NYT Nonsense on SAFRA
With the Student Aid and Fiscal Responsibility Act (SAFRA) likely to be voted on by the full House or Representatives today, the media is finally giving some space to debate over the bill. Unfortunately, the New York Times only pays attention to the parts it likes, writing in an editorial today that:
The private lenders and those who do their bidding in Congress have recently taken issue with a Congressional Budget Office analysis that showed that the bill would save about $87 billion over the next 10 years.
They argue, absurdly, for example, that the savings would be smaller if the system were analyzed under accounting rules other than the ones that the federal government is required to use. The aim is to mislead taxpayers and members of Congress into believing that the C.B.O. estimate is dishonest.
Um, excuse me New York Times, but the CBO has never said the bill — not just going from subsidized to direct lending, but the whole bill — would save $87 billion over ten years. Moreover, it has been a series of analyses from the CBO — albeit driven by requests from members of Congress – that have continually increased the cost estimates for SAFRA. (I have linked to all the CBO analyses here.) CBO’s very first estimate of the bill’s likely net cost put it at around $6 billion over ten years, and it only went up from there after incorporating such things as lending risk and potentially higher Pell grant costs.
Of course, the Times isn’t alone in its refusal to talk honestly about SAFRA. Despite all of the CBO estimates, yesterday U.S. Secretary of Education Arne Duncan said SAFRA would give college students and numerous other interests the world without costing taxpayers a dime. “We’re not asking the taxpayers for one single dollar,” he said. And SAFRA’s sponsor, Rep. George Miller (D-CA), has been touting his bill as a revolutionary money saver since day one.
The truth on this thing is out there, but it’s definitely not in the New York Times.
Filed under: Education and Child Policy; Tax and Budget Policy
The Post and Times Push for Cap and Trade
Since the June House vote on the Waxman-Markey “cap-and-trade” bill, lawmakers from both chambers have backed significantly away from the legislation. The first raucous “town hall” meetings occurred during the July 4 recess, before health care. Voters in swing districts were mad as heck then, and they’re even more angry now. Had the energy bill not all but disappeared from the Democrats’ fall agenda, imagine the decibel level if members were called to defend it and Obamacare.
But none of this has dissuaded the editorial boards of the The New York Times and Washington Post. Both newspapers featured uncharacteristically shrill editorials today demanding climate change legislation at any cost.
The Post, at least, notes the political realities facing cap-and-trade and resignedly confesses its favored approach to the warming menace: “Yes, we’re talking about a carbon tax.” The paper—motto: “If you don’t get it, you don’t get it”—argues that in contrast to the Boolean ball of twine that is cap-and-trade, a straight carbon tax will be less complicated to enforce, and that the cost to individuals and businesses “could be rebated…in a number of ways.”
Get it? While ostensibly tackling the all-encompassing peril of global warming, bureaucrats could rig the tax code in other ways to achieve a zero net loss in economic productivity or jobs. Right. Anyone who makes more than 50K, or any family at 100K who thinks they will get all their money back, please raise you hands.
The prescription offered by the Times, meanwhile, is chilling in its cynicism and extremity. It embraces the fringe—and heavily discredited—idea of “warning that global warming poses a serious threat to national security.” It bullies lawmakers with the threat that warming could induce resource shortages that would “unleash regional conflicts and draw in America’s armed forces.”
(Note to the Gray Lady: This is why we have markets. Not everyone produces everything, especially agriculturally. For example, it’s too cold in Canada to produce corn, so they buy it from us. They export their wheat to other places with different climates. Prices, supply, and demand change with weather, and will change with climate, too. Markets are always more efficient than Marines, and will doubtless work with or without climate change.)
Appallingly, the piece admits that “[t]his line of argument could also be pretty good politics — especially on Capitol Hill, where many politicians will do anything for the Pentagon. … One can only hope that these arguments turn the tide in the Senate.” In other words: the set of circumstances posited by the national-security strategy are not an object reality, but merely a winning political gambit.
There’s no way that people who see through cap-and-trade are going to buy the military card, but one must admire the Times’ stratagem for durability. Militarization of domestic issues is often the last refuge of the desperate. How many lives has this cost throughout history?
Nevertheless, one must wonder at the sudden and inexplicable urgency that underpins the positions of both these esteemed newspapers. Global surface temperatures haven’t budged significantly for 12 years, and it’s becoming obvious that the vaunted gloom-and-doom climate models are simply predicting too much warming.
Still, one must admire the Post and Times for their altruism. The economic distress caused by a carbon tax, militarization, or any other radical climatic policy certainly won’t be good for their already shaky finances, unless, of course, the price of their support is a bailout by the Obama Administration.
Now that’s cynical.
My Morning Tabloid
Why is a U.S. senator’s extramarital affair on the front page of The Washington Post this morning?
Don’t get me wrong, I like a juicy sex scandal as well as the next guy. And I’m amused at my friend and former colleague Radley Balko’s Facebook comment (or was it a tweet? who can keep up with the new media?) that ”sadly, growing public acceptance for gay marriage has given yet another conservative politician no choice but to cheat on his wife.” But this affair fit Bill Kristol’s definition of good Republican behavior: “Republicans have old-fashioned extramarital affairs with other adults.” No prostitution, no underage interns, no public toilets.
So why is it front-page news?
Meanwhile, you know what’s not on the front page, today or any day so far? President Obama’s firing of the AmeriCorps inspector general, in apparent violation of a law that Senator Obama voted for, perhaps in retaliation for the IG’s investigation of Sacramento mayor Kevin Johnson, an Obama supporter. It’s an interesting story. As a Wall Street Journal lead editorial explained:
In April 2008 the Corporation [for National and Community Service] asked Mr. Walpin to investigate reports of irregularities at St. HOPE, a California nonprofit run by former NBA star and Obama supporter Kevin Johnson. St. HOPE had received an $850,000 AmeriCorps grant, which was supposed to go for three purposes: tutoring for Sacramento-area students; the redevelopment of several buildings; and theater and art programs.
Mr. Walpin’s investigators discovered that the money had been used instead to pad staff salaries, meddle politically in a school-board election, and have AmeriCorps members perform personal services for Mr. Johnson, including washing his car.
Other papers have been on the story, notably the Washington Examiner. But as even The Washington Post’s ombudsman notes, not a word in the Post (until a small story on page A19 today, featuring the Obama administration’s spin on the issue). The Post is, however, ahead of The New York Times, which has apparently not run a word on the story, even online, though it did have room for the senatorial affair.
And I have to wonder: If George W. Bush had fired an inspector general who had alleged fraud by a key Bush supporter, would the Post and the Times have covered the story?
What “Taxpayers?”
In an editorial yesterday on President Obama’s proposal to end federal guaranteed student lending and turn everything into loans and grants direct from Uncle Sam, the New York Times had an interesting take on what constitutes putting ”taxpayers’ interests first”:
Private companies that reap undeserved profits from the federal student-loan program are gearing up to kill a White House plan that would get them off the dole and redirect the savings to federal scholarships for the needy. Instead of knuckling under to the powerful lending lobby, as it has so often done in the past, Congress needs to finally put the taxpayers’ interests first.
So let me get this straight: Redirecting tax dollars from lenders — who do get cushy fees and security through the guaranteed loan program — and giving it to students is somehow in the best interest of taxpayers? Maybe I’m old fashioned or something, but wouldn’t the best thing for taxpayers be to get their money back, not just see it shuffled from one special interest to another?
Obviously it would, and not just because taxpayers are best off when they decide how their ducats are used. As Andrew Gillen and I made clear in a Capitol Hill briefing last week, the best thing that could happen for taxpayers, students, and all of society would be for the federal government to provide much less aid to students, not more. The reality is that student aid drives massive, self-defeating college price inflation, creates ugly bloat and waste in our ivory towers, and ultimately cramps economic growth.
And we wonder why there are tea parties!
Week in Review: Successful Voucher Programs, Immigration Debates and a New Path for Africa
Federal Study Supports School Vouchers
Last week, a U.S. Department of Education study revealed that students participating in a Washington D.C. voucher pilot program outperformed peers attending public schools.
According to The Washington Post, the study found that “students who used the vouchers received reading scores that placed them nearly four months ahead of peers who remained in public school.” In a statement, education secretary Arne Duncan said that the Obama administration “does not want to pull participating students out of the program but does not support its continuation.”
Why then did the Obama administration “let Congress slash the jugular of DC’s school voucher program despite almost certainly having an evaluation in hand showing that students in the program did better than those who tried to get vouchers and failed?”
The answer, says Cato scholar Neal McCluskey, lies in special interests and an unwillingness to embrace change after decades of maintaining the status quo:
It is not just the awesome political power of special interests, however, that keeps the monopoly in place. As Terry Moe has found, many Americans have a deep, emotional attachment to public schooling, one likely rooted in a conviction that public schooling is essential to American unity and success. It is an inaccurate conviction — public schooling is all-too-often divisive where homogeneity does not already exist, and Americans successfully educated themselves long before “public schooling” became widespread or mandatory — but the conviction nonetheless is there. Indeed, most people acknowledge that public schooling is broken, but feel they still must love it.
Susan L. Aud and Leon Michos found the program saved the city nearly $8 million in education costs in a 2006 Cato study that examined the fiscal impact of the voucher program.
To learn more about the positive effect of school choice on poor communities around the world, join the Cato Institute on April 15 to discuss James Tooley’s new book, The Beautiful Tree: A Personal Journey Into How the World’s Poorest People Are Educating Themselves.
Obama Announces New Direction on Immigration
The New York Times reports, “President Obama plans to begin addressing the country’s immigration system this year, including looking for a path for illegal immigrants to become legal, a senior administration official said on Wednesday.”
In the immigration chapter of the Cato Handbook for Policymakers, Cato trade analyst Daniel T. Griswold offered suggestions on immigration policy, which include:
- Expanding current legal immigration quotas, especially for employment-based visas.
- Creating a temporary worker program for lower-skilled workers to meet long-term labor demand and reduce incentives for illegal immigration.
- Refocusing border-control resources to keep criminals and terrorists out of the country.
In a 2002 Cato Policy Analysis, Griswold made the case for allowing Mexican laborers into the United States to work.
For more on the argument for open borders, watch Jason L. Riley of The Wall Street Journal editorial board speak about his book, Let Them In: The Case for Open Borders.
In Case You Couldn’t Join Us
Cato hosted a number of fascinating guests recently to speak about new books, reports and projects.
- Salon writer Glenn Greenwald discussed a new Cato study that exa
mines the successful drug decriminalization program in Portugal.
- Patri Friedman of the Seasteading Institute explained his project to build self-sufficient deep-sea platforms that would empower individuals to break free of national governments and start their own societies on the ocean.
- Dambisa Moyo, author of the book Dead Aid, spoke about her research that shows how government-to-government aid fails. She proposed an “aid-free solution” to development, based on the experience of successful African countries.
Find full-length videos to all Cato events on Cato’s events archive page.
Also, don’t miss Friday’s Cato Daily Podcast with legal policy analyst David Rittgers on Obama’s surge strategy in Afghanistan.
Filed under: Education and Child Policy; Foreign Policy and National Security; General; Government and Politics
Oh C’mon, NYT!
C@L readers know that I’m a fan of the NY Times’s news and business reporting. If you want depth and detail (especially today, when papers increasingly read like Tweets), the NYT’s news coverage is about as good as it gets.
The opinion page, sadly, is another matter.
Case in point, last Friday’s lead editorial chastising Japan and Europe for not adopting large fiscal stimulus plans. The lede:
The world economy has plunged into what is likely to be the most brutal recession since the 1930s, yet policy makers in Europe and Japan seem to believe there are more important things for them to do than to try to dig the world, including themselves, out.
That’s actually OK — the editorial board is free to believe (and espouse) that massive fiscal stimulus is the best policy for dealing with the current recession. But to use an old saying, they’re entitled to their own opinion, but not their own facts. Ignoring that admonition, the ed led off its final graf with this howler:
In a recent speech, Christina Romer, another of President Obama’s economic advisers, pointed out some lessons [sic] from the Great Depression: fiscal stimulus works.
If you follow the economic history literature, this is a stunner; some of Romer’s most important academic work demonstrates the opposite, namely that fiscal stimulus did little to get the United States out of the Depression [$] and subsequent U.S. recessions [$]. Has she rejected her own findings?
I tracked down the speech transcript and found out that, nope, she hasn’t; in fact, she was explicit that “fiscal policy was not the key engine of recovery in the Depression.”
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