Lake Wobegon Performance Measure Reveals All Community Colleges Above Average

Measuring college performance is inherently difficult. Determining whether students are successful because they attended college or simply because colleges are good at identifying talented and dedicated students is nearly impossible.

Nonetheless, measuring colleges’ performance is important. Taxpayers should be able to find out whether they’re getting any value for their money.

The North Carolina Community College System has begun to respond to those taxpayer demands. They’ve crafted a multi-measure mechanism to reward colleges for good outcomes. Most of the measures—like GED and licensure passing rates—are sensible.

But a new attempt to measure earnings gains seems designed to only find success. In today’s Pope Center article, Harry Painter reports,

In response to the increasing focus on whether graduates find employment, the NCCCS is trying to add a new measure to its performance funding model based on graduates’ incomes. A new “earnings gains” measure was approved by the State Board of Community Colleges on August 21, but still needs the legislature’s approval…The metric, using wage records from the North Carolina Department of Commerce, will measure just a narrow group of students. That group consists only of graduates of vocational programs who have full-time jobs for the two years before enrolling and for the two years after graduation. The average age of students measured was 34, six years older than average for the community college system.

Having an employment measure makes sense. And in fact, North Carolina already has a tool to do so. North Carolina’s NC Tower website reports education and workforce data from the North Carolina Department of Commerce. The data stretch back to the graduating class of 2003 and are broken down by college (or university) and major. Using that site, it’s easy to find, for example, that the mean income for 2008 NCCCS graduates working in North Carolina was $32,431 five years after graduating with an associate’s degree. The website also reports the percentage of total graduates from each college who are employed in the state following graduation.

So why is NCCCS reinventing the wheel?

You can read Painter’s story here.

Sensible UNC prof surrounded by “locavore” zealots

In this recent Wall Street Journal piece, UNC professor Peter Coclanis discusses the loco locavore climate around Chapel Hill. Big agra, as he terms it, has made food much less costly, yet Luddite activists are on a mission to get everyone to buy local.

Of course, this mania can be found all over the U.S. — wherever you have lots of wealthy leftists who need to feel that they’re doing something to save the planet. Shipping food (and other goods) does not, however, threaten the planet. This is yet another of Mencken’s hobgoblins.

Coming soon … Catalyst: Jim Martin and the Rise of North Carolina Republicans

We’re little more than one month away from the Oct. 6 release of John Locke Foundation Chairman John Hood’s new biography of North Carolina’s only two-term Republican governor of the 20th century.

A realistic post-Obama response to Obamacare

Tevi Troy examines for Commentary magazine readers the prospects for repeal, replacement, and/or reform of the Affordable Care Act once Barack Obama leaves the White House.

Republicans have long been accused of not having alternatives to the ACA, but in truth, if anything, Republicans and conservatives have designed and proposed too many plans to replace ObamaCare. This makes it extremely difficult for Republicans to unite behind a single plan. Fortunately, the primary battles will help select a standard-bearer who can champion and rally support for a single plan that the party can finally call its own.

The candidates, and eventually the new president, will have to properly define the ObamaCare problem. In designing the Affordable Care Act, the Obama administration tried to lasso the moon—to bend the cost curve down while providing universal insurance coverage at the same time. In doing so, the president highlighted the number of people who were uninsured at any point throughout the year, a figure that ranged between 30 million and 46 million.

The law failed to solve either problem. Costs have continued to rise, and even with the increase in the number of people covered, there are and will remain tens of millions of people in the uncovered category. According to the Congressional Budget Office (CBO), there are 35 million people currently uncovered. Even in 2025, more than a decade after its implementation, there will still be 27 million uninsured Americans. The ACA, therefore, has not solved the problem of insuring all Americans at some point in the course of a year. By the standards of the legislation’s intent, it has been, and it will remain, a failure.

The ACA has also failed in its secondary objective: It has not solved the problem of rising costs. Indeed, it has probably made things more costly for both the insured and the federal budget. A recent analysis by Health Pocket found that the ACA plans submitted across 45 states were an average of 14 percent more expensive for the upcoming 2016 year than they were in 2015. And according to the University of Minnesota’s Stephen Parente, the average family plan could cost 61 percent more in 2023 than it did in 2015.

The sales job Obama did on the Affordable Care Act compelled him to claim it would be the comprehensive solution to America’s health-care ills, and his immodest approach unsurprisingly yielded an immodest and unwieldy result. Providing a path to a positive and more tailored solution is therefore essential to replacing or reforming the legislation.

Such a path requires reframing the problems that serious health-care legislation must solve.

Redistributionists relying on the income tax? Good luck with that

James Piereson explains in the latest issue of Commentary magazine why higher income tax rates do little to advance the cause of people who want to take money from the rich and give it to the poor.

Public-opinion polls over the years have consistently shown that voters overwhelmingly reject programs of redistribution in favor of policies designed to promote overall economic growth and job creation. More recent polls suggest that while voters are increasingly concerned about inequality and question the high salaries paid to executives and bankers, they nevertheless reject redistributive remedies such as higher taxes on the wealthy. While voters are worried about inequality, they are far more skeptical of the capacity of governments to do anything about it without making matters worse for everyone.

As is often the case, there is more wisdom in the public’s outlook than in the campaign speeches of Democratic presidential candidates and in the books and opinion columns of progressive economists. Leaving aside the morality of redistribution, the progressive case is based upon a significant fallacy. It assumes that the U.S. government is actually capable of redistributing income from the wealthy to the poor. For reasons of policy, tradition, and institutional design, this is not the case. Whatever one may think of inequality, redistributive fiscal policies are unlikely to do much to reduce it, a point that the voters seem instinctively to understand. …

… The highest marginal income-tax rate oscillated up and down throughout the 1979–2011 period. It began in 1979 at 70 percent during the Carter presidency. It fell first to 50 and then to 28 percent in the Reagan and Bush years. It rose to 39.6 percent in the 1990s under the Clinton presidency, and went down again to 35 percent from 2003 to 2010. It is now back up to 39.6 percent. The highest rate on capital gains moved within a narrower band, beginning at 28 percent in 1979 and falling as low as 15 percent from 2005 to 2011. The highest rate is currently 23.8 percent.

Over this period, regardless of the tax rates, the top 1 percent of the income distribution lost between 1 and 2 percent of the income share after taxes were levied. In 1980, that group claimed 9 percent of before-tax income and 8 percent of after-tax income. In 1990, the figures were 12 percent before tax and 11 percent after tax. In 2010, the figures were 15 percent before and 13 percent after.

The top 10 percent of the income distribution generally lost between 2 and 4 percent of its income share after taxes were levied. That is probably because those households take a greater share of their income in salaries rather than capital gains compared with the wealthiest Americans.

At the other end, the poorest quintiles gained almost nothing (about 1 percent on average) in income shares due to cash and in-kind transfers from government. In 2011, for example, the poorest 20 percent of households received 5 percent of (pre-tax) national income, and 6 percent of the after-tax income. …

… With respect to the recipients of federal transfers, the CBO study reveals a surprising fact: Households in the bottom quintile of the income distribution receive less in federal payments than those in the higher income quintiles. Households in the bottom quintile of the income distribution (below $24,000 in income per year) received on average $8,600 in cash and in-kind transfers. But households in the middle quintile received about $16,000 in such transfers. And households in the highest quintile received about $11,000. Even households in the top 1 percent of the distribution received more in dollar transfers than those in the bottom quintile. The federal transfer system may move income around and through the economy—but it does not redistribute it from the rich to the poor or near-poor.

It is well known in Washington that the people and groups lobbying for federal programs are generally those who receive the salaries and income rather than those who get the services. They, as Senator [Daniel Patrick] Moynihan observed decades ago, are the direct beneficiaries of most of these programs, and they have the strongest interest in keeping them in place.

A look into the world Uber is disrupting

Why has Uber stirred up such controversy? Because the company and similar outfits such as Lyft and Sidecar have challenged entrenched interests like the New York City taxi mogul profiled in the latest issue of Bloomberg Businessweek.

According to the city, the Taxi King controls 860 cabs (Freidman says he actually operates more than 1,100). That’s more than anyone else in town. Factor in the hundreds of vehicles he has in Chicago, New Orleans, and Philadelphia, and he’s almost certainly the most powerful taxi mogul in the country. Freidman makes money by leasing the cabs to drivers on a daily or weekly basis.

To own a cab in New York, you need a medallion—a metal shield displayed on the vehicle’s hood—and there are a fixed number issued by the New York City Taxi & Limousine Commission (TLC). Until very recently, medallions were a good thing to have a lot of. In 1947, you could buy one for $2,500. In 2013, after a half-century of steady appreciation, including a near-exponential period in the 2000s, they were going for $1.32 million.

Then came Uber. Since the arrival of the car-by-app service, valued at about $50 billion, taxi ridership is down, daily receipts have declined, and drivers are idling—or going to work for Uber. Add it up, and desperate medallion sellers are trying to fob off their little tin ornaments for as little as $650,000. …

… There are 13,587 yellow cabs in New York City. That’s not many more than there were when the modern taxi industry was born almost 80 years ago. During the Depression, thousands of jobless men became taxi drivers. As a result, the number of cabs ballooned, and suddenly there weren’t enough passengers to scoop up. The industry became as hopelessly unprofitable as any other. So in 1937 the city created the medallion system that remains in place today. Until 1996, the number of medallions in circulation remained exactly 11,787.

Because the system artificially depressed supply, taxi drivers stayed busy and medallions became more valuable.

Barron’s editorial page editor reminds us about the key flaw in China’s economy

Thomas Donlan‘s latest editorial commentary for Barron’s focuses on the key issue holding back China’s long-term economic health.

Worldly wise investors and sophisticated geopoliticians sometimes forget that Chinese markets reflect the power of the country’s government more than its economy. The price of stocks in state-owned and state-funded corporations has too little to do with their profits and too much to do with their political connections.

Unfortunately for the political and commercial elites thoroughly invested in Chinese success, the government’s economic power seems to be weakening. The elites’ will to rule is not in doubt, but the tools that the ruling class uses may be rusting.

After decades of Chinese economic success, it has become easy to forget that the quasicapitalist China has been unstable all along. Decades after the death of Mao Zedong, political and economic power still grows out of the barrels of guns. Without the guns, China would soon have a new government — or many of them, or none at all.

The guns aim at the hundreds of millions of people brought out of communal poverty into individual prosperity since 1979.

In his treatise on guerrilla warfare, Mao dismissed political liberty as irrelevant to the revolution: “People who live at subsistence level want first things to be put first. They are not particularly interested in freedom of religion, freedom of the press, free enterprise as we understand it, or the secret ballot. Their needs are more basic: land, tools, fertilizers, something better than rags for their children, houses to replace their shacks, freedom from police oppression, medical attention, primary schools.”

Except for freedom from police oppression, hundreds of millions of Chinese have satisfied those primary needs. Now the time has come for a revolution of rising expectations, which always comes when things are getting better — but not quickly enough.

Mao’s face is still on the money. Its value is whatever Mao’s successors say it is from day to day. Economic power still is concentrated in state-owned enterprises and a central bank that answers to the Communist Party to support its leaders’ permanent rule. Political power is the real source of wealth, and more than a billion Chinese have none.

Deng Xiaoping may have said, “To get rich is glorious,” and the phrase has been taken as a signal for the vast economic change that has taken place since he came to power in 1978. But Deng should have told the rest of the story: People can get rich as long as they keep their mouths shut.

Just as admirers of Maoist communism ignored murder and starvation on a scale that overwhelmed the evils of Hitler and Stalin, admirers of Chinese economic reform have often ignored the chain-mail authoritarian fist inside the velvet economic glove.

Goldberg searches for the right and wrong sides of history

Jonah Goldberg continues his campaign against the tyranny of cliches.