Category Archives: Public Policy and Governance

Right Diagnosis; Wrong Prescription

I know that this blog tends to reiterate certain themes, but we all have our preoccupations. Those who are regular readers will recognize a couple of mine: the importance of “hiring” (electing or appointing) government officials who actually know something about government; and the critical difference between “what should we do?” and “how should we do it?”

The election of Donald Trump and his subsequent choice of cabinet officials has pretty emphatically made the case for my first premise. (There’s a Facebook meme to the effect of “If you think anyone can run  the government, I hope your next colonoscopy is performed by a plumber.”)

My second preoccupation–the difference between “what” and “how”– remains less obvious. I thought of it, however, when I read this column by Catherine Rampell in the Washington Post. As she points out, it’s one thing to correctly diagnose a problem. It’s quite another to devise a remedy that will solve the problem rather than inadvertently making it worse.

By all means, let’s raise the living standards of workers at Amazon, Walmart, McDonald’s and other employers of low-wage Americans.

And, by all means, let’s raise Jeffrey P. Bezos’s taxes, too. The founder of Amazon (and owner of The Post) is the wealthiest man in the world. He didn’t need the tax cut that Republicans just gave people like him.

But the sloppily designed Stop Bad Employers by Zeroing Out Subsidies Act (a.k.a., ahem, the “Stop BEZOS Act”) is a terrible way to do either of these things. It’s virtually guaranteed to hurt the very low-income working families its sponsors want to help.

The bill Rampell is citing addresses an issue that I’ve written about several times: some of the nation’s largest companies (including Amazon) pay their workers so poorly that taxpayers make up the difference with food stamps and other social welfare benefits.. In effect, we are paying a portion of those workers’ wages. Meanwhile, the company’s  “savings” go to shareholders as additional profit.

It’s pretty despicable, and it should stop.

The “Stop Bezos Act” would establish a “corporate welfare tax” on firms with at least 500 employees. Companies would pay a tax equal to 100 percent of the value of safety-net benefits their employees receive, including Medicaid, housing subsidies, food stamps and subsidized school lunches.

That certainly sounds good. As Bernie Sanders, the bill’s sponsor, has said,

The working families and middle class of this country should not have to subsidize the wealthiest people in the United States of America. That’s what a rigged economy is all about.

Agreed. The diagnosis is spot on. The prescription, however, would be a disaster; it would hurt the very people it aims to help, because it would discourage firms from hiring workers suspected of drawing benefits.

These workers come, disproportionately, from some of the most vulnerable populations: families with children, older people and workers with disabilities.

Families with children are much more likely to use food stamps. Older Americans who are poor are much more likely to be on Medicaid. And workers with disabilities would face even more barriers to employment under this bill than they already do.

Under this bill, Medicaid-eligible workers with disabilities or other health issues would become thousands of dollars more expensive. Working-age people over 45, who cost Medicaid about twice as much as their younger counterparts, might face even more discrimination in the job market than they already do.

The bill tries to address these issues by barring employers from asking job candidates about benefits. But firms could easily infer which applicants are more likely to get them, based on their races, genders, Zip codes, etc. Such “statistical discrimination” would be difficult to police.

Moreover, employers get information about dependents and marital status when newly hired workers fill out their HR forms. Guess which workers would be at the top of the list when it’s time to downsize?….

Perhaps worst of all, as the Center on Budget and Policy Priorities points out, the bill would ultimately create a new corporate constituency to push for cuts to social programs and stricter eligibility requirements. Suddenly, reductions to Medicaid or school lunches would be directly equivalent to a corporate tax cut.

This bill would also require new oversight, probably spawn multiple lawsuits alleging discrimination, raise equal protection issues (why treat companies with 500 employees differently than those with 480?) and generate numerous new regulations.

Simply raising the minimum wage would go a long way toward solving the problem without creating perverse incentives or requiring additional bureaucracy.

Stop Bezos is a great soundbite. We should do it. How we should do it, however, matters. A lot.

Comments

Why Politics Matters

Do you know folks who think political decisions don’t affect them? Who think voting is a waste of time? Among all of the other reasons they’re wrong, it turns out that a state’s political environment affects how long its residents live.

That was the astonishing conclusion of a study reported by Inc.The study ranked life expectancy in all 50 states, and came to some truly eye-opening conclusions. Among them: residents of Mississippi have the same life expectancy as residents of Bangladesh.

This truly is a fascinating study, pulling together reams of data to create “the most comprehensive state-by-state health assessment ever undertaken,” according to a press release. (The study itself was published in the Journal of the American Medical Association.) It’s unusual because most big studies examine the United States as a whole, and yet there’s a vast disparity of health and longevity among the states.

The report itself focused primarily on the data, rather than on differences in the public policies of the various states, but the following excerpt from the Discussion section is illuminating on that score.

Mortality reversals in 21 states for adults ages 20 to 55 years are strongly linked to the burden of substance use disorders, cirrhosis, and self-harm, and this study shows that the trends for some of these conditions differ considerably across different states. Case and Deaton have called some of these conditions “deaths of despair” and argued that they are linked to the social and economic status of white US adults.

States differ widely in their support of interventions to curb substance and alcohol abuse, and in the availability of programs addressing those dependencies. As far as the statistics on “self-harm,” the language is guarded, but clear: “self-harm” is suicide, and most people who kill themselves use a gun.

The availability of guns is a huge public health issue, and medical and public-health professionals have been arguing for a public health approach to gun violence more  forcefully in recent years. The American Public Health Association and the American Medical Association have both issued statements calling gun violence a public-health problem, and advocating more research. (The “Dickey Amendment,” passed by Congress in 1996, effectively prohibited the CDC from even studying the issue.)

The larger “take away” from the data is economic. States where the percentages of low-income Americans are highest have higher incidences of alcoholism, drug abuse and suicide. It shouldn’t come as a shock that Mississippi, where citizens have poor health outcomes also has an economy that ranks in the bottom of American states.

The environment also plays a part: states that do a better job of controlling hazards like lead and coal ash, for example, reduce illnesses and deaths from avoidable environmental pollutants.

All of these influences on lifespan–the economic health of a state, the efficacy of local environmental protection, the easy availability of guns–are direct outcomes of the  public policies supported by state and local lawmakers. (It will not shock anyone who follows these issues that the states with the worst outcomes tend to be reliably Republican.)

If the disaster that is Donald Trump hasn’t brought home the importance of voting, perhaps explaining to the disengaged that local political policies have a demonstrable effect on our lifespans and those of our families and friends will do the trick.

Comments

About That Umpire Analogy…

In the charade labeled “hearings” on Brett Kavanaugh’s nomination to the Supreme Court, we have once again been treated to the facile comparison of judging and “umpiring,” first used to great effect by now-Chief Justice John Roberts.

There has been plenty to criticize about these hearings, even if the unconscionable and un-American treatment of Merrick Garland isn’t still sticking in your craw. Like so much of federal governance, which has abandoned even the pretense of concern for the common good, the process of selecting a Supreme Court Justice has devolved from a consideration of the candidate’s character and qualifications into a battle for partisan dominance.

Even before the late-breaking allegations that he tried to rape a young woman while in high school–allegations that appear more credible by the day (why else would Senator Grassley have previously secured and pocketed that letter by 65 women saying Kavanaugh was a nice guy), and considerable evidence that he had perjured himself during his prior confirmation hearings, Kavanaugh had emerged as a (very accomplished, clearly intelligent) partisan hack.

We shouldn’t be surprised by either the extreme partisanship or the lack of candor; that’s why he was nominated.

His unwillingness to really engage Senators’ questions, and his pat (non)responses have been par for the course, as the process has become more superficial over the years. The “umpire” analogy is of a piece with the smug responses we’ve come to expect, but my cousin–a doctor with a blog of his own that I quote from time to time–had a perfect reaction to that bit of sophistry:

I usually devote time to exposing health frauds and quackery. But now, I can’t resist bigger prey, namely the U.S. Supreme Court. Recently candidate judge Brett Kavanaugh stated that he likened his Judicial position to that of an “umpire,” an opinion previously attributed also to Chief Justice Roberts during his early hearings in 2005. This assertion, while seeming to express purity and impartiality, is patently false!Why? Because we can first use the example of a real umpire, who works individually in a baseball game and makes binary decisions such as “safe” or “out.” Although usually easily decided, borderline decisions can be resolved by instant video replay, again observed by a single person, usually the umpire himself.

Now let’s extend this analogy to the supreme court: Using the baseball analogy, we place nine justices, or “umpires,” near first base, in order to judge outcomes. A ground ball results in a close call at this base, and our justices then, after thorough discussion, decide that, by a vote of 5 to 4, the runner is out. But the minority of 4 think, possibly correctly, that he is safe. Sound ridiculous? It is!

Here is what makes this scenario so ridiculous. Out of necessity, judges make complex decisions that are subjective, vulnerable to individual bias, education and background, usually require more than one person, and are subject to later reversal by other courts or, in the case of the Supreme Court, even the same court in later years. Examples of reversals are manifold and include such issues as legitimacy of slavery, equal access to public restaurants and schools, etc., etc. Does that description sound even remotely like an umpire? I think not!

I’d say that’s an excellent diagnosis!

Comments

Are Humans Just Self-Destructive?

Another hurricane is bearing down on the east coast; it’s projected to make landfall in the Carolinas, and to wreak havoc–massive rainfall, flooding–in Virginia and inland.

There are people in Puerto Rico still without power, and the island is still dealing with the aftermath of their hurricane. For that matter, Houston hasn’t completely recovered from Hurricane Harvey.

Only the determinedly ignorant continue to insist that these and other disasters are unrelated to climate change. As we’ve been repeatedly warned by scientists (you know–those elitists who actually know stuff), hurricanes gain strength over the warmer oceans that climate change has produced. Meanwhile, our determinedly ignorant President continues to relax environmental rules; most recently, rules limiting methane emissions.

Vox recently considered the insanity of America’s refusal to face facts. Environmental measures are not only necessary for the planet, they would save money. A lot of money.

$26 trillion by 2030.

That, according to the most authoritative research to date, is the amount of money humanity could save through a global shift to sustainable development.

It’s a lot of money. Before you break your brain trying to imagine it, just pause to make a note that it’s a positive sum (uh, extremelypositive), not negative. Net savings, not costs.

That might come as a surprise since decades of conservative and fossil fuel propaganda have made it conventional wisdom that cleaning up our act is expensive — that it costs more than the status quo. It is the argument hauled out against every single pollution regulation.

As the article points out, that argument has always been overstated, but these days, it’s demonstrably, massively wrong. The costs of fossil fuel extraction and pollution have gotten higher and the costs of clean energy have plunged–making it far less expensive to do the right thing than to continue pandering to uber-wealthy oil and gas interests. (Coal is already effectively dead–killed not by “guvment” regulations, but by the market.)

Arguments about the higher costs of clean energy have been less than honest for quite some time,

But these days, it has gotten almost impossible to make sustainability look like a bad deal.

Two forces are acting as a pincer, making the decision more and more obvious.

First, the future damages of climate change are coming into clearer focus, and, more to the point, the damages have arrived, here in the present, in brutal fashion.

And second, the costs of sustainable technologies and practices (e.g., solar panels) have fallen at a dizzying rate in recent years, especially in the energy sector.

The article (which is lengthy) goes on to provide the data that supports the point, complete with charts, citations to research and quotations from heads of state, including former (real President) Obama. I encourage you to click through and evaluate the evidence.
In my opinion, the article’s single most telling point was this acknowledgment of the central challenge we face.

For all their numbers, models, and charts, it’s the one thing reports like this can never tell us: how to conjure leadership and political will — how to induce business and political leaders to cooperate for mutual long-term benefit in spite of short-term differences.

But that’s just the basic human moral project, isn’t it? It’s the central dilemma of our nature and our history: how to cooperate across tribal lines, how to construct systems that bind and benefit widening circles of people. If we knew how to accelerate that process, we’d probably be doing it! Or rather, we are accelerating the process, as best we can, but it remains frustratingly slow.

Residents and visitors are currently evacuating the Carolinas. As they drive out–bumper to bumper, according to friends caught up in this particular event–we and they might think seriously about a world in which such evacuations become routine, at least until rising sea levels take back those beaches we like to visit.

Comments

French Lessons

France has a growing middle class. The United States has a shrinking middle class.

I realize that Americans are reluctant to learn from other countries (most prominent example: healthcare, where we insist on spending twice as much for much poorer results, because hey! we’re Amurica and we know best about everything…), but we really could learn a lot if we were so inclined.

According to the Washington Spectator (link unavailable), America’s middle class has dropped from 60% of all households in the 1980s to 50% in the mid 2010s. Meanwhile, the French middle class rose from 60% to 68%.

The poverty rate for U.S. children in two-parent families in 2010 was 13.7%; in France, it was 8.2%. (That was for children in two-parent families. For all American children, the child poverty rate is 21%; in France, it is 5.7%. As the Spectator points out, the damaging effects of growing up poor are well-documented and socially undesirable.

Why the difference? What does France do right that we don’t?

Although the article fails to mention it, that health care system I referenced is a huge asset to French families, especially families with children. Just knowing that an unexpected illness won’t wipe you out is a big stress reliever, as is the knowledge that you can take a sick child to the doctor without the visit making you late with the rent.

Although the article doesn’t mention health care, it does focus on three other aspects of French social policy that are very different from ours, and that the author finds particularly important: paid parental leave, affordable child care and the French tax system.

In France, paid family leave replaces 100% of the average wages earned by women in the three months following birth or adoption. Eight weeks of paid leave are mandatory, although many businesses offer more. The U.S., in contrast, is the only developed nation that does not have a national paid leave program; as a result, some 25% of new mothers return to work within ten days of giving birth. (It hurts even to type that statistic; I remember how long it took me to feel up to par after childbirth!)

The French child-care system is even more impressive to someone like me, who struggled to find adequate childcare despite having the financial wherewithal to pay for it. France has creches–childcare centers for infants and toddlers under 3–and part-time centers that operate both before and after school. There are other centers that open on days when school is out, and during summer vacations. And all of them are subsidized by the French government. The cost to a family is approximately $1.25 per hour per child.

In the U.S., the after-tax cost of childcare is equal to 38% of average U.S. wages, one of the things that makes parenting an expensive proposition and is a disincentive to women with children entering the workforce.

Finally, French families with children are taxed at a lower rate than families without children. The disparity in tax rates, the maternal leave policy and the generous subsidies for comprehensive child care are all justified by the French belief that children are an investment in the future of the nation.

Clearly,  American policymakers don’t see it that way.

Comments