Those who dismiss the concept of scarcity often embrace an attitude of “if there’s a will, there’s a way”. Americans are steeped in this way of thinking: You can do it! Don’t let the doubters hold you back!
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Politics and Economics
In Part I of this series (What is Affordable Childcare and Whose Childcare Should Be Subsidized?), I concluded the federal government should fully subsidize childcare for low-income families and partly subsidize the childcare of middle-income families…The cost of my proposal? Just four billion a year (or thereabouts). Here are the numbers…
Note that my hypothetical family with a take-home income of $5,000 a month can barely save anything for emergencies, retirement or the kids’ education after high school. Their budget would still be tight if they paid just 7% of their income on childcare, but at least they wouldn’t be teetering on the brink. Now consider parents with net incomes of just $2000 a month….
No surprise here: the smaller the metro and nonmetro population group, the more likely offenses will be cleared by arrest, especially for property crimes, although once again the countryside doesn’t quite follow the pattern.
Republicans often assert that cities run by Democrats are more crime-ridden than those run by Republicans. Democrats often counter there’s no evidence of that. Neither side presents evidence one way or another, other than the anecdotal sort. So I decided to look into the matter myself, using cities with Republican mayors as a proxy for cities that are not dominated by Democrats or progressives. My sample included all the cities with Republican mayors on Wikipedia’s list of mayors of the 50 largest cities in the US, of which there were ten with Republican mayors. I also chose ten cities with Democratic mayors from Wikipedia’s list and then looked up the Major Cities Chiefs Association (MCCA) 2019-2020 figures for homicide and aggravated assault crime rates, et voila!. Here is what I found…
I suspect more crimes will have gone unreported in 2020 (a year of strong anti-police sentiment), but those numbers aren’t in yet. As for why victims don’t report crimes, the most common one is that they dealt with the matter another way. Other reasons include: didn’t consider it important enough to report; police wouldn’t or couldn’t help anyway; fear of reprisal; and not wanting to get the offender in trouble. Here’s how the relative importance of those reasons breaks down by urban, suburban, and rural place of residence…
US crime rates appear to have dropped back to levels last seen in the 60s and 70s. But that doesn’t mean crime is no longer a serious problem in this country. Crime was too high fifty years ago and it remains too high now. As the above charts show, the decades-long surge in violence and property crimes began in the 1960s. And Americans were mad as hell about it. By the end of that decade, “law and order" had become a hot-button political theme and effective campaign slogan.
How the Most Progressive Countries Fund Their Welfare States, Part II: Just About Everyone Helps Out
Of course, the sticker tax rate may not be the effective rate - what the taxpayer actually pays. Either way, the tax burden of the middle-class is rather large in the Top Ten “most progressive” countries, mostly due to their high income and consumption taxes. And that’s not necessarily a bad thing.
I’m more interested in the nuts and bolts of governing than in expressions of political sentiment. I don’t care if someone has the right values or cares about the right things. Give me specific goals and policy proposals. Want to eliminate poverty, hunger, homelessness, etc? Great! What’s the plan? And how are you going to pay for it?
I’m not sure that paying more than 30% of one’s income on housing necessarily means one is suffering financial hardship. That 30% threshold came from the early 1960s when Americans spent almost a quarter of their monthly expenditures on food. Today we spend half as much on food, so shouldn’t we be able to spend more on housing? Spending no more than 30% of one’s income on housing may still be ideal for most low-income households but many better-off households could afford to pay more, especially households in the upper-half of the income distribution.
Some employers are able to absorb minimum wage increases by increasing labor productivity - producing more output per worker. However, this isn’t possible in the childcare business, due to mandated staff-child ratios, which vary somewhat across states. So with large minimum wage increases, employers have little choice but to pass on the extra cost to the consumer, typically parents or government agencies. According to one estimate, a $15 minimum wage for childcare workers would increase US childcare costs by an average of 21 percent —an extra $310 per month for two children. But in some states the increase would be much higher, over $500 a month for two children.
Of course the minimum wage should be increased, but there is no justification for a one-size fits all approach. It makes more sense to yoke a state’s minimum wage to its median wage, at least for the initial reset, and then adjust annually for inflation. The minimum wage in developed countries is often between half and two-thirds of the median wage. For instance, minimum wage to median wage is 54% in Australia, 55% in the United Kingdom, and 63% in South Korea. For the US, I’m thinking a minimum wage of around 60% of each state’s median wage would be reasonable, rounded up to nearest dollar and with a few constraints, such as the new state minimum wage would not be less than the current one. Here’s what such a system might look like…
President Biden recently unveiled his plan to spend $109 billion over 10 years to make community college tuition-free. Biden also wants to increase the maximum Pell grant to $8,295 for the 2021-22 school year. The President’s proposals would certainly ease the financial strains of attending public community colleges, especially for low-income students who are most likely to qualify for the maximum Pell grants.
The Headlines:
“Almost 6 in 10 support Biden's American Families Plan: poll” by Dominick Mastrangelo/ The Hill. May 5, 2021
“Biden’s $1.8 Trillion American Families Plan Is Supported by Nearly 60% of Voters” by Claire Williams/Morning Consult. May 5, 2021
Housing wonks describe individuals who pay more than 30% of their income on housing as “cost-burdened”. So, who are these people, where do they live, and why can’t they find affordable housing?
As for Biden’s infrastructure plan, 59% of those surveyed in the NBC poll thought it was a good idea, 21% disagreed, and 19% had no opinion. Which got me thinking: what is it about the infrastructure plan that these people think is a good idea (or not)? Biden’s infrastructure plan is immense and involves dozens of large-scale projects, including …
The committee backed up their recommendations with results from a survey they had conducted of students and staff. The majority of people surveyed supported the position of School Resource Officer (SRO) , including 72% of Black students, 73% of Latino students, 77% of Asian students, and 62% of white students. White staff members were the most critical of the SRO role, with 54% opposing the position. No teachers and fewer than 6% of students found the SRO “hostile or mistrustful of kids.”
Ideologies are typically inspired by utopian visions entailing a radical overhaul of the existing order - what I call the Big Solution. Problems like intrusive government, poverty, and environmental harm may drive initial attraction to a Big Solution, but in time the relationship between problem and solution changes. That is, where once the Big Solution was seen as a means to fixing problems, it eventually becomes an end in itself - one that requires Big Problems to justify. That’s because Big Solutions typically involve painful sacrifice (the darkness before the dawn). And that pain had better be worth it!
The US federal debt exploded last year. Between a battered economy and trillions in stimulus spending, it will take years to shrink the debt back to a manageable size. In the meantime, the Bold Centrist still wants to fix this country, focusing on six problem areas: healthcare, infrastructure, poverty, social mobility, housing, and threats to the biosphere. The challenge is how to fund the repair job without adding to the public debt or zapping economic growth.
That’s the problem on the micro-level: unhappy and struggling individuals and families. On the macro-level, we have a mismatch between worker skills and employer needs, which has led to chronic labor shortages - especially in the better-paying fields… These shortages not only hurt the company’s bottom line, they undermine labor productivity and economic growth. And the problem’s only going to get worse in the decades to come unless this country comes up with better ways to help people update their skills as needed to meet ever-changing employer demand.
Lifelong learning on a mass scale is in order.