February 15, 2006

Student Union on Tuition Fees

Yesterday’s Warwick Boar briefly touched on union president Brian Duggan’s view of tuition fees.

Students will expect a lot more, because they’re paying a lot more, from their institutions and their unions and we’ll have to be at the forefront of direct representation for students not only to make sure students are getting value for their educations, but to ensure we’re providing the right representations and services, and also making sure we fight fees..The only thing that has been done on fees in the past four years is this leaflet that I’ve made.

That’s fair enough. I hadn’t seen the leaflet he refers to, but there’s some info on tuition fees on the student union website. As regards undergraduate fees for domestic students it says the following

Labour promised not to introduce Top-Up Fees…and then they did. From next year Home Undergrads will pay £3000 a year tuition fees. They will leave Uni with an average debt of £20–25k each. Applications are down across the country; clearly high tuition fees are a barrier to involvement. Students from lower socio-economic backgrounds will recieve help, however the system is confusing and offputting, with many students simply not even considering University because of a fear of debt.

Won't the money be useful to Uni's?

We are all being told that Top-Up Fees are necessary if we are to have enough funding in our Uni's for decent facilities and teaching. This is not true! Fees don't cover it. There is a serious funding problem in Higher Education but £3000 per student does not come close to fixing the problem.

Read in full here.

The first paragraph makes a fair point. The prospect of debt will be a deterrent to some groups even if they would be well equipped to make future repayments. Could we encourage teachers to stress the upside potential to such groups? Could short term grants and bursaries help overcome resistance? Who knows; it’s not discussed. The second paragraph appears confused. It admits to a serious funding problem in higher education, but seems thinks that because £3000 fees are insufficient, we should maintain the status quo. Perhaps the author meant the burden should be shifted to taxpayers. Or maybe the benefits of a relatively cheap education far outweigh the benefits of more money and more resources. Again, we’re not told.

Merely saying that ‘Everyone has the right to education that is FREE, FAIR and FUNDED’ doesn’t make it so. The union needs to better explain why a free university education leads to better outcomes than the alternatives. I don’t mean better outcomes for just the students involved. One must consider all the other parties affected: the lecturers, the universities and the taxpayers who never had the benefit of a university education themselves. I know it's not supposed to be a means of getting change, but the union website seems like a perfect place to fully explain the tuition fee stance to those who're unsure; a place to dismiss the notion that students are selfish and unwilling to endure discomfort for long term gain. At present, it just seems lazy.

February 13, 2006

Corporate Welfare

Not too long ago, outgoing David Cameron boldly said the Conservative party wouldn’t be in the pocket of Britain’s businessmen. From the guardian

Britain's business leaders could be forgiven for being confused. David Cameron gave a rousing speech to the CBI conference in November, promising he would lead a 'campaign for capitalism'. Yet by last week, he was delivering a new year message in which he pledged to 'stand up to big business' and relegated capitalism to the same category as communism – that of outdated 'isms' he wants nothing to do with.

On those lines, here’s a great article from John Stossel about the benefits the already wealthy are able to gain from government. Stossel comments on state insurance schemes for those building on land private insurers avoid, corporate subsides in general and eminent domain. A quote –

A limo took us to Dwayne Andreas’ [Archer Daniels Midland chairman] office. Once the cameras were rolling, I brought out the questions about "corporate welfare." I foolishly thought I could get him to admit he was a rich guy milking the system. I thought he’d at least act embarrassed about it. Fuggeddaboutit. He was unfazed.

Stossel: Mother Jones [magazine] pictured you as a pig. You’re a pig feeding at the welfare trough.
Andreas: Why should I care
Stossel: It doesn’t bother you?
Andreas: Not a bit.

I still wonder why he granted the interview. I asked him about his bribes -- I mean, contributions. For example, Andreas gave the Democrats a check for $100,000. A few days later, President Clinton ordered 10 percent of the country to use ethanol.

Stossel: And the purpose of this money wasn’t to influence the president?
Andreas: Certainly not.
Stossel: So why give him the money?
Andreas: Because somebody asked for it.

Because they asked for it? Give me a break.

Read in full here.

By virtue of size, wealth and organisation certain groups can wrangle favours though the benefits accrue to a closed group rather than society as a whole. What can be done about it? People can’t be prevented from exercising free speech and asking for what they want. Nor does it seem fair to categorically prevent monetary & non-monetary contributions to policymakers. Full disclosure of links between policymakers and special interest groups doesn’t seem to make much difference either. After all, any assistance provided is professed to be in the country’s best interests and thus nothing to be ashamed of.

February 09, 2006

Worker Shortages

Lew Rockwell comments on statements from business groups and politicians about shortages of scientists, engineers and mathematicians.

Think of how jobs have changed. We have fewer people around today who know how to farm because fewer people are necessary to do the job. More kids than ever are going into computer sciences because of the perception that these fields will be lucrative in the future. In neither case was a government program necessary. People entering the job market find out quickly what is in demand and what isn't and compare that to their own capacity for doing the job.

The reason the whole math and science racket bamboozles us again and again has to do with our own limitations and our perceptions of foreign countries. We think: heck I know nothing of these subjects, so I can believe that there is a shortage! And surely math and science are the keys to just about everything.

Read in full here.

The word ‘shortage’ may be used a little loosely in the media when applied to jobs and skills. Not every instance of lack deserves to be taken seriously. It makes no sense for me to say there’s a shortage of Ferraris merely because my student budget would get me laughed out of a dealership. I’m simply not willing to pay what its worth. If I say there's a shortage of Ferraris it should be qualified with a statement of a) why I don't think they're worth what I'm willing to pay, and/or b) why it is impossible to pay the going rate. Even when the latter is the case, the harm being done must be considered before declaring a crisis or deciding active intervention is needed.

Take the issue of teachers. The DfES recognises the obvious (albeit not instant) solution to shortages, as evidenced by generous training bursaries of up to £7000 and Golden Hellos of up to £5000 for PCSE candidates hoping to teach maths and science. Given that it knows the solution, the government couldn't blame poor quality education in certain areas on a lack of staff if it refuses to go further with it’s recruitment efforts.

If there are strong financial constraints on their ability to do this (beyond obstinacy), like an unwillingness amongst the populace to pay more tax, then claims of shortages are more credible. Here we’d need to accept that teachers in state schools aren’t necessarily going to hold degrees in their teaching field. Lower expertise may be a suitable trade-off for lower wages given the difficulty of the material being taught. Perhaps the expectations of teacher expertise are too high.

That said, I doubt the constraints faced are insurmountable. Sure, you may not be able to hike taxes, but I bet there are reasonable sacrifices to be made within government. Could policymakers genuinely say that education is important, but not important enough to warrant sacrificing other schemes, and cutting salaries in other areas? Such reorganisation is difficult politically, but probably not operationally. Shifts in resource use needn’t be radical to have a beneficial impact. As long as reasonable sacrifices exist, claims that poor education is down to a shortage of skilled staff is inaccurate. Like my Ferrari, policymakers just doesn’t want to pay what good (by its own definition) teachers are worth.

February 07, 2006

Signalling & Alternatives to University

Here Bryan Caplan of Econlib, a supporter of the view that a degree is primarily for signalling desirable traits, discusses the value of a degree. Idea is, you’re valued as a graduate not so much for the knowledge you come away with but because sitting through lectures and jumping through exam/assignment hoops for three years implies you’re reasonably productive and capable of learning. That many of the firms we see on campus don’t require specific degrees suggests this is often true. What I liked was a suggestion by a later commenter

Start up a school that screens for IQ, and basically puts students through hell — difficult topics involving critical thinking, research, teamwork, and long hours, all without any grade inflation. It would be cheaper because you wouldn't necessarily need well-educated professors. That would be extremely powerful signaling. You might not even have to charge tuition — if you could run it cheaply enough.. Also, you might be able to pack four years' worth of standard signaling into two years, and people who only made it through one year would still prove something. If it failed, so does the signaling thesis.

Clearly needs refining, but the idea has some appeal. The assessment days (featuring tests, group exercises, presentations and interviews) used by large employers could be a model. University helps develop workplace skills, but for non-technical jobs I doubt the gain significant enough to warrant not considering an 18 or 19 year old, or that lessons wouldn’t be learned anyway, once in a pressured work environment.

There must be quicker ways of verifying the existence of certain traits in candidates / cheaper ways for candidates to convey their ability. That job prospects aren’t the sole concern of most people is deliberately ignored. Taking this into account together with subsidies to education, it’s understandable why such alternative schemes (run by independent firms or employers themselves) aren’t around.

February 02, 2006

George Monbiot

Just found the blog of journalist George Monibot who I’d heard of before, but didn’t know was a Guardian writer. There’s plenty to agree and disagree with but I like his writing. For something of more universal interest (and in keeping in the theme of wealth & happiness) take a look at this article on choosing a career –

How many times have I heard students about to start work for a corporation claim that they will spend just two or three years earning the money they need, then leave and pursue the career of their choice? How many times have I caught up with those people several years later, to discover that they have acquired a lifestyle, a car and a mortgage to match their salary, and that their initial ideals have faded to the haziest of memories, which they now dismiss as a post-adolescent fantasy? How many times have I watched free people give up their freedom?

So my second piece of career advice echoes the political advice offered by Benjamin Franklin: whenever you are faced with a choice between liberty and security, choose liberty. Otherwise you will end up with neither. People who sell their souls for the promise of a secure job and a secure salary are spat out as soon as they become dispensable. The more loyal to an institution you are, the more exploitable, and ultimately expendable, you become.

Read in full here.

February 01, 2006

Is £25k enough?

Yesterday’s T2 supplement contributed to the long running discussion about wealth and happiness. The general thrust is that “Once you’re earning £25 000 and upwards..money becomes increasingly irrelevant to genuine happiness”. Methodological issues relating to surveys of subjective well being suggest claims like that could be treated with caution; particularly when accompanied with suggestions for government policy. Still, it’s worth a read.

True happiness, said Bob Monkhouse, is when you marry a girl for love and later discover that she has money. We all appreciate the joke, of course, because though one side of us knows that a loving relationship provides a good chance of happiness the other thinks it would be guaranteed if that relationship made us rich as well.

Yet study after study shows that money fails to buy happiness. Incomes have increased threefold in Britain since 1950 but contentment levels have barely shifted. European research indicates that lottery winners revert to their previous levels of happiness within a year of their windfall. One look at the permanently sullen face of the multi- millionairess Victoria Beckham appears to prove the point.

Full article here.

Around the web, there has been some discussion of the role research on subjective well being should play in policy formation. See this post from Will Wilkinson on the Happiness and Public Policy blog and this from Chris at Stumbling & Mumbling. One World Week also featured a talk on the issue.

January 30, 2006

Education, Budgets, Patricia Hewitt

In yesterday’s Times Patricia Hewitt wrote a sharp reply to economics correspondent David Smith who had earlier criticised the effectiveness of Labour reforms in various areas. On education, she says the following

He may be almost right to say that 60% of pupils failed to gain at least a C grade in maths or English. The figure is actually 55.7%, which I accept is not good enough. But the same figure was 64.4% in 1997. The biggest improvements have come in primary schools where pupils have had the benefit throughout their education of the extra investment and reforms we have put in. We need to do better still but we are going in the right direction.

The number of 11-year-olds achieving the right standards in English have improved from 65% in 1997 to 79% and in maths from 59% to 75%. It is misleading to criticise the performance of city academies without explaining that they are sited deliberately in the areas of lowest educational performance. Far from “faltering”, they are improving GCSE results three times faster than the national average.

Unfortunately, her letter was published on the same day the Telegraph reported growing deficits in the education sector –

Last night, teaching unions and Conservatives warned that teacher shortages were a renewed risk because head teachers were struggling with debt and complex ring-fenced Government funding. Previous school funding crises – notably in 2000 and 2003 – saw four-day weeks and classes of 90 pupils in the worst-affected areas. They are seen as a significant blot on Mr Blair's record in education.

The latest figures from the DfES, obtained by the Sunday Telegraph, show that state-run nursery schools across England had debts totalling £277,081 in 2004–05. Primaries were £34 million in the red while secondaries were responsible for the lion's share: £86 million.

Taking into account the debt being built up and Brown’s promise to curb public spending post 2008, Blair and Kelly certainly have a mammoth task ahead of them. Nobody expects perfection or instant change, but to say we’re ‘going in the right direction’ seems weak. Hand a few billion pounds to any sensible teenager and she’d probably implement policy that would take the system in the ‘right direction’. That’s not to say total spending should be lower, but consistent failure of budget increases to meet expected standards suggests that there are structural problems to be addressed. One can question the proposals Ruth Kelly has put on the table, but at the very least they're a recognition that cash isn't a cure-all.

January 26, 2006

Political Bias

An MSNBC article comments on a study looking at political bias and mental activity –

Democrats and Republicans alike are adept at making decisions without letting the facts get in the way, a new study shows. And they get quite a rush from ignoring information that's contrary to their point of view.
Researchers asked staunch party members from both sides to evaluate information that threatened their preferred candidate prior to the 2004 Presidential election. The subjects' brains were monitored while they pondered.
"We did not see any increased activation of the parts of the brain normally engaged during reasoning," said Drew Westen, director of clinical psychology at Emory University. "What we saw instead was a network of emotion circuits lighting up, including circuits hypothesized to be involved in regulating emotion, and circuits known to be involved in resolving conflicts."
The test subjects on both sides of the political aisle reached totally biased conclusions by ignoring information that could not rationally be discounted, Westen and his colleagues say.

Read it in full here (via 3quarksdaily)

Yet more evidence that we’re pretty good at deluding ourselves. See this previous post on the issue, and this wikipedia entry on confirmation bias.

Those taking part in the study probably didn’t intend to distort reality. If asked whether they were objective, they’d answer in the affirmative. I like to think I deal with comments here and normal conversations rationally without totally ignoring or misrepresenting issues, but one can’t be sure.
It may be difficult to consciously determine whether you’re dealing with an issue reasonably but it’s probably not impossible given some effort. An impartial third party would help matters. The level of frustration being displayed by whoever you’re talking to is another gauge of how fair you’re being. Deliberately questioning existing views every so often wouldn’t go amiss either. Opinions are worth having but they shouldn’t be so linked to your sense of self-worth that learning becomes impossible.

January 24, 2006

Poor Nations & Negotiations

I came across an old post from Ben Muse quoting an FT article on the practical constraints of poor nations when it comes to participation in world trade discussions. From the point of view of Zambian trade minister Dipak Patel, it highlights how lack of money/staff staff and the resultant reliance on NGOs and foreign donors makes life difficult.

Patel starts working on a speech for the launch of a new handbook about a special preference scheme for African, Caribbean and Pacific countries,... He cites a computer simulation showing that EU demands for cuts in Zambian tariffs will lose the government $15m in precious tax revenue.

But Zambia’s ability to do such research is limited. It has access to an online computer model developed by the World Bank, which allows it to do simulations. “But I don’t have the bandwidth, so I often get cut off,” Patel says. He wanted to do a simulation of the effect of possible cuts in goods tariffs on the LDCs in time for the Livingstone conference, but had to run round the donors asking them to do it for him. It arrived just a couple of days before the meeting, undermining its usefulness.

Read it in full here.

January 21, 2006

Business and Social Responsibility

Yesterday’s One World Week discussion was "Business and Social Responsibility: Do Good Values Equal Good Business?". The list of speakers is here. There was pretty much zero tension between any of the speakers and nothing to really disagree with. They stressed the gains society has seen as a result of the profit motive and that ultimately power is determined by how well they serve the customer. They were also eager to emphasise the role of law and voluntary/mandatory codes of conduct to prevent harm; like individuals not all firms seem to have a conscience. Just a couple of points:

– It wasn’t mentioned, but most people are or will be shareholders of some sort though voluntary savings and pension schemes. With luck, the increased value of such investments will help us fund spending later in life. Some shareholders are already incredibly wealthy, but many others just want some money to fund their retirement, pay for medical expenses and help their children through university. No sense in demonising them all. Beyond the provision of ipods, phones, cars and drugs, this is another helpful way in which we gain from having soundly run firms. Of course, we all have different ideas of what it means for a firm to be 'soundly run', so there's a role for ethical investment trusts, aligned with the varied preferences of individuals.

– Maybe there are conflicts in the stated desires of CSR proponents. A firm that goes beyond its legal obligations and donates all profit to various stakeholders won’t generate jobs, puts existing jobs at risk and won't develop/improve existing products and services. Charity isn't costless and extremes in either position are harmful. This uncertainty suggests that laws creating more positive obligations aren’t necessarily in society’s long term benefit.

– A recent example of a voluntary choice to become more socially responsible is the decision by US firm Whole Foods to embrace renewable energy. See here.

Natural food grocer Whole Foods Market Inc. said it will rely on wind energy for all of its electricity needs, making it the largest corporate user of renewable energy in the United States..The decision follows the publicly traded company's mission of environmental stewardship without losing sight of the bottom line, Whole Foods regional president Michael Besancon said Tuesday.

The firm is known for its commitment to stakeholders and has yet to suffer as a result. See this report on its stock performance. See here

The ability of Whole Foods to essentially establish a high-end niche market in the humdrum grocery business — where innovative ideas tend to be rare — has earned comparisons with coffee titan Starbucks. So have heady growth plans of Whole Foods — it aims for $12 billion in sales in 2010, up more than 150 percent from last year.

If efforts to be take care of stakeholders are well publicised, negative financial effects may be lessened somewhat.

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