EDUCATION FOR THE 21ST CENTURY

We need to reinvent our education system, much of which was designed to train students for an assembly line economy that is no longer with us. Early childhood care and education, K-12 schools, and higher education need to be improved. This is the fifth of the Ten Big Ideas to Save the Economy, presented by Robert Reich and MoveOn.org. [1] We need to build students’ critical thinking and other 21^st century skills, while stimulating their passion for learning and reducing the dropout rate.

Six steps need to be taken:

Stop high stakes testing. Preparing students for today’s economy requires developing their creativity and curiosity, problem solving and teamwork skills, not honing their test-taking skills. Testing and test preparation (for multiple tests) take a significant amount of time away from important instruction and learning. Testing also enriches the for-profit corporations that sell the tests and related material, diverting funding that is sorely needed for educational purposes.
Reduce class sizes to 20 students so teachers can teach and students can learn appropriate skills and knowledge.
Increase funding, particularly federal funding, for early childhood care and education and K-12 schools. High quality early education is essential to prepare all children, especially those from families facing challenges, for success in school and life. K-12 schools need to better support students and their families by providing activities for the full work day and access to the full range of services and supports children and families need.
Strengthen technical training through vocational programs during the high school years and at two-year community colleges. Our economy needs skilled technicians; not every job requires a four-year college degree.
Make public higher education free. A high school education isn’t enough for many jobs in today’s economy; higher education is a public good that should be publicly funded. This will provide a better workforce for our economy and better informed citizens for our democracy. Saddling students in higher education with crushing debt shrinks their work options and their ability to fully participate in our economy.
Improve teacher pay so our best and brightest want to become our great teachers. We pay Wall Street financiers handsomely to develop our economic capital; we should pay our teachers equitably to develop our human capital. We want highly-skilled, highly-motivated teachers who love teaching and bring their full creativity, knowledge, and skills to bear, not ones who simply fulfill bureaucratic requirements and oversee testing.

By reinventing our education system with these six, sensible steps, we will all gain, today and in the future.

[1] You can watch the 3 minute video at: https://www.facebook.com/moveon/videos/10152760137015493/.

PROTECTING OUR ECONOMY AND DEMOCRACY FROM WALL STREET

We need to protect our economy from the risky behavior of the big Wall Street banks and financial corporations. This is the fourth of the Ten Big Ideas to Save the Economy, presented by Robert Reich and MoveOn.org. [1] We need to prevent these Wall St. giants from crashing the financial system and sending our economy into a severe recession again – as they did in 2008. Millions of Americans lost their jobs, their homes, and their savings in the Great Recession of 2008. The Wall Street corporations and their senior managers got bailed out, but the rest of us got sold out.

The giant Wall St. banking corporations are bigger than ever and are up to their old tricks. Given their increased size, they are even more potent economically and politically than before the 2008 crash. They continue to engage in speculative trading and other risky financial activities that could bring them and our economy crashing down again. They are pushing to repeal even the very modest financial regulations that were put in place to better protect us after the 2008 crash (by the Dodd-Frank law). They have friends in Congress (from both parties), as well as in the administration, who are supporting their efforts. They press their case by spending tens of millions of dollars on campaign contributions and lobbying.

Three actions need to be taken:

Reinstate the requirement that banking activities involving government-insured deposits be kept separate from risky financial activities. The Glass-Steagall Act that used to do this – and kept our banking system safe for 70 years – was repealed in the late 1990s. This led to the 2008 collapse and bailout.
Re-institute a small transaction tax, a sales tax, on the purchase of financial assets. This would discourage speculative activity that has no value beyond self-enrichment (especially high-volume, computer-driven trading) and would produce significant revenue that could be put to good use. A 0.5% sales tax on the purchase of financial assets ($5 on every $1,000) would generate roughly $500 billion per year. (See my posts of 10/8/12 and 9/29/12 for more details.)
Split the big banks into multiple, smaller entities. Currently, they are too big to fail, which should mean that they are too big to exist. Their size gives them too much clout, both economically and politically. This makes them dangerous to our economy and our democracy. In the past, the country used its anti-trust laws to break up the big oil companies and the telephone monopoly ATT. Similarly, we should break up the giant Wall St. financial corporations of today. They are so big that a speculative trade that goes sour and puts them into bankruptcy threatens our whole financial system and economy, and, therefore, requires a public bailout. And they are so big that through spending on campaigns and lobbying, coupled with the revolving door that puts former employees in key government positions, they are able to bend the rules of our financial system and economy to their benefit.

[1] You can watch the 3 minute video at: http://civic.moveon.org/tamewallstreet/share.html?id=116548-5637721-c7x9Tcx.

PROVIDING ECONOMIC SECURITY FOR OUR SENIORS

ABSTRACT: We need to improve the economic security of today’s – and tomorrow’s – senior citizens. Strengthening and expanding Social Security is the third of the Ten Big Ideas to Save the Economy. Reliance on Social Security is increasing. Despite its maximum benefit of only $32,000 per year, for one-third of seniors it’s 90% of their income.

Outside of Social Security, the federal government spends $68 billion every year on tax incentives for contributions to Individual Retirement Accounts (IRAs), Keoghs, 401(k)s, and other tax sheltered retirement accounts. However, almost all of these benefits end up in the pockets of the wealthiest Americans. So these supposed retirement savings incentives for the middle and working classes, which significantly reduce government revenue, are primarily just another tax avoidance scheme for the well-off.

Our country both needs to and can afford to provide Social Security to its seniors. With all the challenges the middle and working classes are facing in saving for retirement, we should be strengthening Social Security and increasing its benefits, not cutting them as some people say we should.

FULL POST: We need to improve the economic security of today’s – and tomorrow’s – senior citizens. Strengthening and expanding Social Security is the third of the Ten Big Ideas to Save the Economy presented by Robert Reich and MoveOn.org. [1] We all want to be able to maintain a reasonable standard of living in retirement. However, fewer and fewer workers have pensions from their employers. And saving for retirement is harder than ever because middle class wages have been stagnant for 40 years while living expenses keep going up. In addition, student debt has grown dramatically and most Americans lost substantial income or savings (or both) in the Great Recession of 2008.

A recent study found that more than half of all American households with someone 55 or older have no retirement savings. Among those with some retirement savings, the median amount of those savings is only about $104,000 for those 55-64 and $148,000 for those 65-74 – nowhere near enough to maintain a reasonable standard of living in retirement. [2]

Therefore, reliance on Social Security is increasing. Despite its maximum benefit of only $32,000 per year, for two-thirds of seniors, Social Security represents half of their income; for one-third of seniors, it’s 90% of their income. Nearly half of seniors would be living in poverty if they weren’t receiving Social Security. So Social Security benefits should not be cut; they should be increased.

Some people are using scare tactics – claiming that Social Security is running out of money and that we have to cut benefits or raise the retirement age to preserve it. However, Social Security is not in serious financial trouble; a simple adjustment in how payments into Social Security are calculated will provide funding sufficient for the foreseeable future. Right now, we pay into Social Security on up to $118,500 of annual income; nothing is paid into Social Security on income over that amount. Therefore, a CEO or hedge fund manager making $10 million or more in a year pays the same amount into Social Security as someone who makes $118,500. If this cap on the income taxed for Social Security were lifted, and everyone paid the same rate on all their income (as we do for Medicaid), Social Security would have plenty of money to pay its promised benefits – and more.

The $118,500 cap on the amount of income taxed for Social Security is not sensible or fair. Scrap the cap and everyone alive today can look forward confidently to Social Security benefits when they are senior citizens.

Some people go so far as to say we can’t afford Social Security. However, they conveniently ignore the fact that the federal government spends $68 billion every year on tax incentives for contributions to Individual Retirement Accounts (IRAs), Keoghs, 401(k)s, and other tax sheltered retirement accounts. Although these policies are presented as promoting retirement savings for average Americans, the way these tax breaks are designed results in almost all of these benefits ending up in the pockets of the wealthiest Americans. These wealthy individuals would be saving anyway, so rather than functioning as effective retirement savings incentives, these tax breaks are largely giveaways to the already well-off. [3] The maximum amounts that can be contributed to these accounts are something only the well-off can afford to take advantage of. For example, the maximum contribution one can make to a 401(k) or 403(b) plan is $18,000 per year or $24,000 if one is over 50. (For the sake of comparison, the median annual household income in the US is $52,000.) The huge amounts of money that can be accumulated in these accounts are far more than are needed to maintain a reasonable standard of living in retirement. The result is that these supposed retirement savings incentives for the middle and working classes, which significantly reduce government revenue, are primarily just another tax avoidance scheme for the well-off.

[1] You can watch the 3 minute video at: http://civic.moveon.org/expandsocialsecurity/share.html?id=116037-5637721-y4jZ7Rxn.

[2] U.S. Government Accountability Office. 5/12/15. “Most Households Approaching Retirement Have Low Savings,” GAO-15-419: http://www.gao.gov/products/GAO-15-419

[3] Ghilarducci, T., Spring 2015, “Senior class: America’s unequal retirement,” The American Prospect

BIG IDEAS TO HELP WORKING PARENTS

ABSTRACT: Working parents in the U.S. are struggling both to make ends meet and to be good parents. They need to be paid a reasonable wage so that full-time work provides a decent standard of living for their families (as it used to). Furthermore, employers and government should work together to ensure that workplaces are family-friendly. These are the first two topics of Ten Big Ideas to Save the Economy, presented by MoveOn.org and Robert Reich in 3 minute videos.

The first Big Idea is the Fight for $15 – the campaign for a $15 minimum wage. If the minimum wage had kept up with increases in productivity since 1968, the minimum wage would be over $21 per hour. If it had simply kept up with inflation it would be over $10 per hour. If we want to be a decent and fair society, we need to pay working parents a decent and fair wage. Also, a higher minimum wage would save employers money be reducing turnover.

The second Big Idea is a set of policies and practices that make work family-friendly. Working parents need:

Equal pay for women
Predictable schedules with regular hours
Reliable, high quality child care
Paid family leave

We don’t have a healthy society if we don’t have healthy families and we can’t have a strong country if we don’t have strong families. Providing basic economic security and family-friendly workplaces for our working parents is critical to having strong, healthy families. This is not only an essential investment in families and our economy, but also in our future – our children.

FULL POST: Working parents in the U.S. are struggling both to make ends meet and to be good parents. They need to be paid a reasonable wage so that full-time work provides a decent standard of living for their families (as it used to). Furthermore, employers and government should work together to ensure that workplaces are family-friendly. These are the first two topics of Ten Big Ideas to Save the Economy, presented in 3 minute videos by Robert Reich (President Clinton’s Secretary of Labor) and MoveOn.org (the progressive, grassroots organization promoting participation in our democracy).

The first of these ten commonsense ideas to make our economy work for everyone is the Fight for $15 – the campaign for a $15 minimum wage. A $15 per hour wage would mean that a full-time worker would make about $30,000 a year. [1] Even at this level, many families would still be struggling to make ends meet. Currently, with the federal minimum wage at $7.25, a third of all families live paycheck to paycheck. If, since 1968, the minimum wage had kept up with increases in workers’ productivity (how much the output of their work is worth), the minimum wage would be over $21 per hour. If it had simply kept up with inflation it would be over $10 per hour. If we want to be a decent and fair society, we need to pay working parents a decent and fair wage.

Minimum wage workers are not kids making a little spending money; half of them are over 35 years old, many are women, and many are supporting families. A higher minimum wage would save employers money be reducing turnover, which reduces the costs of recruiting and training new workers. A number of cities (e.g., Seattle, San Francisco, and Los Angeles) have made the commitment to raising their minimum wages to $15 an hour; the rest of the country should follow suit.

The second Big Idea is a set of policies and practices that make work family-friendly. [2] For starters, women should receive equal pay. Also, working parents need predictable schedules with regular hours so they can plan their families’ schedules and know how much income they will have. In some business sectors (such as retail sales, food service, and home care), the majority of workers don’t know their schedules a week in advance. Some only get a few hours’ notice and some show up at work and are told to go home (without any pay) because it’s a slow day. Many employers manage part-time workers’ schedules to make sure they don’t earn any overtime or qualify for benefits. [3]

Reliable, high quality child care, including for out-of-school time when parents are working, needs to be universally available and affordable. Parents (both mothers and fathers) should receive paid family leave when a new child joins the family and if a health emergency occurs.

The benefits of raising the minimum wage and instituting family-friendly workplace policies are broad and reach well beyond workers and their families. Employers would benefit from having more reliable, productive employees. Society (i.e., taxpayers) would also benefit, not only from improved economic efficiency, but also because the children of working parents would be more likely to be successful in school and in life. Other developed countries have implemented most if not all of these policies; we can too if we have the public will to make this a priority.

We don’t have a healthy society if we don’t have healthy families and we can’t have a strong country if we don’t have strong families. Providing basic economic security and family-friendly workplaces is critical to having strong, healthy families. Family values means supporting working parents, which also gives their children a fair chance to succeed. Helping working parents is not only an essential investment in our families and our economy, but also in our children who are the future of our nation and our economy.

[1] You can watch the 3 minute video at: http://civ.moveon.org/fightfor15/share.html?id=114907-5637721-4VHTwex#watch.

[2] You can watch the 3 minute video at: http://civic.moveon.org/helpworkingfamilies/share.html?id=115612-5637721-L2wvmQx#watch.

[3] Loth, R., 5/29/15, “For workers, ‘flexible’ schedule means unpredictability,” The Boston Globe