top | item 1631682

A letter to my students

462 points| sunkan | 15 years ago |blogs.berkeley.edu | reply

169 comments

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[+] pg|15 years ago|reply
There are two ways CA could be doing less for its citizens. They could be raising less money, or spending it more wastefully. The writer seems to assume all the problems he observes are due to the former and none to the latter. The first step in verifying his claims would be to check whether the state's revenues are in fact lower.

Are current state revenues lower than revenues in, say, 1960, when adjusted for inflation?

[+] patio11|15 years ago|reply
Using state figures and the CPI calculator:

1965-1966: $4B nominal ($28B, constant 2010 dollars)

1982-1983: $25.3B nominal ($57.2B)

2008-2009: $144B ($145)

2009-2010: $119.2B ($119.2B)

Even if you adjust for California's prodigious immigration-fueled population growth, spending per person in constant dollars has more than doubled.

You spent your school years with teachers paid less and less.

I feel the urge to get out numbers here, but it would be like shooting fish in a barrel.

[+] avdempsey|15 years ago|reply
According to Prop 13 grand-daddy Howard Jarvis, state revenues have indeed increased since Prop 13 passed (1978).

We have a heckavu budget morass in California. Our ballot initiative democracy has _written into the constitution_ both spending minimums (40% of general budget from Prop 98) for education, and tax maximums. It's a massive vote of no confidence to strip our legislatures of the working room to make a budget.

I'm going to agree with the letter here. Somehow, in California in the 60s, we decided as a state to build the world's best civil infrastructure. We (well my grandparents) built this to benefit residents statewide. The terms of debate have changed from what makes the best place to live, to fear or sounds-nice-but-not-right-nowism.

From 2/3s majorities, to social issues, to pensions, we're in a real hole. But a rebuilt civil infrastructure is necessary, decline is obvious.

[+] _delirium|15 years ago|reply
Not an answer, but you should probably adjust by some sort of CA wage index rather than purely inflation, since a lot of things the government pays for have grown more expensive much faster than inflation (like salaries of sysadmins, and land). Looking at revenues as a percentage of state GDP would be one approximation (that would also bake in a correction for population growth).

I do think it's likely they haven't decreased greatly, though--- imo a bigger factor has been that where the money is spent has shifted greatly (less on education, more on cops and prisons, for example).

[+] ohyes|15 years ago|reply
His claim is that California is bottom of the barrel WRT the amount of money that it is reinvesting in its education system. (Hence the 'prime the pump' analogy)... This is true:

http://www.statemaster.com/graph/edu_ele_sec_fin_cur_exp_per...

To turn this into a 'low taxes vs high taxes' debate is kind of deceptive. I think that the point about taxes is that the debate around taxes has essentially become petty and mean-spirited.

If a politician wants to raise taxes (in any way, even on the wealthiest 1 or .1%, who would barely notice), countless will bitch about it, without regard for data or reason (or common sense). It will be a knee jerk reaction.

WRT to his assumptions, I don't think that he is assuming that California is not spending its money wastefully (see his mention of the penal system). There is an argument to be made, however, that it is incredibly difficult to reclaim wasteful spending that has already been done. (California is not going to pardon 60% of its prison population and close its prisons or cancel state pensions).

So the expedient solution, if you believe in spending more on education and social services, would be to tax more. (but no politician in their right mind would say that).

[+] bokonist|15 years ago|reply
According to this source of unknown reliability ( http://www.usgovernmentspending.com/California_state_spendin... ) state & local spending as a percentage of state nominal GDP went from 20% to 24% from 1992 to 2009. Don't know the numbers going back to 1960, but I'd be shocked if spending was lower then.

For the change in average levels of education and knowledge, the cause seems pretty obvious to me. If you extended the border of California 400 miles south into Mexico, the average state scores on tests of math, history, and English would obviously go down, simply because of the composition of the population. Similarly, if you move 10 million Mexicans into California, the average test scores of the people living within the borders of California will fall (even if there is no change in the amount of learning for one individual person). In general if you look into correlations between education spending and test scores, there is very little correlation. If you look into the correlation of ethnicity and test scores, its very significant.

[+] harshpotatoes|15 years ago|reply
That of course assumes that the money needed provide the same services for the people grows at the same rate as the population growth. In other words, the cost per person might actually be significantly lower to provide services for 1million people than it would be to provide services for 20 million people. And maybe this isn't due to a government 'inefficiency' (mismanagement of funds), but rather an inefficiency that is inherent in the design of our cities and services (Meaning: Long term problem requiring redesign of many services in order to increase spending efficiency).

So really, I think it's far more important to question: 1) How has the cost for these public services scaled with the population in the past? 2) Based on that, how do I think the cost of the these public services scale with the population in the foreseeable future? 3) Is this increase in expenditure due to wasteful mismanagement of funds, or a design problem in our cities and services?

[+] 3d3mon|15 years ago|reply
If you try your hand at this "armchair budget analyst" game, you'll learn that its easier practically and politically (yes, politically) to just raise the money, especially in a state like CA:

http://www.latimes.com/news/local/la-statebudget-fl,0,95571....

To be fair, the CA real estate boom/bust really did a number on the state's coffers. To ignore the impact of the "great recession" is to not see the problem accurately. The govt relied on increasing property tax revenue that disappeared as quickly as the monopoly money used to pay for it (aka subprime loans) and on state income taxes and sales taxes from workers who quickly lost their real estate bubble jobs. If those workers still had their jobs and homeowners still had their homes, we'd find something else to complain about. Moral of the story is be careful when playing with credit.

[+] kds|15 years ago|reply
Not just less or more inflation-adjusted revenues and their spending as absolute sums - the per-capita values impacted by the population growth would be even more informative.
[+] mkr-hn|15 years ago|reply
I don't know much about economics, so I'm probably missing something obvious. How is revenue linked to how much a government is doing for its people?
[+] eli|15 years ago|reply
I think this is actually a much less helpful question than you think it is. For a lot of reasons, outside factors made things like real estate and healthcare a lot more expensive for the state of california. I don't see any evidence that CA is any more wasteful than it was 40 years ago.

Or, put another way, where exactly do you see an extra $100B in CA's budget?

[+] joe_the_user|15 years ago|reply
I believe California currently spends a similar amount on prisons as on education. I don't believe that was the case in 1962.

That would effect total spending. Whether that means California is doing more for its citizens in this way is a question one can ask.

[+] aaronbrethorst|15 years ago|reply
Apparently this professor is better acquainted with the definition of the word posterity than Paul Carr. Thanks again for pointing that out the other day.
[+] nanospider|15 years ago|reply
Looks like there's a Ycombinator startup idea in here somewhere!
[+] Osiris|15 years ago|reply
Education is actually a very substantial part of the California budget. According to http://www.ebudget.ca.gov/agencies.html it's 31% of the budget, with the next largest expenditure being Health and Human Services.

There are few major issues with the California budget.

1) Much of the revenue is required by law to be allocated in a certain way. This leaves the government with very little wiggle room to make changes to the budget.

2) State workers have powerful unions that have burdened the government with an amazing out of debt and future obligations in terms of pension of benefits. No matter what the budget shortfall, the government must meet these obligations.

3) When revenues increased during the DOT COM boom, government was more than happy to spend the increased revenue on new services rather than either decreasing taxes or saving the money in a "rainy day" fund.

4) California is a mess of red-tape and bureaucracy. I'm actually surprised how many startups do business in California and the Bay Area with the all the labor laws and extra benefits that businesses have to pay for that other states don't, like CA SDI that pays for paid leave, while other states don't have it. Also, state land use laws and regulations were directly responsible for the increase in housing prices by making it so difficult to build new developments (among other factors, of course).

Californians have burdened themselves with a massive amount of debt and regulations that have severely hampered the ability of businesses to grow and contribute to state job growth. A article posted a few weeks back showed that there's a huge exodus of people from California to other states. I personally left California (East Bay) because I couldn't afford to buy a home and settle down with my family, not to mention the 9.75% sales tax on purchases from Newegg.com!

[+] _delirium|15 years ago|reply
Since he's coming from the perspective of someone noticing a decline in the UC system, he might be partly noticing a shift within the education spending, rather than overall spending declining (and over-generalizing that perspective). Here's some funding data for the UC system, which has a downward trend in per-student terms since around 1990, except for a brief upward blip during the dot-com boom, and is now lower than it's ever been (as far back as I can find data, anyway):

  Year  State funding (2010 $)  Enrollment  Per-student funding (2010 $)
  1965  $1.37 billion              59,000   $23,000
  1970  $1.84b                     73,000   $25,000
  1975  $2.31b                     84,000   $28,000
  1980  $2.75b                     94,000   $29,000
  1985  $3.23b                    108,740   $30,000
  1990  $3.47b                    125,044   $28,000
  1995  $2.68b                    123,948   $22,000
  2000  $3.94b                    141,028   $28,000
  2005  $3.09b                    158,933   $19,000
  2010  $3.02b                    181,520   $17,000
That probably understates the decline somewhat, because the cost of living in California has grown faster than inflation, so funding should probably be adjusted against a wage index of some sort. Going by pure inflation-calculator adjustments like I used in the above table assumes that you can pay staff in 2010 the same salary as they would get 1965, adjusted only for inflation. That would mean getting professors for around $55,000, sysadmins for around $45,000, etc., which you aren't going to have much luck with.

Benefits outside this direct funding were much more generous in my parents' generation also--- my dad went to a private university in California with his tuition mostly paid by the state, courtesy of the Calgrants program, which used to pay for any California student with grades above a certain level and with financial need to attend any California university, public or private. So to some extent it is sort of annoying that a generation that benefited from those kinds of programs, getting their degree without incurring student-loan debt, now thinks that they need to be cut.

[+] wheaties|15 years ago|reply
I think the author is mistaken. You see, what happened in years past is that they "took out a loan" to pay for now with the promise that they'd pay it later. However, later has come and now those that benefited the most can't understand why those that have to pay for it need to tighten their belts. None of us want to stop paying for it but we've learned what they haven't: you have to live within your means.

My father said it best, "I had it great, you're screwed. Thanks for paying for it."

[+] _delirium|15 years ago|reply
They didn't take out a loan, though--- the generation of Californians he's talking about (pre-1970s) built a bunch of infrastructure while also balancing the state budget.
[+] abcxyz|15 years ago|reply
"You spent your school years with teachers paid less and less, trained worse and worse, loaded up with more and more mindless administrative duties, and given less and less real support from administrators and staff."

What evidence does he provide that the decline in quality of education is due to lower budgets? As technology improves we should expect costs to decline. We should expect higher quality for less cost! When this fails to happen it usually because of artificially erected barriers to entry in an attempt to capture rent for a select few. And just who are loading up teachers "with more and more mindless administrative duties"? Taxpayers? Who benefits when it is increasing difficult to acquire the "skills" necessary to become a new teacher?

He doesn't really provide any unique insight besides blaming all of society's ills on tax cuts. Food has gotten cheaper, electronics have gotten cheaper, why has our government gotten more expensive!?

[+] Locke1689|15 years ago|reply
As technology improves we should expect costs to decline.

Only if you assume labour isn't the prime mover. Assuming that technology improvements help education at all (I'm skeptical -- I learned more about logarithms in math by using an abacus than I did using a calculator), we would ideally want education quality to increase, not decrease. Therefore, we should probably assume costs will stay approximately the same percentage over the years.

One thing I've been thinking about lately is education as related to teacher salaries. In general teacher salaries are pretty poor, but they've always been pretty crappy. However, the civil rights movement has had a big impact since the 50's and there's a big difference. Teaching was and is a female dominated profession -- what's interesting are the opportunities for women since the civil rights act. Now, instead of teaching, the brightest women are more likely to hold more prestigious, higher paying jobs that were previously reserved for white men. In effect, it's as though we were placing a restriction on women that said "If you're smart you can work -- but you can only work as a teacher." I'm not sure how much of a difference this makes, but it seems like it could make quite a bit.

[+] pmb|15 years ago|reply
"As technology improves, we should expect higher quality teachers for less cost" --- if and only if we know how to use technology to increase instruction quality. I contend that we have almost no idea about that.

He is right to blame all of California's ills on tax cuts. They and Oregon have had the worst abuses of the proposition system of all the states. Both used to be prosperous with balanced budgets, but had sneaky time-bomb anti-tax measures voted in, which prevented them from raising revenues even as home prices went up (which should increase the amount of tax owed on a property, but didn't) and inflation made existing fixed dollar amounts worth less and less.

The example I know best is Oregon, where a guy named Bill Sizemore (currently indicted for tax evasion) organized and ran a successful campaign for a measure that required a super-majority of registered voters to vote yes in order to pass any tax increase in a non-presidential election year. Thus, not going to the polls counts as a "no" rather than a "I don't care". Another Oregon measure required that the taxed value of a property could rise by no more than 3% per year. Thus, when I owned a house in Oregon, I was only taxed on two thirds of its value (this is slightly pre-bubble, too - now it is much worse!).

Anyhow, lots of this sneaky stuff has led to the states being almost totally broke, and their respective education systems, which were once the best in the nation, are now circling the bowl. Higher ed is holding up better than K-12.

[+] achompas|15 years ago|reply
What evidence does he provide that the decline in quality of education is due to lower budgets?

Academic positions, like any other job, operate within a competitive labor market. Lower budgets mean less money to attract top talent. Cheaper iMacs can't change that.

[+] Avshalom|15 years ago|reply
"As technology improves we should expect costs to decline. We should expect higher quality for less cost! "

Because teachers are technology...?

Also, fun fact here, being "loaded up with more and more mindless administrative duties, and given less and less real support from administrators and staff" is partially due to those lower budgets.

[+] ju2tin|15 years ago|reply
An article like this without a single reference to the impact and influence of unions is absurd, like trying to explain the workings of the solar system without invoking the concept of gravity.
[+] shmulkey18|15 years ago|reply
Reality check: "The Big-Spending, High-Taxing, Lousy-Services Paradigm: California taxpayers don’t get much bang for their bucks." http://www.city-journal.org/2009/19_4_california.html

Excerpt:

California is the only Sunbelt state that had negative net internal migration after 2000. All the other states that lost population to internal migration were Rust Belt basket cases, including New York, Illinois, New Jersey, Michigan, and Ohio.

As Tiebout might have guessed, this outmigration has to do with taxes. Besides Mississippi, every one of the 17 states with the lowest state and local tax levels had positive net internal migration from 2000 to 2007. Except for Wyoming, Maine, and Delaware, every one of the 17 highest-tax states had negative net internal migration over the same period.

[+] Starchild|15 years ago|reply
It's common knowledge that the founders of the United States favored the separation of church and state because they didn't want government interfering with freedom of religion by telling people what to think.

At that time, there were no government-run schools in America. If someone had suggested that government should be involved in running schools, maintain massive "Education Departments", etc., I'm sure Jefferson, Franklin, and the rest would have had the same reaction that they had to the idea of government-run churches.

If it is dangerous to a free society for government to be involved in telling people what to think via religion (and it is), how much more dangerous is it for government to be involved in telling many of the youngest and most impressionable members of society what to think?

We should demand the separation of school and state and end government control over education in the United States. Schooling is not the only means to getting an education (Mark Twain famously said "Never let your schooling interfere with your education"), but if universal schooling is deemed desirable, you could simply take the amount of money spent by government to run schools and maintain bureaucracies, divide it by the number of students, and issue each student a voucher to spend at the non-government, voluntarily funded community school of their choice.

To support freeing children from the dangers of government indoctrination and control, visit and join the Alliance for the Separation of School and State -- http://www.schoolandstate.org/home.htm. As authoritarians are so fond of saying, "Do it for the children!"

-Starchild, candidate for School Board, San Francisco

[+] KevinMS|15 years ago|reply
[+] mkr-hn|15 years ago|reply
"In Los Angeles, officials say the new schools were planned long before the economic pinch and are funded by $20 billion in voter-approved bonds that do not affect the educational budget."

Even in good times that's a lot for a school that will only house 4200 students. That's almost $140k for every student it holds. I wonder how long it's going to take for students going through it to generate enough economic activity to cover it.

Is there an economist in the house?

[+] nazgulnarsil|15 years ago|reply
tell me where a man gets his corn-pone and I'll tell you what his 'pinions are.
[+] dannyb|15 years ago|reply
I think that this is somewhat disingenuous for the reasons noted by others, but also the failure of the writer to acknowledge that colleges and universities have embraced business models and focused on revenue generation in ways that distract from the core mission.

I hate to say this but while most of the guilt should be borne by fat-cat administrators, faculty are greedy whores who are easily divided and conquered.

[+] endlessvoid94|15 years ago|reply
He bashes the older generation for not spending enough to support the government. Then he excuses them by talking about how they work 2 jobs just to put food on the table.

This guy should run for congress.

[+] jerf|15 years ago|reply
Edit: You know what? This post sucked. Here's a good link I used while babbling thoughtlessly (unless it wasn't good per _delirium): http://www.dof.ca.gov/budgeting/budget_faqs/information/docu...

See my reply to reynolds, which was the only valuable part. The second paragraph is my real point, and I mean that "if" clause.

[+] bokonist|15 years ago|reply
The numbers on total state nominal income are here: http://www.bea.gov/regional/remdmap/REMDMap.aspx

So it looks like state spending rose from 11% of total income in 1977 to 14% today. And total income usually grows slightly faster than the economy (economic growth = change total income - change in the price level). Thus state spending has been growing faster than incomes rise, faster than inflation and faster than the economy has been growing.

[+] rjprins|15 years ago|reply
It should be noted that government is expected to get relatively more and more expensive because it's most of it's duties are of the service type. Services like schools, public transport, health care generally defy automation but costs still rise to stay on par with other industries. As the costs of other products become lower, expect to pay more for services.
[+] _delirium|15 years ago|reply
> on expenditures growing faster than inflation and faster than the growth of the economy

I can buy that they've grown faster than inflation, but have they indeed grown faster than the growth of the economy? I haven't been able to dig up good data on what CA state expenditures were as a percentage of state GDP in, say, the 1960s. (They're currently around 24% of state GDP, if you can find something to compare that to.)

Incidentally, the document you linked doesn't appear to cover most of the actual budget; it's the kind of fake official budget that's passed every year, which currently covers about 1/4 of actual spending. This site has better estimates for the past 20 years, but doesn't go back past 1992: http://www.usgovernmentspending.com/downchart_gs.php?year=19...

[+] reynolds|15 years ago|reply
He mentions in the article that California has plenty of money but aren't spending it on education.
[+] skowmunk|15 years ago|reply
Great candor, great article. Displays some very critical perspectives that people often miss, they want safety, they want good roads, they want good education for their kids, etc, and still not pay the taxes that enable these things. One has to invest now, for a better future.

But there is a paradox, I couldn't find an answer.

The provision of safety, social support systems, equal opportunities, low cost education, etc are critical to getting out the best of a population of a civilization so that that 'advancement' of that civilzation continues.

Yet, the more advanced a civilization becomes, the larger the systems required to sustain that advanced civilzation becomes. And the larger a system becomes, the more in-efficiencies and over heads creep in and the costlier it becomes to sustain that system, at a per-capita level.

The more you charge (taxes) the population to sustain that advanced system, the lesser that people will have to spend on themselves, on their own dreams and development. And the less that people spend on their development, the lesser is their ability to contribute to the advancement of the civilization.

How does one break this paradox?

[+] mudil|15 years ago|reply
Manhattan Project cost nearly US$2 billion ($22 billion in present day value).(http://en.wikipedia.org/wiki/Manhattan_Project) It employed more than 130,000 people. Many labs and plants built in 1940s for the project are still in use today.

We have just spend $760 billion on so-called stimulus. The money is gone, and nothing to show for it.

That's how bloated gov't works nowadays, in CA, federal, and all other states. And the letter is calling for more of this!

PS Great book on Manhattan project: http://www.amazon.com/Making-Atomic-Bomb-Richard-Rhodes/dp/0...

[+] leot|15 years ago|reply
The reasoning seems to go:

1) The stimulus was supposed to mitigate the effects of the recession, and

2) The recession was still very bad, therefore

=======================

3) The stimulus had no positive effect/was not worth the cost.

Now, who wants to play the game "find the fallacy"?

[+] vital101|15 years ago|reply
I live in Michigan. It's no secret that Michigan is having severe budget problems. In fact, there are several counties in Michigan (38 comes to mind) that are actually UN-PAVING roads because they are too expensive to maintain. I often wonder how Michigan would look if instead of making tax cuts, and then cutting services, we instead paid .5% more taxes a year to the state. Would it improve our situation? I hope so. At the very least, we might not be un-paving roads.
[+] protomyth|15 years ago|reply
The raise in taxes might actually have the effect of decreasing the tax base by being the point at which people leave the state. Michigan has a lot of years with a strong Detroit. Now, they have to look at getting new industry and/or belt tightening. It looks like they went for the "in your face" version instead of reducing staff in the counties.
[+] antidaily|15 years ago|reply
Un-paving roads? Man, that's depressing.
[+] Experimentalist|15 years ago|reply
(edit: reply to _delirium, not sure this might be out of order, oops)

As you mention, those stats are only for the UC system (no source), but leave out a whole chunk of other relevant data. The author is addressing what he believes is the decline of public educaiton in general in California, not just UC.

Some people outside CA may not understand that the UC system (University of California) is only one part of the public college and public education system in California.

As far as colleges, California also has substantial state funding for a lot of other non-UC California state colleges (CSU, California State University -- 23 campuses compared to 10 UC) and community colleges.

Of course, additional funding goes to non-college education as well, and grants that people receive who attend private colleges and schools.

Also future liabilities and pensions which are not included on budget.

So my point being--just focusing on your UC stats is misleading.

1. How about the whole California state college system? 2. How about community colleges, vocational education? 3. How about other forms of public education? 4. How about all education grant totals made with public dollars? 5. Also while you are at that, how about adding in future liabilities/pensions which are not included in the yearly budget?

[+] DanielBMarkham|15 years ago|reply
I wrote three comments and erased them all before posting. Let's try #4:

This thing bugs me in a greater sense than simply the issues or people involved, and here's why: you're paying this guy to petition his students to pay him more. Strip away all the (real) problems and politics and all of that, and you end up with some guy you write a check to who is doing his best to a) call you a slovenly idiot, b) get you to spend more on him and his projects, and c) use his position as educator to influence his students to advance his causes.

He may be exactly correct. I don't think he is, but whether he is correct or not doesn't matter. Even if he is 100% accurate in everything he says, it's a conflict of interest. We simply can't have people on the public dole who also are political activists -- even in their spare time. I wish there was some way around this quandary -- the military has higher standards but we still see them getting dragged into various political fights. We have scientists who are activists, teachers who are promoting dissent, and public sector unions who are playing politics with public funds.

Again, it's not that I disagree with their politics or efforts. It's that we cannot self-stimulate. The money that comes from taxpayers cannot be caught into a feedback loop to promote even more money coming from taxpayers. The people we entrust with various public functions cannot also be using the stature we give them to score political points.

The only exceptions to this are political appointees, whose sole purpose is to play politics and be party hacks. For the rest of them, I am concerned that this is a really bad thing that is only getting worse and worse over time. I really hope some of these professional organizations can come up with appropriate ethical standards. It's like I read the other day: it used to be that scientists told you what "is". Now they tell you what we need "to do". (It was accompanied by an interesting graph from Lexis-Nexis with the frequency of the words "science says we must" which is rising exponentially in popular media.)

Aside from the specific politics in this case, the trend here is not good at all.