Training tomorrow’s workers

Training tomorrow’s workers

Louisiana is very generous when it comes to providing college scholarships to traditional students who pursue four-year degrees directly from high school. But it is considerably less generous for everyone else - especially non-traditional students, people from low-income backgrounds and students seeking two-year associate degrees or skills training.

Number of the Day

$723.67 - Average weekly wages for production and “non-supervisory” workers in 2016 - which is 2 percent lower than in 1972, in inflation-adjusted dollars. (Source: EPI via The New York Times)

Louisiana is very generous when it comes to providing college scholarships to traditional students who pursue four-year degrees directly from high school. But it is considerably less generous for everyone else – especially non-traditional students, people from low-income backgrounds and students seeking two-year associate degrees or skills training. Monty Sullivan, who heads the Louisiana Community and Technical College System, says the answer is to invest more in the Go Grants program, which has been consistently under-financed since the Legislature created it in 2004. The inimitable Jim Beam of the Lake Charles American-Press has more:

Sullivan said students in his system are struggling to pay for school more than those who attend four-year schools. Many are single parents who need financial help or have full-time jobs, he said. The Advocate said Louisiana is rare among Southern states because community college support comes from only two sources — state appropriations and tuition revenue. Many states provide a third source of revenue through local property and other taxes.

 

Should Big Oil pay for its damage?

Nearly a decade after tobacco companies agreed to pay hundreds of billions of dollars to compensate states for the damage done to their citizens – and Medicaid budgets – the same legal tactics are being used in an effort to have oil companies take responsibility for their role in global warming. The great Bob Marshall, writing for Nola.com/The Times-Picayune, explains that this could be good news for Louisiana:

Since 1880 Chevron, Saudi-Aramco, ExxonMobil, BP, Gazprom and Royal Dutch Shell trade places in the top five for the leading industrial contributors to increased level of carbon and methane. And importantly for Louisiana’s sinking and crumbling coastal zone, those companies’ products are the top contributors to the increase sea level rise since the 1880s. Given those findings it would seem any coastal city would have a solid case. Our liability law is well established around the principle that if someone hurts you, they should compensate you for any damages. And since our Supreme Court has held that corporations are people too, this case looks like a slam dunk. But when it comes to personal liability, corporations may have more rights than human citizens – and a lot more political power.

 

Corporate tax cuts don’t create jobs

President Donald Trump and his allies claim that the large cut in corporate taxes being proposed as part of his “reform” outline will boost the U.S. economy, spur job creation and lift incomes. But Marcus Ryu, who built a $500 million software company in Silicon Valley that employs 2,000 people, writes in The New York Times that a lower corporate tax rate will not prompt more people to start companies.

What a tax cut would do is increase our post-tax profitability, which effectively transfers money from the federal government to our shareholders. One consequence of this would likely be a one-time increase in our stock price, but with no impact on our operations or employment plans. In theory, this could have the benefit of making it easier to raise cash by issuing more stock to the public, but with interest rates at historical lows for years, American corporations have had no trouble getting capital. In other words, if we are serious about growth, competitiveness and job creation, we should look elsewhere besides the tax code for answers. We can remain open to immigrants in search of better economic opportunities. We can invest in our public schools and universities. We can upgrade vital business infrastructure such as airports, land transportation systems, the internet backbone and our power grid. We can heighten our vigilance about anti-competitive behavior and regulatory capture by very large corporations that make it difficult to start new businesses.

The Economic Policy Institute goes deeper, answering some common questions about corporate taxes. EPI points out that cutting corporate taxes won’t create jobs, or boost investment and wages. American companies are not overtaxed compared to their international peers. What a tax cut will do is increase the deficit and make it harder to pay for things that Americans need, such as health care.

The federal government is the single largest payer of health care costs in the economy, and these health care costs have grown faster than overall economic growth for decades. The federal health programs—Medicare, Medicaid, and the Affordable Care Act—are efficient and do a better job at containing costs than private insurance. Cutting these programs would be inefficient and, worse, just shift health care costs onto American household budgets

 

Full employment and low wages

In America and around the world, unemployment rates have fallen and labor markets are increasingly tight. But that has not translated into higher wages for most rank-and-file workers. Instead, the typical American worker today earns slightly less than her counterpart in 1972 – a phenomenon that is true not just in the United States but in countries such as Norway and Germany, with more egalitarian tax and benefit structures. Peter S. Goodman and Jonathan Soble search for explanations in the New York Times’ Upshot blog:

Some economists argue that the world is still grappling with the hangover from the worst downturn since the Great Depression. Once growth gains momentum, employers will be forced to pay more to fill jobs. But other economists assert that the weak growth in wages is an indicator of a new economic order in which working people are at the mercy of their employers. Unions have lost clout. Companies are relying on temporary and part-time workers while deploying robots and other forms of automation in ways that allow them to produce more without paying extra to human beings. Globalization has intensified competitive pressures, connecting factories in Asia and Latin America to customers in Europe and North America.

 

Number of the Day

$723.67 – Average weekly wages for production and “non-supervisory” workers in 2016 – which is 2 percent lower than in 1972, in inflation-adjusted dollars. (Source: EPI via The New York Times)