Just the Facts

The fact is that there is no shortage of science, technology, engineering, and math workers in the United States, as Michael S. Teitelbaum points out in his article in The Atlantic:

A compelling body of research is now available, from many leading academic researchers and from respected research organizations such as the National Bureau of Economic Research, the RAND Corporation, and the Urban Institute. No one has been able to find any evidence indicating current widespread labor market shortages or hiring difficulties in science and engineering occupations that require bachelors degrees or higher, although some are forecasting high growth in occupations that require post-high school training but not a bachelors degree. All have concluded that U.S. higher education produces far more science and engineering graduates annually than there are S&E job openings—the only disagreement is whether it is 100 percent or 200 percent more. Were there to be a genuine shortage at present, there would be evidence of employers raising wage offers to attract the scientists and engineers they want. But the evidence points in the other direction: Most studies report that real wages in many—but not all—science and engineering occupations have been flat or slow-growing, and unemployment as high or higher than in many comparably-skilled occupations.

The unemployment rate for recent STEM graduates including fields in which it is claimed there are shortages is quite high. Post-docs are increasing in duration, generally considered a sign of an inability of newly-minted PhDs to find any other job.

Why then do Bill Gates (net worth: $67 billion), Larry Ellison (net worth: $43 billion), Sergey Brin (net worth: $22.8 billion), and Mark Zuckerberg (net worth: $13.3 billion) feel the crushing need to import more foreign graduates? Because they want to push down the wages of the workers they employ. Simple as that. IMO there’s already a prima facie case that they colluded to prevent competing on wages with each other. Is it that much harder to believe that they’d lie to push the wages for their workers even farther down?

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The Billion Dollar Fine

Toyota has been fined a billion dollars by the federal government for company actions related to sudden unintended acceleration:

The unintended acceleration issue generated hundreds of lawsuits and prompted Toyota to recall millions of automobiles beginning in 2009.The automaker was first subpoenaed by the Manhattan U.S. Attorney’s office in 2010.

The settlement comes after a four-year investigation that revealed how the company sought to keep details from regulators, officials said.

“Idiots! Someone will go to jail if lies are repeatedly told. I can’t support this,” one Toyota employee said after a meeting, according to a statement of facts released Wednesday.

The deal announced on Wednesday deferred criminal prosecution of Toyota for three years if the company fully complies with all aspects of the agreement, Holder said.

That’s billion with a “B”. I’ve speculated here from time to time that the problem was caused by electronics and/or a software problem with an onboard computer. I continue to suspect that’s the case.

Some are wondering if GM may be next:

The agreement comes as General Motors is also under investigation over its handling of an ignition switch failure linked to a dozen deaths. GM recalled more than 1.6 million vehicles more than a decade after first noticing the issue. Top officials said the Toyota settlement could serve as a template for similar cases.

“My hope and expectation is that this resolution will serve a model for how to approach future cases involving similarly situated companies,” Attorney General Eric Holder told a news conference on Wednesday, though he declined to discuss GM specifically.

The companies may forestall criminal prosecution by complying with the federal government but that won’t do much to slow the number of civil cases and these two auto companies are not alone. There have been incidents of SUA reported in Jeeps, VWs, Kias, and Fords.

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We Need a More Diverse Economy

Michael J. Perrill tells some hard truths about higher education, sounding a theme that’s been a staple here—college just isn’t for everyone:

But our system isn’t rational, and it doesn’t like to acknowledge long odds. Perhaps it used to, but this sort of realism was judged to be deterministic, racist, and classist. And for sure, when judgments were made on the basis of ZIP code or skin color, the old system was exactly that. Those high school “tracks” were immutable, and those who wound up in “voc-ed” (or, at least as bad, the “general” track) were those for whom secondary schooling, in society’s eyes, was mostly a custodial function.

But making sure that there are real options for our young people—options that include high-quality career and technical education—is a totally different proposition. We shouldn’t force anyone into that route, but we also shouldn’t guilt kids with low odds of college success—regardless of their race or class—to keep trudging through academic coursework as teens. Yet it appears that we are doing just that; according to Kate Blosveren Kreamer of the National Association of State Directors of Career Technical Education, only 20 percent of high school students “concentrate” in career and technical education, even though that’s a better bet for many more of them. Then, even when students graduate high school with seventh-grade skills, we encourage them to enroll in college, starting with several semesters of “developmental” education.

This might be the greatest crime. How do low-income students who start community college in remedial courses fare? According to the college-access advocacy group Complete College America, less than 10 percent of them complete a two-year degree within three years. Most won’t ever get past their remedial courses. Almost certain failure.

Yesterday when I worked as an election judge I worked with one guy who was a powder coater by trade and another who made acoustic equipment. It was like a breath of fresh air. Neither of these guys was stupid but neither was an intellectual, either. We found a good deal of common ground. I had more fun chatting with them than I have in a long time.

I think the problem that we have had as a country is that we’ve over-emphasized college educations and what used to be called “learned professions” at the expense of building, making, mining, growing, and so on. If real people with real levels of ability are going to make their homes here we need a diverse economy in which people with a broad variety of skills and talents can prosper rather than one in which only a few people with narrow sets of talents and skills can and we should do what it takes to see that happens.

If that means that Bill Gates or Mark Zuckerberg or Warren Buffett or Michael Bloomberg can only make $1 billion rather than $50 billion, so be it.

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Reactions to Top of the Ballot Elections

As of this moment I’m looking at Bruce Rauner’s candidacy for governor of Illinois favorably. I think that Pat Quinn is a decent bloke who is the wrong man in the wrong job at the wrong time. Illinois has some hard choices to make going forward and I don’t think that Gov. Quinn is up to them.

There is no candidate so terrible including incumbent Illinois Sen. Dick Durbin it could impel me to vote for Jim Oberweis for Senate.

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Not Clear About the Strategy

I’ve mentioned before that I argued for a solid year with my professor of U. S. diplomatic history about whether the U. S. had a foreign policy. I now have the vocabulary to say clearly what I couldn’t then. The United States does have a grand strategy and a foreign policy consistent with grand strategy but, unlike many those of many other countries, they are emergent phenomena. If I had to describe the U. S. grand strategy I would say freedom of commerce on the seas and, in the 20th century, of the skies extending to support for freedom in international trade and the free flow of capital and information.

Contrary to what some people believe none of these things occur in nature. They are artifacts and require vigilance and determination to preserve, can only be preserved by the power of the U. S. federal government, and can only be maintained as long as there’s commitment to them from our elected officials.

That’s why stories like this are upsetting to me:

The Internet is often described as a miracle of self-regulation, which is almost true. The exception is that the United States government has had ultimate control from the beginning. Washington has used this oversight only to ensure that the Internet runs efficiently and openly, without political pressure from any country.

This was the happy state of affairs until last Friday, when the Obama administration made the surprise announcement it will relinquish its oversight of the Internet Corporation for Assigned Names and Numbers, or Icann, which assigns and maintains domain names and Web addresses for the Internet. Russia, China and other authoritarian governments have already been working to redesign the Internet more to their liking, and now they will no doubt leap to fill the power vacuum caused by America’s unilateral retreat.

Why would the U.S. put the open Internet at risk by ceding control over Icann? Administration officials deny that the move is a sop to critics of the National Security Agency’s global surveillance. But many foreign leaders have invoked the Edward Snowden leaks as reason to remove U.S. control—even though surveillance is an entirely separate topic from Internet governance.

I don’t know if relinquishing control of Icann is a big thing or a small thing. I don’t know whether it’s vital or unimportant. I do know that I’d much rather see a federal government that remains committed to preserving the free flow of trade, travel on the seas and in the air, and information than one that is just too fatigued to be bothered by them or thinks it has bigger fish to fry. Maybe I’m overreacting but it sure seems to me that we’re losing the thread on this.

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Increasing Workers’ Wages

I don’t think that Harold Meyerson appreciates the irony of this remark in his article about how to increase workers’ wages:

What corporate apologists won’t acknowledge is that workers’ incomes have been reduced by design. American business has adamantly opposed workers’ efforts to organize unions. Millions of jobs have been outsourced, offshored, franchised out, reclassified as temporary or part-time, or had their wages slashed, in a successful, decades-long campaign to increase the return to capital. Indeed, the only way to explain the soaring profit margins and stock values of recent years despite anemic increases in corporate revenues is that profits have come at the expense of labor. In forecasting the continued rise of profits in 2014, the chief economist for Goldman Sachs, Jan Hatzius, wrote: “The key reason is the continued slack in the U.S. labor market and the resulting weakness of nominal wage growth …. The subdued growth of unit labor costs has supported profit margins even in an environment of low price inflation.”

Contrary to Mr. Meyerson, I think that you’d expect exactly what has happened to happen in a very loose labor market, the opposite to happen in a tight labor market, and his organization supports a loose labor market.

He proposes eight different ways of increasing workers’ share of the pie:

  1. Legislate Wage Hikes in States and Cities
  2. Link Corporate Tax Rates to Worker Productivity Increases
  3. Link Corporate Tax Rates to CEO-Employee Pay Ratios
  4. Make Corporations Responsible for All Their Workers
  5. Help Create Benefit Corporations, and Don’t Tax Them So Much
  6. Help Workers Claim Their Share of Capital Income
  7. Raise Taxes on Capital Income and Redistribute It to Labor
  8. Change the Governance of Corporations

Of these I agree wholeheartedly with exactly two—#6 and #8—although I think we probably differ in exactly how we’d go about doing it.

I don’t think that Mr. Meyerson does a particularly good job of explaining why his proposals would have the results he claims to advocate rather than, say, reducing the amount of work available to Americans.

My own proposals would be somewhat different. I think I’d tighten the labor market here and stop incentivizing companies to send work overseas to avoid onerous and costly regulations, taxes, etc. There are different ways of effecting each of those but those would be my objectives.

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Heading for the Nearest Airport

In my experience in life the simplest explanation for something that doesn’t require alien abduction, divine intervention, or a huge conspiracy that would be impossible to keep secret (but somehow is) is frequently the best. Experienced pilot Chris Goodfellow offers an explanation for why the wreckage of Malaysian Airlines Flight MH370 should be sought between its last known location and Pulau Langkawi.

Update

Jeff Wise argues against Goodfellow’s theory:

Goodfellow’s theory fails further when one remembers the electronic ping detected by the Inmarsat satellite at 8:11 on the morning of March 8. According to analysis provided by the Malaysian and United States governments, the pings narrowed the location of MH370 at that moment to one of two arcs, one in Central Asia and the other in the southern Indian Ocean. As MH370 flew from its original course toward Langkawi, it was headed toward neither. Without human intervention—which would go against Goodfellow’s theory—it simply could not have reached the position we know it attained at 8:11 a.m.

To make a good theory, Einstein is said to have asserted, “everything should be kept as simple as possible, but no simpler.” Unfortunately, Christopher Goodfellow’s wildly popular theory errs on the side of too much elegance.

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How Low?

Just as one measure of how low the turnout was in the precinct where I worked, at one point in the day pollwatchers outnumbered voters eight to one.

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Too Many Conclusions from Too Little Data

I think that the analysts who are drawing conclusions from yesterday’s Illinois primary elections are drawing a pound of conclusions from an ounce of data. Writing at Washington Post Sean Sullivan makes comments about the governor’s race, the conundrum that will face organized labor in the fall, the absence of backlash against the Republican legislators who voted for same-sex marriage, and the yawn in House races in Illinois. Nowhere does he mention the single, critical, inescapable fact of yesterday’s primaries here: the turnout was incredibly low. It was under 10% in the city of Chicago.

I could try to explain the low turnout away any number of ways. It was a primary. It was a mid-term. In the prior three mid-term primaries turnout was 27.3% in 2010, 32.1% in 2006, and 39.8% in 2002. Whatever the reason that’s terribly, depressingly low.

I also think that it’s possible that the number of registered voters has become completely disassociated from the number of people who can be expected to vote in a primary mid-term election.

Many people mocked North Korea’s 100% vote in favor of Kim Jong-Un not long ago. In most cases Chicago’s primaries weren’t elections but affirmations. Nearly all incumbent officeholders ran unopposed. First time officeholder (second time candidate) Will Guzzardi won his race against Maria “Toni” Berrios, daughter of Cook County Democratic Party chairman Joseph Berrios, for the seat in the 39th state house legislative district. Guzzardi a 26 year old Ivy-educated former journalist ran on a progressive platform with the support of organized labor.

But the turnout was low there, too. Rather than drawing conclusions about an anti-incumbent sentiment, an anti-machine sentiment, or the rise in progressives in Chicago politics, the only conclusion that’s really supported by the evidence is that when the turnout is low anything can happen.

I’m exhausted today. I rose at 1:00am yesterday morning (courtesy of an elderly dog with dementia), arrived at the polling place where I had my election judge assignment, and returned home around 9:00pm. Voters expressed plenty of anti-incumbent sentiment but those were only the most disaffected voters.

Why the low turnout? I mentioned some of the reasons above but IMO there are a couple of other reasons worth mentioning. It might be that the torrent of negative ads have finally discouraged voters to the point where they don’t even bother to turn out for elections. The prevailing wisdom is that negative ads don’t suppress turnout but they do produce a sense of futility.

That’s the real message, the real conclusion. In Chicago the voters think that voting is futile.

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Primary Election Day, 2014

Today is the day of the primary elections for the elections to be held in November. As usual, I’m working as an election judge in a precinct in my ward. It will be a long day: I go to the polling place no later than 5:00am and I expect to be home sometime between 8:00pm and 9:00pm this evening.

I expect the worst turnout since I began working as an election judge more than 25 years ago, a combination of it being a primary which, ironically, typically have less turnout than do general elections, it being a mid-term election, and just plain fatigue.

I’ll try to check in at some point during the day but that may not be possible. I’m sure I’ll have something to say about the elections tomorrow.

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