are in college who don’t belong there, and don’t really know why they’re there, wasting their or their parents’ money, or accumulating debt undischargeable in a bankruptcy, except society has told them that it is expected of them. Many of them would be a lot better off getting jobs after high school, and then, after they’ve figured out what they want to do, going to school if their goals require it. In general, older students with life experience (and particularly veterans) are more motivated, and will get much more out of college than someone who just graduated high school (and was perhaps unprepared for college by the terrible public school system).

After I (barely) graduated high school, I was in no mood for college (I didn’t even bother to take the SAT), and went to work for a year or so repairing Volkswagens. That was enough experience to tell me that I didn’t want to do it all my life, and I went to community college for a couple years, picking up enough pre-engineering courses with As to get into Michigan engineering school, something that I wouldn’t have been able to do right out of high school with my grades. And if you want to learn, and save money, you’ll actually get a better education at a community college than a major university for your freshman and sophomore years, because classes will be smaller, with more individual attention from the instructors. It’s only the advanced courses that require a university.

[Update a while later]

A campus full of contradictions:

…perhaps a fourth of the liberal arts courses — many would judge more like 50% — would never have been allowed in the curriculum just 40 years ago. They tend to foster the two most regrettable traits in a young mind — ignorance of the uninformed combined with the arrogance of the zealot. All too often students in these courses become revved up over a particular writ — solar power, gay marriage, the war on women, multiculturalism — without the skills to present their views logically and persuasively in response to criticism. Heat, not light, is the objective of these classes.

Why are these courses, then, taught?

For a variety of practical reasons: 1) often the professors are rehashing their doctoral theses or narrow journal articles and are not capable of mastering a wider subject (e.g., teaching a class in “The Other in Advertising” is a lot easier than a systematic history of California); 2) the quality of today’s students is so questionable that the social sciences have stepped up to service the under-qualified, in the sense of providing courses, grades, and graduation possibilities; 3) the university does not see itself as a disinterested nexus of ideas, where for a brief four years students are trained how to think, given a corpus of fact-based knowledge about their nation and world, and expected to develop an aesthetic sense of art, music, and literature. Instead college is intended as a sort of boot camp for the progressive army, where recruits are trained and do not question their commissars.

So the new curriculum in the social sciences and humanities fills a need of sorts, and the result is that today’s graduating English major probably cannot name six Shakespearean plays; the history major cannot distinguish Verdun from Shiloh; the philosophy major has not read Aristotle’s Poetics or Plato’s Laws; and the political science major knows very little of Machiavelli or Tocqueville — but all of the above do know that the planet is heating up due to capitalist greed, the history of the United States is largely a story of oppression, the UN and the EU offer a superior paradigm to the U.S. Constitution, and there are some scary gun-owning, carbon-fuel burning, heterosexual-marrying nuts outside the campus.

If we ask why vocational and tech schools sprout up around the traditional university campus, it is because they are upfront about their nuts-and-bolts, get-a-job education: no need to worry about “liberal arts” or “the humanities” — especially given that the universities’ General Education core is not very general and not very educational any more. Yes, I am worried that the University of Phoenix graduate has not read Dante, but more worried that the CSU Fresno graduate has not either, and the former is far more intellectually honest about that lapse than the latter.

What a disaster.

The Future Of Tax Rates

They can’t go up much more, despite the delusions of the class warriors:

…we’re pretty quickly going to have to start exploring tax increases on people who make less than $250,000 a year . . . or exploring serious spending cuts. Or looking to limit deductions (including yes, the sacred deductions for charitable deductions and state and local income taxes, and the tax-free status of municipal bonds).

Probably, we are going to have to do all three. The era of “Don’t tax you–don’t tax me–tax that fellow behind the tree!” is coming to a close, not because we’re any more in touch with reality than we were five years ago, but because pretty soon, reality is going to get in touch with us.

Yes. As Frank J. says, math is coming:

Obama wants Math locked completely out of the fiscal cliff talks and instead wants unlimited power to raise the debt ceiling and then tax the rich because of the demands of Fairness — Fairness being the left’s favorite imaginary friend. Math won’t stop laughing at Obama’s plan to pay for everything by taxing the rich, so Obama just won’t work with it at all.

The Republicans at least acknowledge that Math exists but are only trying to compromise with it. We’re broke, and Obama wants to buy a Ferrari we can’t afford, and they’re trying to argue him down to a BMW we can’t afford. I guess they think if they make some changes to entitlements, Math will just relent and allow 2 + 2 to equal 5 so the rest will add up.

Our children and grandchildren will curse all this selfishness and irrationality.

The Battle Of The Narrative

How private citizens can fight ObamaCare:

…we should not let the government escape responsibility for problems they’ve created. This will becoming increasingly important as more ObamaCare problems emerge, such as patients being denied treatments by government-spawned “Accountable Care Organizations” (ACOs) or by government bureaucracies such as the Independent Payment Advisory Board (IPAB) and the US Preventive Services Task Force (USPSTF).

If we let the government shift responsibility for ObamaCare’s problems onto the residual private sector, those problems will eventually be used to justify a government-run “single payer” system. On the other hand, if Americans hold the government appropriately responsible, we stand a chance at adopting genuine free-market health reforms.

Of course, single payer was always the goal for these “liberal” fascists. It’s the usual drill of the Left; pass a law that effs things up, blame the eff up on “deregulation,” and then pass more laws to “fix” it (Dodd-Frank being an excellent example of the genre). Don’t let them get away with it.

The SS2 Drop Test

As Clark Lindsey reports, there was a drop test of SpaceShipTwo, that had some, but apparently not all of the propulsion system installed. I wonder if it was carrying fuel? One of the issues I discuss in my book is its ability to abort with a failed ignition, because while it can dump the oxidizer, it’s not possible to get rid of the rubber slug. Steve Isakowitz told me that it is designed to land with a fuel load, from a CG/weight standpoint, so it would be interesting to see if they demonstrated that ability.

Taxpayers Aren’t Stationary Targets

The lesson of Gérard Depardieu:

Economists as far back at J. B. Say and Gustave de Molinari in the 19th century understood this. As Molinari wrote in his 1899 book, The Society of To-morrow, “The laws of fiscal equilibrium set a strict limit to the degree within which it is possible to impose new taxes, or to increase the rates of those already in force. The relative productivity of taxes soon shows when this point has been overstepped, for then returns not only cease to rise, but immediately begin to fall.”

Things can work in the other direction too. Other things being equal, cutting tax rates can prompt revenues to rise. This is not to say rising revenue is a good thing. As Milton Friedman once said, if a tax-rate cut brings in more revenue, the rates weren’t cut enough. Hear, hear!

Nevertheless, revenues can increase after a rate cut. Case in point: the rate cuts of 2001 and 2003, the so-called Bush tax cuts, which President Obama (until yesterday) had been hoping would expire for the top 2 percent of earners. According to the Congressional Budget Office, revenues increased from $1.9 billion in 2003—when all the cuts kicked in—to $2.3 billion in 2008 (in constant 2005 dollars). At that point the Great Recession hit and of course revenues then fell. Tax revenues always fall in a recession because when people lose their jobs they stop paying the income tax. Companies also pay less as economic activity slows down. When would-be tax raisers today complain that revenues are a smaller percentage of GDP than in previous years, that is the reason. It’s not that the tax rates are too low.

It’s not about revenue. It’s about “fairness.” That is, it’s ultimately about “need” and “ability,” i.e., Marxism.

Related: “The truth is, politicians are telling lies.”

This is not an ideological argument about the moral advantages of a smaller state: it is simple economic necessity. As the man said, there’s no money left. And the only ways that anybody can think of for the state to get more of it are either futile (taxing the “rich”) or destructive of any possibility of recovery (more borrowing). What began as a banking collapse has turned into a crisis of democratic politics. Is this what we have to look forward to? The process of campaigning and voting will be an irrelevance: all parties will tell pretty much the same lies. Whichever one is marginally more credible than the others will gain power (probably in coalition with another bunch of liars), and then have to do what needs to be done in whatever desperate, underhand ways it can devise. Nobody will feel that he got what he voted for, because what he voted for was impossible.

And low-information voters believe them, which is how Obama and other Democrats got reelected. But the piper will be paid. As Glenn says:

Something that can’t go on forever, won’t. Debt that can’t be repaid, won’t be. Promises that can’t be kept, won’t be.

But as with any bubble, the issue isn’t if, but when.