5 Economic Terms Misused Often by Liberals

The Liberal Trifecta Photo Courtesy of liberalwhoppers.com

Danny Zeng | August 13, 2013

(A similar version of this article was first published on PolicyMic on August 12th, 2013)

The President’s recent economic speech in Knox College and the intense subsequent media interest have prompted me to explore the following often-misused economic statistics by Liberals:

1. Unemployment Rate. Whenever the official U.S. monthly unemployment rate ticks down, it becomes world news. I often receive my monthly BLS job report on Twitter: 7.4% for July. While the official rate had gone down slightly from June, and far from the 10% we saw a few years ago, this statistic is overrated and masks weaknesses in the labor market. The official government unemployment rate is an incomplete indicator of joblessness: It does not count those who have stopped looking for work, and it says nothing about net change in jobs as compared to expectation from economists — we came under expectation in July. About 4 million people gave up looking for work in July. Many jobs created were part-time, partly as result of businesses’ wariness regarding Obamacare compliance. In order to boost employment numbers and avoid political backlash, the White House recently suspended enforcement of the employer mandate in Obamacare for one year, a desperate attempt to spur job growth prior to the 2014 election, even if it means shooting themselves in the foot.

The U6 unemployment rate, which is the broadest reported indicator that accounts for underemployment and those who are only “marginally attached to the workforce,” still stands at 14%. This statistic remained flat for the last 12 months. While the official unemployment rate has gone down marginally, we still have 11.5 million people without work. That should be our top focus as a country and we should not pat ourselves on the back every month when the number fluctuates slightly in either direction.

2. Median Household Income. The president said in the same speech at Knox College, “The average American earns less than what he or she did in 1999.” I scratched my head and thought maybe the president was referring to census numbers that show a reduction in median household income. If so, his statement accounts solely for income and fails to assess wealth gained during the period. The census definition of income excludes taxes and non-cash benefits. This method would peg a rich, retired couple with much wealth in financial securities as poor, as their income will be dramatically less as result of retirement. Using a more extreme example, assume the U.S. government takes all of our income and redistributes it back to us through transfers. Our median household income would be zero, despite the fact that we’ll have government transfers to sustain household consumption. Therefore, the measure does not capture financial well-being and consumption very well. Average (mean or median) American households have actually gained in after-tax income, according to the CBO graph. According to economists Bruce Meyer and James Sullivan, median income and consumption both rose by more than 50% in real terms between 1980 and 2009.

The President continues: “this growing inequality not just of result, inequality of opportunity — this growing inequality is not just morally wrong, it’s bad economics. Because when middle-class families have less to spend, guess what, businesses have fewer consumers.” Scott Winship of Brookings discussed the effect of inequality, growth, and opportunity back in April, saying there is scant evidence that supports the proposition that inequality hampers growth. The President here also unveils the premise of his economic worldview. He seems to believe that consumption creates demand that then creates supply. According to this logic, the economic remedy would simply constitute putting more dollars into the pockets of middle-class families. Where are these dollars coming from? Businesses themselves? Or Government? The President seems to suggest that more middle-class spending power could come from the rich (mathematically it wouldn’t make sense for it to come from the poor). If only would the rich share their slice of the pie (redistribution), then businesses will thrive. He is not talking about opportunity here; the President is talking about redistribution. How does spending more money solve the “inequality of opportunity” if not for us to have the same “opportunity” to spend more? And “spend more” necessarily implies more dollars, whose origins I’ve discussed above must come from the rich. Thus, this is a loopy argument that mistaken income for consumption, which in turn distorts economic policy. Unless, of course, one buys into the argument that redistribution constitutes wealth-creation…

A Higher Ed with Even Higher Disappointment

Photo Courtesy of Business Insider

Danny Zeng | August 2nd, 2013

Recently I have had very engaging conversations with a couple of close friends regarding the status of higher education today. The United States is famous for its world-class higher education system that continues to attract world’s top talents. It is reported in 2011 that about 746,000 international students, or 6% of college student population, studied in the United States. Our nation’s graduate programs are filled with students of other national origins. Many immigrant families aspire to send their kids through some of world’s most renowned universities. My friends and I discussed the purpose of modern higher education and in particular how does liberal education fits in present higher education model. As a student of both liberal and practical education, I often muse at the gaps within my own disciplines. As a government major, I don’t find my curriculum challenging enough. Too little emphasis – if any – is placed on political philosophy, international politics, statecraft, and geopolitics. More finance theory, grounded in economics, should be taught in business schools so the practical how-to can be traced to a solid theoretical foundation for problem solving. Indeed, there is very little curricular guidance from the University beyond mere degree completion – meet and consult over a checklist.  Wall Street Journal recently had a thought-provoking essay celebrating the demise of literature on college campuses. The author argues that alas students could enjoy and truly savor literature for their insight and brilliance without being constantly drowned in the intellectual cesspool of GPA gamesmanship:

“The destruction of the humanities by the humanities is, finally, coming to a halt. No more will literature, as part of an academic curriculum, extinguish the incandescence of literature. No longer will the reading of, say, “King Lear” or D.H. Lawrence’s “Women in Love” result in the flattening of these transfiguring encounters into just two more elements in an undergraduate career—the onerous stuff of multiple-choice quizzes, exam essays and homework assignments.”

McKinsey & Company published a study in May that surveyed more than 4,900 college graduates and made the following observations:

• Mismatch of Skills. Nearly half of graduates say that they are in jobs that don’t require a degree
• Underprepared. About one-third of graduates did not feel college prepared them well for the workplace
• Buyer’s Remorse. Half of graduates would have chosen a different major or school
• Brand Shoppers. Half of graduates didn’t look at graduation rate; four in ten did not look at job-placement or salary records
• Lack of Opportunities. Four in ten of Top 100 colleges couldn’t get jobs in their chosen field
• Underutilization of Recruitment Resources. Less than 40% used career services; less than 30% tapped into alumni network

The dearth of liberal education on college campuses has been an ongoing phenomenon that faculty, students, and administrators seem to have complacently embraced as inevitable. While traditional liberal education has been sacrificed at the altar of knowledge for transient vocational training, skill workshops, and non-core educational benefits, institutions seemingly cannot even live up to its watered-down mission. If higher education fails to enrich our souls and inspire our appetite for knowledge, in addition to failing to train the right talents for today’s economy, then what is the purpose of higher education? Did not the evolution (or devolution) from liberal education to highly specialized, vocational trainings produce a modern, functional learning model? If higher ed cannot live up to the latter and arguably easier part of the bargain, then the entire system would be nothing more than an unfortunate, generational brain drain. Understanding this question is not only indispensable to satiate our own desire for knowledge and search for intellectual wholesomeness, but indeed it will be critical to the sustainability of an informed citizenry – a prerequisite for a functional democracy.

Independence Day: Remembering The Cause

Fifty-six delegates to the Second Continental Congress risked their name and honor in declaring their colonies’ independence from the English Crown on July 4, 1776 in Philadelphia. The document became known as the Declaration of Independence. Digital version of this famous painting is retrieved from en.academic.ru

Clay Olsen | July 4th, 2013

“Objects of the most Stupendous Magnitude, Measures in which the Lives and Liberties of Millions, born and unborn are most essentially interested and now before Us. We are in the very midst of a Revolution, the most [complete], unexpected, and remarkable of any in the History of Nations.”

– John Adams

By the late 18^th century, the British colonies in North America were becoming frustrated with Great Britain’s growing control and incessant taxes. The epicenter of these feelings was undoubtedly in the colony of Massachusetts, in a town called Boston. Tensions were high due to events like the Boston Massacre, the Boston Tea Party, and the implementation of the Coercive Act. Out of the furnace of Boston came John Adams. The firsthand experience of the imperialism of Great Britain had given him a clear view of what all thirteen colonies were likely to face if they did not comply. Adams believed that the continuous addition of taxes was a plot by the British to enslave the colonists. He would become a major role throughout the revolution, including a key member of the Continental Congress. The first meeting of the Continental Congress occurred after the Coercive Act was brought to the colonies. It was here that grievances and petitions to King George III began. War with Britain was generally accepted to be a last resort if it was even a consideration on the table. However, about eight months later in April of 1775, the first shot was fired and war was on the horizon.

As Great Britain rallied her fleets at home, petitions were continually sent from the colonies to the crown. The British government felt that the colonists needed to be taught a lesson through power and force in order for there to be peace again. So as the British were building up an army to hastily crush the rebellion, the Continental Congress met again to discuss the reality of declaring independence. The choices were quite simple at this point: bend the knee to the British and ask for forgiveness or fight for independence. It was not a question as to which path was easier, but as to which path was right.

A committee was formed of five men (Adams, Jefferson, Franklin, Livingston, and Sherman) to draft a declaration of independence that would lay out the case for why the colonists were rebelling. The document was not a grievance that there were not enough regulations on the colonies. It was not a complaint that the rich colonists got to keep too much of their money. And it was not an objection that the British government did not have enough control over their lives. Instead, this was a document claiming that a government thousands of miles away, with no relationship to the governed, was unsuitable to a people with God-given rights of life, liberty, and the pursuit of happiness. The document was a cry against big government and taxation without representation. And it was a call for the transfer of powers from the state to the individual. The document was debated and edited. It was finally agreed upon on July 4^th 1776 and sent out to the world as the Declaration of Independence.

The American Revolution was a revolution that called upon ordinary men in order to succeed. Thomas Paine, a simple tailor, wrote the very famous pamphlet known as Common Sense. Paine was not a wealthy man; he was not involved in politics or law, but he had the ability to explain revolutionary ideas in plain English. People came to love the pamphlet that he wrote in which he claimed, “an island cannot rule a continent.” Three months after its publication, 150,000 copies of Common Sense were circulating the colonies. Support for what was now being called “The Cause” was on the rise.

Inexperience seemed to be the one thing the Continental Army was well supplied with. Colonial soldiers were mostly militia while the British force consisted of a professional army and navy as well as mercenaries. The average British solider was 28 years old with seven years of experience while the average colonial solider was 20 years old with six months of experience (if any at all). The British attack force closing in on the colonies was larger than the population of Philadelphia, the most populace colonial city at the time. Try to imagine the army of colonists, made up of men ages 15 and up, marching towards New York to face one of the most powerful militaries at the time and a navy that was unmatched by any other. Perhaps the biggest advantage that the Continental Army had over the redcoats was their spirit. The British soldiers and mercenaries fought for a paycheck. Colonists fought for Liberty, for themselves and also for generations to come, for you and for me.

The hunger for independence would soon be satisfied because of the brave Americans that gave their lives for “The Cause;” because they believed that a people should not be bullied by their government, especially one in which they had no representation in. On Independence Day we remember this sacrifice, but may we never forget the responsibility that a representative government has given every citizen: to voice their beliefs and keep the government accountable so that our nation does not become a continent ruled by an island of bureaucrats. Our country was founded on trust in the individual, the governed, rather than the government. In a time of need, the cry of Liberty called not only upon men of great power, but also on those from humble walks of life. Thomas Paine, a tailor, was able to influence a nation.  May we as Americans never accept the proposition that we are merely numbers in a pool of statistics. We each have the power to positively affect our nation in many different ways. Our country was founded by brave individuals who were willing to give up their lives for the freedom of their family and of their fellow countrymen. Our armed forces today show us that we continue to be a nation of courageous individuals. We are a land of the free because of the brave men and women that volunteer to protect our nation. May we never forget our history and may God continue to bless the United States of America.

Midnight Tweets from #HB2: The Good, the Bad, and the Ugly

Pro-life advocates organize and gather inside the Texas Capitol to support HB2 sponsored by Rep. Laubenberg (R-Parker) Photo Courtesy of Texas Alliance for Life

Danny Zeng | July 3rd, 2013

OK, I admit. The first one is biased…BUT that picture shared by Governor Perry is priceless. The other ones are great pro-life arguments made by everyday folks on Twitter. Overall, the overwhelming amount of tweets under #Stand4Life, including many posted by first-time Twitter users (discernible by an egg picture), was very encouraging. Around midnight, the House State Affairs Committee voted 8-3 in favor of HB 2 out of the committee. The bill will now go to the full House for consideration. Pro-lifers prevailed in face of rampant vulgarity and “hail satan” chants!

The Good

The Bad

The most recent Texas Tribune poll states otherwise: 62% of respondents (including 61% of women) show at least some support for abortion restrictions. National Journal released a poll that shows 48% of Americans favor a bill that bans abortion after 20 weeks, a four-point lead over the opponents. The same polls shows that a majority (51%) of young people aged 18-29  favor such a ban (and 41% oppose). In addition, 50% of women are in favor of such ban as opposed to 44% against. This again goes to show that people who descend upon the Capitol do not represent Texans and the American people.

To them, it’s a joke.

Wow…

When they speak of “human rights”…well you can read it again from Kirsten Powers’ column from yesterday

Human-rights movements have traditionally existed to help the voiceless and those without agency gain progressively more rights. Yet in the case of abortion, the voiceless have progressively lost rights at the hands of people who claim to be human-rights crusaders. Abortion-rights leaders have turned the world upside down. They want us to believe that a grown woman is voiceless, that she has less agency than the infant in her womb who relies on her for life. A woman has so little agency, we are told, that she is incapable of getting an abortion before the fifth month of her pregnancy. To suggest she should do so is a “war on women.” It’s an insult to women dressed up as “women’s rights.” (The Daily Beast July 2, 2013)

Thanks but no thanks. I don’t think we’ll take advice from a self-avowed “progressive Democrat.” But apparently some young women would stand for “hail satan?”

Please explain the moral distinction between “pro-abortion” and “pro-choice”

“The unborn” who is indisputably on a path to BE born and is at the most vulnerable stage of his/her life…Yes, I’d say we care more about “the unborn” versus a fully-grown adult.

Dream big. I like it.

The whole structure of the federal constitution is to outline, limit, and separate power into three branches of government and establish a system of checks and balances to protect the kind of “inalienable rights” proposed by Thomas Jefferson in the Declaration of Independence, “that among these are Life, Liberty, and pursuit of Happiness” umm in that order where Life takes precedence (perhaps common sense?) over liberty and pursuit of happiness. I’m curious to see the right to abortion in the Constitution.

The Ugly

Not worthy of comments.

HIGHLIGHTS: On SCOTUS Decisions in Windsor & Hollingsworth

Photo Courtesy of The Atlantic Wire

Danny Zeng | June 26th, 2013

It’s all over the news, so I’m not going to cover the basics but instead dive straight into these cases. Just in case you were living under a rock though, 1) Section III of DOMA that defines marriage as a social institution between a man and woman for purposes of federal law was struck down today by the Supreme Court; 2) Prop 8 was vacated and remanded to lower court on procedural ground, namely that petitioners (proponents of Prop 8) were found not to have standing, so the Court did not consider the merits in Hollingsworth – meaning California will have same-sex marriage. Most are direct quotes and passages from the cases that I think are relevant for the sake of understanding different arguments. I expounded on some of them with my own comments and explanations. I also put a heavier emphasis on Windsor because it includes arguments on merits and not just on procedural jargons. I know everyone’s busy and won’t have the chance to go through 100 pages of legal writing (I did – don’t judge), which is why I “sparknoted” the cases for you into 4 pages! My goal is to stimulate a conversation about these cases using highlights from original documents and to let more people know what they are and are not about.

UNITED STATES VS. WINDSOR (DOMA SECTION 3)

KENNEDY, MAJORITY

“By history and tradition the definition and regulation of marriage, as will be discussed in more detail, has been treated as being within the authority and realm of the separate States…” but the federal government could pass “limited federal laws that regulate the meaning of marriage in order to further federal policy,” but DOMA goes too far.

“The recognition of civil marriages is central to state domestic relations law applicable to its residents and citizens…the Federal Government, through our history, has deferred to state law policy decisions with respect to domestic relations…The significance of state responsibilities for the definition and regulation of marriage dates to the Nation’s beginning” BUT “Despite these considerations, it is unnecessary to decide whether this federal intrusion on state power is a violation of the Constitution because it disrupts the federal balance.” What? Did I miss something? Kennedy all the sudden slams on a gas pedal that’s going 90mph on  a state highway only to hit I-10 and starts to lose steam. His federalism argument stops short of arguing that states should be able to decide on marriage altogether as what Justice Alito alludes to in his dissent. Instead, Kennedy changes gear a little and attempts a different set of arguments …

“The history of DOMA’s enactment and its own text demonstrate that interference with the equal dignity of same-sex marriages, a dignity conferred by the States in the exercise of their sovereign power, was more than an incidental effect of the federal statute. It was its essence”

“DOMA’s principal effect is to identify a subset of state ­sanctioned marriages and make them unequal. The prin­cipal purpose is to impose inequality, not for other reasons like governmental efficiency.”

“It [state enactment of marriage equality laws] reflects both the community’s considered perspective on the historical roots of the institution of marriage and its evolving under­standing of the meaning of equality”

“The avowed purpose and practical effect of the law [DOMA] here in question are to impose a disadvantage, a separate status, and so a stigma upon all who enter into same-sex marriages made lawful by the unquestioned authority of the States”

“And though Congress has great authority to design laws to fit its own conception of sound national policy, it cannot deny the liberty protected by the Due Process Clause of the Fifth Amendment.”

“This requires the Court to hold, as it now does, that DOMA is unconsti­tutional as a deprivation of the liberty of the person pro­tected by the Fifth Amendment of the Constitution”

“While the Fifth Amendment itself withdraws from Government the power to degrade or demean in the way this law does, the equal protection guarantee of the Fourteenth Amend­ment makes that Fifth Amendment right all the more specific and all the better understood and preserved”

ROBERTS, DISSENT

There is no evidence that DOMA “codifies malice” or that “no legitimate government interests.” Deference to the legislative branch – Roberts does not address heightened scrutiny needed to consider for issues of sexual orientation. Scalia and Alito dodge this line of reasoning as well and defer to rational basis. This almost rings Robert’s framework in the Obamacare decision: it’s not the court’s prerogative to decide on political questions best left to other branches of government

“I would not tar the political branches with the brush of bigotry.” Roberts is concerned about the Court having to adjudicate on states’ definitions of marriage in the future; he attempts to circumscribe the bounds of the majority opinion.

SCALIA, DISSENT JOINED BY THOMAS

“The ‘prudential’ discretion to which both those cases refer was the discretion to deny an appeal even when a live controversy exists—not the discretion to grant one when it does not.” Scalia takes issue on majority’s interpretation of judicial review and its logic on Windsor’s standing.

“The ‘judicial Power’ is not, as the major­ity believes, the power “‘to say what the law is,’” – only when the case has actual standing to sue, which Scalia believes not. The justice reasons that Windsor had already won her case at the district level. The book should have closed there.

“If a President wants to insulate his judgment of unconstitu­tionality from our review, he can. What the views urged in this dissent produce is not insulation from judicial review but insulation from Executive contrivance.” [emphasis mine] Scalia is saying that of course the court has the power to judicial review but that is not contingent on say Obama administration refusing to defend DOMA

“If Congress can sue the Executive for the erroneous application of the law that ‘injures’ its power to legislate, surely the Executive can sue Congress for its erroneous adoption of an unconstitutional law that ‘in­jures’ the Executive’s power to administer—or perhaps for its protracted failure to act on one of his nominations. The opportunities for dragging the courts into disputes hitherto left for political resolution are endless” – This goes back to Scalia’s dissent on Windsor ever having standing because if so, this would lead to dog-eat-dog litigation between Congress and White House…

…Congress already has numerous tools to ensure enforcement i.e. power of the purse and power to confirm presidential appointees. “Our system is designed for confrontation” leave it to political branches

“Placing the Constitution’s entirely anticipated political arm wrestling into permanent judicial receivership does not do the system a favor. And by the way, if the President loses the lawsuit but does not faith­fully implement the Court’s decree, just as he did not faithfully implement Congress’s statute, what then? Only Congress can bring him to heel by . . . what do you think? Yes: a direct confrontation with the President.” – classic sass from Scalia…Congress should confront the President if he fails to enforce the laws not the Court

“The decision is based on Fifth amendment due process grounded in liberty not exclusively or primarily on Fourteenth Amendment. “In accord with my previously expressed skepticism about the Court’s “tiers of scrutiny” approach, I would review this classification only for its rationality.” Tier scrutiny elevates the ground for judicial consideration because such case considers sexual orientation and sexual relationships, something that the majority had done; but Scalia disregards that and judges based on the lowest threshold: rationality

“DOMA avoided all of this uncertainty by speci­fying which marriages would be recognized for federal purposes. That is a classic purpose for a definitional provision” Scalia fights back with a reason for section III definition – to provide uniformity to federal law enforcement

“Some might conclude that this loaf could have used awhile longer in the oven. But that would be wrong; it is already overcooked.” I love this quote…Scalia is referring to “substantive due process” a complex class of constitutional jurisprudence which he’s not a fan of – this goes along with his skepticism toward Kennedy’s reasoning in the majority. “The sum of all the Court’s nonspecific hand-waving is that this law is invalid (maybe on equal-protection grounds, maybe on substantive-due process grounds, and perhaps with some amorphous federalism component playing a role) because it is motivated by a ‘bare . . . desire to harm’ couples in same-sex marriages” I find this a strong objection to the majority’s opinion. What exactly is Kennedy basing his decision on in terms of precedence?

Scalia concludes that the decision helps no one, that “the Court has cheated both sides, robbing the winners of an honest victory, and the losers of the peace that comes from a fair defeat. We owed both of them better. I dissent” partly because he points out the flaw of the majority opinion – which I fully agree – that it comingles multiple constitutional logic that weakens its argument