the poor folks.

The High Cost of Ignoring Poverty
Posted on May 4, 2007
By E.J. Dionne
WASHINGTON—Republicans once preached compassion, but then went off to war. Democrats waged a war on poverty, but then lost some elections. They decided the middle class is where it’s at.
But the poor are still with us and their ranks are growing. One in eight Americans lives in poverty, which seems obscene given that the really rich are enjoying a level of privilege that may make the Vanderbilts in the Gilded Age look like abstemious Puritans.
“Rising inequality” is a bloodless term. But consider the facts behind the phrase: In 2005, the richest 1 percent of Americans held 19 percent of the nation’s income, the largest share since 1929; the poorest 20 percent held only 3.4 percent.
The historically inclined will recall that 1929 was the year of the great crash, which was followed by the Great Depression. History suggests that concentrating wealth and income in a small group of privileged people is bad for economic growth.
One reason our nation has maintained generally healthy levels of economic growth is our success in spreading income around—particularly during the 1940s to the early 1970s. This created more purchasing power among an ever larger group of Americans. We are thus tempting fate by following the formula of Andrew Mellon, the Republican Treasury secretary in the Roaring ‘20s who never met a tax cut for the rich he didn’t like. He was rather popular until 1929.
Here’s the odd thing about the present moment: As a country, we are much more practical about poverty reduction than we were in the 1960s. Most plans on offer are not utopian schemes. They promote work and would build ladders so today’s poor can become tomorrow’s middle class.
That’s the significance of the anti-poverty report issued last week by the Center for American Progress, the think tank that is the closest thing we have to a Democratic administration in exile. The CAP report deserves more attention than it has gotten, not because it breaks new ground but precisely because it brings together some of the most pragmatic ideas on poverty reduction. The task force that prepared it included veteran liberals such as Peter Edelman and Angela Glover Blackwell, but also resolute middle-of-the-roaders such as the Rev. Floyd Flake, a champion of faith-based approaches to poverty, and Charles Kolb, president of the pro-business Committee for Economic Development.
Their first recommendations aren’t revolutionary, just sensible: They’d raise the minimum wage, and they’d expand the Earned Income Tax Credit, a program supported by Ronald Reagan and expanded by Bill Clinton. The EITC has done more than any other measure to keep working Americans out of poverty. The task force would also make unionization easier, on the theory that giving workers the power to bargain for themselves is better than a government handout.
More should be done for poor 16- to 24-year-olds who are out of school and out of work. In 2005, the report says, there were 1.7 million of them, a number big enough to be alarming but small enough to give public policy a chance to make a difference.
Other recommendations are designed to promote upward mobility through expanded child-care assistance, “early education for all” and stepped-up efforts to make higher education more accessible. The panel would modernize the unemployment insurance system and other low-income programs that date back 30 years or more. Capitalists should like their proposals to give the poor more access to financial services and expand their ability to save. And to prevent a new crime wave, the task force urges us to do a lot more to “help former prisoners find stable employment and reintegrate into their communities.”
Will all this cost money? You bet, about $90 billion a year—a little over one-fifth of the annual cost of the 2001 and 2003 tax cuts, many of which go to the rich. This would not break the bank of a country with a $13 trillion GDP, and it’s for programs that cannot be demonized as more of “the failed old liberalism.”
The new Democratic majority in Congress seems determined to “fix” the alternative minimum tax, which unfairly pushes many middle- and upper-middle-income taxpayers into brackets they shouldn’t be in. That’s just fine. But these taxpayers are still doing reasonably well after taxes. A lot of Americans in the ranks of the working poor are not doing well, and they are the people Democrats claim to represent.
And it would be awfully nice if Republicans revisited their commitment to compassion. As President Bush knew in 2000, swing voters like that sort of thing.


This article discusses what we've been doing in class--examining the inequality of income in America. To me, this is an extremely crucial and interesting topic. The wealthy are overly wealthy--the poor are overly poor. We're losing the middle ground. However, I do know that statistics can be drastitcally skewed to fit a certain situation so here are some biases that may be in the data:

wealthy people oftentimes (not always) give a large percentage to nonprofit organizations.
the survey may or may not have taken into account things like welfare, government grants and funding.
the "poor" may include teenagers / those working part time while furthering their education, etc...
they might have included those who are unemployed in the survey.

economics of pollution in california

The economics of global warmingBy Andrew Leckey Tribune Media Services
Posted April 23 2007

As I write this, a rock band plays loudly down the
block at a "Stop Global Warming" university rally, and Arnold Schwarzenegger is
staring right at me.Well, not actually Arnold himself.The California governor's
famous face is staring out from the covers of Newsweek (headline "Save the
Planet -- or Else") and Fast Company ("His Green Ultimatum Will Create Huge New
Markets Across California") sitting on my desk.Schwarzenegger, whose Humvees now
run on hydrogen and biodiesel fuel, has become a national figure in the push for
reducing greenhouse gas emissions.The aggressive California Global Warming
Solutions Act, scheduled to go into effect in January, mandates a 25 percent
reduction of carbon dioxide emissions by 2020. As Schwarzenegger recently met
with federal Environmental Protection Agency officials in Washington, asking for
a waiver in order to enact that state law, he was talking up green issues all
over town.The band should not be confused with Al Gore's "Live Earth" concert
series planned for July. "Live Earth" will raise money to battle climate
change.At the corporate level, ConocoPhillips became the first major U.S. oil
company to call for a federal global warming emission cap. It joins BP PLC in
the U.S. Climate Action Partnership in espousing that goal."We believe that the
science is quite compelling and that climate change is certainly attributed to
human activity and to the substantial use of fossil fuels," Jim Mulva, chairman
and chief executive of ConocoPhillips said.The U.S. Supreme Court recently ruled
the federal government is responsible for regulating carbon dioxide emissions
from cars. The Bush administration has refused to impose mandatory limits and
also contends any global agreement must include China and India.Looking at this
from a business standpoint, a federal emissions cap most likely would be less
stringent on oil and auto companies than a wide variety of rules enacted by
states. The auto industry would prefer an across-the-board emissions cap for all
industries, including utilities, rather than one that singles out cars.As global
warming emerges as a national priority, the way it is tackled will affect many
industries and the overall economy. Companies are beginning to take positions
and choose up sides, not just on direction of the action but its
forcefulness.The public ultimately dictates the course taken, since negative
publicity and financial pressure gains every company's total attention. While
the goal of a better environment seems a "no-brainer," the process isn't. Within
a complex unfolding drama with global repercussions, the motives of all the
players involved must be scrutinized.

This article discusses the economic impact of a cap on federal emissions. A new law called the California Global Warming Solutions Act calls for a 25% decrease in emissions. From an economic standpoint, saying that companies have to pay a set amount for each ton of emission would be a better choice. This way, companies have more incentive to cut down on their emissions, while with the CGWSA they have no incentive for a decrease more than 25%. This is called a Pigovian Tax and is more economically sound than government mandates.

eskimo doctors

Alaska's Doctor Shortage

2/27/2007

Sen. Lisa Murkowski began the Senate Health, Education, Labor and Pensions
Committee hearing on Feb. 21 by addressing mail she's received over the past
year from patients, especially those on Medicare, who say they have made 80 to
100 calls unsuccessfully trying to find a doctor.These calls are a cry for help.
The shortage of physicians in Alaska continues to worsen and the level of
treatment that seniors receive has declined.The medical association is backing
state legislation to fund training of 20 Alaska medical students per year
through the WWAMI program. Students are able to attend out-of-state colleges and
receive discounted tuition in Wyoming, Washington, Alaska, Montana and Idaho.
There are currently 10 Alaskans enrolled in each University of Washington
medical class. Alaska also offers one three-year residency program, training 12
new family practice doctors per year. WWAMI and Alaska's residency program both
produce about 14 doctors per year who stay in Alaska.This number is pathetically
low compared to Texas and California, where there are more than 6,000 residency
slots in each state. Alaska's hope for physicians shouldn't be out of state. But
the problem is that the eligible medical students can't get the training here.
The WWAMI program needs to expand available slots for medical students, rather
than force students to leave state to attend a university that provides more
opportunities.Debt has become a concern, however, for students who are
practicing to be physicians.Creating special residency programs - which would
promise residents a job upon completion - and providing more funding for medical
programs would allow students to start and finish the program and residency
training without fear of debt. This would also give an incentive for more
medical residents to stay in state, and it could improve the quality of medical
care for seniors. Residency programs need to be made eligible for federal
funding to encourage partnerships between Outside residencies and Alaska, rather
than having medical students permanently leave the state, ultimately creating a
shortage of eligible physicians.
And guess what? UAA is across the street from Providence Alaska Medical
Center, the state's largest hospital, which already provides continuing
education for physicians. What Alaska needs is to create a medical program in
state by creating a partnership between Providence Hospital and UAA. The need
for physicians has been made clear, so a step in the right direction would be
providing more funding toward that goal. What UAA needs is a medical program
that can train more than the paltry 20 students who have to travel out of state
to receive additional training.Unfortunately, the University of Alaska Fairbanks
receives the most funding of all UA campuses. During Lisa Murkowski's first year
as senator, the federal government provided almost 73 percent of the funding at
UAF for research. UAF is the northernmost campus in Alaska, and it has a
shrinking student enrollment. It's time to stop bailing out the sinking ship
that is UAF and allocate more funds to UAA. The state's largest university is
the ideal location for establishing a medical program in Alaska.Murkowski says
she will soon propose a bill to back expansion of doctor training programs and
the expansion of community health centers. But unless she wishes to receive more
calls each year regarding the lack of eligible doctors in Alaska, she should
consider ways to improve funding to establish a medical program and create a
partnership between UAA and Providence Hospital.Supplying more opportunities
locally by creating UAA's own medical program will fulfill the demand for the
increasing need of physicians in Alaska.

This article talks about the severe shortage of doctors in Alaska. (Can you imagine making 100 phone calls to doctors without finding one?!) As the article says, Alaska is funding a program to train students out of state in the medical profession, and med schools in Washington are offering discount tuition. Still, the problem remains debt: students can't afford a pricey stint in med school, and a residency program. Full-tuition grants are one option; building a med school in state is another option. Students would be more eager to go to in an in-state school, and they could apply for the appropiate government grants. The shortage can be alleviated by raising the supply of doctors--the demand is certainly high enough.

why pepsi is pretty much going to take over the world.

http://money.cnn.com/2007/02/13/commentary/sivy/sivy.moneymag/index.htm?postversion=2007021309

This article pretty much says that Pepsico is doing very well because they've not only cornered the market on salty snacks but the "thirst-quenching" beverages that often accompany them.

So, basically, we all know that Pepsi is one of the world's biggest suppliers of cola, and junk food is often a complementary good to soda. By basically creating thirst through their junk food, they raise the demand for Pepsi. By selling Pepsi, they raise the demand for junk food and other salty snacks. It's called "synergy", apparantly. It's pretty brilliant.

Conversely, it could backfire on them. You could buy a Pepsi product but instead of heading for its subdivision of Frito-Lay, you could choose a different snack. But overall, it's a pretty good business plan.

economics & marriage

Blumner:
Saving marriage a matter of economics, not 'values'

Marriage has been in the news lately for its scarcity. More than half of all women in our country are now sans spouse. It's enough to make a wedding planner sob into her taffeta. This slow demise of marriage - down nearly 50 percent since 1970 - results from several trends. Americans are waiting longer to get hitched, are living together without benefit of marriage and, of course, are divorcing at a high rate. This is old news. Drill a bit deeper in the marriage statistics, and you'll unearth a much more remarkable fact: Better off couples are half as likely to divorce. Families with annual incomes over $50,000 have a 31 percent chance of divorce after 15 years, according to a study by the National Marriage Project at Rutgers University, whereas families with incomes below $25,000 have a 65 percent chance. Income predicts divorce with great accuracy. The numbers suggest that a key variable in family stability is less cultural or sociological - less about personal values - than about basic economics. It is hard to get along when you can't get by. There are plenty of stresses that buffet a marriage, but facing more bills than income has to be among the most insidious. Few things are as humiliating and oppressive as working full time yet knowing there is no way your paycheck will provide for your family. It is not a feeling that working Americans in the 21st
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century should be subject to, yet we increasingly are. The Bush administration has focused on marriage as an anti-poverty program, with the government directing hundreds of millions of dollars in tax money to help marriages flourish. I agree that healthy marriages should be encouraged. Married couples have higher incomes through their combined efforts, generally provide a better environment to raise children, and bring wider social stability. But just teaching people conflict resolution and relationship skills is not addressing the elephant in the room. You want healthy marriages? Then start reversing the growing income inequality and the you're-on-your-own economy that America has become. You want healthy marriages? Then start with healthy people and make sure that no American is without affordable health care and no employee has to lose a day's pay when sick. San Francisco is the first city in the country to require employers to provide paid sick leave, and you would think it was demanding gold-plated toilet seats at the loading dock bathroom. The travesty here isn't old liberal San Francisco bilking business owners. It is that any employer today can actually get away with not providing their staff accrued sick pay. Are they kidding? President Bush's idea to reduce the uninsured is a tax deduction for the purchase of private health insurance, a plan that would do virtually nothing for the lower income uninsured. The president should get real. Shoring up families means universal health care. You want healthy marriages? You want things to look more like the venerable 1950s when people seemed calmer and more secure about their lives? Then return to defined benefit pensions. Today only about 21 percent of workers in the private sector enjoy this peace of mind. Instead, we have shifted the risk of retirement onto workers' shoulders. If you don't invest wisely in your 401(k) or if you didn't put enough of your income aside or if you outlive your nest egg, well, thems the breaks. If Bush had his way, even Social Security would lose its entitlement status and become an investment program fraught with personal risk. You want healthy marriages? Then a $2-per-hour increase in the minimum wage won't cut it. We should figure out what constitutes a living wage and make that the floor. In England the minimum wage is $1,800 per month compared to our $824 for full-time work. The idea across the pond is that if an employer wants to monopolize the working time of an employee, then that employee should be paid enough for a reasonable existence. Marriages only have a chance when the people who are in them have a chance. The statistics couldn't be clearer: If the workplace provides men and women dignity and a semblance of economic security, that will translate into stability within the family. If the Bush administration really wants to gird the institution of marriage then it should forget about sermons and lectures on personal virtue (the government's marriage programs are largely operated by faith-based institutions). Red states, which tend to be more avidly religious, have higher divorce rates than blue states. Whereas in low-divorce blue states, workers tend to have higher incomes. It's not a matter of values, it's a matter of value for one's labor. Only by demanding that workers receive decent wages and benefits and only by becoming a more generous society will the decline of marriage substantially slow. Everything else is just a diversion.

--------------------------------

I chose this article because I think it's interesting that the author points out that the divorce rate is higher for lower-income families. I think the solutions she offers to getting more people married are interesting, so I'm going to go through and critique them, in an economic way of course:

You want healthy marriages? Then start reversing the growing income
inequality and the you're-on-your-own economy that America has become.

The growing income inequality I believe the author is referring to is the fact that there are rich people, and there are poor people. It's sad, of course, that some people are ridiculously rich while some people are ridiculously poor, but it's always been that way--and it always will be. In Wheelan's book (I don't have it with me right now, but I remember VERY CLEARLY) he goes through many different techniques on how we've tried to make the rich poorer and the poor richer--and the money never ends up with the poor. It never really works. It's just the way things are in our market system. There will always be unemployment.

Then start with healthy people and make sure that no American is without
affordable health care and no employee has to lose a day's pay when sick.

So, if I get this right, the author is saying that the reason there are so many low income people (resulting in a higher divorce rate among lower-income couples) is because companies don't pay for sick days. An externality for companies paying for sick days is this: say you are never sick. You're always at work on time. Then Lucy is never there. Lucy's always sick. Not only do you possibly have to do extra work to make up for Lucy (opportunity cost: the work you're supposed to be doing), but the company has to pay wages for someone who isn't present. The company is poorer. They may dock some of your pay. So, basically, people who show up every day may end up working harder for less money, and people who are sick end up working less for more money. Hmm.

You want healthy marriages? Then a $2-per-hour increase in the minimum wage
won't cut it. We should figure out what constitutes a living wage and make that
the floor. In England the minimum wage is $1,800 per month
compared to our $824 for full-time work. The idea across the pond is that if an
employer wants to monopolize the working time of an employee, then that employee should be paid enough for a reasonable existence.

Increasing the minimum wage that dramatically (the author is suggesting we more than DOUBLE the minimum wage per month) means everyone has more money. So far, so good. But then the company who makes gum has to pay their employees more, so to compensate, they raise the price of their gum from $1 to $2. Goods cost more. It works basically like inflation. I don't like it.

If the Bush administration really wants to gird the institution of marriage
then it should forget about sermons and lectures on personal virtue (the
government's marriage programs are largely operated by faith-based
institutions).

I agree that the Bush administration probably shouldn't focus so much on faith to save the country's marriages, but instead, they should probably work on tax cuts for those in marriages--especially for lower-income families. They could set up a law saying that couples with a combined income of less than $25,000 gets a certain percentage of tax cuts.

The END!