Obama - The Captain of the Economic Ship

Obama survived the first 100 days. And with record approval ratings to boot.

Hooray! Who'd have thunk, right?

Bank defaults, no problem. Obama the CEO to the rescue. GM and Chrysler going under? No sweat, Obama the Chairman of the Board is there to fire the CEO of GM, and order Chrysler to go bankrupt. Millions in the nation needing health care? No problem. Obama the healer is there to help. Bring peace and prosperity to the world? Obama the conciliator is there to bring long lost respect to the US in international arena. So, Obama the miracle worker should be able to get Americans healthy, wealthy and wise once more, and bring the good old days back, right?

I think "not so fast".

This economic ship called the US of A, captained by our own Barak H Obama, has at least three boat anchors that need to be dealt with before it can be turned around, and set sail into clear waters.

Let me elaborate.

The first boat anchor is the demographics. America is aging. There are more and more people reaching retirement age, with fewer and fewer people feeding into the social security system. If it was not for immigration, we would have gone into negative population growth. But a large portion of the immigrants barely make minimum wage. And therein lies the rub. No matter how hard we try, the math of getting more taxpayers paying into the social security trust fund is not going to work, unless they increase the retirement age, cut benefits, or both. So there goes the historical standard of living. Both the young and the old, rich or poor, will have to pay more to keep even bare bones benefits alive. This is a structural issue - which means there are no feasible solutions in sight under the current legal and economic structure, without burning a huge hole into people's wallets.

The second boat anchor is the total debt in the system. I have blogged about his before, but I strongly feel it needs to be stated again. The total debt, which is the combined debt of local, state and federal governments, individuals, and businesses, is now over 50 trillion dollars. Even with 1 trillion dollar government bailout, which is a drop in the bucket, the debt is about 3.5 times the GDP. In comparison, the total debt was about 2.5 times GDP during the height of the great depression. A healthy, self sustaining economy can handle a debt load of 1.5 times GDP. So, we have about 2.0 times GDP's worth of debt to work out. That is like saying a person's maximum tolerable weight is 220 pounds, but the current weight is 500 pounds, and he needs to lose 280 pounds pronto! Those who have lost weight know, this ain't gonna happen overnight. Maybe over years, if we are lucky. And the agony will come when the governments will tax us more just to service debt, companies will charge more for their products and services, and individuals will cut down spending just to survive.

The third boat anchor is our public education system, especially the K-12. Much has been said, correctly I might add, by Obama and his ed sec Arne Duncan, on how dire the issue is. After all, it has been proven beyond doubt that a well educated workforce is more productive, and a more productive workforce can outproduce the competition and bring prosperity and wealth back to this country. But by many accounts, the system is so stuck in its own little world, blissfully oblivious of the raging storm, that any meaningful change will take more than an act of Congress to occur. I have heard archived speeches of every president of the United States, starting in the 1960's that the US will be #1 in education in the world. I have yet to see objective data that show that the goal has been achieved. If anything, in many ways, we have fallen behind more nations in the rest of the world. The worst indictment, I think, is that we are yet to officially convert to the metric system. We are not the only one, we have a banana republic (Myanmar) and a ship licensing republic (Liberia) to keep us company. The rest of the world has moved on...

I wish President Obama the best of luck as he navigates through his next 100 days!

Friedman Nails It - Again

Thomas Friedman is one of my favorite columnists. His columns continue to shed new light on the issues he brought up in his groundbreaking book "The World Is Flat". (It is now one of the required reading books for students of International Economics course at local Clark College.) In his most recent op-ed article, published in the New York Times, he sheds new light on how the lack of progress in K-12 education has hurt the US economy.

http://www.nytimes.com/2009/04/22/opinion/22friedman.html

Headlined "Swimming Without a Suit", it has some shocking numbers. One of the estimates of the cost of poor showing in our K-12 system is summed up here: "If America had closed the international achievement gap between 1983 and 1998 and had raised its performance to the level of such nations as Finland and South Korea, United States G.D.P. in 2008 would have been between $1.3 trillion and $2.3 trillion higher." In percentage terms, the GDP would have been roughly 10 to 18 percent higher. Which in turn would have meant we did not have to have the recession we are going through now, because the economy would still be growing, instead of shrinking.

If there is a bright spot, the article mentions that more and more top Ivy league graduates are signing up for "Teach For America", an organization that provides college scholarships in exchange for two years of teaching in inner city schools. It has produced produced such distinguished alumni as Michelle Rhee, the chancellor of Washington DC schools. For many years, they have attracted top graduates from various fields, with an average college GPA above 3.5. Apparently their applications are up 40 percent this year, and most of them are graduates of top schools such as Yale, Princeton, and Harvard.

One small problem for those living in the Pacific Northwest. Teach For America does not operate here. Wonder why?

Thanks to Charles Hoff for sending me the link.

College Freshmen Still Struggle with Basic Algebra

I found this on another web group on math. It quotes an article from the campus newspaper at Oregon State University, the premier state "tech", known for its strong engineering department. Now, you need to realize that this is a student run paper, with a staff made up entirely of students. Even they are now sensing that something is fishy. Maybe they are not so naive as we think. Another thing to note is that Math 111 is college algebra, which is a remedial math course, about the same level as a rigorous high school Algebra 2 course, for those who do not pass the college math placement test. Here is the headline:

"Math 111 continues to be slippery slope for OSU students
Problems with Math 111 are believed to stem from students' inadequate grade school teaching in math"

The article goes on to say "Math 111 has been rumored throughout campus to be one of the most failed classes at Oregon State. Many students go into class with that expectation."
and an observation from a freshman math professor "After 10 years of teaching the course, Argyres said he felt that many students go into the course feeling they can just memorize things, but he said it's really all about understanding concepts. He said he feels that this issue originates in elementary school." "When students never learned the basic information appropriately in high school, or earlier, it is significantly more difficult for them to succeed when they get to college algebra."

I was aware that the school district that my kids attended in Oregon used "Mathland" for elementary schools in the early 2000's, and switched to "Investigations" around 2005. Now they are moving to "Everyday Math". In other words, they have hopped from one reform curriculum to another, without really making a substantial move towards what I consider real math. Here is a quote from the OSU professor which pretty much sums it up:

"Mathematics is densely a foreign language with a foreign spelling routine with all these different symbols," Argyres said. "Part of [understanding the language] is understanding what we mean by the symbols."

Read the full article here:

http://media.barometer.orst.edu/media/storage/paper854/news/2009/04/20/News/Math-111.Continues.To.Be.Slippery.Slope.For.Osu.Students-3717089.shtml