Education

Over the past 50 years test scores in K-12 education have not improved but the cost per student has quadrupled in real dollars. Teacher salaries have kept ahead of inflation and class size has been reduced from 22 to 15. During these years the experts have tried things like No Child Left Behind and Race To The Top but these have only made things more complicated for teachers. Some have proposed that student discipline problems have disrupted the system and others go even further to suggest that this is because of the lack of fathers in the home. Teachers are being asked to take on the responsibilities of parenting. Students who receive private tutoring show marked improvement and this leads to the question of using AI as a one-to-one student/teacher program. Something different is needed.

More tax on the rich

Since the end of WW 2, government intervention in the economy has expanded social safety nets characterized by increased regulation, growth of entitlement programs and increased popularity in ideas like universal healthcare, childcare and free college. The number of federal government regulations have increased from 400,000 in 1970 to over one million today. Government spending increased from 31% of GDP in 1980 to 120% of GDP today. Where did the money go? Between 1989 and 2026 the top one percent gained $21 trillion in assets while the bottom 50% lost $900 billion. The rich got richer and the poor got poorer. During these years and continuing today the cry of tax the rich has been heard and in 1980 the top one percent of earners paid 19% of all income tax and today that number is 38%. The concept of income redistribution sounds reasonable but is not working. As the rich paid more the gap widened. The same can be said for the education gap. In 1970 the cost per student was $4,000 per year (inflation adjusted) and by 2020 it was $15,000. In 1970, 39% of high school grads were reading at grade level and in 2020 that number was 37%. Once again, money is not the answer. Perhaps it is time to try a new approach. This will be difficult because the cry of tax the rich sounds so good. As a matter of fact, tax anyone but me sounds good to most people.

Tests

When new products and procedures are introduced to the general public the government often times will vouch for the safety of these things. Recall between 1951 and 1962, one hundred above ground nuclear bombs were tested in the Navada desert. At the time the government allowed many soldiers, along with scientist and press people to observe these tests. Over the years about 400,000 soldiers witnessed these tests and they were told there was no danger. Studies later showed that these tests led to health problems that are still happening today. There are statistically higher rates of leukemia, thyroid cancer and respiratory cancers. A 1997 study estimated 10,000 to 75,000 potential thyroid cancer cases from fallout.

State debt

Many states in the US are facing long term debt problems which are adding to the cost of living and causing people to move to states that are not affected by this. A good example is Illinois. For more than 50 years state workers watched their pension benefits grow and the state failed to prepare. As the population ages and more people retire the problem gets worse. The state then has to raise taxes to cover the debt which means young working people will leave the state leaving fewer people to tax. Thus, taxes must be raised again and more people leave and leads to a death spiral. Illinois is trapped in the worst pension crisis in the nation. The state’s five pension systems carry about $144 billion in unfunded liabilities. Illinois families pay the highest effective property taxes in the country, with most of those dollars being spent to keep up with overpromised pensions rather than to create better schools, safer streets or improved services. In the past Illinois has diverted pension funds into the general fund. Illinois lost a congressional seat in the 2020 census and is scheduled to lose another seat in the 2030 census. This means fewer federal dollars coming in. New York and California are in similar situations. It is easy to hand out benefits today that you don’t have to pay for until later but later has arrived.

Time and money

Financial advisors often speak of the miracle of compound interest and use an example to illustrate the point, to encourage young people to save early. The first person, starting at age 25, saves $1,000 per year at 5% interest for ten years at which time he has $12,577 and then he lets that accumulate at 5% for the next 20 years and has $33,066. The second person saves $1,000 per year for 20 years starting at age 35 and in 20 years has $33,370. The second person set aside $20,000 and had only $300 more than the first person who set aside $10,000. The moral is to start early.

Migrants

The latest figures show that during the Biden years, 8 million illegals crossed the southern border along with 1.5 million got a ways. About 40% of these paid coyotes to help them and the cost varied by location. From Cost Mexico 7000 to 10000 Central America 16000 to 18000 Asian 40000 to 75000 If the average was $12,000 that comes to over $100 billion dollars. While the border patrol spent time on the illegals there was less time to interdict drugs and OD’s increased as did the number of drugs that were missed by border patrol. Many of these migrants were convicted felons and 300,000 children became unmonitored, meaning lost. The government approved $170 billion to deport illegals and the process caused protest across the country. There were many reasons why these migrants were allowed entry but one of the most important is that US citizens were concerned about the safety of the migrants.

Income gap

As the income gap becomes wider the cry to raise taxes on the rich becomes louder. The top 20% earn an average of $300,000 while the bottom 20% earns only $18,000. The top one percent earns $750,000. Most people see a difference between a person who starts a new business and earns a high-income vs those who work for a company and earn a big salary. The average salary for a CEO in the top 500 companies is $20 million per year. When the CEO salary is high then the underling VP’s get higher incomes. Salaries include base pay plus bonus and are tied to performance (stock price).