The Horrors of Austerity

The enforcement of austerity in the Eurozone (and the covert concessions here) are taking a horrendous toll that can’t be quantified. That which can be commodified indicates that austerity as a policy is as toxic as synthetic CDOs or the poisonous brew of beer and gasoline downed by a despairing Greek man whose business was ruined. For many Greeks, suicide seems like the only way out.

The most dramatic sign of Greece's pain is a surge in suicides.

Recorded suicides have roughly doubled since before the crisis to about six per 100,000 residents annually, according to the Greek health ministry and a charitable organization called Klimaka.

About 40% more Greeks killed themselves in the first five months of this year than in the same period last year, the health ministry says.

A suicide help line at Klimaka, the charitable group, used to get four to 10 calls a day, but "now there are days when we have up to 100," says a psychologist there, Aris Violatzis.

The caller often fits a certain profile: male, age 35 to 60 and financially ruined. "He has also lost his core identity as a husband and provider, and he cannot be a man any more according to our cultural standards," Mr. Violatzis says.

What I don’t understand is the idea that austerity will solve economic ills. The policy of higher taxes on everyone but the top 1% and deep spending cuts that only affect the lower 99% leads to a terrible outcome. Everyone is buried under debt, there are no jobs, therefore there is no income tax revenue, demand is nonexistent except for the need for necessities like food, shelter and health care:

Gross domestic product in the second quarter was down more than 7% from a year before, amid government spending cuts and tax increases that, combined, will add up to about 20% of GDP. Unemployment is over 16%. Crime, homelessness, emigration and personal bankruptcies are on the rise.

The weaker countries in the Eurozone are “contaminating” the so-called stronger economies. Remember when Paulson/Bernarke said the subprime disaster could be contained? They were sticking their fingers in an overflowing dike. Interbank lending has dried up, money market managers have pulled out, bank runs are plentiful and the PIIGs can’t raise any money without having to pony up more each day. What banks are holding what unwinding sovereign debt?

Wall Street runs on greed and fear, and fear is ruling the day. It is unknown how many credit default swaps are in play and what is the notional value involved because the CDS market is unregulated and no one has the faintest idea how much or how far.

It’s hilarious that the Tea Partiers complain about the restrictions of Dodd Frank or the Consumer Financial Protection Bureau, as though the global financial system didn’t blow up in 2008 and there was no need to prevent that from happening again. Boy do they hate the equivalent of seat belts and motorcycle helmets. Until they hit a brick wall and go flying through the windshield or into open space. Wait’ll they get a load of real sovereign debt default instead of the blackmailing, Standard & Poor’s-driven downgrade.

On the Waterfront: Jimmy Hoffa is dead. Long live James Jr.!

Unions are the villains in the Right’s narrative about what’s wrong with America. They are painted as lazy, incompetent, violent thugs. This is to distract from criminal enterprises masquerading as the "efficient markets tend to equilibrium" theory and the dismantling of the New Deal ethos.

Fox News
played an edited video of James Hoffa Jr.’s Labor Day speech seeming to threaten violence against the Tea Party. They played it over and over again. The edits were obvious (check out the link, which contrasts Fox’s footage with ABC’s unedited film). The actual footage shows Hoffa rousing the troops to vote out the Congressmen who want to eliminate unions. Quoting from the transcript:

”Everybody here’s got to vote. If we go back, and keep the eye on the prize, let’s take these son of a bitches out and give America back to an America where we belong.”

It’s not only the Right that positions unions as thuggish. The International Longshore and Warehouse union shut down the ports of Seattle and Tacoma, joining its fellow union to protest the Port of Longview’s decision to use non-union labor at its new grain terminal.

The Journal of Commerce headlines its story on legitimate strike activity, “ILWU Protest Closes Ports of Seattle, Tacoma”. That’s a relatively objective headline. On the other hand, The New York Times headlines its story, “Union Dispute, Turning Violent, Spreads and Idles Ports.” Its lede focuses on the violence.

The eradication of unions and collective bargaining power would eliminate the already weakened position of labor versus management. Labor unions support the interests of the working and middle class. They are willing to fight for their candidates with blood and treasure. There is no other major source of support for like-minded politicians. The unions convinced white males to vote for Obama in 2008 because they said he promised to back them up. If the unions become toxic, only corporate money will influence politics.

The choice could not be clearer. Republicans want to eliminate public schools, public services, dismantle regulations protecting the safety of air, water, pharmaceuticals, the environment, Social Security, Medicare; indeed halt any government spending except for money released through tax cuts, which goes into the pockets of the rich. There is redistribution of income, all right, but not from the rich to the poor; rather, it’s the other way around. This is piracy, aka privatization.

What Makes Sammy Learn? Robot Teachers Yes, Human Teachers No

Millions of dollars are at stake in education programs like “Race To the Top”. Determination of where federal money goes is highly dependent on student test scores. Whether a teacher is fired or not is dependent on student test scores. In NYC schools are graded from A-F and closed based on student test scores.

Yet according to a detailed
investigative report , in a town (Kyrene, AZ) where millions were spent on technology in the classroom, student scores didn’t improve. And we’re talking about a lot of money:

Under a ballot initative approved in 2005, the district has invested roughly $33 million in such technologies [as laptops, big interactive screens and educational software.

Since 2005, scores in reading and math have stagnated in Kyrene, even as statewide scores have risen.

The same people who tout testing as the be-all and end-all dismiss the importance of Kyrene’s scores. Perhaps not surprisingly, many of those touting technology in the classroom have close ties to companies which produce these products. Some are major players in the administration:

Karen Cator, director of the office of educational technology in the United States Department of Education, said standardized test scores were an inadequate measure of the value of technology in schools. Ms. Cator, a former executive at Apple Computer, said that better measurement tools were needed, but in the meantime, schools knew what students needed.

Kyrene’s class sizes are increasing and teachers, who have not had a raise since 2008, make a median wage of $45,000. Many have second jobs to make ends meet. Money budgeted for technology cannot be used for any other purpose in the school district:

“We have Smart Boards in every classroom but not enough money to buy copy paper, pencils and hand sanitizers,” said Nicole Cates, a co-president of the Parent Teacher Organization at Kyrene de la Colina, an elementary school. “You don’t go buy a new outfit when you don’t have enough dinner to eat.”

Education budgets in areas other than technology have been slashed. The sole determinant of proof of student learning, test scores, so prized by educational reformers like Michele Rhee, does not show that technology without qualified teachers increases learning. There is no way to separate the effects of technology versus the effects of teaching on student learning.

But there are undoubtedly winners. The sellers of educational technology. They carefully track which school districts get federal funding and tax assessments for technology, then spring into action. The director of technology for the school district has decision-making power over spending those millions. Sometimes it’s used to replace that which is deemed “obsolete”. Kind of like “planned obsolescence”, where a household products company might add “X-Factor” to a detergent to shake up sales:

Last summer, the district paid $500,00 to CCS [Presentation Systems, a leading reseller of Smart Boards in Arizona] to replace ceiling-hung projectors in 400 classrooms. The alternative was to spend $100,000 to replace their aging bulbs, which Mr. Share [the director of technology at Kyrene] said were growing dimmer, causing teachers to sometimes have to turn down the lights to see a crisp image.

Mr. Dunham [a salesman for CCS] said the purchase made sense because new was better.

But Ms. Kirchoff, the president of the teachers’ association, is furious. “My projector works just fine,” she said, “Give me Kleenex, Kleenex, Kleenex!”

My advice to educational reformers who spout the wonders of unproven, high-cost, “sexy” technology at the expense of the rest education exercise some consistency in how they quantify the efficacy of reform. Are student scores important, or aren’t they? When faced with technology, do people in positions of power make decisions based on their intuition:

”My gut is telling me we’ve had growth,” said David K. Schauer, the superintendent [in Kyrene].

Or do they simply quantify teaching ability? That’s backwards. Technology is consistent, a fungible thing. Teachers are human beings, adaptive, social and capable of learning.

You better figure out how to educate future generations before you blow your wad on toys. No taxpayer will put out for a subsidy toward $100,000 x whatever for new bulbs. Unless they’ve been solely educated by technology salesmen and spokesmen.