How to tell right from wrong... It ain't easy!

Do your kids think there are “moral facts”?  Are there circumstances where it is okay to lie, cheat or steal?

Philosopher and college professor Justin McBrayer concerns himself with such questions and was upset enough about what his second grader is being taught in school to air his opinion in the NY Times.  He discovered that the common core curriculum, by its definitions of fact vs. opinion, teaches our children that values (or value claims as he describes them) are not facts.  They are opinions.  

Connecting the lessons his son is being taught in the second grade to cheating on college campuses, he observes “that the overwhelming majority of college freshmen in their classrooms view moral claims as mere opinions that are not true or are true only relative to a culture.”

I sent the article to my brother who is a bit closer to this issue than I.  He has worked on education issues with Georgia’s state government and his wife spent her career teaching grammar school.  He expressed amazement that “parents of grade school children extend small things into the cause of the world’s problems.”

He’s probably right.  But, there was something about Professor McBrayer’s argument that stuck in my head.  Then, it came to me. What’s missing in his essay is any mention of a social contract, an implicit agreement among members of society who embrace a common set of values. “All Men Are Created Equal”, for example, is part of a value system that forms the basis of a social contract.  In a literal sense, it is not a fact. Some people are created smarter or stronger or prettier.  However, the statement — which is really meant to convey “All Men Have Equal Rights” — drives legislation and government enforcement of equal opportunity laws.  That is part of the social contract that we accept prima facie.

I agree with Professor McBrayer that it’s appropriate to separate mere opinions from value statements.  "Copying homework assignments is wrong" is a statement of our values and a good lesson to teach our children.

However, children’s values are learned more in their activities and day-to-day experiences than in classrooms.  Kid’s taught to play golf are charged with scoring and adhering to the rules.  There are valuable lessons in this activity that have nothing to do with fact vs. opinion.  They have to do with personal responsibility and how we treat others.  It’s a social contract of a sort.  

Another example of how children learn comes from comparing parents’ behavior to what they say.  You can tell your kid that it’s wrong to lie.  But, they learn that lying is part of the fabric of society.  If Mom tells someone how nice he or she looks and then tells Dad how awful that person looks, the kid learns that - at least in that situation - it’s okay to lie.  Ultimately, they figure out that an overwhelming number of people cheat on their taxes or steal office supplies from their employers.

Teaching kids not to lie, cheat or steal is important.  And, Professor McBrayer is right when he says, “consistency demands that we acknowledge the existence of moral facts.”

However, in a world where the social contract is constantly evolving, distinguishing fact from opinion is an important skill.  People’s values go well beyond clear rules about what is right and what is wrong and our perspective is constantly changing. Witness the change in people’s attitudes about gay marriage, for example. 

Moreover, I contend that many “moral claims” are relative to culture.   In a complex global community, moral relativism is required to address society’s larger issues.  

In politics… How much should we tax the rich to provide for the poor?

In medicine… Should we administer an experimental drug to a critically ill patient?

In business… Are we treating our customers ethically?

In foreign affairs… When should we send troops to defend another nation?

In a post a few years ago (From Deadly Sin to Virtue), I quoted Barry Schwartz, a Swarthmore professor and co-author of “Practical Wisdom:  the Right Way to Do the Right Thing”.  He compares finding what’s right to jazz improvisation.  The notes are on the page but the musicians play a variation that results in beautiful music.

In American society, our response to people and institutions that are unprincipled is to create rules to govern their behavior.  But, that doesn’t work.  What we need, Schwartz asserts, is the moralwill to do the right thing and the skill to figure out what that is.

Let’s figure out how to teach that lesson to our children.

WHO WILL LEAD?

It’s Time to Replace Our Universities with…

The Madison Convention Center

Would you send your kid to a university that looks like this?  To be clear, you are looking at a picture of the convention center in Madison, WI.

Before you answer, I ask you to consider a few macroeconomic and social factors. 

A colleague in the educational publishing field recently told me that “point-in-time” certification is “dead”.  That’s the word he used – dead!  Education and the certifications or degrees that go along with it will be a lifelong endeavor, he contends.  Here’s an easy example.

How valuable is your four-year degree in computer science if you earned it in 1975?  How about 1985?  Or 1995?

2005? 

A technical degree whether in computer science, medicine or metallurgy requires constant updating to be relevant in the modern workplace.  So, what is the value of a four-year degree?

I have written about the near obsolescence of a four-year degree before.  In “Don’t Send Your Kid to College”, I advocated that parents and matriculating students demand they get an education that provides them with the skills that are essential to today’s job market. 

Of course, there is a broader perspective.  My four-year degree in Naval Engineering was quite relevant when I served as Chief Engineer of a US Navy ship.  Since then?  Not so much.

Is your education relevant to your work?

Does it need to be?

Wisconsin governor Scott Walker placed this issue front and center a few weeks ago when he proposed a $300 Million cut to the budget of the University of Wisconsin system.  Not satisfied to leave it at that, he also proposed (and later withdrew) a change to the 110 year-old mission statement, replacing a phrase about the “search for truth” with language requiring that the system meet the “state’s workforce needs”.  The governor is something of a lightening rod. So, I would ask you to set your political views aside for the moment and consider…

The college experience is more than a job-training program.  When I studied engineering, I was also required to take courses in political science, history and literature.  In those days, the ideal was expressed as producing a “well-rounded individual”. 

Following Gov. Walker’s pronouncements, Christine Evans, a history professor at University of Wisconsin-Milwaukee, wrote passionately about the “Wisconsin Idea” in the New York Times.  “As my students understand,” she wrote, “the humanities train critical thinkers and citizens. That may be inconvenient for politicians who see their constituents as merely a ‘work force,’ but it is definitely good for our democracy…”

In my private correspondence with Professor Evans, she expresses concern that “Faculty control of universities has also increasingly given way to [a] ‘CEO’ model for higher education that means VERY highly paid administrators make decisions without concern for universities' core missions or much of a sense of what we do or why.”  She goes on to bemoan “our legislature now demands vast reams of new paperwork so they can be sure we are ‘accountable.’” 

These criticisms ring true to me.  CEO’s drive revenue.  Their training is well suited to improve the bottom line but not necessarily the best educational outcomes.  And, I can’t see how the legislature adds any value by requiring more red tape. 

In a larger context, however, I wonder how we as a society can sustain the system. Universities raise large endowments to build gyms, libraries and dormitories, the better to attract new students. And so the cost of a college education has increased by nearly 500% since 1985. And, we all know what student loan debt is doing to young graduates. 

Meanwhile, kids who go away to college can attend courses online from their dorm rooms, all of the books in those expensive libraries are available online and 70% of classes are taught by adjunct professors, most of whom earn less than $50K per year. In other words, we are paying to maintain overhead -- facilities and faculty -- designed for a bygone era.  Why not use a smaller platform like a convention center where students attend classes online and take turns being on campus for one or two weeks per semester?

There’s more to the college experience than classes, libraries and professors, of course.  Many in my generation wax poetic when talking about their college years – the lasting relationships, the broadening of their perspectives, the chance to break away from Mom and Dad.

So, I’ll ask my opening question again, only slightly differently.  Do we, as a society, need to maintain a system that is now so expensive that fewer middle class families can afford it?  Or, can we gain the same advantage by replacing the high overhead infrastructure of our universities with a new model?

WHO WILL LEAD?

Robert Reich, the corporate income tax and the middle class

Robert Reich

I enjoy the writings of Robert Reich despite his liberal leanings.  He is intelligent and articulate and, most importantly, not dogmatic.  On his Facebook page last week he voiced his support for President Obama’s one time tax on the overseas profits of American corporations to rebuild America’s infrastructure.  In a 2 minute video he laid out his case that American corporations enjoy the protections of American trade policies without the penalty of being taxed. 

I immediately thought this was at odds with his prescription for corporate taxes in his 2009 book, Supercapitalism and the Transformation of Business, Democracyand Everyday Life.  But is it?

Then he argued that corporations should not be treated as people and that such treatment distorts their effect on government policy.  This is from page 218…

“The result of this anthropomorphic [treatment of corporations] is to give companies duties and rights that properly belong to people instead. This blurs the boundary between capitalism and democracy, and leads to a host of bad public policies. Consider, for example, the corporate income tax. The public has the false impression that corporations pay it, and therefore they should be entitled to participate in the democratic process under the old adage “no taxation without representation.” But only people pay taxes. In reality, the corporate income tax is paid—indirectly—by the company’s consumers, shareholders, and employees. Studies have attempted to determine exactly how the tax is allocated among these three groups, but the distribution remains unclear. What is clear is the corporate income tax is inefficient and inequitable.

“It’s inefficient because interest payments made by corporations on their debt are deductible from their corporate income tax while dividend payments are not. This creates an incentive for companies to over rely on debt financing relative to shareholder equity, and to retain earnings rather than distribute them as dividends. The result, in recent years, has been for many corporations to accumulate large amounts of money that the company then uses to purchase other companies or to buy back its shares of stock. Capital markets would be more efficient if these accumulated profits were redistributed to shareholders as dividends. “Decisions by millions of shareholders about how and when to reinvest these funds are likely to be, as a whole, wiser than decisions made by a relatively small number of corporate executives. Abolishing the corporate income tax would thus help capital markets work better.

“The corporate income tax is inequitable in that retained earnings representing the portion held by lower-income investors are taxed at a corporate rate that’s often higher than the rate they pay on their other income, while earnings representing the holdings of higher income shareholders are taxed at a corporate rate often lower than they pay on the rest of their income. As we have seen, under Supercapitalism, investors have far more power than they did decades ago. Their decisions about where to put their money to maximize their returns are similar to any other decisions they make about how to increase their earnings. Logically, there is no reason why their ‘corporate’ earnings should be taxed differently than their other earnings. Abolishing the corporate income tax and treating all corporate income as the personal income of shareholders would rectify this anomaly.”

To be fair, the two comments are taken out of context and provide Dr. Reich’s answer to two different questions.  In his book, he is advocating a policy that would favor the middle class by lowering the tax burden of owning corporate stock and mutual funds, cause corporations to be smarter about how they invest their capital, reduce corporate lobbying in Congress and create jobs in America rather than overseas.  His Facebook comments are made in the narrower context of the budget proposal submitted by the President to Congress earlier this month. 

His argument that American corporations enjoy the benefits of US trade policies is somewhat suspect, however.  Those policies are more favorable to our trading partners than to American corporations. 

Enacted in 1994, the World Trade Organization (WTO) has enabled emerging economies to participate in free trade with the industrialized world and has helped to alleviate poverty in those countries.  The rapid expansion of the global economy is among its myriad benefits.

However, the WTO puts every nation and every corporation on an equal footing and precludes the US from taking direct action to pressure trading partners to eliminate barriers to US exports and other unfair practices. Under this regime, American corporations do well to invest overseas.

If we want to help the middle class, lets address the underlying causes of their distress.  Overhaul of tax and trade policies is a good place to start.

WHO WILL LEAD?

F.I.C.A., Inflation and the Middle Class Squeeze

“What’s this F.I.C.A.?” said my son.  He was home from college (in 1992) and was deconstructing his first pay stub from his summer work at a local nursery.  F.I.C.A., which everyone knows is the payroll tax that feeds the Social Security and Medicare trust funds, was larger than any deduction on the stub.  Such are the travails of a 19-year-old working for minimum wage.

The tax is very regressive.  It penalizes low wage earners more than high wage earners as it takes 7.5% of every dollar earned up to $117,000 each year.   It’s only one of the ways in which middle class taxpayers are hurt more than those at the top and bottom.

The poor receive government benefits in the form of the Earned Income Tax Credit, Medicaid, Section 8 housing and food stamps to keep them afloat.  By the time your earnings get to around $35,000 annually, most of that is phased out.

At the top, the wealthy can lower their tax bill though a variety of credits and deductions associated with owning assets, like stocks and real estate.  Those factors typically don’t help the middle class as much.

The middle class squeeze is about more than just taxes though.  It’s about inflation.

We keep hearing that inflation is under control.  And, the numbers don’t lie.  Overall inflation has been running well below the Federal Reserve’s target of 2% for years now.  However, as the cost of manufactured goods has been going down, the cost of essential services has gone up a lot!  Here’s a chart from the liberal think tank Center for American Progress (CAP) that illustrates the problem very well:

Which of these services can you forgo?

Meanwhile incomes are dropping in real terms.  This chart compiled by Mother Jones using data from the US Census Bureau shows the trend going back to 1967 and indicates that 2012 median income is about the same as it was in 1989.

Politicians on the left and right are now talking about the middle class and I suppose that’s good. But, what are the solutions they propose?  It may be too soon to tell how the President and his Republican opponents in Congress will define the battleground.  However, it’s easy to predict that it will be more of the same standoff.

CAP proposes a long list of solutions reminiscent of the 1960’s before globalization and automation stripped good paying factory jobs out of the US economy. These include raising the minimum wage, strengthening unions, improving education, reforming healthcare and realigning factors leading to more equitable home ownership.  

Will a return to the policies of the Great Society work in the 21^st Century?

For their part, Republicans haven’t come up with a viable alternative – or any alternative other than lowering taxes and reducing the deficit.  Both are attractive but unlikely to trickle down to the middle class. 

But, if these policies won’ t work, what will?

It’s hard to know for sure.  However, I would favor those that provide opportunity through programs that would likely defy the dogma of both the left and the right. We can encourage the growth of high paying, blue-collar jobs in industries like energy and manufacturing through deregulation and subsidies. We can reform the tax code so that the burden falls less on employers and employees than on those who profit from asset appreciation.  And, rather than imposing huge tuition costs on those who might graduate without needed skills, we could provide support for technical skills demanded by the market. 

Moreover, capitalists – those who believe in a society built on opportunity rather than welfare – must find a way to ensure that the middle class can share in the benefits of our system.

WHO WILL LEAD?