Saturday, October 30, 2010

Europe v. America

A European/Belgian friend and I were discussing the lost art of friendly debating. Here are his thoughts on why Europeans are better able to have substantive discussions than Americans:

From my perspective, and based on my experience, Americans tend to be far more focused on judging people than trying to understand and appreciate them. Besides it being an insurmountable threshold to creating a community and meaningful relationships or friendships, it also makes them incapable of discussing any complex issues abstractly, especially if social norms and/or emotional reactions are involved. Furthermore, in the U.S., everything seems to be associated to some form of social norm which basically reduces any interaction to the equivalent of a discussion about the weather.

As I see it, people are isolated here, and incapable of transcending themselves, their relationships and their cultures, virtually creating a prison for themselves. The hole and emptiness this creates inside needs to be reinforced by 'same-minded' people and creates a co-dependent society of 'yes' people where they interchange their sadness by pretending to adhere to social norms for each-other...in other words, our culture is nothing more than a collective delusion creating a sick form of normalcy through a cult-like enforcement of norms and values.

Interesting observations. Cheery fellow, isn't he? :-)

Friday, October 29, 2010

What Governor Schwarzenegger Accomplished

When you vote on November 2, 2010, remember three things: 1) absolute power corrupts; 2) much of our country's success is due to checks and balances; and 3) Governor Schwarzenegger, a Republican, accomplished quite a bit in recent budget negotiations:

It is often said that politics is the art of compromise and, let me tell you, this is exactly what this budget is -- it's compromise, where everyone came together. As you know, that we Republicans wanted to make cuts of more than $12 billion. Democrats were talking about borrowing billions of dollars or raising taxes of billions of dollars. Well, we all gave something up in order to get to that sweet spot of compromise.

Our final budget solution, therefore, can be broken down into three pieces. First of all, let me just go through the numbers:
  • $7.4 billion in cuts,
  • I will also be using my blue pencil to cut an additional $965 million.
  • Then there's $5.4 billion in federal funds,
  • $5.5 billion in fund shifting and other revenues.
When it comes to cuts, we were able to protect, of course, some of the key priorities:
  • Number one, we protected education, kindergarten through 12th and we funded it at the same level as last year,
  • Higher education will actually receive a $1.2 billion increase,
  • Number three, we protected the budgets of our public safety men and women,
  • We protected foster care services and even extended those services from the age of 18 to 21,
  • And we ensured that our most vulnerable citizens can continue to have access to health and human services programs.
What would have happened without the threat of a GOP Governor's veto? How many more billions would we have borrowed?

Thursday, October 28, 2010

Jess Walter: Financial Lives of Poets

I usually don't read fiction, but the title of Jess Walter's Financial Lives of the Poets intrigued me. Poetry and finance? I couldn't resist. So far, it's an easy, fun read, and I just wanted to share some fun paragraphs from the book (page 71, trade paper):

At my mid-sized newspaper, the soul-disabled publisher scoured the various newspaper chains until he found the perfect budget-hacking delusional jargon-monkey, a man driven out of every crappy newspaper he ever ruined...

Like any tyrant worth his sadism, M---'s first move was to force out any managers who might disagree with him, and his second move--right out of the Khmer Rouge playbook--was to target and demote any intelligent people left who might question his propaganda...

Oddly, M--- seemed to have no real interest in the city his newspaper was supposed to cover; his only passion was the business itself, a thing he called newspapering, and he constantly made us all uncomfortable by professing a creepy, nostalgic love for this made-up word, a love he seemed to mainly show by wearing a '40s-movie fedora and getting weepy whenever he reflected back on the fourteen months he spent as a libelous reporter waterboarding the English language. "The man loves journalism the way pedophiles love children," we used to say.

Like I said, a nice, quick read.

Wednesday, October 27, 2010

California Teachers: Do They Make Enough Money?

I am so tired of dealing with Californians who don't know basic facts about their own state. Below is a discussion I've had more times than I'd like to count. It demonstrates the strange situation we have in California, where voters view strong and powerful entities--like government and teachers' unions--as victims in need of more support.

Jason: [makes a pro-Jerry-Brown comment. Mr. Brown is a Democrat in a state where Democrats have controlled an almost uninterrupted majority in the state legislature for decades.]

Lawyer: Voting for Brown means a vote for political uniformity, i.e., Dems in White House, Congress, CA legislature, and CA governor's office. When was the last time total power led to good results? Vote for Meg Whitman and support political diversity. I know she's not anywhere close to perfect, but aren't you concerned about maintaining real checks and balances?

Jason:
when has complete gridlock led to anything?

Lawyer: there was temporary gridlock because the Dems wanted to pass a budget without including important reforms. For example, is pension reform important to you? If so, having a Republican in the Governor's office helped reform pensions. See here: http://gov.ca.gov/speech/16158/ [Update: link has expired. Former Governor Arnold Schwarzenegger negotiated pension reforms before leaving office.]

A Republican in the Gov's office means that it may take us longer to pass a budget, but once it passes, the budget is likely to include more spending cuts than tax increases. 


Castagn: "A Republican in the Gov's office means that it may take us longer to pass a budget, but once it passes, the budget is likely to include more spending cuts than tax increases."

So it will take longer to pass an even crappier budget than we usually get? Sign me up. I certainly feel that we need to cut school funding and social services a bit more rather than fund them adequately.

Lawyer:
you think 37 to 60 billion dollars each year isn't enough for K-14 funding? (By the way, 80 to 85% of that money goes into the pockets of teachers and other school staff. More here--you need to click on the "Teachers in California" link.) [Note: at some point, the link may become outdated because of updates to the Ed-Data website. As of July 4, 2011, however, the link to the "Teachers in California" January 2010 edition states, "Although there is some variation, expenditures on salaries and benefits for all employees typically make up 80 to 85% of a district’s budget, with the bulk of it going to teachers." Also from the same page: "In 2008-09 California’s teachers were predominantly white (70.1%) and female (72.4%), quite a different look from the student population that was 51.4% male and had major ethnic categories of 49.0% Hispanic, 27.9% white, 8.4% Asian, and 7.3% African-American."]

Also, by law, a set percentage of general fund revenues must go to K-14 education (see
Prop 98 and the California Constitution). There is not much either a GOP or Dem governor can do about that percentage. [Update: in 2011-2012, Gov. Brown proposes to spend about 42% of California's entire state budget for K-12 education. That apparently translates into about 55% of general fund revenues, which doesn't include the state's bond/interest payments. It also doesn't include additional funding sources, such as the federal government (11%) and local property taxes (21%). (See here.)] You are entitled to your opinions, but not your facts. To learn more facts, check out this link: http://willworkforjustice.blogspot.com/2010/09/teachers-unions-running-california.html

Jefferson:
are you saying that teachers are overpaid? BTW, blogs are not good sources for "facts" as they are one person's opinions.

Billy:
[Note: no one responds to this comment] Regarding California's unfunded pension obligations:

http://www.stanford.edu/group/siepr/cgi-bin/siepr/?q=%2Fsystem%2Ffiles%2Fshared%2FGoingforBroke_pb.pdf

This is the same issue that quite a few European govts are grappling with (lately the mess in France has been getting a lot of coverage). Namely, these generous pension systems are unsustainable:

"The study concluded that the state’s unfunded pension liability has topped half a trillion dollars – six times the present state budget.

Put another way, future California taxpayers are going to be on the hook for more than $500 billion simply to make up the difference between the pensions we’ve promised to today's state workers and the money we’ve invested to pay for them.

That’s tax money that will have to be shelled out before a nickel is spent on the public services of the future."

Lawyer:
every statement at the link is supported by objective evidence. Once again, you are entitled to your opinions, but not your facts. Fact: "According to the CTA's parent union, the National Education Association, California teachers were the nation's top-paid, with $64,424 average annual salary in 2007-08."

[Update on 6/20/13: according to the non-partisan Legislative Analyst Office  as of 2011, "California has the highest average teacher salary [$66,064 in table for CA; $53,168 for U.S.] of any state in the country but also has among the highest numbers of students per teacher. California ranks 31st in per pupil spending. California ranks almost last in student achievement."]   

After about five years of experience, many--not all--teachers in the Bay Area make around 65K to 70K. In addition to receiving a middle-class salary, most teachers receive generous benefits such as job security and pensions (and in some cases, lifetime medical benefits). Such benefits can add up to hundreds of thousands of dollars over the course of a teacher's career.

New teachers--who have less than five years experience--are underpaid because we spend billions of dollars each year paying teachers who no longer work, i.e., retired teachers. Our current teacher compensation system is back-loaded, where retired and older teachers receive the majority of benefits while newer and younger teachers must wait in line to catch up.

Jefferson:
I didn't present any facts, just questioning the neutrality of the source, so please save your 'you are entitled to your opinions, but not your facts' spiel.

I would like to see where your 'most teachers in the Bay Area make 70k after 5 years' claim came from. Your 'factual' blog states, "As a result, many new teachers quit within five years." Why would they quit when they are on the verge of a huge payday? If you stick it out for 5 years you'll be set for life it seems.

Is $64k a year that unreasonable for the California? We have one of the highest cost of living in the nation. Maybe $64k is high for the central valley but it's below median for SF, San Jose, or any larger Cali cities.

Lawyer:
1) the $65 to $70K (approx) annual salary number is based on publicly available information;

2) if the teachers' unions admit that the average salary in the entire state--including data from the Central Valley--was 64K three years ago, it's not difficult to see that COLA would put the average Bay Area teacher's salary around 70K; and

3) I didn't say 64K or 70K was "high." I said it was reasonable, especially when factoring in benefits such as job security, lifetime medical benefits (in some cases), and pensions.

4) the NEA claims that half of all teachers quit within five years: http://www.washingtonpost.com/wp-dyn/content/article/2006/05/08/AR2006050801344.html

The additional and gradual salary increases after five years don't seem to make up for the realization that teachers' unions tend to focus on retired and non-working teachers. As I said before, the teacher compensation system is back-ended, which harms younger and newer teachers. The unions' excuse is that we don't pay teachers enough money, but they are unwilling to sacrifice anything on the back end to help newer and younger teachers. Instead, they want to raise taxes to maintain their back-ended compensation system while using younger and newer teachers as props in budget negotiations.

I also think many teachers go into teaching with unrealistic idealism and are confronted with sobering reality. The reality is that much of academic achievement is based on the kind of parenting received by children before they enter 4th grade, not to mention parental income and education levels.

Jefferson:
this is the reply from a friend who IS a teacher in the bay area regarding the claim that 5-year teachers in the bay makes $75k and gets "generous benefits such as job security, pensions, and lifetime medical benefits."

"So NOT true. I get no medical benefits in Fremont. I don't pay into social security so I get no social security benefits when I retire. And I have been working for 10 years in the same district and I still do not make near 75K. Believe me. All of that is b*llshit."  [Note: in some cases, if a California teacher works longer in the private sector than in the public sector, s/he may collect both a pension and Social Security benefits. For example, a teacher could work 10 years in a public school system, then work in a private school for 15 years, eventually collecting both pension and Social Security benefits.]

Lawyer:
what school district does she work for, what grade does she teach, what is her education level, and what is her exact job title? Please see below for salary information copied from Fremont's own website:

http://docs.google.com/viewer?a=v&pid=sites&srcid=ZGVmYXVsdGRvbWFpbnxiZXR0ZXJmcmVtb250dW5pb258Z3g6YzZiY2Y1ZjhlYWMyNTU4

Look at salaries for mid-range teachers in Fremont High: $78K.


Jefferson: She works in Fremont, that's all I'll going to say to protect her privacy.

I also have other friends who are bay area teachers. NONE of them live the life that you described ($75k+ salary, lifetime medical benefits, pension, etc.). Besides all that, the work environment sucks. Unlike you and me who answers to one level of management, they answer to administration, parents, students (yes students), and often politicians who have no idea how screwed up education is in this country and thinks they are getting too much money.

Lawyer:
as the link above and other publicly available links demonstrate, your basic facts are wrong. Moreover, your unwillingness to share generic information about your friend is strange when she is the sole support for your contentions. If you want to continue discussions, please provide evidence and objective evidence.

Jefferson:
Where is the 'lifetime medical benefits, pensions, etc.'?

You're right. It's obviously an overpaid job. Let's cut all teacher salaries in line with janitors, maids, etc. There's an oversupply of teachers anyway, people are just dying to get into the education field. It's so much more lucrative than being an accountant, scientists, engineers, etc.

I'm being sarcastic obviously. If you have to listen to some of the BS teachers face, claiming they are 'well-paid' is an insult.


Lawyer: CalStrs ( http://www.calstrs.com/investments/index.aspx) is the teacher's pension fund. It has assets of $138.6 billion (yes, that's billion with a "b"). According to its own website, it is "the nation's second largest public pension fund." [Update: as of 5/31/13, the pension fund is worth $166 billion.]

Your last comment is based on emotion, not logic or facts. I hope you will stop engaging in propaganda and will try harder to use facts and logic to make your case. We already have Glenn Beck and others at Fox News relying on propaganda to make their case :-)

In any case, I am tired of dealing with Californians who lack basic knowledge about the issues and yet believe their opinions should be given any weight. In the future, please use objective evidence and personal knowledge to support your contentions.  


Jefferson:
So the pension fund has plenty of assets. [He obviously didn't read Bill's comment. Sigh.] You still have not shown how '5-year teachers receive generous benefits such as job security, pensions, and lifetime medical benefits (worth thousands of dollars)" Which in itself is an emotional argument designed to portray teachers as over-compensated and not based on facts.

But keep up the ad hominem attacks, bud. You seem intelligent enough, I hope you realize the hypocrisy in your last statement.

Lawyer:
1. Public school teachers in California are unionized, which provides them job security. See the chart below, which shows the difference in job security between government workers and private sector workers:

http://1.bp.blogspot.com/_HOMfaLGCZIY/THoXdPJM3TI/AAAAAAAAAdQ/GOFeYbeQrMg/s1600/the_protected_class.png

[The chart is from this link: http://online.wsj.com/article/SB10001424052748703447004575449813071709510.html?mod=googlenews_wsj]

2. The teachers' pension fund is underfunded by around $42 billion. Taxpayers in California are on the hook for the full amount of teachers' pensions [Editor's note: as of 2011, the state teachers' pension fund assumes a 7.75% rate of return on all investments--regardless of actual investment performance.  This means that any shortfall must be made up by taxpayers or by higher contributions by existing teachers, especially younger/newer teachers]. See http://www.businessweek.com/news/2010-01-27/california-teachers-pension-fund-42-6-billion-short-update1-.html

3. After five years, most public employees--not just teachers--are eligible for pensions. For example, after five years of work, a gardener from a local school district may be eligible to receive a pension for the rest of his life.

In any case, information about state workers and their access to pensions, medical benefits, and other benefits is not hard to find. Here's one place to start, on CalPERS: http://ctainvest.org/home/CalSTRS-CalPERS/about-calpers/calpers-retirement-benefit.aspx

I hope you will use this discussion as a starting point to learn more facts about California's public sector unions and teachers' unions.

Jefferson: [people who lack evidence and objective support tend to resort to personal attacks.]
I really like how you attacked me for using anecdotal evidence, then provided your own to make your point - "a gardener from a local school district." Guess they don't teach the philosophy of hypocrisy in law school.

Ah, that really explains your assholedness and condescending attitude. Sorry bud, you took the gloves off first. If you really want to change someone to your point of view, try not to be condescending about it, but then again, you're a lawyer. (Apology to all the other good lawyers out there, I'm only referring to this one).

Karena: Here's the salary scale for Palo Alto Unified School District. As you might imagine from the community they're drawing from, these are some of the best-paid teachers in the state of CA. http://www.pausd.org/community/employment/teachers/teacher_salaries.shtml

Even if you have a 30-unit master's degree when you're hired by PAUSD, you're still making just $62,636 at 5 years experience. If you have only a BA, which is more likely, then you're making $55,025 after 5 years. How do you figure the "average" Bay Area teacher is making $70+ a year at the 5-year mark?

Lawyer:
almost all of the teachers I know spend their summers taking grad courses. After five years, most of them attain enough units to get close to the $70K mark. For Palo Alto, assuming twelve units every summer, after five years, a teacher would have 60 units and make $69K. That salary figure doesn't include the value of benefits, which are substantial. Also, many teachers work only 180 days a year (i.e., the minimum number of school days required by state law).

Remember: most teachers have summers off and are encouraged to use their time to earn grad degrees. The additional education is what allows many teachers to reach the 65 to 70K (approx) mark after just five years. After a certain point, teachers max out the value of their education and go back to getting three months' vacation a year and numerous paid state holidays.

I hope that makes sense. I mean, think about it--almost everyone in the private sector has to work year-round for the same salary. Thus, when teachers attend school over the summer, they are putting in similar hours as private sector workers. In short, at least initially, more ambitious teachers act rationally and work year-round to maximize their salaries. Such activity means they put in the same time as private sector workers, but receive a guaranteed payoff.


Overall, most Bay Area teachers receive middle class salaries with generous benefits unavailable to most private sector workers. If teachers want higher salaries, they ought to consider switching to 403(b) plans and getting paid more on the front end instead of burdening taxpayers with billion dollar, back-ended pension obligations. Of course, the government unions realize how valuable their pensions are, which is one reason they are sacrificing higher salaries so that retired (aka non-working) teachers can continue getting generous pensions.

I've seen so many private sector workers get fired, it is disconcerting to hear a relatively comfortable, politically-connected group of people complaining about not receiving more money from taxpayers. When you represent people who have little job security, who are poor, or whose only safety net is unemployment insurance, it's tough to sympathize with government employees, who are relatively much better off.

Karena:
I'm not going to argue with a lot of the things that teachers unions push, including underpaying younger teachers to pad the pockets of older ones. Still, I do know that all of the under-35s I got to know chatting in the staff room, including myself, either lived with their Silicon Valley engineer SOs, or with their parents. There are plenty of people in this valley who can't make ends meet, and the vast majority can't afford to buy a house. Still, the existence of unemployed and/or downtrodden others doesn't magically make a teacher's lot an awesome one, or cutting funding to schools and teachers a solution to serious structural budget problems in CA.

As we could ask all the other Americans who don't go into teaching, leading to a massive dearth of qualified teachers: if it's such a well-paid, fantastic job, why don't you do it? ;-)

Lawyer:
funny you mention this, because I just visited a public elementary school and was surprised by the number of male teachers...I didn't see a single one! I happen to love teaching kids, and I volunteer as a youth basketball coach. I've considered going into teaching, and as a first step, I recently offered to tutor ESL kids at the local school district. (I majored in English and used to tutor ESL college students.)

Bonus I: Antonio Villaraigosa, Mayor of Los Angeles, 12/7/10: “there has been one, unwavering roadblock to reform: teacher union leadership...The teachers unions aren't the biggest or the only problem facing our schools, but for many years now, they have been the most consistent, most powerful defenders of the unacceptable status quo.” More here.

Bonus II: Did you know the average California teacher receives the equivalent--at least as of 2011--of a $500,000 lump sum when s/he retires? Never heard that before, huh? Funny how the teachers' unions don't mention that. More here.

Bonus III: Actually it looks like I may have underestimated the value of teachers' pensions. More here. MyMoneyBlog calculates that as of 3/2011, a $300,000 lump sum would would get you just $1300/mo in annuity payments.

Bonus IV: from Joel Klein, The Atlantic, June 2011:

[C]onsider the financial burden that comes with providing lifetime benefits. Given the time between first putting aside the money to fund such a “long-tail exposure” and having to begin paying it, the amount “reserved” by the employer necessarily depends on a host of imprecise assumptions—about the rate of return that the money invested in the pension fund will earn, about how long employees will live, and even about how much overtime employees will work during their last few years, which is normally included in calculations of the amount of the pension. Each dollar set aside this year to cover the ultimate pension exposure must be taken from what would otherwise be current operating dollars.

Consequently, elected officials have had every incentive to make extraordinarily optimistic assumptions about the pension plan—or to simply underfund it—so they can put as little as possible into the reserve. Unfortunately, but predictably, that’s exactly what has happened: most states “assumed” they would get an average 8 percent return on their pension reserves, when in fact they were getting significantly less. Over the past 10 years, for example, New York City’s pension funds earned an average of just 2.5 percent. Now virtually every pension plan in America that covers teachers has huge unfunded liabilities. A recent study by the Manhattan Institute estimated the total current shortfall at close to $1 trillion. There’s only one way to pay for that: take the money from current and future operating budgets, robbing today’s children to pay tomorrow’s pensions.

Bonus V: from Michael Podgursky, "Fringe Benefits," Educationnext, Summer 2003 (Vol 3, No 3)


Bonus VI: Lobbying information here: https://www.opensecrets.org/industries/indus.php?ind=L1300 

Monday, October 25, 2010

Magma to Cadence: Bring it On

I attended Magma Design Automation’s (LAVA) annual meeting on September 23, 2010. Over the past year, Magma stock has handily beaten the S&P 500. Since September 28, 2009, the S&P has struggled to break even while Magma's stock has increased around 70%.

Chairman and CEO Rajeev Madhavan handled the formal portion of the meeting, which was uneventful. After the meeting, he generously agreed to allow me to ask him questions one-on-one.

Mr. Madhavan’s energy is palpable. You can almost feel his lava-hot desire to succeed when you hear him speak and move. One gets a sense that Mr. Madhavan is bustling with ideas and can't wait to share them with you.

I expressed my concern that Magma’s general business was becoming commoditized, which usually causes margins to decline. However, Mr. Madhavan told me that Magma had “substantial leadership in the analog area” with several unique, brand-new tools. He said he was “extremely confident” about the new tools. He also indicated Magma’s biggest challenges were internal, i.e., to ensure execution without incurring more expenses.

When I pointed out that Magma was a smaller player in a market dominated by Cadence (CDNS) and Synopsys, Inc. (SNPS), Mr. Madhavan compared Magma to Google's Android, contending that if size mattered, Microsoft should have been able to outcompete Android–which has not proven to be the case. He also said that “Cadence is weakest in [its] technology” and doesn’t offer the “best of anything [in its market].” To put Cadence’s technological issues in context, Mr. Madhavan said that some of Cadence’s products were “three to four times slower” than anyone else’s. When I expressed surprise, Mr. Madhavan’s eyes lit up. He immediately issued a bold challenge to Cadence, saying,“You name it, I’ll take them on anyplace...every couple of weeks or so, we’re winning evaluations against Cadence, and we’re seven to fifteen times faster” in SPICE and several times faster in digital now.

What about Synopsys, I asked? Mr. Madhavan’s tone softened. He said Synopsys is “strongest in terms of numbers” and its balance sheet, and Magma “must continue to differentiate” its own products to compete with Synopsys’ products. [According to Magma, "In SPICE Magma has a tremendous differentiation and we expect to increase our digital differentiation with our upcoming product launches.”]

My impression was that Cadence was expanding in China, so I asked Mr. Madhavan about Magma’s Chinese footprint. Mr. Madhavan confirmed his company also had “sales and marketing in China” but indicated that the industry has yet to do as much business there as in the U.S.

I asked Mr. Madhavan about his biggest challenges going forward. He said that his primary goal was getting “engineers to try” Magma’s products. Once engineers try Magma products, they tend to view Magma as an attractive partner. But Mr. Madhavan admitted that existing business practices--specifically all-you-can-eat deals from other EDA suppliers--encouraged inertia. Because the consequences of missing a deadline can be so severe, most engineers prefer to stay with the more established names rather than switch, even if Magma’s products are better and faster.

Regarding my contention that EDA was becoming more commoditized, Mr. Madhavan expressed disagreement: “The very fact that [other companies] think that their products are commodities is the anti-thesis of Magma...we strive to differentiate--that’s our culture.”

How about it, Cadence? Will you take on Magma in a head-to-head contest? Mr. Madhavan is waiting for you.

Bonus: a review of Magma’s 2009 shareholder meeting is here.

Disclosure: I own a small number of Magma (LAVA) shares. My holdings may change anytime. Also, a Magma employee had the opportunity to review this article and submitted some comments to me. I included some of his comments, including the references to SPICE.

Movie Recommendation: Battle of Algiers (1966)

I've just seen one of the best movies ever made: The Battle of Algiers (1966). It's about colonization, terrorism, and independence. It is stunning to see the potential parallels between America's campaign in Iraq and the French's campaign in Algiers.

Friday, October 22, 2010

Think Corporations Don't Pay Enough Taxes? Joke's on You.

Of course we have to pay taxes. The question is, "What kind of taxes should we impose for maximum efficacy?"

From David Walker's book, Comeback America (hardcover, page 121): "we must realize that corporations don't really pay taxes. Rather, they pass along any tax, in the form of higher prices to consumers, lower wages to workers, and/or lower returns to shareholders."

(And last time I checked, CalPERS and many middle-class Bay Area families were shareholders.)

Thursday, October 21, 2010

Random Thoughts

1. If the South had a way to make money without needing to enslave Africans, would we have had a Civil War?

2. The surest path to tyranny is hyperinflation.

3. Public sector compensation and private sector compensation are completely different. Unlike the private sector, public sector compensation usually includes unpredictable long-term structural debt, such as pensions and medical costs. The costs of pensions and medical treatment depend on a person's age and health. If it was so easy to analyze costs relating to a person's age and health, we could all run insurance companies. Moreover, when governments make long term compensation promises, they are using taxpayer money (OPM) and have little incentive to get the numbers right. More here, from a letter to The Atlantic (Nov 2010):

In the final analysis, it doesn’t matter whether you work for GM or N.Y. or U.S.A.; it doesn’t matter if you are in a defined-benefit or defined-contribution plan--your retirement is dependent upon the earnings and productivity of your grandchildren and their friends. All of the pieces of paper in these plans are just proxies: claims on a portion of the labor of future generations. All of these retirement schemes seemed affordable when they were new. We didn’t see why they were inexpensive: because they were built on leverage. They depended upon borrowing against the future growth of the three unsustainable pyramids: economic, population, and credit. None of those can continue forever, and as one fades, the others must take up the slack. But once all three pyramids are played out, the plans face a few stark choices: substantially raise contributions, substantially lower payouts, or go bankrupt.

Steven Flint Manasquan, N.J.

4. People's voting preferences are probably based in large part on whether they have children. Most parents probably favor the status quo. Why? The more society changes, the less knowledge they can pass along to their kids. The parents' economic skills may also decline in value if society changes too much. In contrast, people without kids have more time to adapt to changes and also have a higher incentive to change society to suit their own needs and wants. In conclusion, I bet parents tend to be more "conservative" while childless adults tend to be more "liberal."

5. The S&P 500 is about 1180. The Dow is about 11,142. Perhaps the market is a bit frothy. Markets may be anticipating an extension of the Bush-era tax cuts, which means an assumption of a more politically balanced federal government. But elections can be unpredictable...

Wednesday, October 20, 2010

Questions re: Charter Schools

1. If charter schools don't have the burden of paying billions of their dollars to retired/non-working school personnel, can't they use more of their dollars to pay newer teachers more and to limit class sizes?

2. If charter schools must compete for students and overcome parental inertia (i.e., most parents will move their kids along in the same school system unless they have a good reason to change), don't charter schools have a greater incentive to provide better services and to be more transparent?

3. Do you believe competition usually leads to better service and products?

4. Do you believe that monopolies usually lead to good service, superior efforts, and superior results for consumers? If not, do you realize that by opposing charter schools, you are supporting the status quo, which is a monopolistic public education system?

5.
Most people agree that parental involvement, the level of parental education, and good parenting skills are the primary factors in determining a child's academic success. How does paying teachers more or opposing charter schools solve the problem of uninvolved parents, uneducated parents, or a lack of parenting?

Random thoughts of the day:


1. Competition lowers prices for consumers; monopolies, on the other hand, usually allow entities, whether government or corporate, to increase prices. Right now, public schools have a virtual monopoly on education because most students must attend a school based on where they live rather than other standards, such as test scores, better facilities, better teachers, etc. The more schools must compete for government money (which is related to the number of students attending a school), the more all schools are incentivized to improve services.

2. Re: why privatization will decrease education costs. Again, when you break a monopoly, costs usually go down. Some people appear to be assuming that charter schools will incur the same expenses as public schools, and therefore it will all be a wash. This is incorrect. We know California's public schools are inefficient. They use about 85% of their funding to pay employees and contractors, which means they spend only about 15% of their money on children.

For example, in some California public schools, a gardener, after just 5 years of work, is eligible for a pension of around $1,000/month. It is unclear how paying a gardener a pension after five years of work helps children, but let's set that issue aside. If a charter school hires a gardener but without the burden of a pension, it has more options. It can increase a teacher's salary by $1,000/month, buy laptops for students, or add courses. To make a long story short, the opportunities to game our current education system are enormous. Charter schools, if run properly, can set up systems that are harder to game and that lack long-term structural deficits such as pensions.

Over time, as more students attend charter schools, the state may eventually be able to force teacher unions and public schools to eliminate their own long term structural deficits and to adopt student-centric teaching and evaluation methods. In time, we may even be able to amend the state Constitution to divert education-earmarked money to services that benefit all state residents. Even if we fail to divert money to non-education services, competition alone and the battle for students/state money will improve education for all students, which is the ultimate goal.

Tuesday, October 19, 2010

Are State Pensions Sustainable?

"There seems to be a high likelihood that future generations will have to bear the substantial burden of making up pension benefits for previous generations of state employees. While citizens of states that are particularly hard-hit by the pension crisis may be able to escape to other states, an acceleration of this demographic phenomenon would leave a dwindling taxpayer base behind in the states facing the largest liabilities. This would increase the likelihood of a federal taxpayer bailout in which taxpayers in all states would bear the burden of the states in default. The problem of state and local pension liabilities is therefore a problem for all U.S. taxpayers, not just those in the states with the largest deficits." -- Joshua Rauh

More here. Scroll all the way to the bottom to see your state's ranking. The lower your state's ranking, the better.

It's not pretty if you live in Illinois, Connecticut, Indiana, or New Jersey.

It's much better if you live in North Carolina, New York, or Nevada.

Monday, October 18, 2010

How to Help Poor People

The best thing anyone can do is make a poor person self-sufficient and/or independent.

Welfare and charity do not make a poor person self-sufficient because they regard the poor person as a passive recipient of benefits rather than someone with under-utilized skills.

A job allows a person to become self-sufficient.

To give someone a job, corporations and small businesses must grow and make higher profits so they can afford to expand.

For businesses to grow and make higher profits, they must sell more products.

Therefore, the goals of any fiscal policy ought to be 1) increase public demand for products by ensuring a fluid money supply; and 2) maintain the purchasing power of the currency.

The Federal Reserve's monetary policy seeks to promote "maximum" sustainable output and employment and to promote "stable" prices. More here.

Friday, October 15, 2010

Thought of the Day

California's public K-12 schools: billion dollar babysitting boondoggles?

Sounds like a harsh question until you realize we currently have no objective way of measuring teacher performance. Consider this paragraph--about another topic but also relevant here--from David Walker's book, Comeback America (hardcover, page 164):

Without any standards of measurement, all definitions of "success" and "failure" devolve to the political arena. If your party enacted the new housing stimulus program, then you can make a dozen claims to support its success. But your opponents, at the same time, can point out as many claims of its failure. We ordinary taxpayers who footed the bill can only hope something good came out of the exercise--but we can't tell either. This is simply unacceptable and must change.

Our schools have no real standards to measure the effectiveness of teachers. Unions resist testing and making teacher evaluations public. Meanwhile, kids move along within the system, and it's hard to tell whether they succeed based primarily on the school they attend or their parents' involvement.

Thursday, October 14, 2010

On California Education

Three must-read links on education:

Grand Theft Education [Warning: PDF] (Hat tip to Jon.)

Reason.com: "The two largest teachers unions, The American Federation of Teachers and the National Education Association, overwhelmingly supported Obama with their votes and their contributions. Some 95 percent of the groups' campaign contributions go to Democratic candidates and the NEA, spends more money on elections that Microsoft, ExxonMobil, Walmart, and the AFL-CIO combined. No wonder Obama's big talking point is that he wants to add 10,000 more teachers to public payrolls despite the fact that there are already more teachers per student than ever.

Reforming education may not be politically easy, but the solution is pretty simple: Give parents and students more ability to choose - and exit - schools. This works for every other sort of business and it works for higher education, too. There's no reason to think it wouldn't work for K-12 education."

Economist blog: "America's public-sector unions...have an extraordinary power to force the state to dance to their tune, squashing innovation, reducing productivity and undermining competitiveness."

"With poor prospects in the ultra-competitive private sector, government work is increasingly desirable for those with limited skills; at the opposite end of the spectrum, the wage compression imposed by unions and civil-service rules makes government employment less attractive to those whose abilities are in high demand..."

Bonus: more facts here.

Wednesday, October 13, 2010

Leon Panetta Speaks at SCU

Leon Panetta, Director of the CIA, spoke at Santa Clara University last week (October 8, 2010). He was entertaining and clearly proud of his Italian heritage. In one of his best moments of the night, he told a story about the necessity of fighting for your beliefs:

A priest and a rabbi want to learn more about each other's beliefs, so they attend a boxing match. One of the boxers goes to the corner and makes the sign of the cross. The rabbi sees this and asks the priest, “What does that mean?” The priest responds, “Not a damn thing, if he can’t fight.” (It’s much funnier when spoken.)

Overall, Panetta said all the right things. He is against “enhanced interrogation techniquesaka torture (he said the CIA uses the Army Field Manual on interrogations). He thinks the media is doing Americans a disservice through its soundbite-style reporting (and even took a jab at Fox news, saying that the media panders to the lowest common denominator because they don’t want to be “outfoxed.”) In any case, here are the highlights of Panetta's speech as I saw them:

In D.C., “gridlock is the order of the day.”

Panetta singled out Yemen, Somalia, Afghanistan, Iraq, and Pakistan as hotbeds of terrorism. He said that Pakistan had nuclear weapons and Al-Qaeda leaders.

He said India was an emerging power but will have to deal with its poverty problem [which may limit its ascendancy].

He said, “My job is to tell the truth,” whether they [the White House and Congress] like to hear it or not.

The CIA has four basic missions: counter-terrorism (CT); counter-proliferation; cyber-security; and minimizing the risk of surprise.

One interesting quote: “We are conducting a war within Pakistan.”

“Security and stability are our top priorities.”

On nuclear proliferation, “all we need is a nuclear arms race in the Middle East,” he said with an exasperated tone.

He singled out North Korea as an active proliferator that shares nuclear technology with other countries. He also mentioned Iran's nuclear program, but didn't provide much detail other than mentioning it as a potential catalyst for a nuclear arms race.

On cyber-security, Panetta singled out China and Russia as potential threats. He said the “next Pearl Harbor could be a cyberattack” that shuts down our power grid or financial system. He said we experience hundreds of thousands of cyberattacks each year.

Panetta also went on several tangents, mentioning the Mexican drug cartels, which have killed 15,000 people, and the rising power of Brazil and India.

He told us that “we do not have to choose between law and security,” but “at the same time, we cannot be free unless we are secure.”

Panetta said the CIA’s budget has “tripled” since 9/11, which was cause for concern. He said such growth and unchecked expenditures “frankly scared the hell out of” him. (Prior to becoming Director, Panetta spent years on the House Budget Committee trying to balance the federal budget.)

Panetta has reduced the CIA’s reliance on outside contractors (I believe he said the CIA has reduced its reliance on contractors by around "20%," but I couldn't quite make out the specific context, and I'm sure there are many different kinds of contractors, so the 20% number may not be very helpful to anyone).

Panetta has made knowledge of a foreign language a requirement to advance within the CIA. His goal is to “be diverse,” and he wants to increase the CIA’s overall diversity from 23% overall to 30%.

Panetta said the CIA’s basic goal is “convincing people to risk their lives to give us information–that is what it is all about.” If we can’t protect them [the assets], he said, no one will want to work with us (later, he criticized WikiLeaks because some of the documents released contained names).

Panetta also said the President of the United States signs off on all covert operations, and the CIA's decisions are also reviewed by the Attorney General as well as overseen by Congress [see Senate Select Committee on Intelligence and the House Permanent Select Committee on Intelligence]. He went out of his way to say that the CIA keeps the President and Congress apprised of all operations.

He said that over half of the CIA’s workforce was hired post-9/11.

During the short Q&A session, Panetta criticized the media, saying its quality has declined because of soundbites and increased competition (this is where he made the comment about the general media not wanting to be “outfoxed”).

Panetta said the CIA had no excuse for not having oversight over [outside] contractors. He also said that certain security details were outsourced because certain agencies don't have designated security personnel. (I think he mentioned protection for certain Afghan politicians and State Department personnel, but don't quote me on this.)

Panetta lamented the state of modern politics, indicating that the goal ought to be consensus, but now politicians care more about surviving in office. Panetta said we can “govern by leadership or [by] crisis,” and right now, we are governing by crisis.

As I left the speech, I realized I had listened to a series of bromides. For example, Panetta left out the CIA’s role in extraordinary renditions. While Panetta said we should not look backwards to the Bush administration’s mistakes, he also didn’t say anything about how the CIA sought to avoid similar debacles. My own personal experience regarding FOIA requests was markedly different with the CIA than it was with the FBI–even though both were providing me information pursuant to the exact same federal law.

At the end of the day, Mr. Panetta is just one individual, just like President Obama is just one individual. My feeling is that Americans keep looking for one person to change things, but our form of government is anti-royalty and therefore one person’s power–though vast–is still limited. We need to move away from a "single individual" mentality and try to elect people who are comfortable delegating power and who will create changes from the bottom up. If this decade is any indication, it appears that one person can make a difference on the negative side, but not so much on the positive side.

Tuesday, October 12, 2010

The DMV: How to Improve It?

I recently had a terrible experience with the DMV. I brought my cousin for his driving test, and the driving testers were rude and unsympathetic to my cousin's ESL situation. One tester had an accent so thick, I had no idea what he was saying. This unattractive, short, and fat male tester clearly reveled in the little power his job provided him. Meanwhile, the top manager told me she had only 2 driving testers for 40+ people that day. When I asked, "Why do you only have two people? Did a bunch of people call in sick?" the manager remarked, "That's not your business. I don't need to explain our procedures to you."

To be fair, the highest-ranking DMV local executive, the Administrative Director, treated us well, but even he managed to foul up--he cited a non-existent Vehicle Code section (VC 4008) when explaining why I had to follow a certain procedure.

Anyway, I was so frustrated with my experience at the DMV, I spent all day and night thinking about how we could improve the DMV's service. Regarding the driving testers, you can't measure performance based on pass rates or complaints for obvious reasons (e.g., all of the rejected applicants will complain, etc.), so you have to have some competition to establish objective benchmarks.

Here's what I came up with: if an applicant fails, he should be given an opportunity to go to a private, non-DMV tester. If he passes the non-DMV, private driving test and has no traffic infractions for one year, the DMV should assign its tester a point. After 25 points, the DMV should re-assign its employee with 10% lower pay. (I chose 25 points, but the appropriate number should reflect our intent to achieve a balance between fairness and competence--you don't want DMV testers being afraid to fail bad drivers.)

At the same time, if the private (non-DMV) tester passes someone, and the driver gets a moving violation (not a parking ticket or other minor infraction), then the private DMV provider should pay a fine into California's general fund. The amount of the fine should be adjusted for inflation and should be significant enough for the private testing agency to evaluate its own testers and testing process after 25 fines. (There must be a built-in incentive to discourage the private competitor from passing everyone or having lax standards.)

[Update: a friend says it's unfair to penalize the private corporation for at-fault accidents or moving violations because too many unpredictable, untestable factors are involved. I explained the private corporation must have some check against passing everyone. Moreover, if the private corporation gets fined enough times, it will fine-tune its testing process (I assume the corporation will have access to the general nature of the violations). Also, the goal is to provide incentives for improving the testing process and checks against exclusive government power--not to create a perfect system, which is impossible.]

Now that we've imposed checks on the DMV and its competitor, we also need a check on the driving applicants themselves. This issue is simple to resolve: if a driving applicant wants a non-DMV test after failing the DMV test, then s/he should pay a small, nonrefundable fee to the DMV. A small fee would discourage bad drivers from wasting people's time and would not prevent good drivers from opting for a second opinion.

The issue of improving government services is complex. It took me the entire day to come up with the idea of an objective secondary evaluation. (Once I thought about FMLA and the employer's option of sending the employee to another doctor for a second opinion, the solution became clear.) I've concluded you must have competition and/or the threat of wage/job loss to promote customer service and performance. Once you realize competition and incentives are linked to superior customer service and performance, ideas flow more easily (and one begins to see why government unions are terrible for everyone but themselves).

In any case, creating a fair system that encourages responsive government employees is certainly possible. It irks me when people say, "The government is different from private industry; therefore, you cannot apply similar standards to both." Really? What's the alternative? Terrible customer service and higher taxes for life?

Note: the major problem with the above scenario is the cost of setting up a competitor. Who is going to pay for the private competitor? If the drivers themselves pay, we have a conflict of interest. Perhaps the public would be willing to divert some of its existing taxes in the form of a grant to private competitors, which would be set up as non-profits.

Monday, October 11, 2010

Frederick Douglass on Freedom

‎"If there is no struggle, there is no progress. Those who profess to favor freedom, and yet depreciate agitation, are men who want crops without plowing up the ground. They want rain without thunder and lightning. They want the ocean without the awful roar of its many waters. This struggle may be a moral one; or it may be a physical one; or it may be both moral and physical; but it must be a struggle.

Power concedes nothing without a demand. It never did and it never will. Find out just what any people will quietly submit to and you have found out the exact measure of injustice and wrong which will be imposed upon them, and these will continue till they are resisted with either words or blows, or with both. The limits of tyrants are prescribed by the endurance of those whom they oppress." -- Frederick Douglass

Friday, October 8, 2010

Funny Stuff My Family Sez

I come from a family of immigrants. Learning a new language is hard, but it creates some hilarious moments. On Facebook, I posted the following status update:

David Walker: "Even if they [interest rates] don’t go up, the single largest line item in the federal budget within 12 years will be interest on the federal debt -- larger than defense, larger than Medicare, larger than Social Security. And what do we get for that? Nothing."

Below it, I said, "This Halloween, I'm thinking about going as the federal debt."

A friend of mine, Ziem, responded, "Don't. You'll be gang-raped by people dressed as special interests."

I read his comment while my family and I were dining in a semi-formal restaurant with my 21 year-old cousin, my aunt, and my uncle, who were visiting from Iran. The following transcript doesn't do the scene justice, but it's the best I can do. I hope you'll be entertained as much as we were:

Me: [cracking up]

Everyone: "What's so funny?"

Me: "Um, how do I explain this? Well, let's see if he [pointing to my cousin] can understand this, because it's complicated, but at least we can test his English."

"Do you know what a budget is?

Cousin: "No."

[Parents explain what it is, he gets it]

Me: "What about a deficit?"

Cousin: "No."

[Parents explain what it is, he gets it]

Me: "Do you know what "special interests" are?"

Cousin: "No."

Dad: "We don't have those in the Iranian political process, so he won't know what that is." [Tries to explain "special interests" to my cousin]

Cousin: [smiles] "Ah, you mean like the mullahs?" [religious leaders]

Me: "Yes! Good job!" [I tell him about my status update and Halloween costume proposal]

"Do you get it?"

Cousin: "Yes."

Me: [I repeat Ziem's comment, but use "hit" instead of "gang rape."]

[Everyone laughs]

Me: "I told you 'hit,' but it's even funnier with the actual word my friend used."

Everyone: "What word did your friend use?"

Me: "Think of a word that's worse than 'hit.'"

Mom: Does it start with the letter, "f"?

Me: [caught off-guard, but manage to shake my head]

Dad: "Kill"?

Uncle: "I think I know what it is." [Turns out later that he didn't.]

Cousin: "What letter does it start with?"

Me: "Hmm, well it's two words. I don't think you'll get it, but I'll try anyway. It starts with an 'r.'"

Cousin: "Rape?"

Me: "Yeah, but it's worse than that. Think multiple people."

Cousin: [confused] "What's the other letter?"

Me: "It starts with a 'g.'"

Cousin: "Gangbang"?

Me and Dad: [start laughing hysterically]

Mom: [looks confused, turns to my cousin and asks] "What's a 'gangbang'?"

Cousin: [looks at me, starts cracking up]

Me: [I can't stop laughing and leave the table for the next 10 minutes. When I come back, no one mentions the conversation, but people are smiling.]

Thursday, October 7, 2010

Random Thoughts: On Elitists and Inflation

"Liberals" and Democrats like to argue that poorer Americans vote Republican because they are misled by rich people and corporations. (See Frank Thomas's What's the Matter With Kansas, which argues that conservatives have manipulated poor people into voting for the GOP and against their own self-interests.) This smug, self-serving thesis puts liberals in a position to "help" the poor, usually through more government programs.

In reality, poorer people vote based on their economic circumstances and tend to focus on economic issues because they know the value of a dollar. In contrast, rich people's life experiences tell them that money is abundant and can be spent and created again. For example, blue state residents tend not to be offended when the federal government prints money and puts their grandchildren in debt. Unsurprisingly, West/East coast liberals (blue states) have higher salaries and earnings than Midwestern and Southern conservatives (red states).

The problem is that the perception of money as an easily renewable resource leads to inflationary policies that create higher costs of money for those on the lower end of the income scale who tend to be net borrowers of money, not lenders or large savers. (Printing more money also causes the devaluation of the dollar, decreasing the purchasing power of the poor, but that's a separate and more complicated issue).

Also, poorer people intuitively understand that injecting more money into something causes inflation. For example, if you pay LeBron James more, the cost of NBA tickets increases, because the owners have to make more money, and most businesses make more money by raising prices. For poorer people, inflation tends to show up in higher prices, making it more difficult for them to buy things (like a good seat in an NBA game).

Another example: it's much easier for poorer people to buy a decent house in a decent neighborhood if a house costs 100K and the median price is 150K, than if a house costs 400K in a neighborhood where the median price is 600K. Think about why house prices tend to be so much higher on the coasts compared to the Midwest and South, and why someone in the Midwest or South wouldn't want his/her children to pay 400K to live in a decent neighborhood. (Why increase the cost of living in a decent neighborhood if you don't have to?)

Rich people, unlike poorer people, tend to be the beneficiaries of inflation--when it happens, their salaries go up along with prices, so they notice no changes or believe they are doing even better. (Think about it: 80% of Americans would never pay $650,000 for a 4 bedroom, 2 bathroom house in a so-so school district, but rich people in the Bay Area do this all the time and rely on continued inflation to increase their home's value.)

Bottom line: if you don't have much of something, it becomes more precious to you, and you can't stand to see too much of it being used or spent. Generally speaking, abundance mitigates caution and tends to cause inflation. Inflation tends to be bad for poorer people and good for some people, especially educated and affluent people. Therefore, poorer people tend to vote for fiscally conservative candidates because they want to keep their costs low, and they intuitively understand that more money tends to lead to higher prices.

Bonus: historically, the Democrats have favored bigger government. Well, big government costs money, and paying government workers higher salaries and expensive benefits costs money, and they both cause inflation. Inflation hurts poor people. Ergo, in most blue states where Democrats have controlled the legislature for long periods of time, it is harder for poor people to buy homes, afford to live in decent neighborhoods, etc. It's really interesting that anyone would actually think that the Democrats help the poor when it's harder in most blue states for a family making 30K to buy a home and be debt-free than it is for the same family in most red states.

Idiocracy

California-based voters who focus on social issues are like students who study hardest for the class in which they already have an A- (sociology) while ignoring the class in which they are failing (economics).

Wednesday, October 6, 2010

Thank You, Gov. Schwarzenegger

From SF Gate, October 4, 2010, by Bob Egelko: "The state Supreme Court upheld Gov. Arnold Schwarzenegger's furloughs of 200,000 state employees today, saying the Legislature had ratified his decision to order workers to take three days off each month without pay." See Professional Engineers in Cal. Government v. Schwarzenegger.

From the Gov: "Today's ruling [authorizing government employee furloughs] upholds the state's actions to protect taxpayers and ensure we live within our means."

Governor, you deserve so much more credit than you have been given. When you realized the Democratic state legislature wouldn't work with you, you went to the people via the initiative process--but we failed you. Now, you are doing the best you can to prevent the unions from destroying California. You have saved us $1 billion. Thank you.

Despite this victory, I am not entirely optimistic. I know your power has limits--as it should. The Court ruled that only the Legislature can authorize the governor to cut employee pay and workweeks. I predict the Democrats will pass a law limiting your power to furlough employees in the future. More details from the decision below, courtesy of the DFEH and Director Phyllis Cheng:

On December 1, 2008 — faced with (1) a large current state budget deficit that was projected to grow to more than $40 billion by the end of the 2009-2010 fiscal year, and (2) the very serious prospect that by as early as February 2009 the state would run out of cash to pay its ordinary expenses — the Governor of California declared a fiscal emergency, called the Legislature into special session, and submitted to the Legislature a comprehensive plan to address the budget problem. The Governor’s budget plan included, among many other cost-saving features, two proposed statutory provisions that would direct the Department of Finance and the Department of Personnel Administration to implement, for the remainder of the 2008-2009 fiscal year and for the entire 2009-2010 fiscal year, a mandatory one-day-a-month unpaid furlough of most state employees employed by the executive branch, a proposal that would save the state approximately $37.5 million per month by reducing by approximately 5 percent the wages paid to each of the affected employees.

Two and one-half weeks later, on December 18, 2008, the Legislature passed its own proposed comprehensive budget legislation, comprising 15 separate budget-related bills. Among many other differences from the Governor’s proposal, the Legislature’s alternative plan did not include the Governor’s recommended furlough provision.

On December 19, 2008, the Governor issued the executive order that lies at the heart of the present litigation, instructing the Department of Personnel Administration to implement, beginning on February 1, 2009, and continuing through June 30, 2010, a mandatory two-day-a-month unpaid furlough of most state workers employed in the executive branch.

Shortly after the Governor’s issuance of this executive order, a number of employee organizations — the recognized, exclusive bargaining representatives of a majority of the workers employed by the State of California — filed three separate, but similar, lawsuits, contending that the Governor lacked authority to implement unilaterally an involuntary furlough of represented state employees that reduced such employees’ hours and earnings by approximately 10 percent. The trial court, acting on an expedited basis, treated the three cases as related, heard argument in the cases together, and thereafter issued a single ruling rejecting the broad attacks made by the employee organizations on the executive order and concluding that the Governor possessed the authority to impose the furlough in response to the fiscal emergency facing the state.

The employee organizations (hereafter sometimes referred to as plaintiffs) appealed from the trial court’s ruling. After briefing in the Court of Appeal was completed and the three cases were consolidated for purposes of oral argument and decision, but before the Court of Appeal set the matter for oral argument or issued a decision, we exercised our authority pursuant to article VI, section 12, subdivision (a) of the California Constitution to transfer the consolidated matter to this court for oral argument and decision.

For the reasons explained below, we conclude that, under existing constitutional provisions and statutes, the Governor on December 19, 2008, possessed authority to institute a mandatory furlough of represented state employees, reducing the earnings of such employees, only if specifically granted such unilateral authority in an applicable memorandum of understanding entered into between the state and the employee organization representing the affected employees. Although there is considerable doubt whether the applicable memoranda of understanding granted the Governor such authority, we further conclude that even if the Governor lacked authority to institute the challenged furlough plan unilaterally, plaintiffs’ challenge to the furlough plan now before us must be rejected. In mid-February 2009 — shortly after the furlough program went into effect — the Legislature enacted, and the Governor signed, legislation that revised the Budget Act of 2008 (2008 Budget Act) by, among other means, reducing the appropriations for employee compensation contained in the original 2008 Budget Act by an amount that reflected the savings the Governor sought to obtain through the two-day-a-month furlough program. The February 2009 legislation further provided that the specified reduction in the appropriations for employee compensation could be achieved either through the collective bargaining process or through “existing administration authority.” That phrase, in the context in which the revised budget act was adopted and in light of the provision’s legislative history, reasonably included the furlough program that was then in existence and that had been authorized by the current gubernatorial administration. In particular, the bill analyses considered by the Legislature made specific reference to furlough-related reductions of employee compensation costs. Under these circumstances, we conclude that the Legislature’s 2009 enactment of the revisions to the 2008 Budget Act operated to ratify the use of the two-day-a-month furlough program as a permissible means of achieving the reduction of state employee compensation mandated by the act.

Accordingly, we conclude that the 2009 budget legislation validated the Governor’s furlough program here at issue, and reject plaintiffs’ challenge to that program.

http://www.courtinfo.ca.gov/opinions/documents/S183411.PDF

Monday, October 4, 2010

Social Rights v. Economic Rights

I had a very long debate about social rights and economic rights. It involved a philosophical debate about whether social rights--such as being able to call your relationship a "marriage"--and economic rights--such as a job--are equally important.

Me: I got a very smart liberal Democrat to say that letting a child die was the same thing as denying gay couples the right to call their union a "marriage." I asked him, "If you had to choose between a job and feeding your kids (economic rights) and gay marriage (social rights), does one trump the other?" He said they were equally important--even after I explained that one scenario would cause a child to die.

For many so-called liberals, human beings and property rights are mere obstacles to their version of a more fair and just society.

"Experience should teach us to be most on our guard to protect liberty when the government's purposes are beneficial. Men born to freedom are naturally alert to repel invasions of their liberty--by evil-minded rulers. The greater dangers to liberty lurk in insidious encroachment by men of zeal, well meaning but without understanding." -- Justice Louis Brandeis

Alicia: Everyone thinks they're right.

Me: except that the point of being a true conservative or classic liberal is that you cannot trample someone else's property rights or right-to-life to get a desired result (assuming the person has achieved his property legally and you are not acting in self-defense).

Ivie: your analogy is flawed!

Me: flawed how? I understand that the choice offered is not ideal, and in an ideal world, we should have both social and economic rights; however, this is a philosophical exercise. The whole point of a philosophical exercise is to present tough choices to determine a person's values.

Alicia: What are the rates of child deaths by hunger in the United States? Would job creation really stop the problem of hunger in the US? Would the same children at risk of dying of hunger before jobs are created still be at risk after job are created? Is the issue of hunger in the US more important than it is in other countries? Does the severity of the issue in developing nations make it more pressing to deal with the problem there, first?

Me: you are injecting several other factors into the question, which was originally intended to force someone to choose between two clearly defined choices that involve different values.

Alicia: Life doesn't work like that, though. What's the point in having to pick between two clearly defined choices when that's never the case?

Me: to determine someone's value system and to determine a baseline to analyze more complex issues. We live in an imperfect world, and sometimes we must choose between two imperfect or non-ideal scenarios.

Alicia: There's this exercise we do a lot with the group I work with where you figure out what element (Thai people use animals) you are. I still haven't decided what I think of the activity, but it kind of seems like you just end up putting yourself in a box. I'm not sure if I agree with activities that involve strict yes or no, you are this or you aren't. I think analyzing more complex issues would give you a pretty good baseline, too.

Me: think about Kant and the categorical imperative. You have to analyze different situations and tough either/or scenarios to arrive at a consistent baseline.

Alicia: Why is there a need to come to a consistent baseline? Why do I have to always think that one thing is better than the other? Why wouldn't someone be able to call themselves a liberal without subscribing to all its ideologies? What's the measure of what's right and wrong? Is there anything that's truly good or bad, true or false? I think there's a big difference between sitting around and intellectualizing things and real life. You can consistently hold opinions that point to non violence and an aversion to killing, but if it comes down to a real life situation where you might have to kill someone (for whatever reason), then who really knows what you'd do. The Milgram experiment shows that what people think they'd do, want to do is different than what they'd actually do.

Just as not having a job MIGHT end in the death of a child, not helping to promote inclusion through policies like allowing gay marriage MIGHT end in death as well.

Me: except that your two scenarios are not at all similar, and therefore you miss the point of my original question. If you do not have a job, you cannot earn a living, and you cannot typically feed your child. It is true that perhaps welfare will allow your child to survive, but some countries lack welfare programs and food stamps. To determine a universal set of values, you cannot require that your child will be born in a first world country, b/c you would be imposing a random, lucky element in a discussion about universal values.

Once you apply Rawls' "veil of ignorance," and agree that you cannot predict whether you will be in California or Uganda, the possibility of welfare and other avenues of survival become less certain. But whether in CA or Uganda, someone with a job and source of income has a much higher (tho not 100%) chance of improving his/her child's chances of survival. It should be obvious that jobs require money and money requires goods, and goods involve food, etc. In other words, the existence of jobs requires a minimum level of infrastructure, and once you admit the existence of infrastructure, jobs have a direct value on survival.

At the same time, one can easily argue that gay marriage, whether in California or Uganda, will have little impact on being able to feed a child. This is b/c whether in California or Uganda, one does not have to be married to a man or a woman to feed a child. Thus, the presence or absence of gay or heterosexual marriage is irrelevant when it comes to feeding a child in California or Uganda. In contrast, a job presumes infrastructure and certainly improves the chances of buying food, whether in CA or Uganda.

Therefore, the situations are obviously different, and the attempt to make them appear similar is incorrect. Social values tend to be emphasized by rich, affluent people (if you are American, you are richer than 99% of the world). Poor people care about survival, not social values. If you want more social values, you have to give people jobs first, and the social values follow. In short, economic values are a good indicator of social values, and I believe that economic values are the foundation for social values--and not the other way around.

That is the point of the question: to test whether someone believes that gay marriage, by itself and in the abstract, creates stability and infrastructure--which of course it does not. In contrast, a job and money require certain basic infrastructure. Assuming basic infrastructure, a person with a job has a directly improved chance of improving his progeny's survival, whereas the abstract value of (gay) marriage is an idea that bears no direct relationship to survival or childbearing. In fact, once you realize marriage itself--whether hetero or gay--has little direct bearing on a child's survival, it is easy to see that economic values are more important than social values.

Maris: Wow. As a liberal parent, even I have to say there is definitely a hierarchy in democratic causes. Geesh.

Me: Maris, you have (indirectly) hit the nail on the head. I have found that the main difference on various issues is the presence of children. People with kids tend to have more common sense on these issues, perhaps because they must think about the future. My hypothesis is that the greatest danger to civilization is childless humans, b/c to them, it is easier to see society as a vehicle for advancing social causes instead of a unique, fragile infrastructure.

Maris: Perhaps it's the job. It's pounded into us "life over property" over and over and over again. By chance does this friend have kids?

Me: all the people in the room who said that social values were equal to economic values were child-less. The two people who had children did not answer my question.

Alicia: I think if you're going to answer this question straight, the only way to answer it is in terms of the United States. The policies of different countries are far too different to be able to compare them. The topic of gay marriage in the U.S. is far different than in Uganda. I don't think you can say that because looking at economic needs in Uganda is more important, that the same could be said in the US. There are different priorities and different needs. It would be like looking at a school in a impoverished area and one in a rich area and saying that because the poor school needs computers, so does the rich school.

Also, I think that a child's survival does have something to do with marriage. By furthering the cause of gay marriage, then you're indirectly furthering the cause of gay adoption, allowing children access to home and survival they might not have had otherwise. By putting children into loving homes, you're helping to end the cycle of poverty that would end up putting more children in danger of starvation.

But, that's not to say I think that one is more important than the other. It's to say that different situations deserve different thought, and that, for me, the situation can't be clean cut. There are a million different ways to look at that question, and I personally wouldn't want to look at it terms of only have one right answer.

I also think that it's not so much about having children as it is about looking outside of yourself. I think having children helps people to realize the need to protect more than themselves. However, I think it's just as bad to think about just your family as it is to think about yourself. Never said it wasn't understandable, but shouldn't be the goal.

Me: as far as I know, you don't need to be married to adopt in California. See California Family Code 297.5.

Also, I will accept your "American" restriction. Please answer the following question: an American adult is malnourished. Which is more important to him? Gay marriage or a job that will allow him to make money and buy food? (Economic infrastructure that allows him to get food from welfare programs, or the abstract right to get married as a gay or straight person?)

Alicia: But, it's not legal for gay couples to adopt children in all US states. The question wasn't asked in terms of California.

And, of course, to someone directly affected by poverty, their most important issue is going to be getting food. But that doesn't mean that gay marriage issues aren't valid in their own right. The point I'm trying to make is that both issues are valid. And in certain instances, they both take a more important role. I don't believe that one is always more correct than the other.

I think more important than economic or social reform is educational reform, as it has an effect on all areas of society. By improving education, you're not only creating a less impoverished society, but one that is more willing to accept all types of lifestyles.

Me: you said, "And, of course, to someone directly affected by poverty, their most important issue is going to be getting food."

I was getting worried there :-) Of course in an ideal world, we want both social and economic rights--but no one in their right mind thinks that economic rights are the same as social rights in every instance. Even though it took about ten tries, you've passed the test of common sense, and you don't even have any kids :-)

And I agree with you re: educational reform, but that's a topic for another time.

Me: 1. Who voted for Prop 8? Most affluent Bay Area DINKs, or most poorer Central Valley folks?

2. Who cares more about gay marriage? Affluent Swedes (who have wonderful infrastructure) or members of the Taliban (who are located in areas without economic infrastructure)?

3. Please cite a single place without economic infrastructure and/or affluence that has advanced or supported gay rights.

4. Whom amongst you is willing to say that a poor Somali or American who lacks food believes that jobs and economic infrastructure are equal in importance to the idea of gay marriage?

Patrick: ‎"this is a philosophical exercise. The whole point of a philosophical exercise is to present tough choices to determine a person's values."

So is the question, "would you rather be burned alive, or frozen in a block of ice?" a philosophical question?

Why would I have to make this choice? Why must a child die in order that same sex couples might wed?

The only scenario in which this sequence might come true is a terrorist's demand: Criminalize same sex marriage, or this child gets in the head. In that event, my choice would be for a SWAT team to shoot the terrorist in the head.

Me: except that both your scenarios involve death--a tangible, real thing with the same end result. As a result, there is no real choice. In contrast, my question involves a real choice between an abstract right vs. a tangible right.

By setting up a question that involves two tangible results that are exactly the same, you've missed the whole point of the question--to differentiate between tangible rights leading to a better economic position, and abstract rights leading perhaps nowhere.

Patrick: Your point's ridiculous. But to play your game, suppose the Ku Klux Klan announced that if America does not return to segregation and Jim Crow, the Klan will hijack multiple airliners and fly them into the Empire State Building and the Washington Monument. So we must choose between loss of intangible rights and loss of tangible rights, according to the Klan.

My response would be that this is a stupid choice. Arrest the Klan.

And WHY would rejecting Proposition 8 kill a child?

Peter: I think the laws pertaining to the death of children are pretty well hammered out, whilst the laws pertaining to gay marriage are not, hence the unequal amount of attention one gets over the other. I'm not sure exactly what basis you are using to equate the two things, except that there are laws which oversee them.

Me: @Patrick and @Peter: you've missed the entire point of the exercise. Let's try again.

My scenario involves an attempt to differentiate between economic rights and social rights. We are attempting to gauge the value of a job, which leads to money and increased chances of survival vs. the abstract value of having two men or women get married. It is obvious that almost anywhere in America or elsewhere, a single person who is unmarried has similar chances of survival than a married couple (whether gay or straight). It is also obvious that marriage has little direct relevance on survival, b/c in most places, someone need not get married to have a job or to survive, even if it means stealing food.

It is also obvious that assuming basic infrastructure, having a job has direct relevance on a person's survival. Namely, a person with a job or money (tangible goods) has an increased chance of attaining food and shelter when compared to someone without a job or money.

It therefore follows that in almost all instances, someone who had to choose between a job and money vs. marriage (whether gay or straight) would rationally choose a job and money if survival were at issue.

Again, my scenario sets up a contrast between economic rights impacting survival and non-economic rights that may or may not have any impact on a person's survival. If you want to create an analogy, you must stay within those guidelines.

Your example fails to set up a situation similar to mine. Instead, you have created a situation where someone must choose between death and segregation--both of which involve tangible property/economic rights. The reason segregation was immoral and harmful to Africans wasn't because of some abstract idea--it was because segregation and Jim Crow prevented Africans from gaining the same property rights, police protection, and economic rights as white Americans. So your example compares two economic rights, one direct (right to life) and one indirect (property rights). It is not similar to my scenario and is therefore inapplicable to this discussion.

Alicia: Also, you're making the assumption that economic reform would lead to positive change. And I'm sure there were plenty of people who questioned whether the social reform of the 1910s and 60s would make a change, but I'm pretty happy that happened.

Me: Last time I checked, we were relatively affluent in the 1960's. Also, b/c we didn't have to worry about fulfilling our basic survival needs, we were able to focus on improving social ideals and social values. Which proves my point: economic values and affluence typically precede broader social values and acceptance.

Think about it: how willing were most Americans pre-WWII to accept broader social values and change? Why do Americans, even today, go anti-immigrant whenever there's a recession? Why are more affluent areas in America more open to immigrants and diverse lifestyles than poorer areas?

Me: @Patrick: there's another issue you've missing: most Americans today don't care much about marriage as they used to. Therefore, a married person, whether gay or straight, has little advantage over an unmarried person in modern-day America. Which, of course, makes your refusal to see the difference between a job--necessary for survival and basic needs--and marriage--unnecessary for survival and basic needs--very, very troubling.

In the old days, segregation caused serious problems economically and also psychologically, because de jure segregation makes the side imposing segregation superior to the side subject to segregation. This superiority manifests itself in substantive, tangible ways that restrict economic rights.

If we were arguing about whether gay people had to attend separate schools, work in limited professions, buy houses only in specific neighborhoods, etc. this would be a completely different conversation. But we're not--we are discussing an abstract right that may have no economic impact on a person during the time he or she is alive. If you don't believe me, go outside and see if it makes any difference whether you wear your marriage ring or do not wear your marriage ring.

It should be obvious that the failure to allow (gay) marriage--which doesn't restrict most people from basic survival or a high quality of life--and the active imposition of segregation--which does harm a person's chances of affluence and a high quality of life--are completely different.

(P.S. By using scenarios that involve two economic rights rather than one abstract social right and one economic right, you implicitly accept that I am correct. In other words, you cannot even pose a question similar to mine without imposing scenarios that involve two economic rights. Therefore, you intuitively understand that a social right is worth less than an economic right...which is the entire point of this discussion.)

Peter: Well, there's a lot of ways you can look at this, but my view is pretty simple.

If you look at a married couple as an economic unit, then compare the survivability of the two people working together vs. the one person working by themselves, I think you'd be hard pressed to find a situation in which the single person has an advantage.

That being the case, and all child rearing being equal (which in reality it is of course not, but this is a thought exercise), then it would seem obvious that the couple would create a higher chance for survival of children, regardless of sex or orientation, hence a relation between economic and social rights.

Now, lets look at the other side of things. What would be the benefit, economically, of disallowing marriage between an arbitrary set of two people, based on any criteria which would exclude some portion of the population? If someone can answer that, then please do, as I cannot.

So, lets apply these values to your scenario: 1) Jobs lead to survival; 2) Gay marriage leads to social freedom. I come out with: two people with two jobs have a better chance of survival than one person with one job, and any person reliant on those people's survival will therefore have a greater chance of survival if they rely on two people rather than one.

By that reasoning, allowing any two people to get married and rear a child increases the survival rate of children, so it would seem that convincing multiple people to work as a single economic production unit has more economic benefit than denying certain people from forming such units.

I think this pretty creates a link, at least in this instance, between social liberty and economic viability.

Me: I was waiting for someone to link marriage to economic values. By creating the link, we are no longer comparing an abstract right vs. an economic right--we are comparing two economic rights.

I agree that marriage's value is only relevant to this discussion if it is linked to economic gain or loss. No sane person would equally compare an economic right to an abstract social right. You've now proved my point: abstract social rights are worth less than economic/tangible rights. Thus, in California, which already guarantees substantive equal rights to gay couples (see Family Code above) to the greatest extent possible, economic rights take precedence over abstract social rights. Remember this discussion if some misinformed person tells you s/he's voting for Candidate A over Candidate B for a California state office based on the right to gay marriage in California.

The only rational argument for social rights being equal to economic rights is if those social rights impact property rights or the right to life. That was my whole point. Why did it take this long to get here?

Tahir: Who cares more about cartoons of Mohammed published in Denmark? Affluent Swedes (who have wonderful infrastructure) or members of the Taliban (who are located in areas without economic infrastructure)? In fact, wasn't the Taliban the ones who squandered time and resources on shelling ancient statues documenting that at least some of their ancestors were Buddhists? Why weren't those shells sold in exchange for food?

Me: you've sort of helped prove my point--by disrespecting all property rights (such as the statutes they destroyed, as well as women's property rights), the Taliban demonstrates that destitute people tend not to care about social rights or economic rights. In other words, the Taliban is willing to destroy everything opposed to them, whether abstract or tangible, because their lack of an economic or social infrastructure allows them to be completely destructive without having to suffer any negative consequences. Inject religion into it, which has allowed them to make their right to life abstract, and they now have nothing to lose. The Taliban has no respect for economic or social rights, and part of their savagery is based on having no infrastructure or tangible rights, period.

The reason tangible rights mean more than abstract rights is b/c tangible economic rights give people something to lose. People with something to lose tend to care more about social rights that help preserve their property.

Tahir: Well no, the Taliban justified the action on the basis of a social right, furthering their particular set of religious beliefs despite their economic destitution.

Me: I disagree. The so-called "social rights" advanced by the Taliban involve destruction of everyone else's property and social rights. I don't think any reasonable person would argue that the right to destroy everything is a social right. That's sort of the point--the reason economic rights are superior to abstract social rights is b/c people with something tangible to lose tend to create more affluent and open societies than people with nothing tangible to lose. The basis for civilization is property and tangible economic rights, not abstract rights divorced from economic rights.

Tahir: So-called to you, established to them. You need to back up the distinction with universally applicable reasoning rather than an abstract plea of what a "reasonable person" would argue. And the Taliban certainly do not believe in destroying any one else's social rights any more than those who want to deny gay marriage to others. Where is the distinction between the two?

The starting point of a civil society is a respect for individual liberty limited to the extent it unreasonably interferes with another's liberty to arrange their social and economic affairs as they see fit.

Defining "unreasonable" is where us lawyers come in. And of course, if your "choice" is to have real world relevance, I would expect some reference to child deaths in Massachusetts that are linked to gay marriage in that state. One argument at a time no doubt.

Me: You said, "And the Taliban certainly do not believe in destroying any one else's social rights any more than those who want to deny gay marriage to others. Where is the distinction between the two?"

You're comparing people who voted for Prop 8 [to deny gay marriage] with the Taliban? You lose automatically.

Tahir: you've abandoned argument for conclusory statements. Do better and show me the steps of your reasoning.

Me: I already did explain my reasoning. The Taliban believe in nothing, and to them, even life is abstract. The Taliban show what happens when people deem abstract values the same as tangible economic values, namely, total destruction. This is b/c abstract values--when divorced from tangible economic consequences--are of course subjective. Once something is subjective, there is no basis for objective protection of tangible property rights. In contrast, a society that values tangible property rights over abstract social rights creates the necessary framework for social values.

Tahir: No, the Taliban do not "believe in nothing' and they certainly for a time created a framework for their social values (and you and I find common ground on disagreeing with those social values). Take time to think. This statement is a non-sequitur: "Once something is subjective, there is no basis for objective protection of tangible property rights." Consider instead that the absence of gay marriage bars gays from adding their partners to their health insurance. Are you trying to say that the denial of marriage to some on the basis of a subjective decision that one pair of humans should be able to cover each other on their health insurance and another pair of humans should not is a denial of a tangible economic benefit? Careful where your reasoning takes you.

Me: you just linked economic rights to social rights. That's my whole point. Social rights, in the abstract and divorced from economic rights, are inferior to tangible economic rights.

My statement re: social rights being subjective meant that social rights, in the abstract, are subjective. Which they are, of course. It is only by linking them to economic rights do they gain tangible form and equal priority with economic rights.

Tahir: Tangible economic rights are certainly of more consequence in the real world, but then I take it that if I put to you the question you posed to your smart liberal friend and explained to you in turn that the denial of gay marriage would kill another human being who could not thereby obtain employer-provided health insurance through his/her spouse that you would agree the two situations you posit are equivalent?

Me: now we're getting somewhere. First, in California, your scenario is void and inapplicable because of Family Code 297.5. But let's pretend we are in Wyoming. In that case, your analogy still isn't applicable, because American hospitals are legally required to treat everyone, regardless of marital status or sexual orientation. But let's keep going, because you're onto something here.

If you could show that the failure to obtain health insurance would definitely lead to a person's death in Wyoming, then yes, we are comparing two deaths, which implicates two economic rights. Consequently, the two situations would be equivalent. But for reasons stated above, your example doesn't apply in the United States. And if you notice, the issue, as you've now drafted it, isn't about marriage per se or the ability to call a couple "married," but the availability of health insurance to all persons--an economic issue.

You've merely linked a social right--marriage in some states--to the right to receive privately-subsidized health care. Now that we have universal health care, it's also unclear whether your analogy applies, but I do not want to be too uncharitable, b/c you have implicated an equivalent economic right--the right to life--and in doing so, have proved my point: that abstract social rights, without being linked to economic rights, are inferior to economic rights. How many times must we go around the same mulberry bush? :-)

Peter: I was only speaking to this particular scenario, in which there is a clear link between a social and economic function. I certainly would not use the same reasoning if this were two other arbitrary issues, one purely social, the other purely economic. It seems to me that society and economy are very strongly linked, especially if you consider food production to be relevant to the economy. I think from a governance perspective that you can make laws to govern economy quite easily, where laws which govern social behavior with no seeming direct impact on economy should be handled with much greater care, or in other words, there should be less of them.

This does not in any way confer a graded value system on either social or economic rights, simply on my faith in the legal system to govern those rights and ensure equality. It's easy to split a dollar in half, not so much a human.

So, I believe I can be consistent with my views on economic rights, and my views on social rights by saying there should never have been a law made which limited anyone's right to be "married" or to call it whatever they want, nor should any entity have a right to discriminate against those who are married, unless the marriage in some way impedes the rights of the entity. In other words, there should be no difference between any marriage anywhere as it applies to the state, the federal government, or any private entity operating within those boundaries. There should also be no law forcing people to accept that what they call marriage and what someone else calls marriage may not agree.

Basically, at home you can yell whatever you want at your four walls, but when you go outside of your home you have to accept that everyone has the same rights.

Alicia: I think it's definitely more of an issue than just "the right to call a relationship a marriage." There's a reason that people don't want gay marriage to be legal. It's not arbitrary. By not allowing gay people to get married, you're telling an entire group of people that they aren't allowed to do something that other people are allowed to do. If you subscribe to the belief that homosexuality isn't a choice (as I do), then it's like saying blond people can't get married. Even if you believe it's a choice and think it's immoral, it would be like saying that anyone outside of your religion couldn't get married. How do you think people would react if suddenly everyone decided Muslim people couldn't have a valid marriage in the United States?

I don't think anyone would disagree that economic issues are important. I think everyone one is trying to say that economic AND social issues are important. That you can't just abandon social reform because there are situations in which the need for economic reform might be more dire. It's not "this or that"--it's everything.

One of my favorite Buddhist ideas asks the question: What do you see when you look at a piece of paper? Buddhist belief says that it's not just a piece of paper. It's the sky, the rain, the tree, the ground, the people who cultivated it. It's everything, because everything in our world is interconnected in some way. Nothing is ever just one thing.

Me: First, please keep in mind I've already said that both social and economic rights are important. Second, we live in an imperfect world that can force us to make decisions between two inflexible scenarios, and sometimes neither scenario is ideal.

The question is what do we do when we must choose between two imperfect candidates? If Politician A has better economic ideas than Politician B, but Politician A is against gay marriage, for whom should you vote? Obviously, there are other issues besides economics and gay marriage, but we can characterize most issues as either economic or social.

My argument is that in an imperfect world--i.e., until we get a mainstream candidate who is fiscally conservative and socially liberal--we must give precedence to economic rights. In other words, when forced into a box with imperfect options, one must give precedence to economic issues, not social issues. I've shown that economic rights are superior to social rights if one must make a choice between them. Of course, whether Candidate A does indeed have superior economic ideas than Candidate B is an entirely different discussion, but it is the discussion we ought to be having.

Jon: The question itself is not designed to spur debate or evaluate the relative merits of each position on the topic you supposedly wanted to address. It's a set up so that no matter the answer, you can declare victory. Hence the only way to have a chance in the debate, logically, is to change the rules by forcing a new question so there can be real debate. Now if you had asked something like:

You are a California senator and you are late for two votes on which yours is the deciding factor, but you only have time to cast one. A bill that will cap government spending equal to inflation thus curbing tax increases, or one that will overturn prop 8 and allow gay marriage, which do you vote for thus ensuring it passes?

This is open for real debate, real support of your position etc. As neither choice is clearly right, but one is economic and one is social, it's actually a test of which you would choose.

Getting someone to admit they would rather save a baby than allow gays to marry says nothing about economic or social values, it says they aren't a psychopath.

Me:
kudos on coming up with an interesting question/scenario. The point of our discussion is that the Senator should vote for or against the economic issue b/c it takes precedence over the social issue. (I actually have no problem with gay marriage, but I'm troubled by the idea of letting a court overrule the initiative process unless fundamental rights are involved. Hence, the dilemma in California, where we have FC 297.5.)
Sometimes, you are stuck with two imperfect scenarios and you have to make a choice. The issue is how we choose between two imperfect scenarios, which is similar to voting for GOP or Dem candidates, neither of whom are perfect.

So one benchmark is whether we go by social rights or economic rights. Are they equivalent, or is one superior to the other? The point of this discussion is that economic rights should trump social rights in a head-to-head collision b/c economic rights are the foundation for most social rights.