How much can the American worker shoulder?

by philg

As this entry is being typed, Congress is overriding King Bush II’s veto of the $300 billion farm subsidy bill. All of the money is going to be collected from working Americans and (a little bit) handed out to the poor via food stamps and (a lot) handed out to millionaire farmers. This made me wonder how hard the average American is going to have to work for the next five years. Let’s look at some major items that primarily benefit those who don’t work…

  • $300 billion farm handouts
  • $1.4 trillion($250 billion per year and growing) for Medicare (health care for those over 65)
  • $1.6 trillion ($300 billion per year and growing) for Medicaid (health care for poor Americans)
  • $500 billion, estimated remaining cost of our effort to make Iraq safe for Iraqis (some estimates and comparisons to previous wars)
  • 13 percent of wages for Social Security, includes employer-paid portion (Social Security is billed as a savings program, but it is really pay as we go and depends substantially on taxes from current workers)
  • about 1 percent of wages to pay for all the people in prison (roughly 2 percent of the working age population)

We have approximately 150 million workers in this country. Running the numbers, over the next five years, each of those workers will have to generate more than $25,000 plus 13 percent of wages. An employer of American workers would therefore have to pay at least $5,000 per year per person just to enable that person to pay enough taxes to cover farm subsidies, health care for the old and the poor, and our misadventures in Iraq. Then the employer would have to pay another 14 percent on top of whatever else was being paid to cover Social Security and prisons.

Given that a fairly well educated worker in China can be employed for $5,000 per year, it is tough to understand how the American economy is sustainable unless we believe that our workers are vastly better educated than Chinese workers.

Let’s not forget that the working slobs are soon to be taxed another $1 trillion to bail out real estate and mortgage speculators (higher end of Standard and Poor’s estimate of the ultimate cost to the taxpayer).

The prevailing wisdom at the New York Times (editorial) seems to be that our economic future will be assured if we start selling houses to each other at ever-higher prices. All we need to do to grow our economy is build more and larger houses and sit inside them watching big-screen TVs that we import from Asia, occasionally getting up to drive our imported car to the supermarket to buy more chips and beer, stopping on the way home to fill up with imported oil.

Given all of the burdens that the American worker has to shoulder compared to his counterparts in younger countries, could the truth be a lot more frightening? Might we have to work harder? Study at night instead of watching TV?

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Avidyne loses their biggest client

by philg

Hot on the heels of Governor Deval Patrick trying to destroy the aviation industry in Massachusetts, Avidyne, our only local avionics company, which was founded by an MIT alum, has suffered the loss of their largest customer, Cirrus Design. Route 128 is high tech, but apparently Olathe, Kansas is higher tech. Garmin has sewed up nearly every new certified aircraft design with its G1000 system. A Garmin glass panel is now standard on more or less every plane from the Chinese-built $130,000 Cessna 162 Skycatcher right up through the $4 million light jets. The one big thing that Garmin was missing was synthetic terrain, a featured offered by Microsoft Flight Simulator for $39, in experimental airplanes for $2,000, by Chelton as part of a $90,000 retrofit system and as of a few weeks ago by Garmin as a $10,000 option.

More: Aero-news.net.

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Governor Deval Patrick’s war on the environment

by philg

Governor Deval Patrick’s proposed new aircraft sales tax for Massachusetts has been passed by our House and denied by our Senate. The decision will now rest with a conference committee.

At first glance this would appear simply to be a jobs creation bill for New Hampshire, Connecticut, and Rhode Island, sending airplanes, hangar construction, maintenance, and pilot jobs over the borders. It also looks like a revenue reduction bill since (a) nobody buying a $10 million plane would be dumb enough to base it in Massachusetts and pay the tax, and (b) all of people who would have been employed in the care and feeding of that $10 million plane will now become residents of other states and therefore will stop paying income tax, sales tax, and property tax here in Massachusetts.

A deeper look reveals how destructive this bill will be to the environment. Let’s look at noise first, a common complaint of those who have recently built houses near long-established airports.

Scenario 1: Jet lives in MA. Owner drives to airport, takes off for West Palm Beach, hangs out with rich pals, returns to MA. Jet is tugged into hangar. Takeoffs in MA: 1. Landings in MA: 1.

Scenario 2: Jet and its crew of pilots, flight attendant, and mechanics all live in Nashua, NH and pay taxes up there. Owner drives to his local airport in MA where the plane is waiting for him. He flies to West Palm and back. The jet returns to NH. Takeoffs in MA: 2. Landings in MA: 2. Twice as much noise plus some extra fuel burned for the additional 10 minutes of flight time each way.

Now let’s look at fuel consumed and CO2 emitted.

Joe Average: Joe and his three friends are going to buy a new four-seat airplane for $300,000 and share it. They had planned to keep it at Hanscom Field despite the high fuel prices and expensive hangars. Faced with the new tax, however, they decide that the plane should live in Nashua, NH. The tax savings alone will pay for four years of hangar up there and they only plan to keep the plane for four years before upgrading to something with higher performance to match their increased flying skill. Fuel and maintenance will be cheaper as well. Every time they go flying, however, Joe and his friends will drive an additional 60 miles round-trip to get to the plane and back home.

Generic Company: Despite facing some of the nation’s highest labor costs and most onerous regulations on business, somehow this mid-sized company has managed to hang on in the blighted crack-house dominated town of Springfield, MA. All of their competitors have moved to South Carolina and Kentucky or overseas. Generic has offices and operations in six other states and keeps a 15-year-old jet here at headquarters for when it needs to send teams of people out to meetings (neither Springfield nor any of its other locations are served by commercial airlines). The jet is very noisy by modern standards and also rather thirsty. Generic has been considering upgrading to a quieter airplane that burns half as much fuel, but the payback period would be 5 years because they don’t fly many hours per year. When Deval Patrick’s new tax takes effect, Generic runs the numbers again, concludes that the payback period would now be 8 years, and decides to fly the airplane for 10 minutes to tax-free Connecticut for repainting and new carpet and upholstery. Generic will be inflicting a lot more noise on neighbors with its old jet and burning twice as much fuel as if they had upgraded.

If passed, this tax is going to be remembered as another nail in the coffin of central and western MA. Eastern Massachusetts does okay no matter how incompetent our government. Harvard and MIT have accumulated more than $50 billion dollars in wealth. There are a lot of businesses that need to be near Harvard and MIT. People come up from Manhattan fighting for the chance to pay $10 million for a beach house on Nantucket and then to pay property tax on that house for the rest of their lives. If the City of Cambridge can’t figure out how to teach kids reading and arithmetic for $15,000 per year per kid, Buffy and Chip can be sent to private school.

What have they got going in Worcester and points farther west? Big airports and a tradition of skilled craftsmanship. With Governor Patrick’s new tax, they’ll have to look somewhere other than aviation for new jobs. Maybe they can compete with northern Kentucky for the next Toyota factory…

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Why do black leaders support Barack Obama?

by philg

America’s black leaders have overwhelmingly endorsed Barack Obama for president. Ask Jesse Jackson, Louis Farrakhan, or Reverend Jeremiah Wright, Jr. whom they are going to vote for and it is Obama, Obama, Obama. The question is “Why?”

Ask one of these guys why black Americans aren’t doing better in school, in steering clear of the judicial system, or in finding jobs and they will say that it is white prejudice that is impeding black progress. Rev. Wright said “Fact number one: We’ve got more black men in prison than there are in college. … Fact number two: Racism is how this country was founded and how this country is still run.” (source) The prevailing theory among black leaders seems to be that when a white person sees black skin, he or she will deny the person inside the skin a job, an educational opportunity, a house in a nice neighborhood, etc.

Along comes Barack Obama, inside a skin that he claims is black and that these same leaders claim is black. White people have given this guy good grades in school. White people have hired this guy for high-paying jobs. White people have given this guy millions of their hard-earned dollars to buy his books. Tens of millions of white people have voted for this guy to represent and/or govern them. In his autobiography, he does not mention having to make any special efforts to overcome white prejudice nor does he cite any incidents in which white prejudice had an effect on his educational opportunities, job opportunities, social opportunities, or housing opportunities.

If Barack Obama’s black skin has not held him back, it would seem to discredit these guys’ explanation of what is holding back others in America with black skin. Why then would they recommend voting for the very person whose success is discrediting their logic?

[Note that in December 12, 2007, I predicted in this Weblog that Obama would win the general election.]

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Experience as a teacher turns out to be worthless

by philg

In this study by the Urban Institute, punks freshly graduated from college and paid about $30,000 per year were found to be more effective as schoolteachers than experienced union members who draw $80,000 of taxpayer blood for their 9 months of work each year.

Can it be that experience is worthless? I have taught classes from a pre-existing syllabus using a proven textbook. The very first time that I did the class, I worked a bit harder than I would have in subsequent classes, but probably managed to be 85 percent as effective as I could possibly have been. I have taught classes where I was one of the textbook authors and a designer of the syllabus. In this case, experience teaching was hugely valuable and resulted in massive changes to the syllabus, course structure, and textbook (fortunately online in HTML format and thus easily changed).

If public school teachers don’t write or choose their textbooks, it might not make any sense to pay experienced teachers more than beginners. http://www.cpsd.us/Web/HR/2008CTA_UnitA_Salary.pdf shows the salaries for the Cambridge Public Schools, some of the least effective in Massachusetts as measured by student achievement tests. A 22-year-old with a bachelor’s earns $41,000 for 9 months. A teacher with 11 years in the system would earn $69,000. That 11-year veteran who picked up online master’s and Ph.D. degrees in education would earn $81,500 (presumably there is no evidence to support the theory that a degree from University of Phoenix makes someone a better teacher).

If we wanted to spend the same amount of money every year, maybe it would be smarter simply to pay all teachers the same salary, e.g., $60,000 for 9 months of work. We would thereby attract a more able class of young college graduates and if after 7 years they got sick of the job they wouldn’t be tempted to stay because their salary was due to go up so dramatically.

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