Wintery Knight

…integrating Christian faith and knowledge in the public square

Economist Walter Williams explains how to not be poor

Economist Walter Williams

Economist Walter Williams

Here is his article on wealth and poverty on Creators.

First, there is no real poverty in the United States:

There is no material poverty in the U.S. Here are a few facts about people whom the Census Bureau labels as poor. Dr. Robert Rector and Rachel Sheffield, in their study “Understanding Poverty in the United States: Surprising Facts About America’s Poor”, report that 80 percent of poor households have air conditioning; nearly three-quarters have a car or truck, and 31 percent have two or more. Two-thirds have cable or satellite TV. Half have one or more computers. Forty-two percent own their homes. Poor Americans have more living space than the typical non-poor person in Sweden, France or the U.K. What we have in our nation are dependency and poverty of the spirit, with people making unwise choices and leading pathological lives aided and abetted by the welfare state.

Second, the “poverty” is not caused by racism, but by poor choices:

The Census Bureau pegs the poverty rate among blacks at 35 percent and among whites at 13 percent. The illegitimacy rate among blacks is 72 percent, and among whites it’s 30 percent. A statistic that one doesn’t hear much about is that the poverty rate among black married families has been in the single digits for more than two decades, currently at 8 percent. For married white families, it’s 5 percent. Now the politically incorrect questions: Whose fault is it to have children without the benefit of marriage and risk a life of dependency? Do people have free will, or are they governed by instincts?

There may be some pinhead sociologists who blame the weak black family structure on racial discrimination. But why was the black illegitimacy rate only 14 percent in 1940, and why, as Dr. Thomas Sowell reports, do we find that census data “going back a hundred years, when blacks were just one generation out of slavery … showed that a slightly higher percentage of black adults had married than white adults. This fact remained true in every census from 1890 to 1940″? Is anyone willing to advance the argument that the reason the illegitimacy rate among blacks was lower and marriage rates higher in earlier periods was there was less racial discrimination and greater opportunity?

Third, avoiding poverty is the result of good choices:

No one can blame a person if he starts out in life poor, because how one starts out is not his fault.

If he stays poor, he is to blame because it is his fault. Avoiding long-term poverty is not rocket science. First, graduate from high school. Second, get married before you have children, and stay married. Third, work at any kind of job, even one that starts out paying the minimum wage. And finally, avoid engaging in criminal behavior. It turns out that a married couple, each earning the minimum wage, would earn an annual combined income of $30,000. The Census Bureau poverty line for a family of two is $15,500, and for a family of four, it’s $23,000. By the way, no adult who starts out earning the minimum wage does so for very long.

Fourth, what stops people from making good choices is big government:

Since President Lyndon Johnson declared war on poverty, the nation has spent about $18 trillion at the federal, state and local levels of government on programs justified by the “need” to deal with some aspect of poverty. In a column of mine in 1995, I pointed out that at that time, the nation had spent $5.4 trillion on the War on Poverty, and with that princely sum, “you could purchase every U.S. factory, all manufacturing equipment, and every office building. With what’s left over, one could buy every airline, trucking company and our commercial maritime fleet. If you’re still in the shopping mood, you could also buy every television, radio and power company, plus every retail and wholesale store in the entire nation”. Today’s total of $18 trillion spent on poverty means you could purchase everything produced in our country each year and then some.

Walter Williams is one of my two favorite economists, the other being Thomas Sowell. By sheer coincidence, they both happen to have grown up poor, and they both happen to be black. They understand what causes poverty very well. I recommend their books to you if you want to understand poverty, too.

Filed under: Polemics, , , , , , , , , , ,

Why is it so hard for young people to find a job?

Young people have a sense of entitlement

Young people have a sense of entitlement

Bloomberg News discusses the “Professionalism in the Workplace” survey of human resources specialists from York College of Pennsylvania.

Forty-nine percent of [those surveyed] stated that less than half of new employees “exhibit professionalism in their first year.” More than half (53 percent) have noticed “a sense of entitlement” rising among younger workers; almost 45 percent have seen a “worsening of the work ethic,” including “too casual of an attitude toward work” and “not understanding what hard work is.”

Younger workers believe they can multitask and remain productive, the human-resources people told the York researchers. Thirty-eight percent of respondents blamed multitasking for the lack of “focus” among younger workers. The authors of the study explained that the younger generation “believes that it is possible to multi-task effectively” and that using social media, for example, is an efficient way to communicate. In interviews, the applicants check their phones for texts and calls, dress inappropriately and overrate their talents.

“The sad fact is some of these persons probably do not understand what is wrong with this,” the authors note.

Older workers have always complained about younger workers, of course, but there’s a difference: This time they attribute the youthful flaws not to ignorance or waywardness, but to a “sense of entitlement.”

We might forgive 18-year-olds fresh out of high school for lacking employability skills (the manufacturing sector hires many workers lacking undergraduate degrees). But when he or she reaches 23 and has four years of college, employers expect a white-collar worker to recognize basic norms of dress and deportment.

What happened in college, then? The survey by York College’s Center for Professional Excellence assigns colleges part of the blame, observing that letting students miss deadlines without penalty and assigning good grades for middling work only make them form the wrong expectations.

Meanwhile, the UK Daily Mail had the results from a 2013 survey:

Young people’s unprecedented level of self-infatuation was revealed in a new analysis of the American Freshman Survey, which has been asking students to rate themselves compared to their peers since 1966.

Roughly 9 million young people have taken the survey over the last 47 years.

Psychologist Jean Twenge and her colleagues compiled the data and found that over the last four decades there’s been a dramatic rise in the number of students who describe themselves as being ‘above average’ in the areas of academic ability, drive to achieve, mathematical ability, and self-confidence.

But in appraising the traits that are considered less invidualistic – co-operativeness, understanding others, and spirituality – the numbers either stayed at slightly decreased over the same period.

Researchers also found a disconnect between the student’s opinions of themselves and actual ability.

While students are much more likely to call themselves gifted in writing abilities, objective test scores actually show that their writing abilities are far less than those of their 1960s counterparts.

Also on the decline is the amount of time spent studying, with little more than a third of students saying they study for six or more hours a week compared to almost half of all students claiming the same in the late 1980s.

Though they may work less, the number that said they had a drive to succeed rose sharply.

[…]Twenge is the author of a separate study showing a 30 per cent increase towards narcissism in students since 1979.

‘Our culture used to encourage modesty and humility and not bragging about yourself,’ Twenge told BBC News. ‘It was considered a bad thing to be seen as conceited or full of yourself.’

Just because someone has high self-esteem doesn’t mean they’re a narcissist. Positive self-assessments can not only be harmless but completely true.

However, one in four recent students responded to a questionnaire called the Narcissistic Personality Inventory with results pointing towards narcissistic self-assessments.

Narcissism is defined as excessive self-love or vanity; self-admiration, or being self-centered.

Twenge said that’s a trait that is often negative and destructive, and blames its boom on several trends – including parenting styles, celebrity culture, social media, and easy credit – for allowing people to seem more successful than they really are.

I think what I am seeing is that not only do they work less, but they work at things they “like”, rather than at things that will allow them to provide value to others. So, you’re not going to find a lot of computer programmers or petroleum engineers among young Americans, but you will find a lot of people gravitating to jobs that are easy that make them feel good about themselves, and look good to other people, too.

Obviously, there are policy reasons for youth unemployment being so high, but I think this attitude that young people have is definitely part of it.

Filed under: Commentary, , , , , , , , , , , , ,

Why is college so expensive? Why does university tuition cost so much?

The correct answer appeared in the radically leftist New York Times, of all places.

This is by Paul F. Campos, law professor at the radically leftist UC Boulder.

He writes:

[P]ublic investment in higher education in America is vastly larger today, in inflation-adjusted dollars, than it was during the supposed golden age of public funding in the 1960s. Such spending has increased at a much faster rate than government spending in general. For example, the military’s budget is about 1.8 times higher today than it was in 1960, while legislative appropriations to higher education are more than 10 times higher.

In other words, far from being caused by funding cuts, the astonishing rise in college tuition correlates closely with a huge increase in public subsidies for higher education. If over the past three decades car prices had gone up as fast as tuition, the average new car would cost more than $80,000.

Some of this increased spending in education has been driven by a sharp rise in the percentage of Americans who go to college. While the college-age population has not increased since the tail end of the baby boom, the percentage of the population enrolled in college has risen significantly, especially in the last 20 years. Enrollment in undergraduate, graduate and professional programs has increased by almost 50 percent since 1995. As a consequence, while state legislative appropriations for higher education have risen much faster than inflation, total state appropriations per student are somewhat lower than they were at their peak in 1990. (Appropriations per student are much higher now than they were in the 1960s and 1970s, when tuition was a small fraction of what it is today.)

As the baby boomers reached college age, state appropriations to higher education skyrocketed, increasing more than fourfold in today’s dollars, from $11.1 billion in 1960 to $48.2 billion in 1975. By 1980, state funding for higher education had increased a mind-boggling 390 percent in real terms over the previous 20 years. This tsunami of public money did not reduce tuition: quite the contrary.

[…]State appropriations reached a record inflation-adjusted high of $86.6 billion in 2009. They declined as a consequence of the Great Recession, but have since risen to $81 billion. And these totals do not include the enormous expansion of the federal Pell Grant program, which has grown, in today’s dollars, to $34.3 billion per year from $10.3 billion in 2000.

The more money that is attached to students, the more money universities charge – simple.

But where is the money going? Is it mostly going to research? To the classroom? To hire more and better professors?

No:

Interestingly, increased spending has not been going into the pockets of the typical professor. Salaries of full-time faculty members are, on average, barely higher than they were in 1970. Moreover, while 45 years ago 78 percent of college and university professors were full time, today half of postsecondary faculty members are lower-paid part-time employees, meaning that the average salaries of the people who do the teaching in American higher education are actually quite a bit lower than they were in 1970.

By contrast, a major factor driving increasing costs is the constant expansion of university administration. According to the Department of Education data, administrative positions at colleges and universities grew by 60 percent between 1993 and 2009, which Bloomberg reported was 10 times the rate of growth of tenured faculty positions.

Even more strikingly, an analysis by a professor at California Polytechnic University, Pomona, found that, while the total number of full-time faculty members in the C.S.U. system grew from 11,614 to 12,019 between 1975 and 2008, the total number of administrators grew from 3,800 to 12,183 — a 221 percent increase.

If you’re going to college or trade school, go to a low-cost school. Do a STEM degree or do a trade that pays well. Try to get tuition assistance even if it means going to a less prestigious school. And work at every opportunity you get in the most serious job you can find. Don’t spend your money – save it. Especially don’t spend your money on fun, vacations and alcohol. As soon as you grow up, you’re going to wish you could have it all back.

Filed under: News, , , , , , , , , , , ,

As senator, Hillary Clinton paid women 72 cents for every dollar she paid men

Hillary Clinton and Planned Parenthood

Hillary Clinton and Planned Parenthood

I already knew that Hillary Clinton was pro-gay-marriage, and radically pro-abortion, but it turns out that she is a hypocrite on women’s issues, as well.

The Washington Times reports:

During her time as senator of New York, Hillary Rodham Clinton paid her female staffers 72 cents for every dollar she paid men, according to a new Washington Free Beacon report.

From 2002 to 2008, the median annual salary for Mrs. Clinton’s female staffers was $15,708.38 less than what was paid to men, the report said. Women earned a slightly higher median salary than men in 2005, coming in at $1.04. But in 2006, they earned 65 cents for each dollar men earned, and in 2008, they earned only 63 cents on the dollar, The Free Beacon reported.

[…]Mrs. Clinton has spoken against wage inequality in the past. In April, she ironically tweeted that “20 years ago, women made 72 cents on the dollar to men. Today it’s still just 77 cents. More work to do. #EqualPay #NoCeilings.”

Meanwhile, she is making “equal pay for women” her top priority.

CBS News reports:

Hillary Clinton lamented the number of women in the fields of science, technology, engineering and math at a Silicon Valley women’s conference on Tuesday, and called for more action to close the wage gap.

[…]In advocating for closing the pay gap, Clinton also endorsed the impassioned plea for wage equality made by Patricia Arquette in her Oscars acceptance speech for Best Supporting Actress.

“Up and down the ladder many women are paid less for the same work, which is why we all cheered at Patricia Arquette’s speech at the Oscars — because she’s right, it’s time to have wage equality once and for all,” Clinton said.

All right, let’s take a look at the facts on the so-called “pay gap” between men and women.

The facts

This article is from the very left-wing Slate, of all places.

Excerpt:

The official Bureau of Labor Department statistics show that the median earnings of full-time female workers is 77 percent of the median earnings of full-time male workers. But that is very different than “77 cents on the dollar for doing the same work as men.” The latter gives the impression that a man and a woman standing next to each other doing the same job for the same number of hours get paid different salaries. That’s not at all the case. “Full time” officially means 35 hours, but men work more hours than women. That’s the first problem: We could be comparing men working 40 hours to women working 35.

How to get a more accurate measure? First, instead of comparing annual wages, start by comparing average weekly wages. This is considered a slightly more accurate measure because it eliminates variables like time off during the year or annual bonuses (and yes, men get higher bonuses, but let’s shelve that for a moment in our quest for a pure wage gap number). By this measure, women earn 81 percent of what men earn, although it varies widely by race. African-American women, for example, earn 94 percent of what African-American men earn in a typical week. Then, when you restrict the comparison to men and women working 40 hours a week, the gap narrows to 87 percent.

But we’re still not close to measuring women “doing the same work as men.” For that, we’d have to adjust for many other factors that go into determining salary. Economists Francine Blau and Lawrence Kahn did that in a recent paper, “The Gender Pay Gap.”.”They first accounted for education and experience. That didn’t shift the gap very much, because women generally have at least as much and usually more education than men, and since the 1980s they have been gaining the experience. The fact that men are more likely to be in unions and have their salaries protected accounts for about 4 percent of the gap. The big differences are in occupation and industry. Women congregate in different professions than men do, and the largely male professions tend to be higher-paying. If you account for those differences, and then compare a woman and a man doing the same job, the pay gap narrows to 91 percent. So, you could accurately say in that Obama ad that, “women get paid 91 cents on the dollar for doing the same work as men.”

I believe that the remainder of the gap can be accounted for by looking at other voluntary factors that differentiate men and women.

The Heritage Foundation says that a recent study puts the number at 95 cents per dollar.

Excerpt:

Women are more likely than men to work in industries with more flexible schedules. Women are also more likely to spend time outside the labor force to care for children. These choices have benefits, but they also reduce pay—for both men and women. When economists control for such factors, they find the gender gap largely disappears.

A 2009 study commissioned by the Department of Labor found that after controlling for occupation, experience, and other choices, women earn 95 percent as much as men do. In 2005, June O’Neil, the former director of the Congressional Budget Office, found that “There is no gender gap in wages among men and women with similar family roles.” Different choices—not discrimination—account for different employment and wage outcomes.

A popular article by Carrie Lukas in the Wall Street Journal agrees.

Excerpt:

The Department of Labor’s Time Use survey shows that full-time working women spend an average of 8.01 hours per day on the job, compared to 8.75 hours for full-time working men. One would expect that someone who works 9% more would also earn more. This one fact alone accounts for more than a third of the wage gap.

[…]Recent studies have shown that the wage gap shrinks—or even reverses—when relevant factors are taken into account and comparisons are made between men and women in similar circumstances. In a 2010 study of single, childless urban workers between the ages of 22 and 30, the research firm Reach Advisors found that women earned an average of 8% more than their male counterparts. Given that women are outpacing men in educational attainment, and that our economy is increasingly geared toward knowledge-based jobs, it makes sense that women’s earnings are going up compared to men’s.

When women make different choices about education and labor that are more like what men choose, they earn just as much or more than men.

Filed under: News, , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Should young Americans feel confident about their economic prospects?

Wages of Young Americans (Source: The Atlantic)

Wages of Young Americans (Source: The Atlantic)

Graph: Young People’s Wages Have Fallen Across Industries Between 2007 and 2013.

Young Americans are taking longer to graduate and graduating with more debt, but that’s not all – they aren’t find jobs, and the jobs they do find typically don’t allow them to pay back their loans.

Here’s an article from The Atlantic, which leans left.

Excerpt:

American families are grappling with stagnant wage growth, as the costs of health care, education, and housing continue to climb. But for many of America’s younger workers, “stagnant” wages shouldn’t sound so bad. In fact, they might sound like a massive raise.

Since the Great Recession struck in 2007, the median wage for people between the ages of 25 and 34, adjusted for inflation, has fallen in every major industry except for health care.

These numbers come from an analysis of the Census Current Population Surveyby Konrad Mugglestone, an economist with Young Invincibles.

In retail, wholesale, leisure, and hospitality—which together employ more than one quarter of this age group—real wages have fallen more than 10 percent since 2007. To be clear, this doesn’t mean that most of this cohort are seeing their pay slashed, year after year. Instead it suggests that wage growth is failing to keep up with inflation, and that, as twentysomethings pass into their thirties, they are earning less than their older peers did before the recession.

The picture isn’t much better for the youngest group of workers between 18 and 24. Besides health care, the industries employing the vast majority of part-time students and recent graduates are also watching wages fall behind inflation. (40 percent of this group is enrolled in college.)

It’s not just that – the Democrats are doing a pretty good job of wrecking other parts of the economy, from energy development to health care to entitlement programs to college tuition, which rises higher as government throws more money into the system. They are doing everything they can to wreck the economy with higher taxes and burdensome regulations.

As a result of our headlong rush towards socialism, the U.S. economy has now fallen to number 2 in the worldbehind China.

Look:

We’re no longer No. 1. Today, we’re No. 2. Yes, it’s official. The Chinese economy just overtook the United States economy to become the largest in the world. For the first time since Ulysses S. Grant was president, America is not the leading economic power on the planet.

It just happened — and almost nobody noticed.

The International Monetary Fund recently released the latest numbers for the world economy. And when you measure national economic output in “real” terms of goods and services, China will this year produce $17.6 trillion — compared with $17.4 trillion for the U.S.A.

As recently as 2000, we produced nearly three times as much as the Chinese.

To put the numbers slightly differently, China now accounts for 16.5% of the global economy when measured in real purchasing-power terms, compared with 16.3% for the U.S.

This latest economic earthquake follows the development last year when China surpassed the U.S. for the first time in terms of global trade.

So things are bad for young people, and it’s going to get worse.

It’s important to check what major you are studying to make sure you get a return on your investment, and don’t be scared to study something you hate if it means that you can make your career work. Your education and career choices are not about fulfillment and thrills. You have to make hard choices in order to make ends meet so that you have freedom to do the things you ought to do, especially if you want to get married and start a family. Those marriage and family plans start the day you step into high school, in my opinion.

UPDATE: 17.7% Teen Unemployment in America – Still Above Rate of 6 Years Ago and Labor Force Participation Remains at 36-Year Low.

Filed under: News, , , , , , , , , , , , , ,

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