Federal Reserve Chair Janet Yellen: Economic Inequality Threatens America!

Dear Commons Community,

In blunt and candid terms, Federal Reserve Chair Janet Yellen sounded an alarm about widening economic inequality in the United States, suggesting that America’s longstanding identity as a land of opportunity was at stake. As reported by the Associated Press:

“The growing gap between the rich and everyone else narrowed slightly during the Great Recession but has since accelerated, Yellen said in a speech at a conference in Boston on economic opportunity. And robust stock market returns during the recovery helped the wealthy outpace middle-class America in wages, employment and home prices.

“The extent and continuing increase in inequality in the United States greatly concerns me,” Yellen said. “By some estimates, income and wealth inequality are near their highest levels in the past hundred years.”

Yellen’s extensive comments on economic inequality marked an unusual public departure for a Fed chair. Her predecessors as head of the U.S. central bank tended to focus exclusively on the core Fed issues of interest rates, inflation and unemployment. Indeed, the Fed’s mandate doesn’t explicitly include issues like income or wealth disparities.

But since taking over from Ben Bernanke in February, Yellen has made clear she is deeply concerned about the financial challenges that ordinary workers and families face. Throughout this year, she has stressed the need for the Fed to keep rates low to boost economic expansion and hiring. She has said that the unemployment rate, now at 5.9 percent, doesn’t fully reflect the health of the job market: Yellen has expressed concern, for example, about stagnant incomes, the number of part-time workers who want full-time jobs and the many people who have given up their job searches and are no longer counted as unemployed.  In her first speech as Fed chair, she highlighted the hurdles faced by three unemployed workers. And in congressional testimony in February, Yellen called income inequality “one of the most disturbing trends facing the nation.”

Her remarks Friday, accompanied by extensive data compiled by her staff, expanded on her concerns. Between 1989 and 2013, Yellen noted, the average income of the top 5 percent of households rose 38 percent. For the remaining 95 percent of households, it grew less than 10 percent. The widening gap in overall wealth is even more pronounced. The average net worth of the bottom 50 percent of families – a group of about 62 million households – was $11,000 in 2013, Yellen said. Adjusted for inflation, that figure is 50 percent lower than in 1989. By contrast, the average real net worth of families in the country’s top 5 percent has jumped from $3.6 million in 1989 to $6.8 million in 2013, according to the Fed’s data – an 89 percent surge.

“I think it is appropriate to ask whether this trend is compatible with values rooted in our nation’s history, among them the high value Americans have traditionally placed on equality of opportunity,” said Yellen, a labor economist.”

Congratulations to Dr. Yellen for using her position as the Fed Chair to drive home the inequality issue.

Tony

 

The History Manifesto: Need to Know the Past to Plan for the Future!

Dear Commons Community,

The Chronicle of Higher Education has an essay by historians, David Armitage and Jo Guldi, calling for a “deep understanding of history” as a basis of planning for the future. Drawing on the theme offered by George Santyana that “Those who cannot remember the past are condemned to repeat it”, Armitage and Guldi make the case that a specter is haunting our time: the specter of the short term. They posit:

“We live in a moment of accelerating crisis that is characterized by a shortage of long-term thinking. Rising sea levels and other threats to our environment; mounting inequality; rotting infrastructure. Our culture lacks a long-term perspective.

Where can we turn for deep knowledge?

To history—the discipline and its subject matter….

What we hope for is a kind of history with a continuing role for microhistorical archival work embedded in a larger macro-story woven from secondary sources. The public future of the past is in the hands of historians, “if we are willing to look out of our study windows, and to think of history not as the property of a small guild of professional colleagues, but as the rightful heritage of millions.” The words are those of the American historian J. Franklin Jameson, in 1912. They are urgently relevant today.

Once called upon to offer their advice on political development and land reform, the creation of the welfare state and urban reconstruction, historians, along with other humanists, have effectively ceded the public arena. To put the challenges we face in perspective, and to combat the short-termism of our time, we urgently need the wide-angle, long-range views that historians can provide.

Historians: There is a world to win. Before it is too late.”

This essay is based on Armitage and Guldi’s book, The History Manfesto, which is freely available for download from Cambridge University Press.

Tony

NSF-Funded Scientists Subjected to a “Witch Hunt” by Congressional Committee!

Dear Commons Community,

NSF-funded scientists are alarmed that they are being subjected to inquiries and a “witch hunt” by a Republican-controlled Congressional committee. Under the guise of seeking out wasteful spending, the Congressional Committee is investigating the merits of NSF-funded projects. As reported in The Chronicle of Higher Education (subscription required):

“NSF grants to some 50 professors across the country are now being investigated by the Republican-controlled committee. More than a dozen of the researchers, in comments to The Chronicle, said they had little idea what the politicians were seeking, but warned of a dangerous precedent in what they described as a witch hunt.

“This is an outrageous politicization of science,” said one of the researchers, Glenn Gordon Smith, an associate professor in instructional technology at the University of South Florida who has used NSF money for work involving climate change.

“This is a ludicrous waste of taxpayers’ money,” said Celia Pearce, an assistant professor of digital media at the Georgia Institute of Technology whose studies the work applications of large-scale, multiplayer online worlds. “It saddens me that elected officials are attacking science in this way,” said Robert M. Rosenswig, an associate professor of anthropology at the University at Albany, a campus of the State University of New York, whose NSF-financed grant involved studying Mexican history…

Aides to the chairman of the House committee, Rep. Lamar Smith of Texas, have been visiting NSF headquarters, just outside Washington, for the past several months to study the grants—primarily in the social sciences, many in anthropology—approved in recent years.”

As an example, Dr. Smith named above, used an NSF grant to develop a curriculum on climate change for high-school students. He suggested pure political motivation lay behind the committee’s focus on his work. “When you are selectively in denial of overwhelming scientific evidence,” he said, “you seek out ways to discredit investigators who research in that area.”

Tony

 

Key Inequality (Wealth to Income) Measure is the Highest Since the Great Depression!

Wealth to Disporable Income

Dear Commons Community,

The ratio of wealth to household income in the U.S., a measure of inequality, is the highest it has been since just before the Great Depression, Credit Suisse noted in a 64-page report on global wealth released on Monday. The bank also warned that this was not good news for the health of the economy:

“This is a worrying signal given that abnormally high wealth income ratios have always signaled recession in the past,” the bank wrote.

Meanwhile, the richest 1 percent in the world own 48 percent of all the world’s wealth, according to Credit Suisse — a worrying signal for the global economy. As reported in The Huffington Post:

“Because wealth is a big pile of money that has been built up over the years, and income is a much smaller annual flow of new money, this ratio is always pretty high: Going back to 1900, wealth has always been at least four times as high as disposable income.

But sometimes the country’s wealth stockpile surges to even greater heights. Right before the Great Depression, there was seven times as much wealth in the country as disposable income. Right before the dot-com and housing bubbles burst, there was six times as much wealth as income…

Today the ratio is higher than at the peak of the dot-com and housing bubbles.

Most of the wealth build-up of recent years has been due to the stock market soaring to record highs. There is at least some justification for record-high stock prices, given that corporate profits are at record highs, too.

Then again, the stock market that has been inflated at least partly by historic levels of Federal Reserve stimulus. And corporate profits are at record highs at least partly because companies are being so stingy with workers: Wages have been flat throughout the recovery and for the past few decades, really, when you adjust for inflation.

Whether we get a recession this time or not, this news is at least a sign that French economist Thomas Piketty was on to something when he warned that wealth tends to grow more quickly than income, leading to dangerous imbalances.”

Tony

German Universities Eliminate Tuition for International Students!

Dear Commons Community,

German universities are now free to all international students. The last German state to charge tuition at its universities struck down the fees last week.  According to one CBS affiliate:

“In explaining why Germany made this move, Dorothee Stapelfeldt, a Hamburg senator, called tuition fees “unjust” and added that “they discourage young people who do not have a traditional academic family background from taking up study. It is a core task of politics to ensure that young women and men can study with a high quality standard free of charge in Germany.”

Actually, German universities were free up until 2006 when they started charging tuition. That triggered such a crush of criticism that German states began phasing out this policy. Lower Saxony was the last holdout.

It’s too bad that politicians in the U.S. don’t feel that a college education is worth supporting appropriately. State aid to the nation’s public universities took a nosedive during the 2008 recession and education funding remains well below those levels. The average state is spending 23 percent less per student than before the recession, according to a report by the Center on Budget and Policy Priorities.”

I would also add that unlike in Germany,  most American public colleges and universities have had to increase student tuition to make up for decreases in state funding,

Tony

 

Pope Francis in a Vatican Document Challenges the Catholic Church to Change Attitude to Gays!

Dear Commons Community,

In a dramatic shift in tone, a Vatican document which some have referred to as an “earthquake” said that homosexuals had “gifts and qualities to offer” and asked if Catholicism could accept gays and recognize positive aspects of same-sex couples. The document, prepared after a week of discussions at an assembly of 200 bishops on the family, said the Church should challenge itself to find “a fraternal space” for homosexuals without compromising Catholic doctrine on family and matrimony. As reported by Reuters:

“While the text did not signal any change in the Church’s condemnation of homosexual acts or gay marriage, it used less judgmental and more compassionate language than that seen in Vatican statements prior to the 2013 election of Pope Francis.

“Homosexuals have gifts and qualities to offer the Christian community: are we capable of welcoming these people, guaranteeing to them a further space in our communities? Often they wish to encounter a Church that offers them a welcoming home,” said the document, known by its Latin name “relatio”.

“Are our communities capable of proving that, accepting and valuing their sexual orientation, without compromising Catholic doctrine on the family and matrimony?” it asked.

John Thavis, Vatican expert and author of the bestselling 2013 book “The Vatican Diaries”, called the report “an earthquake” in the Church’s attitude towards gays.

“The document clearly reflects Pope Francis’ desire to adopt a more merciful pastoral approach on marriage and family issues,” he said.

London-based QUEST, one of the oldest Catholic gay rights groups, said in a statement that parts of the synod document “represent a breakthrough in that they acknowledge that such unions have an intrinsic goodness and constitute a valuable contribution to wider society and the common good.”

The Vatican document will be the basis for discussion for the second and final week of the bishops’ assembly, known as a synod. It will also serve for further reflection among Catholics around the world ahead of another, definitive synod next year.”

For Catholics and Catholic watchers, this is an incredible development. It will be interesting to see what the synod says (if anything) about divorce and abortion.

Tony

 

Budget Stagnation Hindered NIH in Researching a Vaccination for EBOLA!

Dear Commons Community,

Dr. Francis Collins, the head of the National Institutes of Health, said that a decade of stagnant spending has “slowed down” research on all items, including vaccinations for infectious diseases such as EBOLA. As a result, he said, the international community has been left playing catch-up on a potentially avoidable humanitarian catastrophe. Furthermore, as the federal government frantically works to combat the Ebola outbreak in West Africa, and as it responds to a second diagnosis of the disease in Dallas. Texas, Dr. Francis Collins, the head of NIH says a vaccine likely would have already been discovered were it not for budget cuts. As reported in The Huffington Post:

“NIH has been working on Ebola vaccines since 2001. It’s not like we suddenly woke up and thought, ‘Oh my gosh, we should have something ready here,'” Collins told The Huffington Post on Friday. “Frankly, if we had not gone through our 10-year slide in research support, we probably would have had a vaccine in time for this that would’ve gone through clinical trials and would have been ready.” It’s not just the production of a vaccine that has been hampered by money shortfalls. Collins also said that some therapeutics to fight Ebola “were on a slower track than would’ve been ideal, or that would have happened if we had been on a stable research support trajectory.”

“We would have been a year or two ahead of where we are, which would have made all the difference,” he said. Speaking from NIH’s headquarters in Bethesda, Maryland, the typically upbeat Collins was somber when discussing efforts to control the Ebola epidemic. His days are now spent almost exclusively on the disease. But even after months of painstaking work, a breakthrough doesn’t seem on the immediate horizon.

Money, or rather the lack of it, is a big part of the problem. NIH’s purchasing power is down 23 percent from what it was a decade ago, and its budget has remained almost static. In fiscal year 2004, the agency’s budget was $28.03 billion. In FY 2013, it was $29.31 billion — barely a change, even before adjusting for inflation. The situation is even more pronounced at the National Institute of Allergy and Infectious Diseases, a subdivision of NIH, where the budget has fallen from $4.30 billion in FY 2004 to $4.25 billion in FY 2013.”

Dr. Collins’ comments are indicative of the sad state of the federal government’s inability to work out budget comprises that are for the good of the country and its people and not for the good of a political party.

Tony

Enrollments Drop In Teacher Education Programs Nationwide!

Teacher Education Programs Enrollment

Click on the image to enlarge.

Dear Commons Community,

Between 2010 and 2012, enrollment fell in both undergraduate (nearly 11 percent) and graduate (more than 12 percent) teacher education programs in public and private nonprofit universities according to the National Center for Education Statistics. As reported in The Chronicle of Higher Education (subscription required):

“The numbers don’t match overall enrollment trends. Undergraduate fall enrollment at four-year public and private nonprofit universities increased by more than 3 percent from 2010 to 2012. And according to survey results released by the Council of Graduate Schools in September, graduate enrollment at participating public and private nonprofit universities increased by an average of 0.7 percent annually from 2008 to 2013.

Among survey respondents, education had the greatest percentage decrease of all graduate programs from 2012 to 2013 (down 4.5 percent) and the greatest average annual percentage decline from 2008 to 2013 (down 3.4 percent)…

Data show that the paths students take to prepare for the teaching profession are changing. For-profit institutions have gobbled up an increasingly large share of students, as have online degree programs.

Enrollment in education programs at private, for-profit institutions has greatly increased in the past decade. From 2010 to 2012, enrollment in private, for-profit undergraduate education programs rose nearly 4 percent. Enrollment in for-profit graduate education programs decreased more than 21 percent but was still more than 50 percent higher than in 2004…

The recession hit [also] many school districts hard, and experts who spoke to The Chronicle believe layoffs and decreased hiring may have discouraged students from pursuing teaching careers.

“In the last few years, school districts have been cutting back on the number of teachers. There were layoffs in a number of areas, and hiring diminished, and the job market became less attractive,” said Arthur Levine, president of the Woodrow Wilson National Fellowship Foundation and a former president of Columbia University’s Teachers College. “One of the things we’ve seen is that career changers who were interested in switching to teaching are less likely to do it now. The field seems too uncertain, and holding on to their current jobs seems appealing…

Mark LaCelle-Peterson, vice president for policy and programs at the American Association of Colleges for Teacher Education, believes the numbers will rebound when the economy picks up.

“Enrollment in teacher-education programs has always been cyclical and somewhat responsive to the economy,” he said. “In the long term, it will be responsive to the job market. Right now we’re still projecting a need for quite a number of new teachers.”

The issues raised by these data should be of great interest and maybe concern to faculty and administrators in teacher education programs. I agree with Mark Lacelle-Peterson that enrollment in these programs is cyclical.  However, careful planning including the development of online programs especially at the graduate level should be considered.

Tony

 

Malala Yousafzai and Kailash Satyarthi Share Nobel Prize for their Work with Children!

Malala

Kailash

Dear Commons Community,

Malala Yousafzai, a 17-year-old schoolgirl and outspoken activist, from Pakistan, and the Indian child rights campaigner Kailash Satyarthi, were announced as this year’s winners of the Noble Peace Prize. Ms. Yousafzai will share the $1.1 million award with Mr. Satyarthi, 60, a veteran, soft-spoken activist based in New Delhi who has rescued trafficked children from slavery. As reported in the New York Times:

“Announcing the prize in Oslo on Friday, the committee chairman, Thorbjorn Jagland, said it was important for “a Hindu and a Muslim, an Indian and a Pakistani, to join in a common struggle for education and against extremism” — a resonant message in a week in which the Pakistani and Indian armies have exchanged shellfire across a disputed stretch of border, killing 20 villagers. But it was also a message that highlighted how far Ms. Yousafzai has come from her original incarnation as the schoolgirl who defied the Taliban and lived to tell the tale…

“I was totally surprised when I was told, ‘Congratulations, you have won the Nobel Peace Prize, and you are sharing it with a great person who is also working for children’s rights,’ ” Ms. Yousafzai said at a news conference…

“If with my humble efforts the voice of tens of millions of children in the world who are living in servitude is being heard, congratulations to all,” Mr. Satyarthi said in a television interview on Friday.”

Tony

NIH Awards $32-Million to Tackle Big Data in Medicine!

Dear Commons Community,

In a major move to support research on the use of big data in medicine, the National Institutes of Health announced on Thursday awards totaling $32-million. More than two dozen institutions will use the funding to devise innovative ways of helping researchers handle huge sets of data seen as increasingly central to future medical discoveries. The grants are the first outlay in a project, announced last year and known as Big Data to Knowledge, that’s expected to involve more than $600-million in spending by 2020. Its goals include developing and distributing methods, software, and tools for sharing, analyzing, managing, and integrating data into medical research. As reported in The Chronicle of Higher Education:

“Examples of the medical challenges that the grant recipients hope to help solve include finding disease associations in the three billion base pairs in the human genome, or in the estimated 86 billion neurons in the human brain, NIH officials said.

“Data creation has become exponentially more rapid than anything we anticipated even a decade ago,” the NIH’s director, Francis S. Collins, said during a briefing on Thursday, “and the challenge is to try to be sure we’re not exceeding the ability of researchers to capitalize on the data.”

“We see more and more the NIH as a digital enterprise,” said Philip E. Bourne, who this year became the agency’s first permanent associate director for data science.

The awards announced on Thursday were divided by the NIH into four broad categories: Twelve centers that will focus on solving computing challenges, nine that will create indexing systems for large volumes of biomedical data, nine that will tackle training and career-development strategies, and another nine that will develop course materials related to big data, including open online formats.

The grant recipients are a mix of leading public and private research institutions. Those with multiple awards are the University of California at San Diego, with three grants, and Harvard University, the Johns Hopkins University, the Mayo Clinic in Rochester, the Oregon Health and Science University, Stanford University, the University of California at Los Angeles, the University of Pennsylvania, and the University of Southern California, with two apiece.”

Tony

 

 

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