Posts Tagged ‘Education’

Paul Krugman is an NYT op-ed columnist, economics professor at Princeton, and everything that is wrong with academic economics. His recent article aimed at blasting Rand Paul about a tweet is a great example of his academic shortsightedness.

His worst quote is the following:
“issuing debt is a way to pay for useful things, and we should do more of that when the price is right. The United States suffers from obvious deficiencies in roads, rails, water systems and more; meanwhile, the federal government can borrow at historically low interest rates. So this is a very good time to be borrowing and investing in the future, and a very bad time for what has actually happened: an unprecedented decline in public construction spending adjusted for population growth and inflation.”

This would have made since back when the National Debt was 1/10 what it is today. Had that borrowed money been spent on infrastructure like Krugman is suggesting, we’d have amazing roads (maybe even paved in gold!), freeways, practically no student loan debt, an abundance of water retention systems in California, and massive alternative energy infrastructure. Instead, our roads are in horrible condition and cost us an average of $515/month (after double taxes – income and excise- mind you).

Sure, Krugman’s statements make sense on paper. I’ve seen this kind of thinking before when I was studying economics in college. It’s the same shortsightedness that had me question whether a degree in economics was worth anything more than the paper it is written on. Spoiler alert: the ink costs more than the paper.

Earlier this year, Krugman wrote another half-witted articles about debt (amongst so many others).

With statements like “Because debt is money we owe to ourselves, it does not directly make the economy poorer (and paying it off doesn’t make us richer)”, Krugman proves that studying economics at Princeton is a waste of money. First, our national debt is not owned entirely by American citizens. Second, owing YOURSELF money is fine (great example is taking a loan against your 401K) ONLY IF you pay it back. At some point, you aren’t going to have income, and if you’ve borrowed your entire 401K, you’re really hurting your retirement as well as what you are leaving behind for your family. The argument that the microeconomics doesn’t apply to the macroeconomics is false.

It’s certainly a reasonable argument to make that America borrowing money from itself and then paying it back is a good thing much like borrowing from a 401K is a good thing for an individual. However, if that money doesn’t get paid back and just piles up instead, you’re left with an accelerated increase in debt:

National Debt per citizen in 1980: $4,118
National Debt per citizen currently: $57,093

Even adjusting for inflation, the $4,118 only equals a mere $11,926.11. That’s quite a bit off from the $57K each citizen owns. It gets even worse when you only count taxpayers.

Borrowing and paying back is fine, but that’s not what America is doing. We’re borrowing and then having someone else pay it back (maybe, if they can). That’s called a Ponzi scheme. If America was borrowing from itself (which it isn’t since 35% is foreign owned) and paying back the debt within a generation, we’d see a much smaller national debt than the $18MMM+ we currently have.

At the end of the day, it appears Krugman is too smug with his academia version of national debt that he can’t see the flaws of his logic when applied to the real world as opposed to the fictitious one in which he wants to believe actually exists. He’s played his cards right and gotten to a level of academic prestige, which is great for him and the New York Times; not so good for public perceptions of debt.

The perspective of Thiel in this April 10 TechCrunch article is pure genius! One really must question the value of spending massive amounts of money on higher education when we have reached unemployment levels rivaled only by the Great Depression but have the must educated population in history. Besides mountains of debt, what has all that education provided so many Americans who are out of work? To top it all off, tuition and materials (books) continue to increase in cost. Thiel is definitely right on the money here!

I know I’m about to piss off just about every college student in America, but they really aren’t to blame for cuts to the government spending at state universities. It’s the students before them that are the issue.

The entire concept of the state government providing funding to the state universities is pretty simple: the universities provide an education that allows students to attain higher paying jobs and create businesses that in tern hire more people.

With unemployment at record highs and income a lower levels than a decade ago, clearly the universities have not produced the results the state government was hoping for. The state government pays for most everything with tax dollars. If unemployment is high and business isn’t booming, the universities haven’t produced students who can grow the economy. Their funding should get cut. It’s pretty simple.

Of course, the state governments should be providing the universities with any funding. If anything, they state governments should issue grants and loans to prospective students only. On top of that, the state governments should not rely on taxes for those funds at all. Instead, states should issue bonds to raise money for the grants they issue to students. This would eliminate “budget cut” woes for universities. A university would stand purely on its own merit and ability to compete for quality students. All of this would allow universities to actually compete for students instead of having state mandated tuition fees. Generally speaking, competition generates lower prices as cost is quite often one of the most important factors for any purchasing decisions.

Anyone who says the Bush stimulus package of a $600 tax rebate is not going to stimulate the US Economy hasn’t been watching The Big Idea with Donny Deutsch. I’ve seen more millionaires made from $600 or less on that show than I ever thought was possible. The moral of the story: Your wealth is what you make of it.

Every time I watch that show, I’m completely inspired. Regular people making it big because they had a dream that they pursued. My favorite episode was a few days ago. I can’t remember the guy’s name, but there was a venture capitalist on the show who said that the “side job” never becomes the next million dollar idea. Got me thinking about how many “side jobs” I’ve had over the years. None of them took off. Watching the show, I see nearly all of the stories have something in come: they quit their job went after the dream.

What dream is worth dreaming but not pursuing? Time to take the plunge. Grab that $600 tax rebate and do something with it!

You don’t realize it yet, but in the next 3 minutes you’re going to learn why God has not been answering your prayers. Before I get to that, I’m going to share with you an experience that I’ve had several times in the past and, most recently, this morning. My confession is that this is something that I have done myself. What I’m about to share is something that we have all done at some point in our life and then pondered why the outcome is so different than how we thought God had intended it. So what is the secret to God answering our prayers?

A good friend of mine was sharing about her experience with failing a test necessary to received her teaching credential. She had taken the test last year and failed. She was devastated, but she picked up her chin and started studying again to take the test this year. She spent hours studying and doing what she felt was needed to ensure that she passed the test. Then she began telling me about her conversations with her higher power, God, regarding her journey.

She had made several requests to God that if he did not want her to pursue this goal of hers, he should make sure that certain milestones were not met (such as receiving scholarships, early rescheduling, etc.) Yet, everything fell into place. My friend was clear that God intended her to take *and* pass the test this second time around. She was riding high in faith that she would pass the test. I remember her talking about how positive she was trying to be about the test. She was trying not to think about the last test. She had asked God for guidance, and it was clear to her that he intended her to pass. She failed the test earlier this week.

Almost everyone has heard of this happening to someone. Or maybe you have experienced this for yourself. You called upon God to give you guidance, and he has given you a path that is as clear as the hand in front of your face. To my friend, God has shown her exactly what she was supposed to do by supporting her pursuit of her teaching credential exactly as she knew it should happen. Now, she was upset with God for having not protected her interests. After all, she had made the requests of God, and he had put everything in place for her. I’d venture to guess that you’ve had this experience yourself.

So, why is it that God can appear to answer our prayers one day and not answer them the next? I know that some of us have it that it is all part of God testing us. However, that God is testing our faith by baiting us with cheese of our wants being fulfilled, only to take the cheese away at the last minute is a bit obscene. Bait & switch, deceit, and lies are very human type games. What is more likely than God playing some faith testing game with us is that we have fooled ourselves into believing that our wants and pursuits are supported by God at all. We do this by making demands on God like my friend, “God, if you really don’t want me to pursue this then you should not allow me to receive the scholarships I need.”

Many of us have it that we are so important that God is listening and reacting to every request and demand we make of him in the exact way that we want him to. There are a lot of assumptions we are making about our conversations with God:

  1. He’s actually listening
  2. He takes action in response to our requests
  3. He responds and alters the universe in a way that makes sense to us

Don’t be offended by any of these three assumptions. I’m not suggesting that God does not listen to us. I’m also not suggesting that God doesn’t take any action in response to our requests. I personally believe in a higher power that is always listening and responding to everything that everyone thinks, says, or does. So where does that leave us with the final assumption? The one that God responds and alters the universe in a way that makes sense to us.

As this blog rolls to an end, I invite you to consider that the answer
to the question at hand lies in the realm of responsibility. We project onto God that which we believe to be what he is “revealing to us”. Take a moment to soak this up. Put another way, we see the actions unfolding in our life as God’s response to the requests we are making of him. Like my
friend has experienced, God will not make you pass or fail in life. So, then, why do we make God responsible for the outcomes we experience in life? Stay tuned to my blog for more.

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