Barack Obama’s State of the Union Address

In Barack Obama’s State of the Union Address, there are some sections that give rise to more questions than answers.

I’ve been asking CEOs to give more long-term unemployed workers a fair shot at that new job and new chance to support their families; this week, many will come to the White House to make that commitment real.  Tonight, I ask every business leader in America to join us and to do the same – because we are stronger when America fields a full team.

The Federal Government is the nation’s largest employer. Why isn’t Obama using his executive authority to establish a hiring preference for the long-term unemployed? If it is legal to hire someone because of his or her skin color, why isn’t it legal to hire someone because he or she has been at home for the past 99 weeks?

Estiven Rodriguez couldn’t speak a word of English when he moved to New York City at age nine.  But last month, thanks to the support of great teachers and an innovative tutoring program, he led a march of his classmates – through a crowd of cheering parents and neighbors – from their high school to the post office, where they mailed off their college applications.  And this son of a factory worker just found out he’s going to college this fall.

New York City has some of the most lavishly funded schools in the world. American colleges have some of the lowest admission standards. In fact, the City University of New York has had no admissions requirements, other than a high school diploma or GED,  since around 1970 (see Wikipedia). Why are we surprised that the public’s investment in Mr. Rodriguez is yielding a return? Shouldn’t we expect that any child in whom $200,000+ of education is invested would be able to attend college if he or she chose to do so?

It’s not just oil and natural gas production that’s booming; we’re becoming a global leader in solar, too.  Every four minutes, another American home or business goes solar; every panel pounded into place by a worker whose job can’t be outsourced.

The U.S. isn’t a significant manufacturer of solar cells (Wikipedia chart through 2010). We import them from China and install them. Are we a “global leader in LCD TVs” because we import a bunch of them from Korea, China, and Taiwan to watch this weekend’s Super Bowl? Are we a “global leader in camera systems” because a lot of Americans have purchased Canon, Nikon, and Sony cameras?

Last year, I asked this Congress to help states make high-quality pre-K available to every four year-old.

If the K-12 schools are so bad that we are shocked when a high school graduate (see above) is able to enter college, why will government-run pre-K be better? And how can the federal government “help states” to do this? If the federal government takes money away from residents of each state, brings that cash to Washington, D.C., then sends it back, how was that “helping the states”? Isn’t the federal government just collecting taxes that otherwise could have been collected by local or state governments? [Separately, it would be nice to see an explanation about how pre-K is the key. New Hampshire has historically not required that its town-run school systems offer kindergarten (i.e., public school would start at first grade). Yet New Hampshire's high school graduation rate is nonetheless higher than the rate in neighboring Massachusetts (86% versus 83%; source) and is much higher than the national average.]

Today, women make up about half our workforce.  But they still make 77 cents for every dollar a man earns.  That is wrong, and in 2014, it’s an embarrassment. A woman deserves equal pay for equal work.

Given these numbers, why does the federal government employ any men, starting with Obama? If women will do the same job just as well for 23 percent less money, couldn’t Obama trim the deficit substantially by firing all of the men and replacing them with women? [And separately, maybe this does explain why there are so many long-term unemployed people in the U.S. It would be irrational for a profit-minded company to hire a man, paying him nearly 30 percent more to do the same job (according to President Obama). Just imagine if Facebook had hired a man instead of Sheryl Sandberg. Instead of paying $845 million in 2012 for a COO (USA Today), the shareholders would have had to give up $1.1 billion. That extra compensation would have entirely wiped out the company's $53 million profit for 2012 (10K).]

Let’s do more to help Americans save for retirement. Today, most workers don’t have a pension.  A Social Security check often isn’t enough on its own. … That’s why, tomorrow, I will direct the Treasury to create a new way for working Americans to start their own retirement savings:

Since we already have Social Security, if it isn’t sufficient, why not fix it so that it is, instead of creating something new?

 Already, because of the Affordable Care Act, more than three million Americans under age 26 have gained coverage under their parents’ plans.

How is this fair? If a person is under 26 and has had the misfortune to lose both parents and/or has parents who have the misfortune to remain uninsured after Obamacare, he or she suffers the additional misfortune of having to pay for his or her own health care?

Citizenship means standing up for the lives that gun violence steals from us each day.

Why do victims of gunshots get priority? (about 11,000 per year; source) Why doesn’t citizenship mean standing up for the lives that car accidents, many of them preventable through uncontroversial engineering improvements to roads and/or cars, steal from us each day? Or being concerned about other preventable deaths (table)? And why do we give priority to victims here in the U.S.? Shouldn’t we also stand up for the lives of people in other countries?

And we do them because we believe in the inherent dignity and equality of every human being, regardless of race or religion, creed or sexual orientation.  And next week, the world will see one expression of that commitment – when Team USA marches the red, white, and blue into the Olympic Stadium – and brings home the gold.

If everyone is inherently equal, why are we so determined to bring home the gold? Wouldn’t participation be sufficient?

[And speaking of the Olympics, why did I fall on my face the last time that I tried ice dancing to Justin Bieber's Believe album? Where was the inherent dignity that the President of the United States has promised?]

11 Comments

  1. Federico

    January 30, 2014 @ 7:33 am

    1

    I like Obama, and I would have voted for him, were I a US citizen. But Obama is a politician, and does what every politician (and quite a lot of people in power) do, that is, he buys into this myth: doing stuff is easy, managing the people doing stuff is hard. The reality is that doing stuff is hard, and managing the people doing the work is often easy — it surely is that way it is normally done (and I mean, claim merit if things work, and put the blame on the people actually doing the work if things do not).

    The point of management, when done correctly, is to bring *greater* skills and experience to bear. If a manager’s only claim is ‘I have management training’, ‘I play golf with the CEO’, and all the ‘vote for me’ tactics, the best we can expect is that management will not screw things up (and I vote based on which of the options is the least bad in this respects).

  2. philg

    January 30, 2014 @ 11:18 am

    2

    Thanks, Federico. You didn’t address the substance of any of the apparent contradictions above but say that you like Obama and would have wanted to vote for him. So you provide an incentive for a politician to promise you something that sounds good/feels right regardless of whether or not it can be implemented or funded.

  3. TimB

    January 30, 2014 @ 12:24 pm

    3

    Phil – excellent points, all. You could have included that Oil and Gas is booming despite the Administration opposing the industry at every turn. You surprise me a little – I bet your perspective is not widely held in the faculty lounges of Cambridge. :)

  4. Anonymous

    January 30, 2014 @ 2:28 pm

    4

    You ask the question, “Since we already have Social Security, if it isn’t sufficient, why not fix it so that it is, instead of creating something new?”

    Some pretty simple changes could be made to Social Security. The tax rate could be doubled, the earnings cap could be raised or eliminated. Then the benefit amount could be increased (eventually) by 80% or 90% (whatever amount would balance the cash flow over 50 or 75 years).

    Unfortunately, the House of Representatives is controlled by a party that wouldn’t go along with such a change.

  5. davep

    January 30, 2014 @ 3:04 pm

    5

    PG: “New York City has some of the most lavishly funded schools in the world.”

    Are you talking about the “flagship” schools? If so, not all children in NYC go to them. “Lavishly funded” implies that the students see the funding (maybe, you are talking about the overall cost of the education system in NYC).

    PG: “Why are we surprised that the public’s investment in Mr. Rodriguez is yielding a return?”

    Ignoring the advertising aspects of the SOTU, Rodriguez seems to be more like children in NYC who often fail to graduate. NYC has students that are easy to teach (for whom the “return” is almost guaranteed). It also has students who are hard to teach (for whom the “return” is much less likely). Ironically, you don’t need to throw money at easy-to-teach children and throwing money at hard-to-teach children doesn’t seem to help.

    PG: “Are we a “global leader in camera systems” because a lot of Americans have purchased Canon, Nikon, and Sony cameras?”

    The issue isn’t being a “global manufacturing leader” in solar (though, that might be nice). The issue is being a “global USAGE leader” in solar (which has a value/importance that is separate from manufacturing).

    PG: “How is this fair?”

    Life isn’t fair. Where these poeple better off before “Obamacare”? (That there is a population that doesn’t benefit from a change doesn’t mean that the change should not have been implemented.)

  6. davep

    January 30, 2014 @ 3:06 pm

    6

    Regarding solar usage, we might care about using more solar (and less oil/coal) in a way that is different that we would care about how much TV people watch.

  7. Roger Ritter

    January 30, 2014 @ 6:21 pm

    7

    Regarding the retirement accounts, in addition to Social Security we have IRAs, Roth IRAs, and 401(k)s. Why do we need yet another federal program to get people to save for retirement? If they won’t save with the current set of options, I don’t think another program will make much difference.

  8. philg

    January 31, 2014 @ 1:03 pm

    8

    Roger: Excellent point. Back in the 1980s I understood personal retirement options. I could rely on Social Security or supplement with an IRA. I think that the IRA was dead simple as well. Regardless of income level, the amount put into an IRA was deductible from one’s taxes and investment returns were tax-free and the money couldn’t be taken out until one reached retirement age (or pay a penalty). Today I am presented with a bewildering array of government-affiliated options, some of which are entitled to tax benefits and some of which are not. The tax benefits depend on my income level, which fluctuates and therefore I would have to do research every year to see if my current income and the current regulations will align somehow to give me a tax benefit. Now Obama has added one more by executive order. Does it make sense to have American citizens spend all of this time and energy researching the different government-sponsored retirement programs? Wouldn’t even the government be better off if people put their time and energy into working a few extra hours each year and paying taxes on those extra wages?

    Davep: I don’t know if the New York City school system spends most of its money on a handful of schools, as you suggest, or whether Mr. Rodriguez was fortunate enough to attend one of the schools favored with most of the money (assuming that you are correct and NYC operates some Ritz-Carlton-type schools as well as some more like a guesthouse in rural Laos).

    https://www.census.gov/newsroom/releases/archives/governments/cb13-92.html says “Of the 100 largest school systems by enrollment in the U.S., New York City School District in New York ($19,770) had the highest current spending per student in 2011″. (Note that these figures understate true spending because they don’t include capital costs, e.g., spending $200 million to construct a high school.)

    If I purchased the most expensive reasonably popular car sold in America, e.g., a BMW 7-series or Mercedes S-class, I would not be bragging to my friends that I successfully got from my driveway to the supermarket and back.

  9. davep

    January 31, 2014 @ 1:55 pm

    9

    PG: “(assuming that you are correct and NYC operates some Ritz-Carlton-type schools as well as some more like a guesthouse in rural Laos).”

    You are looking at a complicated problem in an overly-simplistic way. “Lavish” is a weird word to describe the the issue.

    For NYC highschools, there are “elite” ones (like Bronx Highschool of Science) that have competitive entrance requirements. Most of the students who get into them are highly motivated (often, with highly motivated parents). Those students will succeed (even if they all don’t get into Harvard) even if they have poor teachers!

    There is another, large?, student population that (for various reasons) are not motivated at all. For some, their parents aren’t really interested in their children succeeding. For these students, highschool serves as a detention center (of sorts). Often, these students are poor and first/second generation immigrants. Even with competent and motivated teachers (and lots of money), these students are not going to succeed. How to get this population to succeed is a tough problem (I’m not sure if it can be solved). The real tragedy is that the motivated students that are in these other schools are hard to help. (Of course, the issue isn’t just students. Unions make it nearly impossible to get rid of bad teachers. Tenure is automatic in NYC. “Accountablilty” forces the system to get students to pass standardized tests rather than being taught to their level. Etc. Etc.)

    Rodriguez is meant to be an example of the second population (probably, not quite accurately). (NYC’s student population is only slightly less than the total population of NH.) You could argue that NYC “spends too much” but it’s hard to say, given the diverse student population NYC is stuck with, what success rate would be reasonable to expect.

    Anyway, the SOTU is a commercial. It’s advertising. It’s not a source of objective information.

  10. philg

    January 31, 2014 @ 2:17 pm

    10

    Davep: “Rodriguez is meant to be an example of the second population” of students whom you say lack motivation? How was he selected for that honor? Nobody argued that NYC “spends too much” as you suggest. I pointed out only that with an investment by taxpayers of $200,000 in Mr. Rodriguez’s public school education we should not be surprised to find that he is capable of enrolling in college.

    As for SOTU being “advertising,” as you suggest, it would seem to be a pretty poor advertisement for government spending if the president expresses shock that someone might graduate from one of our government-run schools and/or attend college after doing so.

  11. Anonymous

    January 31, 2014 @ 6:17 pm

    11

    The quality of NYC schools is very diverse. For example, I’m pretty happy with my son NYC publicly funded school, but he goes to Hunter College HS, one of the best schools in the system. The reality is that, as a whole, NYC has very little to show for all the money that goest into public education. According to this official site http://www2.ed.gov/about/overview/fed/10facts/edlite-chart.html), as a country we are paying more than ever for education without getting much in return. For example, Korea spends significantly less and their PISA scores are much higher (http://www.businessinsider.com/pisa-rankings-2013-12).

    I would love to see Obama speaking about that “inequality.”

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