Matt Yglesias

Feb 19th, 2009 at 11:42 am

The Government Makes the Stuff We Need

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A commenter at the Atlantic remarks:

There’s the rub. My company’s bank loan officer has called frequently asking if we need to borrow. They are begging to lend money. For what? We could buy a nice new machine tool at a good price, but why do that when sales are falling? Put an extension on our building? Buy some failing competitor and strap oneself with debt? Unless you absolutely need a new car or a new television or a new roof, the big ticket discretionary purchases paid for by loans aren’t going to be made. The loans the banks are making now are companies rolling over existing debt, not new debt. Given the “stuff” out there that is discretionary purchases, I wouldn’t be at all surprised to see unemployment hit 20% before a bottom is reached.

I think this captures something important. And I also think it’s an important part of the case for increased public investment, somewhat apart from the specific issue of the economic stimulus package. If you try to put the contemporary United States in historical and international perspective, you’ll see that we’re doing really well in a lot of ways. As a society, we’re not suffering from an objective shortfall in the quantity or quality of automobiles we have. We’re certainly not falling short in either the number of houses around or their general size and lavishness. We have a lot of very nice televisions, a lot of computers, a lot of cell phones and DVD players, etc. It’s not just that we’re prosperous enough that people aren’t starving to death, but over and above that compared to anyplace else in the world we just have a ton of consumer goods stockpiled such that even if purchases of new goods slowed enormously for years we could keep on keeping on at a high standard of living.

But that’s not to say that things are perfect. Compared to other times and other countries, there are a lot of scores on which we’re doing extremely well. But there are other respects in which we’re falling well behind what we know is achievable by contemporary societies.

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We have a smaller proportion of our population graduating from college than do some other countries, and we’re making no progress. Relatedly, our K-12 education system could perform better. Our intercity passenger rail offerings are much worse than they could be, and none of our non-NYC metro areas have really top-notch mass transit offerings. We have substantially more violent crime than do other countries or historical periods in the United States. The level of prenatal health care our pregnant women are receiving is substandard, as is the physical fitness of our children. Public libraries are generally worse than they were a generation ago. America’s streets and sidewalks are, in general, not especially clean or well-maintained. And though our highways are plentiful, they’re not well-maintained either.

This all adds up to a lot of fields in which it would be plausible to say that we could enhance human welfare by expending more funds. But these are basically all things in which the private sector could realistically only have a secondary role. There’s a lot of dogma about to the effect that jobs working for the government aren’t “real” jobs—that somehow the police and teachers and firefighters and the guys who build the bridges and drive the buses aren’t creating anything of value. But that’s preposterous. The work is real, the jobs are real, and the benefits are real. It’s true that it’s difficult to maximize the efficiency of a public sector enterprise. But it’s also true that there are categories of goods that can’t be adequately provided without a large public sector role. And given the generally high level of wealth we enjoy, compared with the past 35 years of starving the public sector, the marginal dollar invested in these kind of endeavors can do an enormous amount of good. And that’s especially true at a time when it seems that relatively few individuals seem inclined to go further into debt for the sake of acquiring a BlueRay player. There’s enormous willingness out there at the moment to lend money to the United States government, and there’s a lot of stuff the United States government could be doing to benefits its citizens.






69 Responses to “The Government Makes the Stuff We Need”

  1. matt (not the famous one) Says:

    Our New York City Metro Area doesn’t have “to notch” transit, either, by world standards. It’s much worse than Paris or Moscow and probably lots of other places, too, and only getting worse.

  2. shah8 Says:

    1) I don’t see spelling and grammar errors anymore. I really appreciate that!

    2) Someone needs to document the effect of the y2k bug. That event has had a bigger impact on our infrastructure than is generally understood, and it was a key bubble that has left us some benefits down the road.

    3) I think, based on y2k, Apollo Program, Manhattan Project, and the various civil engineering fevers through history, that a stimulus plan should be based on one idea. Pick an upgrade, any upgrade, and push the hell out of it. Take, say electricity infrastructure improvement. Spend all of the stimulus money on that. It’s easier to create concrete goals that can be met, and this kind of single focus creates a complex financial ecosystem around it that can do some of the part of reinflating the economy.

  3. joejoejoe Says:

    Good post except…

    …Chicago has great public transportation. It might not be the most modern subway system but it runs 24/7 and has modern 24/7 bus lines that saturate the city. And Metra has extensive commuter rail to the ‘burbs. Both Chicago airports are connected to the subway while neither of NYC’s two airports are connected directly to the subway. Chicago’s grid layout really makes it simple and effective to use public transportation. Google Transit Maps makes it REALLY easy to use public transit. Add in the new CTA feature that lets you know when the next bus is arriving thanks to GPS and smartphones and it’s a pretty darn good system.

  4. Christopher Monnier Says:

    Government should finance the stuff we [collectively] need (education, transportation, public health), but I’m not convinced government is the most effective mechanism to administer those goods. Matt says, “It’s true that it’s difficult to maximize the efficiency of a public sector enterprise,” but opening the administration/delivery of public goods to competition and market forces can more effectively “maximize the efficiency” than can a centrally-planned bureaucracy.

  5. JT Says:

    Then call now for raising taxes to pay for your social engineering projects Matt.
    But no, you and the lying Dems and the Big Fat ObaLiar aren’t willing to do that.
    Hell, you aren’t even willing to put your progressive nightmares through the regular budget process.
    Afraid of democracy are you?
    Do you think for one minute that American voters would support the ObaStimulator if they knew the truth of the financial realities we face now and more seriously in just a few years?
    But they don’t get that.
    Instead the ObaLiar uses the same deceitful scare tactics that Bushit employed to sell his wars.
    Gee Matt in your infinite wisdom you were a chief cheerleader for those disasters of epic proportions too now weren’t you?
    Do you see a pattern emerging here?

    Do you see the budget just agreed to by California?
    See the tax increases?
    See the cut in social services?
    Now imagine that on a national scale. Oh and without the $timulator because contrary to your claims the world is not begging to further finance the American implosion.
    Because Matt you well know that is what must come in our future and that not many years away.

    So what’s the ObaAnswer?
    Why let’s dig the hole as deep as possible and as fast as possible lying through our teeth the whole time.
    This is change?
    Hell I used to believe it’d at least be enough change to buy a cup of coffee.
    If Matt gets his way we can give that up too.
    But hey that’s progressive cause I’m sure some poor coffee grower was just gettin’ exploited to death selling his product to us anyway.

  6. cd Says:

    “There’s a lot of dogma about to the effect that jobs working for the government aren’t “real” jobs—

    You’re right, this is preposterous. I would add that McArdle likes to rail against so called “make work” jobs, but I would argue that if a teacher isn’t a “real” job, then what exactly is a half-assed econoblogger? I’m pretty sure that is much less of a “real” job.

  7. Joe Says:

    There’s a lot of dogma about to the effect that jobs working for the government aren’t “real” jobs—that somehow the police and teachers and firefighters and the guys who build the bridges and drive the buses aren’t creating anything of value.

    This type of sentiment makes me livid. I’ve got a proposal: How about I stop doing my job and our state stops enforcing ambulance regulations? Then the next time you call 911, a guy with a taxicab and a packet of bandaids will show up to drive you to the hospital. For $800. Oh, and while you were there, say hello to the lady with Stage IV breast cancer. She could have easily been saved by early screening, but the state couldn’t fund it because there were no lawyers to defend it in the lawsuit involving the rightwing whackjobs who don’t want a dime going to women’s health clinics, even if that dime pays for things like mammograms and pap smears.

  8. Mark Says:

    @joejoejoe

    Chicago’s public transit system is fine, but it can’t hold a candle to those of the major cities in Western Europe. I used to think it was great, but then I spent six weeks in Europe, where trains came on time, weren’t earsplittingly loud, and appeared to have far more stations and interconnectivity.

    It sucked to have to come back and wait 30 minutes for trains and buses that are scheduled to come every 10 minutes. Then to have to transfer to another bus or train, and wait longer for it to show up. Chicago’s buses, in particular, are terribly unreliable, even if they do saturate the city. The trains are better, but those don’t saturate the city at all.

    That said, the Metra commuter rail is actually pretty nice.

  9. zyxw Says:

    There’s a lot of dogma about to the effect that jobs working for the government aren’t “real” jobs—that somehow the police and teachers and firefighters and the guys who build the bridges and drive the buses aren’t creating anything of value.

    Part of the problem is that every day in the news we see stories about government folks, including our legislators, screwing the public. The vast majority of government workers, doing important work every day, aren’t news. So instead we see stuff like the police officer in a nearby town who takes home $168K due to overtime, and apparently sleeps in some apartment during part of the many hours he’s being paid for. When someone screws up like that for a private company the chances are they are quietly fired and never heard from again. I’m not saying this perception is the truth, just that it is what the public sees every day.

  10. DCreader Says:

    I think its worth considering to what extent public sector unions have undermined support for provision of public services by making it harder to provide those services in a streamlined way. When I lived in Philadelphia the transit union and the teachers union seemed to be run by crazy people who demanded lavish benefits and zero accountability. I’m a big supporter of more investment in transit and education but I absolutely could not stomach those people.

  11. Brad Says:

    I’m amazed that Matt was able to do a post about how shitty America is without dragging out his bullshit child poverty chart again.

  12. zyxw Says:

    DCreader has it right. I too am a big supporter of public education, but the NY unions are killing off their support with the public by stuff like this. My daughter’s middle school chorus teacher makes $76K, gets two months off every summer, has complete medical care coverage, many other benefits, and will soon retire in her 50s with full pay and medical benefits for the rest of her life. The union just got another contract with guaranteed raises in everything, and there is no way to fire anybody unless they commit a crime. That’s tough for many taxpayers who are in much worse economic shape.

  13. Thomas Says:

    Three things:

    The public sector isn’t starved. It has grown over the last 35 years, whether measured on an absolute basis or as a percentage of GDP.

    There’s no dogma that says that government jobs aren’t real jobs. Just that some government jobs aren’t real jobs.

    The most crucial words in Matt’s post are “at the moment”.

  14. Stefan Says:

    My daughter’s middle school chorus teacher makes $76K, gets two months off every summer, has complete medical care coverage, many other benefits, and will soon retire in her 50s with full pay and medical benefits for the rest of her life.

    And this is bad why? Do you think she’d be a better, more motivated and committed teacher if she was paid less and had to spend her time and energy worrying about her retirement instead of focusing on your children’s education? Do poorer, more economically insecure teachers produce smarter, more motivated students?

  15. harold Says:

    I wholeheartedly agree with no. 8 about Chicago’s transportation system — interconnectivity is bad and the waits are unsupportable. Nor is it all that affordable. Interconnectivity in NYC, especially in the boroughs could also be improved.

    No. 12, it is the principals in NYC schools that are a problem, not the teachers. The teachers earn every penny and benefit — though their duties ought to include supervising the children at lunch rather than leaving this to untrained aides.

  16. washerdreyer Says:

    We have a smaller proportion of our population graduating from college than do some other countries, and we’re making no progress.

    I was under the impression that you thought attempts to increase the percentage of the population which graduates from college were misguided, and that it wasn’t a particularly important goal.

    there is no way to fire anybody unless they commit a crime.

    Look, there’s lots of craziness involving teacher’s unions (see e.g. the rubber room episode of This American Life) but this kind of hyperbole helps no one.

  17. Stefan Says:

    My daughter’s middle school chorus teacher makes $76K, gets two months off every summer, has complete medical care coverage, many other benefits, and will soon retire in her 50s with full pay and medical benefits for the rest of her life. The union just got another contract with guaranteed raises in everything, and there is no way to fire anybody unless they commit a crime. That’s tough for many taxpayers who are in much worse economic shape.

    How is it tough? Are you imagining that if somehow the teachers were paid less, then that money would be distributed to you instead? How do you think that would work, exactly?

    Rather than bemoan the fact that some portion of the middle-class is able to live in dignity and earn a decent living while doing valuable work, you should perhaps work towards securing those benefits for yourself. But that won’t come by taking away benefits from teachers and other public sector employees — instead, it will come from pressuring the government to provide a comparable safety net in terms of health care, retirement pensions, and other benefits for all workers, both public and private sector. You don’t get rich by beggaring your neighbor.

  18. drinkof Says:

    “It’s true that it’s difficult to maximize the efficiency of a public sector enterprise. ”

    Those who natter about the inherent inefficiency of the public sector haven’t spent enough time at, say, a large retail chain, an electric utility, etc. Even those that are reasonably well run have inefficiencies galore.

    “There’s no dogma that says that government jobs aren’t real jobs. Just that some government jobs aren’t real jobs.”

    That’s just not so. The dogma SHOULD contain the qualifier “SOME”, but for the vast range of dittoheads and red meat didacts, it does not.

  19. steve duncan Says:

    Education is not going to improve markedly. Millions of children have parents that believe in Intelligent Design or Creationism. The nation’s children watch televison, text message, play video games or otherwise avoid any pursuit of knowledge outside of school. At graduation and beyond they can’t name ANYONE representing them in any legislative body. They couldn’t identify more than a handful of states or countries on a world map. I posit the vast majority of the populace, of any age, hasn’t read a non-fiction book cover to cover in the last year. Home schooling is touted by millions of parents and a segment of the education establishment. When I was in high school we had science labs, access to chemicals and various machines and instruments. What home schooling parent has that? We were challenged in our classes by other students, both in the individual rigor of our work and thoughts and from an overall competetive standpoint as to class standing and rank. What home schooled child gets that interplay? My mathmatics instructor had a Masters in his field, as did all my other instructors have field specific degrees in the disciplines they taught. What mother or father has that breadth and depth of knowledge? Can they teach calculus, biology, chemistry, advanced writing, complex language skills, foreign languages, art, and a host of other skills? Who are these parents? A vast, untapped reservoir of renaissance wizards? There are many millions of both children and parents that have a deep anti-intellectual bent, disdaining the arts, sciences, literature and the like. They’re suspicious of those taking education seriously. You see examples of this in minority societies, children attacking other children for “acting white” in studying hard and getting good grades. I don’t see it changing soon and if it eventually does it’ll be glacial in pace. Meanwhile we’ll continue to lag behind other countries in various measurements and assessments regarding education.

  20. MSully Says:

    Echoing DCreader (#10), state budgets also face a real timebomb in unbelievably lavish pension plans for public workers that will require painful increases to fund them in the near future. In NY, police and firefighters can “retire” after 20 yrs and average >$50,000 retirement pay (boosted by generous overtime during their final 3 yrs on the job). Of course most then go on to get second careers started while drawing benefits that most of the private sector employees can only hope to achieve. Until this situation is fixed, the prospect of even more public jobs is terrifying.

  21. zyxw Says:

    Stefan: What’s bad about it is that there is no accountability. Wages just increase based on years of service, with no regard to teaching quality. There are layers and layers of administrators making over $100K, and it is hard to see exactly what they do. We have pretty good schools, but there are also a ton of lousy teachers making big salaries that aren’t really adding value to the system. The worst teachers seem to stick around forever until they retire, as I suspect they wouldn’t be able to easily find other work. I would be happy paying top dollar if I was getting top dollar results. Also, the union has created a higher price than the local economy can bear. That wage is about 50% higher than the median income, and when you add in the cost of the benefits it is tough for people to swallow. I probably won’t be able to afford to live in this town much longer because my salary does not go up as fast as the costs.

  22. Joe Says:

    My daughter’s middle school chorus teacher makes $76K, gets two months off every summer, has complete medical care coverage, many other benefits, and will soon retire in her 50s with full pay and medical benefits for the rest of her life. The union just got another contract with guaranteed raises in everything, and there is no way to fire anybody unless they commit a crime. That’s tough for many taxpayers who are in much worse economic shape.

    Let me get this straight: This woman has at least a bachelor’s degree and almost certainly a master’s degree, plus 30ish years of experience, and at the peak of her professional career in her late 40s or early 50s, she’s earning $76k a year — and somehow this is exorbitant in your mind? Unbelievable.

  23. Joe Says:

    state budgets also face a real timebomb in unbelievably lavish pension plans for public workers that will require painful increases to fund them in the near future.

    The problem with not funding them will be: (1) these same state workers generally are off the social security system, so if you don’t keep their pensions in recognizable form, they are going to be destitute; and (2) most state workers have been operating under the assumption that the promises made to them would be kept, so their savings rates have been diminished (also compounding this — many did not move to a more lucrative private job to save more because of the promised pensions).

  24. DaveinHackensack Says:

    This was my response to that Atlantic commenter’s post:

    Why not offer tax credits then, to encourage spending? What if Creech’s company were given a 50% tax credit on the purchase of a new machine tool, but only if they purchased it by the end of 2009? How about offering a similar credit to consumers? It wouldn’t be a panacea for bankrupt businesses or unemployed people, but it might encourage more solvent businesses and employed consumers to open their wallets this year.

    And this was his response:

    I’m sure that the company would buy a new machine tool (or a used reconditioned one) if 50% could be written off against taxes. There’s always some outdated, slow machine that can be traded in.

    We know demand will someday return (we sell a lot to oil exploration and refining outfits). Ironically, however, any new machine would allow us to eventually ramp up productivity without having to add a job! (Two or even three CNC machines can be tended by one employee while older models usually required one per machine.)

    Also, ironically, because we have been conservative with our lending, we actually have the cash to buy a new CNC without going to the bank – leaving more for the bank to lend to others who may have saved less for a rainy day.

    My preferential “stimulus package” would have been to end corporate income taxes (which bring in about $400 billion to the Treasury) which would certainly help to attract investment, talent, and jobs from all over the world.

  25. mpowell Says:

    22: These people are amazing. We just had a massive economic collapse because after the real estate market melted down and people lost their access to easy credit demand plummeted. But no, the problem is experienced people doing important work are being paid slightly more than a living wage in the mostly costly to live in city in the country. And they have healthcare! WTF?? But we should definitely let bank CEO keep flying private jets around the country.

  26. zyxw Says:

    #25, no this is in a small town in upstate NY where the median income is around $50K. Teachers, police, and firemen should be well compensated, but they need to understand that they can’t demand wages and benefits going up when everyone else’s wages and benefits are going down.

  27. Steve Says:

    “The problem with not funding them will be: (1) these same state workers generally are off the social security system, so if you don’t keep their pensions in recognizable form, they are going to be destitute;”

    First, most are in the social security system, with the exception of cops. Second, the cops generally have pensions in addition to their (basically, privatized) alternative social security programs. They’ll probably be making more money in retirement than you are making now, so don’t worry about them.

    “and (2) most state workers have been operating under the assumption that the promises made to them would be kept, so their savings rates have been diminished (also compounding this — many did not move to a more lucrative private job to save more because of the promised pensions).”

    First, state workers have had the same opportunity to save via public sector equivalents of 401(k)s (457s and 403bs). Second, most didn’t have the option to move to “more lucrative” private jobs. A veteran NY teacher with a bachelors in English isn’t going to get paid $85k to work 180 days a year in the private sector; she probably wouldn’t even earn half that.

    This gets the point of why so many tax payers resent the public sector feather-bedding: it used to be that one traded opportunity for security in a public sector job, but over the last decade or so, public sector salaries and benefits have become so generous that they are both more lucrative and more secure than average private sector jobs — and that cushy deal comes at the expense of private sector tax payers.

  28. Joe Says:

    Teachers, police, and firemen should be well compensated, but they need to understand that they can’t demand wages and benefits going up when everyone else’s wages and benefits are going down.

    I’m a lawyer for the state government. We’ve been told no raises next year, plus five furlough days.

  29. Joe Says:

    First, most are in the social security system, with the exception of cops. Second, the cops generally have pensions in addition to their (basically, privatized) alternative social security programs. They’ll probably be making more money in retirement than you are making now, so don’t worry about them.

    I can only speak to my experience, which is we get a pension and that’s it — no social security, no “alternative” social security.

    Second, most didn’t have the option to move to “more lucrative” private jobs. A veteran NY teacher with a bachelors in English isn’t going to get paid $85k to work 180 days a year in the private sector; she probably wouldn’t even earn half that.

    I made triple in the private sector what I do now working for the government. Now, the hours are much nicer (40 hours per week instead of 70) and the work is a lot more interesting and fulfilling, but a big reason that I was willing to take the 70% pay cut was the idea that I didn’t need to save because there was a pension.

    First, state workers have had the same opportunity to save via public sector equivalents of 401(k)s (457s and 403bs).

    Why would you save if you were promised an adequate pension?

    This gets the point of why so many tax payers resent the public sector feather-bedding: it used to be that one traded opportunity for security in a public sector job, but over the last decade or so, public sector salaries and benefits have become so generous that they are both more lucrative and more secure than average private sector jobs — and that cushy deal comes at the expense of private sector tax payers.

    See above. Security has nothing to do with it. I’m not unionized, and most of the government jobs in our state don’t have civil service protections. I moved from a $200k+ job to a sub-$80k job pretty much solely because I wanted to see my daughter every day, and the work is a lot more interesting.

  30. steve duncan Says:

    Add to being anti-intellectual also the qualities of envy and resentment. Per many above comments the only people making what they’re worth are themselves, and even that’s not enough. EVERYONE else is overpaid for what they do, especially government workers. Government workers are the spawn of Satan. Fire all the teachers and close the schools. Home schooling will do. While you’re at it put out your own fires, firefighters are overpaid too. Unclog your own sewers, build your own bridges and investigate your sister’s murder for yourself. Damned cops are overpaid. Oh, in a legal scrape and of modest means? Well, represent yourself in court, seeing as how court appointed attorneys all live on lavish estates and drive Bentleys. And retire at age 45 to Italian villas. I read it on Drudge. Limbaugh said so. Ask zyxw, he’ll tell you.

  31. Bleebs Says:

    The willingness for the government to spend gobs more money is meaningless without addressing the revenue side. If we don’t achieve some basic semblance of responsibility in our spending (vis-a-vis our tax revenue) we will definitely start to run into problems with other countries being willing to lend us money. If they do continue, it causes havoc with unintended consequences for trade, the dollar, etc.

    Basically, for the government to fund all this spending, taxes must be hiked eventually, which further depresses the economy. Just like personal households, I think governments will have to readjust their expectations and realize they will be doing less, not more. State and local governments know this right now, because they must balance their budgets. The federal government will realize this when it goes bankrupt.

  32. harold Says:

    I can’t get over someone resenting that her daughter has a chorus teacher. Would that the schools in NYC had chorus teachers! Singing in a chorus has millions of documented psychological and intellectual benefits that last a lifetime. It enhances learning in other areas and is deeply fulfilling. Arguably more than sports. I can’t think of a better way to spend public money than to sponsor school and community choruses nationwide (Wales anyone?), led by well-prepared professionals.

  33. steve duncan Says:

    harold, chorus schools turn kids gay. No one that ever spent a lot of time singing in a chorus could be depended upon to slash a Muslim’s throat while grappling in a foxhole. C’mon!

  34. harold Says:

    Narrow and myopic attitudes such as the one about the chorus teacher are the principal reason our cultural and educational systems are in such bad shape and dreadfully lagging compared to other countries.

  35. Steve Says:

    “Why would you save if you were promised an adequate pension?”

    To be prudent, to build a nest egg to supplement my pension in old age, and to perhaps leave a legacy for my children.

  36. Stefan Says:

    Teachers, police, and firemen should be well compensated, but they need to understand that they can’t demand wages and benefits going up when everyone else’s wages and benefits are going down.

    Actually, that’s exactly the opposite. Wages experience either upwards or downwards pressure, and if teachers, police and firemen are well compensated, then private sector employers in your region will eventually have to increase their wages as well in order to attract and retain qualified employees. If their salaries were to go down, on the other hand, then there’d be less incentive for your employer to pay you anymore because there’d be less competition.

  37. Stefan Says:

    We have pretty good schools, but there are also a ton of lousy teachers making big salaries that aren’t really adding value to the system. The worst teachers seem to stick around forever until they retire, as I suspect they wouldn’t be able to easily find other work. I would be happy paying top dollar if I was getting top dollar results.

    Welcome to reality. This is a problem endemic to any human endeavor, and is not particular to schoolteachers. I work in Wall Street related private enterprise, and there too there are a ton of lousy workers making big salaries that aren’t really adding value to the system.

    I would be happy paying top dollar if I was getting top dollar results.

    If you really want top dollar results, you won’t get it by lowering salaries and cutting the safety net.

  38. harold Says:

    “If you really want top dollar results, you won’t get it by lowering salaries and cutting the safety net.”

    –Thank you, Stefan! A voice of reason against the fumes of ignorance, superstition, and insanity that have been engulfing us for the last 30 years.

  39. zyxw Says:

    For the record, she’s a great chorus teacher and I feel personally happy that she is doing so well, and I’m doing fine economically. But, a high percentage of the teachers themselves don’t live in town–when I asked some of them why, they said the taxes were too high! Same thing with a lot of the police and firemen, at least according to articles in the newspaper. Some members of the city government live outside the city limits. The city is gradually becoming too expensive for all but the rich and wealthy retirees, and a very high percentage of the city budget is payroll. Interesting spiral.

  40. Stefan Says:

    Thank you, Stefan! A voice of reason against the fumes of ignorance, superstition, and insanity that have been engulfing us for the last 30 years.

    Curiously enough, that’s what I have printed on my business cards…..

  41. harold Says:

    zyzw,

    Don’t blame it on the unions, blame the way education is funded by being linked to real estate speculation. (Taxes are high because the people in your district insist on quality education, no doubt.)

  42. Thomas Says:

    hey Joe, is the time you spend posting here part of your 40 hours a week?

  43. Jonathan Says:

    What? NYC Metro area has “Top-Notch” mass-transit?

    I live in New Jersey, 18 net miles from my office in Manhattan. It takes me 90 minutes to get to work using mass transit. NJTransit is awful due to train frequency and delays, partly due to Amtrak being so awful, and probably needs the most improvement, and NYCTransit isn’t much better.

    In NYC itself, the transit is okay because it can get you where you need to go, but that’s where it ends. It’s noisy, smelly, uncomfortable (spending 40 minutes on a train touching butts with someone else is uncomfortable on several levels), confusing, announcements are terrible, train delays are frequent and unexplainable, etc.

    In terms of mass-transit affecting the lives of the most people, and requiring the most improvement, I’d say NYC Metro area mass-transit is bottom-notch

  44. Luke Says:

    If Wall St. bankers died on the job at the same rate as NYPD or NYFD, I’d be fine with them getting paid more.

    Also, I’m betting that the Scrooges demanding these pay cuts were the same ones going around in (bootleg) NYFD hats after 9/11.

    Never again!

  45. Steve Sailer Says:

    I gather from the photo that Matt’s plan for improving public school test scores is to alter student demographics to be similar to Finland’s.

    You know, that just might work …

  46. Joe Says:

    hey Joe, is the time you spend posting here part of your 40 hours a week?

    No.

  47. steve duncan Says:

    “I gather from the photo that Matt’s plan for improving public school test scores is to alter student demographics to be similar to Finland’s.”
    ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
    If nothing else it would render the schoolyard taunt “You’re acting white” an utterly incongruous slander.

  48. DCreader Says:

    Look, the whole point of a union is to drive wages above the market rate. Public sector unions, being as they are the monopoly labor providers to monopoly institutions (there’s little private sector competition in the services the gov’t provides) are able to capture an even bigger share than their private sector counterparts. If private sector unions drive too hard a bargain they bankrupt their companies. Public sector unions face no such constraint.

    As a result, voters who might be willing to pay higher taxes in exchange for better public services become less willing to do so because they fear their money will simply be expropriated by the unions. I don’t know how big a factor this is, but given the fact that public sector unions are major Democratic supporters I thought the idea that they might also be major stumbling blocks to progressive goals was an interesting one.

  49. steve duncan Says:

    “As a result, voters who might be willing to pay higher taxes in exchange for better public services become less willing to do so because they fear their money will simply be expropriated by the unions.”
    ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
    Wait, are you saying that all these years I thought public sector employees were earning a good wage I was mistaken?! The damned unions were keeping the pay differential between the public and private pay scale for themselves! OMG!!!

  50. DCreader Says:

    Stephan said:

    And this is bad why? Do you think she’d be a better, more motivated and committed teacher if she was paid less and had to spend her time and energy worrying about her retirement instead of focusing on your children’s education? Do poorer, more economically insecure teachers produce smarter, more motivated students?

    Would she be even more motivated and committed at $1 million a year? Probably. Would that be a good use of scarce resources? Probably not. We don’t produce “smarter, more motivated students” merely by paying individual teachers as much as possible. There are other educational inputs. Those other inputs are short-changed when we have to over-pay for some teachers. Even worse, voters become less willing to tax themselves to pay for public services because they get less “bang for the buck” due to the unions.

  51. DCreader Says:

    Stefan said:

    Actually, that’s exactly the opposite. Wages experience either upwards or downwards pressure, and if teachers, police and firemen are well compensated, then private sector employers in your region will eventually have to increase their wages as well in order to attract and retain qualified employees. If their salaries were to go down, on the other hand, then there’d be less incentive for your employer to pay you anymore because there’d be less competition.

    So if we paid all public sector workers $1 million/year then pretty soon we’d _all_ make $1 million/year? Of course not. We live in a world of finite resources. Paying public sector workers more than a market wage means public goods are more expensive and we can afford less of them. Less education for our kids, less safety on our streets.

    As for the effect of public sector wages on private sector wages, the public sector raises wages only by increasing the demand for labor and this bidding up wage rates. Employing the same number of people but paying them 10x as much doesn’t do anything but increase competition for those plum public sector jobs.

  52. vanya Says:

    We have a smaller proportion of our population graduating from college than do some other countries, and we’re making no progress

    Good. Hopefully the proportion will continue to decrease. Can we please drop the notion that universal college education is a panacea? For most “students”, college is just 4 years of partying with a degree at the end. You really should not require a college degree to become an accountant, a shop owner or a mechanic. Or even a journalist. We really should be providing more vocational and technical education, not wasting resources on degrees.

    Also, Greater Boston’s inadequate mass transit system is no more inadequate than Metro NY. Just demonstrating once again that MY was one of those Harvard dicks who never left Cambridge.

  53. Fred Says:

    “We live in a world of finite resources. Paying public sector workers more than a market wage means public goods are more expensive and we can afford less of them. Less education for our kids, less safety on our streets.”

    DC Reader wins the thread.

  54. Glaivester Says:

    Education is not going to improve markedly. Millions of children have parents that believe in Intelligent Design or Creationism.

    Which matters how, in terms of educational achievement?

    I hate to break it to you, but whether a person believes in evolution, theistic evolution, intelligent design, creationism, the flying spaghetti monster, that the earth was born of a giant egg, etc., has no practical effect on their life for 95%+ people.

    Even most biologists don’t really do anything where macroevolutionary theory actually plays a large practical role in their work.

    In fact, the only evolutionary theory that really effects our educational system in any way is the bizarre belief that human evolution stopped dead around 100,000 to 10,000 years ago, so that there are aboslutely no biological differenes of import between different groups of people from around the world. And the belief that humans are exempt from biological urges and pressures, and that everything that people do that distinguishes one group (sexual, ethnic, etc.) from one another is socially constructed.

    And of course, the corollary belief that if we just try, really, really, hard, we can reconstruct everyone into bourgeois egalitarians.

  55. Demosthenes Says:

    So if we paid all public sector workers $1 million/year then pretty soon we’d _all_ make $1 million/year? Of course not. We live in a world of finite resources. Paying public sector workers more than a market wage means public goods are more expensive and we can afford less of them. Less education for our kids, less safety on our streets.

    As for the effect of public sector wages on private sector wages, the public sector raises wages only by increasing the demand for labor and this bidding up wage rates. Employing the same number of people but paying them 10x as much doesn’t do anything but increase competition for those plum public sector jobs.

    You must be joking.

    If public sector wages fall, you aren’t necessarily going to see much personal benefit, because the cut taxes won’t make up for the lack of services. And you definitely won’t see more teachers or firemen or whatnot, since the government might (and probably will) choose to plow that money into tax cuts, or high-priced consultants, or another sports stadium, or a higher mayoral salary, or any number of other things taht aren’t teachers and/or firemen.

    And, yes, a raise in their salary will raise equivalent salaries, within certain logical limits. If public sector wages rise, they’ll become more desirable compared to private sector jobs. If there’s enough elasticity in wages among employers in that sector, that’ll mean that wages rise, since they do need to keep up productivity. They’ll just cut other things.

    (Executive compensation comes to mind.)

    Stefan was right: you don’t get rich by beggaring your neighbour, because the guys that manage both of you will be happy beggaring you both.

  56. wiley Says:

    Pay cops less, and see what you get.

  57. PQuincy Says:

    zyxw’s mode of argumentation unfortunately resembles that too often seen on the right (though I’m not accusing zyxw of this, and s/he’s much more reasonable than they are, fortunately).

    @ post 12, he complained about his daughter’s chorus teacher making too much, having too good working conditions, and being immune from firing.

    A number of posters pointed out that $76000 in NYC is not a lot of money, especially for a skilled professional at her peak earning years.

    So, at post 21, he retrenches. It’s actually not the salary and working conditions s/he laments (though these were at the top of the list in post 12: it’s the lack of accountability.

    Again, a number of posters doubt whether job security is really that big a deal, and zyxw, to his credit, changes his argument again: the problem is that too many teachers can’t afford to live in his town.

    Don’t post a complaint about teacher’s wages if you actually don’t think they are the problem!

    Meanwhile, DCReader chimes in, claiming that it’s all well and good to talk about competent chorus teachers, but that we have scarce resources, and shouldn’t pay her $1 million a year. WTF? No one was suggesting that. DCReaders implication is that $76K is extravagant too, because we are dealing with ’scarce resources.’

    Funny, we have trillions to spend on weapons systems and overseas adventurism. But teachers for schools are not a good use of ’scarce resources’! Grow a brain, man! The problem with schoolteachers and most other public employees is emphatically not that they are hogging the scarce resources. It is that the United States has been systematically dis-investing in education and other public services for 30 years, ever since Reagan, in favor of a wildly bloated defense establishment (Eisenhower had no idea!), and vast tax giveaways to corporations and wealthy individuals.

  58. Rich McA Says:

    Finally remembered which John K Galbraith book made this point about underinvestment in public goods: The Affluent Society.

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