In a recent editorial the editorial board opinied: Private employees have been required to take pay cuts, furlough days, cuts in their companies' contributions to retirement benefits and have made other sacrifices. They see no reason why public employees shouldn't feel some of the pain. That's one of the messages voters sent Tuesday. Union leaders and county supervisors who fail to recognize that have blinders on.
Surely the MJS editorial board knows that County workers are already saddled with 26 furlough days, an avergae salary cut of $5,000 annually.
And surely the editorial board knows that more than one thousand middle class County jobs have been eliminated, including 65 layoffs last year, contributing to Milwaukee's soaring poverty rate which the board routinely bemoans.
It is gross dishonesty for the MJS editorial board to imply that County employees and other public sector workers haven't made sacrifices because they have.
The MJS editorial board has consistently supported demands for employee concessions by firms like Mercury Marine and Harley Davidson without ever exploring whether the firms' financial position requires these concessions. Now that private sector employees have been forced to accept the destruction of their middle class wage and benefit structures that took generations to build, the editorial board is using these concessions to whipsaw public sector employees into even more concessions.
But to imply as the editorial did that County workers haven't made concessions is either dishonest journalism or misinformed reporting.
Either way, the MJS editorial board is waging a dishonest and one-sided class war against the state's hard working, middle class while urging tax breaks for millionaires.
How much do middle class workers need to give up to satisfy the MJS editors?
A recent Wisconsin State Journal (WSJ) editorial in support of MATC entitled "MATC deserves priority this fall" was in sharp contrast to the Milwaukee Journal Sentinel's (MJS) over the top coverage of MATC a week ago.
The catch-the WSJ piece was about Madison Area Technical College, while the MJS's was about Milwaukee Area Technical College, the Wisconsin Technical College System's large flagship campus with 55,000 students and 125 associate degree and diploma programs.
The MJS recently ran two front page, above the fold articles that inaccurately claimed MATC was facing a "looming financial crisis" and implied that bloated faculty salaries were the cause. The WSJ, in contrast, editorialized about the important role Madison Area Technical College is playing in providing dislocated workers with retraining and reviving the Wisconsin economy and endorsed a $131 million investment in the college.
Differences in Madison and Milwaukee faculty compensation, however, are minimal.
Madison's instructional cost per full time equivalent (FTE) student was 7th lowest in the 16 district system at $9,416, while Milwaukee's was 6th lowest at $9,485.
Madison total costs per FTE was 9th at $12,921, while Milwaukee's was 8th at $13,367.
Both have exceptionally high and stable bond ratings.
So if faculty compensation and fiscal management don't explain the differences in editorial tone and analysis, what does?
Perhaps the MJS's hostility to pubic employees and their unions explains their coverage. The former is evidenced by its on-going series of front page articles on public employee pay without a similar focus on exorbitant CEO compensation and or corporate corruption. The later is demonstrated by the papers treatment of its own employees who have experienced layoffs and salary cuts and the MJS's universal support for concessions.
Over the last five years from Harley Davidson to Mercury Marine, from the auto industry to the County, from MPS to MATC, the Journal Sentinel editorial Board has never editorialized about an employer demand for concessions it didn't support. In the case of MATC it proposes them even after acknowledging that the faculty union has given major concessions including voluntarily giving up a negotiated salary increase and agreeing to health care concessions.
The MJS's skewed coverage of MATC was also in startling contrast to its coverage of recent Public Policy Forum reports on the City and the County's budgets. Both studies documented real financial challenges, much more challenging than MATC's. In fact, the County's financial situation is so perilous that the Greater Milwaukee Committee says it is on the verge of bankruptcy and has proposed dissolving the County. The MJS has endorsed that proposal. Yet, its articles on the City and the County were buried on the third page of the local section.
While the Great Recession has intensified financial pressures on all units of local government, the single biggest cause of their structural financial problems is the rapid decline in state support. The City of Milwaukee's shared revenue has declined from 46% of its budget ten years ago to only 34% today. MATC's state aid has declined from 30% in 1990 to 13% today. Yet the MJS's articles fail to even mention unfunded state mandates and declining state revenues.
The WSJ editorial in support of a $131.7 million referendum begins:
Madison Area Technical College is on the front lines of putting people back to work and helping others keep their jobs in this challenging economy.
The community college is training — and re-training — tens of thousands of workers in south-central Wisconsin each year. And a slew of them are well past the age of traditional students.
It concludes:
...no unit of government is in a better position to address those needs than the local community college.
Earlier in this decade the Milwaukee Journal Sentinel and its allies on the Milwaukee Public School Board, Bruce Thompson, Jeff Spence and Ken Johnson, promoted small schools as the key to improving the academic performance of Milwaukee's public schools.
This was part of a national initiative funded with hundreds of millions of dollars by Microsoft's Bill Gates. Gates himself has now concluded that the effort was ill conceived. He acknowledged this when he told the delegates at the American Federation of Teachers national convention in Seattle that he now understands that empowering teachers is the key to reforming urban education. "If reforms aren't shaped by teachers' knowledge and experience, they're not going to succeed, "he said.
Members of the Gates Foundation staff later met with AFT executives, and the two teams discussed ways to collaborate.
The MJS editors have not been as self-critical as Gates, although their constant advocacy of a mayoral takeover of MPS suggests that they recognize that simply changing the size of schools has little to do with engaging and educating students.
Unlike Gates, however, the MJS continues to promote solutions like the mayoral takeover that at best leave teachers on the sidelines and at worse make them the enemy of education reform.
In Brockton, Massachusetts a different approach was taken. Rather than breaking up a large school, linking teachers' compensation to student performance or firing "bad" teachers, faculty were empowered to take ownership over their school and its curriculum. The results: a failing public school with 4100 students has become one of Massachusetts highest performing schools.
According to of the New York Tines:
A decade ago, Brockton High School was a case study in failure. Teachers and administrators often voiced the unofficial school motto in hallway chitchat: students have a right to fail if they want. And many of them did — only a quarter of the students passed statewide exams. One in three dropped out.
Then Susan Szachowicz and a handful of fellow teachers decided to take action. They persuaded administrators to let them organize a schoolwide campaign that involved reading and writing lessons into every class in all subjects, including gym.
Their efforts paid off quickly. In 2001 testing, more students passed the state tests after failing the year before than at any other school in Massachusetts. The gains continued. This year and last, Brockton outperformed 90 percent of Massachusetts high schools. And its turnaround is getting new attention in a report, “How High Schools Become Exemplary,” published last month by Ronald F. Ferguson, an economist at Harvard who researches the minority achievement gap.
What makes Brockton High’s story surprising is that, with 4,100 students, it is an exception to what has become received wisdom in many educational circles — that small is almost always better.
The Times goes on to point out;
Brockton never fired large numbers of teachers, in contrast with current federal policy, which encourages failing schools to consider replacing at least half of all teachers to reinvigorate instruction....
Teachers unions have resisted turnaround efforts at many schools. But at Brockton, the union never became a serious adversary, in part because most committee members were unionized teachers, and the committee scrupulously honored the union contract.
An example: the contract set aside two hours per month for teacher meetings, previously used to discuss mundane school business. The committee began dedicating those to teacher training, and made sure they never lasted a minute beyond the time allotted.
“Dr. Szachowicz takes the contract seriously, and we’ve worked together within its parameters,” said Tim Sullivan, who was president of the local teachers union through much of the last decade.
There is a lesson here. Are the MPS board and the Milwaukee Journal Sentinel paying attention?
A recent Milwaukee Journal Sentinel article, the last is a sensationalist and dishonest series about Milwaukee Area Technical College (MATC), targeted a Pre-College instructor, suggesting that he was somehow gaming the system.
Others have now chimed in that he is ONLY a GED instructor. In fact, Mr. Holmes who has been a professional educator for 36 years not only teaches a full load of classes to some of our community's most disadvantaged students, but he also has wide ranging administrative duties as the Instructional chair for the entire four-campus Pre-College division.
When MATC instructors take on additional responsibilities they are paid only 60% of the full-time salary saving the college money because it does not hire full-time faculty or staff to conduct those duties. In the private sector that MATC's critics are so quick to point to employees who work overtime are paid time and one half.
The Public Policy Forum report that was the basis for the MJS's series of articles was quite clear: the average base salary for MATC faculty in 2007 was $85,000. The only way faculty made above that was doing additional work at a discounted rate.
The MJS and others may not like it that MATC's educators are paid fairly for their education and years of experience. But that is hardly the scandal that the paper's coverage implies.
Students in the Pre-College division are overwhelming working class and disproportionately students of color. There are over 100,000 adults in the MATC district who do not have a high school degree. MATC and all technical colleges are required by state legislation to provide the educationally disadvantaged with low-cost education. That is a very good thing, although very challenging work. The educators who work in this division change lives as the video below makes clear.
The MJS analysis that MATC is in a financial crisis is also not supported by the facts.
MATC has an Aa1 bond rating and unlike the City, County and State has not experienced any reduction in its rating over more than a decade.
The college also has a healthy rainy day fund unlike the State or the County.
MATC has maintained its infrastructure enabling the college to provide our students with hands-on state-of-the market technical education. For every dollar invested in MATC, $4 returns to the local economy. MATC provides the middle skills workers that make up 70% of Southeastern Wisconsin ’s workforce.
MATC has become overly dependent on local property taxes. This has nothing to do with faculty salaries. In fact, instructional costs per full time equivalent student, a generally accepted measure of institutional efficiency, were 6th among all tech colleges in 2009.
MATC has been forced to rely on local property taxes because state investment has declined from 30% as recently as 1990 to less than 14% today. As a result MATC has been forced to rely on local property taxes to make up the difference.
In 1999 the Milwaukee Journal made exactly this point when it wrote an editorial entitled “Deadly cuts to tech schools” and asked “Who’s to blame? It answered: “The state that’s who….”
Over the past twenty years the state’s contribution to tech colleges has plummeted. During these years Republican Senators Alberta Darling and Glenn Grothman, the most vociferous critics of MATC, have repeatedly voted against increasing tech college funding. The result is that property taxes have increased to support the college’s work educating and training the labor force.
After more than two decades of state disinvestment, the Journal Sentinel has now decided it’s the faculty who are to blame for the college's fiscal challenges. The destructive trends the Journal identified in a decade ago remain. Faculty salaries have increased modestly over the same period although last year, in the middle of the Great Recession, MATC’s faculty voluntarily gave up their negotiated salary increase.
What has changed, as Eric Gunn, a columnist for Milwaukee Magazine and former Journal reporter, wrote in a recent column is that the Journal Sentinel is now run by an anti-labor cabal that sees no contradiction between attacking the middle class salaries of MATC’s faculty while arguing that the Bush tax cuts for millionaires should be extended.
High school and college students are having a tough time finding summer jobs.
The unemployment rate for the 16-to-24 age group reached a record 19.6 percent in April, double the national average of unemployment. For those job seekers, said Heidi Shierholz, an economist at the Economic Policy Institute, “This is the worst year, definitely since the early ’80s recession and very likely since the Great Depression.”
According to a recent article by Karen Herzog in the Milwaukee Journal Sentinel, however, this precipitous decline in youth employment is a byproduct of the Wisconsin Legislature's decision to raise the minimum wage to $7.50 an hour.
Herzog presents a few anecdotes from employers to substantiate her claim. But she fails to square her analysis with any recognition that the record rate of youth unemployment is a national problem that predates Wisconsin’s minimum wage increase.
In June 2009 before the minimum wage increase in July 2009 the Bureau of Labor Statistics reported that employment rates among the nation’s teens (16-19 year olds), especially boys, had reached historic lows. During June, the employment rate (seasonally adjusted) of all 16-19 year olds in the nation was estimated to be only 29.2%, meaning that only 29 of every 100 youth ages 16-19 were employed in any type of job in this month..
Over the October-November 2007 to November-December 2009 period, the number of employed teens in the U.S. declined by nearly 25% while the number of employed 20- 24 year olds fell by nearly 11%.
Job loss in relative terms (-25%) among the nation’s teens in the Great Recession is greater than it was for all workers in the Great Depression of the 1930’s (1929-1933). The employment losses for young workers far exceeded those of all other age groups. In fact, the June 2009 employment rate of teens was the lowest ever recorded in the 62 years of employment data that are available from the monthly Current Population Survey dating back to 1948.
Herzog presumably ignores this reality because to acknowledge it would undermine her contention that Wisconsin’s minimum wage increase is the cause of high youth unemployment. Or if she acknowledged it, she would have to make the absurd argument that fear of an increase in Wisconsin’s minimum wage to $7.50 caused employers in every state, several of whom have a higher minimum wage than Wisconsin, to cut back on youth employment..
Attributing high youth unemployment to Wisconsin’s minimum wage increase ignores recent research that indicates that incremental increases in the minimum wage do not undermine employment. Studies of states that actually raised the minimum wage in the early 1990s by economists David Card and Alan Kreuger found no increase in unemployment.
A more recent study by Jeff Chapman that reviewed the experience in all twelve states that had raised their minimum above the federal minimum during this decade concluded:"Despite very strong evidence to the contrary, those opposed to minimum wage hikes continue to claim that such policies have and will eliminate jobs. ...the facts clearly show that the benefits of such increases outweigh any potential costs.”
Youth unemployment is a national problem. It is likely to remain a serious problem without a federal youth jobs program. Blaming it on incremental increases in the minimum wage is inaccurate. It may encourage policy makers to attempt to reduce the minimum wage, but it won't help young people find jobs or earn income.
The report by the Northeastern University's Center for Labor Market Studies concluded:
The severe teen joblessness problem is a year-round problem not confined to the summer. A job stimulus program for teens is needed that will create jobs for youth in the public and nonprofit sectors and provide economic incentives through wage subsidies for private for profit employers to hire teens….The time for comprehensive and sustained policy actions on a wide variety of fronts to get our youth to work is now.”
In a recent editorial the MJS editors implied that America’s deficit problems were caused by the same “out-of-control spending on government programs for aging populations”as Greece's. Social Security, Medicare and Medicaid were specifically cited. “Take heed” warned the state’s largest daily as it called for “new austerity” measures, presumably including cutting Social Security, Medicaid and Medicare.
Before we begin slashing our senior citizens' hard earned benefits we ought to take a closer look at the facts. As Noble Prize winning economist Paul Krugman wrote:
The truth, however, is that America isn’t Greece — and, in any case, the message from Greece isn’t what these people would have you believe.
So, how do America and Greece compare?
Both nations have lately been running large budget deficits, roughly comparable as a percentage of G.D.P. Markets, however, treat them very differently: The interest rate on Greek government bonds is more than twice the rate on U.S. bonds, because investors see a high risk that Greece will eventually default on its debt, while seeing virtually no risk that America will do the same. Why?
One answer is that we have a much lower level of debt — the amount we already owe, as opposed to new borrowing — relative to G.D.P. True, our debt should have been even lower. We’d be better positioned to deal with the current emergency if so much money hadn’t been squandered on tax cuts for the rich and an unfunded war. But we still entered the crisis in much better shape than the Greeks.
Even more important, however, is the fact that we have a clear path to economic recovery, while Greece doesn’t.
The U.S. economy has been growing since last summer, thanks to fiscal stimulus and expansionary policies by the Federal Reserve. I wish that growth were faster; still, it’s finally producing job gains — and it’s also showing up in revenues. Right now we’re on track to match Congressional Budget Office projections of a substantial rise in tax receipts. Put those projections together with the Obama administration’s policies, and they imply a sharp fall in the budget deficit over the next few years.
Greece, on the other hand, is caught in a trap. During the good years, when capital was flooding in, Greek costs and prices got far out of line with the rest of Europe. If Greece still had its own currency, it could restore competitiveness through devaluation. But since it doesn’t, and since leaving the euro is still considered unthinkable, Greece faces years of grinding deflation and low or zero economic growth. So the only way to reduce deficits is through savage budget cuts, and investors are skeptical about whether those cuts will actually happen.
It’s worth noting, by the way, that Britain — which is in worse fiscal shape than we are, but which, unlike Greece, hasn’t adopted the euro — remains able to borrow at fairly low interest rates. Having your own currency, it seems, makes a big difference.
In short, we’re not Greece. We may currently be running deficits of comparable size, but our economic position — and, as a result, our fiscal outlook — is vastly better.
That said, we do have a long-run budget problem. But what’s the root of that problem? “We demand more than we’re willing to pay for,” is the usual line. Yet that line is deeply misleading.
First of all, who is this “we” of whom people speak? Bear in mind that the drive to cut taxes largely benefited a small minority of Americans: 39 percent of the benefits of making the Bush tax cuts permanent would go to the richest 1 percent of the population.
And bear in mind, also, that taxes have lagged behind spending partly thanks to a deliberate political strategy, that of “starve the beast”: conservatives have deliberately deprived the government of revenue in an attempt to force the spending cuts they now insist are necessary.
Meanwhile, when you look under the hood of those troubling long-run budget projections, you discover that they’re not driven by some generalized problem of overspending. Instead, they largely reflect just one thing: the assumption that health care costs will rise in the future as they have in the past. This tells us that the key to our fiscal future is improving the efficiency of our health care system — which is, you may recall, something the Obama administration has been trying to do, even as many of the same people now warning about the evils of deficits cried “Death panels!”
So here’s the reality: America’s fiscal outlook over the next few years isn’t bad. We do have a serious long-run budget problem, which will have to be resolved with a combination of health care reform and other measures, probably including a moderate rise in taxes. But we should ignore those who pretend to be concerned with fiscal responsibility, but whose real goal is to dismantle the welfare state — and are trying to use crises elsewhere to frighten us into giving them what they want.
In the Milwaukee Journal Sentinel's latest man bites dog story Katelyn Ferral writes:
More than 65% of Midwest chief financial officers and senior comptrollers said cutting corporate and personal income taxes is the best way to create jobs, according to a national survey conducted by Grant Thornton this month. Thirty-five percent of those polled said cutting personal income taxes would be most effective in creating employment opportunities, while 32% said cutting corporate tax rates would best allow companies to hire.
What will the MJS tell us next, that alcoholics prefer beer to sparkling water?
Economic policy, including tax policy, should be based on facts not opinions, even those of highly paid CFOs.
The United States enacted the largest tax cut in its history in 2001 ($1.3 trillion) and followed that up with additional capital gains and dividend tax cuts in 2003.
The total value of the 2001-2003 tax cuts was $1.8 trillion.
More than 50% of the $1.8 trillion tax cuts went to the richest 1%, CEOs and CFOs included who averaged over $900,000 annually.
The result-the weakest job creation of any post World War II business cycle.
If cutting top marginal income rates led to job creation we should have had a job boom. Instead we had the opposite. And a large proportion of the private sector jobs that were created (finance, real estate and construction) were the result of the housing bubble. Once that burst all of those jobs were eliminated.
We experienced much greater job growth during every other post WWII business cycles, including those in the 50s, 60s, 70s and 90s, when the top marginal tax rate was significantly higher than it was during the 2001-2007 business cycle.
High income personal income tax cuts, such as the 2001 tax cuts or those advocated by the CFOs, are weak economic engines because high income earners are less likely to spend their additional income than less affluent people.
The Milwaukee Journal Sentinel circulation must really be down, or its editors have a pathological hatred of the American Recovery and Reinvestemnt Act.
There are no other possible explanations for its sensationalist, above the fold, front page article about the failure of the Milwaukee Area Technical College (MATC) and four other stimulus fund recipients to meet a reporting deadline.
That’s right, the Journal Sentinel thought missing a deadline merited front page and distorted coverage. Sure, MATC’s administration needs to tighten up its reporting procedures, but its failure to meet a deadline on money it has not even received hardly constitutes front page news.
Here’s how distorted the reporting was: the Journal Sentinel first said five organizations received a grand total of two hundred thousand dollars. But after acknowledging that amount, the paper quoted the chairman of the Federal Recovery Board claiming: “…they took millions and thumbed their noses at the taxpayers.”
If only MATC had received millions of federal dollars, it wouldn’t be struggling to meet the huge increase in demand for its services.
The real scandal that merits front page coverage is that MATC’s enrollments have soared as Iraqi veterans and dislocated workers seek occupational training, but state aid to the tech college system has fallen to 13%, the lowest level in history and way below the state’s 33% commitment. And while President Obama has proposed a significant increase in federal support for two-year colleges, Congress has yet to approve the needed funding while the GOP appears committed to opposing absolutely everything Obama wants.
Rather than manufacturing imaginary scandals, the Journal Sentinel should use its bully pulpit to demand that the federal government increase its investments in higher education.
The local newspaper apparently has an axe to grind with the stimulus program. A month ago in a front page article entitled "Economists see no stimulus jobs" it incorrectly claimed that the American Recovery and Reinvestment Act had not created any jobs, an assertion that virtually no economist agrees with. Now it implies that the program is acting irresponsibly.
The only institution that is behaving irresponsibly is the Milwaukee Journal Sentinel which in its desperate effort to increase sales, has, in the words of Steven Colbert, a truthiness problem.
The final nail in the coffin of the printing industry's advanced technology center was driven last week when Waukesha County Technical College (WCTC) ended its relationship with the Institute on Graphics and Imaging just 2 ½ years after it began. The $4 million publicly funded building will no longer be a printing industry research and technology center. It will now house regular WCTC classes and services.
The failure of this taxpayer funded facility to generate economic growth, research and development, job creation or training should be a warning to those who have uncritically supported the M7 Water Council's water cluster initiative.
The rhetoric and promises of printing and water cluster advocates are startling similar. Wisconsin is alleged to house a vibrant cluster of printing and water technology companies. Industry success requires public investments in R and D to support these firms. The result: Southeastern Wisconsin will become another Silicon Valley.
In both cases, the drive for public investment has been championed by industry CEOs, justified by industry financed studies and uncritically supported by the local media.
In 2004 the Milwaukee Business Journal, for example, enthusiastically proclaimed:"Wisconsin's printing cluster leaders continue to support a move to make the area the 'Silicon Valley of printing.' The centerpiece of that plan calls for a 27,000-square-foot applied technology center at WCTC...The proposed center...would serve as the hub for a printing industry cluster...."
The printing technology center was first proposed in language that parallels the rhetoric of today's water cluster advocates in the Wisconsin Printing Industry Cluster report to the state's Economic Summit III in 2002:
“With high-pay jobs, several market- leading companies, significant private sector R&D, and a steady supply of skilled workers from technical and baccalaureate colleges, the Printing Cluster is well positioned to continue as a major driver of the Wisconsin economy.”
The Council’s recommendation mirrored the M7 Water Council's push for UWM's fresh water research to be industry focused: "“Since the presence of R&D units is critical for the success of any knowledge-based industry, one of the colleges or universities should establish an R&D capability."
"...The Printing and Graphic Design Center, which is staffed by WCTC and UW-Stout, is one logical site for an applied R&D center."
The Printing Industry Cluster like water cluster advocates also argued that establishing a publicly funded research and development technology center would help attract additional R and D activity to the state. “PIW (Printing Industries of Wisconsin) and its members should lure the R&D operations of printing trade associations to Wisconsin...These R&D operations could obtain critical mass if combined with a college technical capability and support from private companies in R&D consortiums."
One of the printing industry cheerleaders was Milwaukee Journal Sentinel weekly business columnist John Torinus who also owns Serigraph, a West Bend printing company. He championed the center as "infrastructure …established to support the (printing) cluster.” Torinus, in a column that sounds errily similar to current promises by water cluster advocate and Badger Meter CEO, Rich Meeusen, even promoted the notion “that our growing muscle in the industry cluster could result in Wisconsin becoming ‘the Silicon Valley of printing.’"
The failure of the printing clusters' advanced technology center is a warning that policy makers should not rely on industry financed research and CEO anecdotes to develop economic development policy.
CEOs and business association spokesman have good reasons to try to externalize the costs of their firms' and sector's technology development, research and training. Most importantly it reduces their costs and increases profits. But it violates the fundamentals of market economics. Without significant skin in the game, business leaders have no incentive to minimize risky investments.
Industry financed research is unreliable. For generations the tobacco industry funded studies that denied any link between smoking, cancer and heart disease. Oil companies have financed climate change denial research in order to defeat legislation designed to reduce fossil fuel consumption. Industry financed research promoting sectoral strategies raises similar conflict of interest issues. Before public dollars are invested in a particular industry, citizens should insist the analysis and strategies be validated by independent research.
None of this means that UWM's efforts to establish a School of Fresh Water Sciences is misguided. Given the college's proximity to Lake Michigan, the importance of the Great Lakes, UWM's leadership in fresh water science and the wide range of fresh water scientific and policy issues, the School of Fresh Water is an important initiative. Nor is it an argument against developing a coherent and strategic industrial policy.
The demise of the printing industry's advanced technology center is a warning that policy makers should not allow private firms or the corporate community to define the School of Fresh Water Sciences' research agenda and scope of inquiry. That is the responsibility of the Fresh Water school's faculty and staff. And it is a warning to all of us to examine any industry spokeman's claim that taxpayer assistance is all that is needed to create another Silicon Valley.
On Friday the Milwaukee Journal Sentinel argued that "...the legislature's Joint Finance Committee should at the very least maintain its small increase in state aid for technical colleges."
The editorial board noted the critical role the Milwaukee Area Technical College (MATC) is playing in the Great Recession:
Milwaukee Area Technical College plays a key role in training workers for jobs during an economic downturn. This has never been clearer than during this recession. As unemployment numbers go up, students flood to MATC to sharpen current skills or learn new ones....
MATC is different from a traditional four-year college, but just as necessary. Most of the students at the school just take a class or two. But these classes may be just what they need to earn or keep a job.
In other words, MATC helps the community roll with the economic punches by helping workers and those laid off to reinvent themselves and adapt to new economic realities.
Technical college state aid has fallen from more than 30% of revenues in 1990 to a measly 13% today. This precipitous decline in state investment has shifted the burden of financing workforce education and training to property tax-paying homeowners and students, undermining the legislature's intent when it created the Wisconsin Technical College System (WTCS) in the 1970's with a three-legged funding model of one-third state aid, one-third local property taxes, and one- third other sources.
The Joint Finance Committee restored proposed cuts to WTCS general aid (totaling $3.37 million) and approved a 1% increase in general aid (totaling $1.84 million). It was the first increase since 2001. The vote was 12-4 on party lines with Democrats in favor and Republicans opposed.
The Journal Sentinel editorial in support of increased investment in technical education was its first since 1999.
Has Milwaukee's Mayor Barrett decided that downtown Milwaukee is a better location for UWM's new engineering campus than the County Research Park in Wauwatosa?
It appears that might be the case.
In a December 18th article in the Milwaukee Journal Sentinel, Larry Standler reported that the Mayor's stimulus proposal included: "$15 million to help the University of Wisconsin-Milwaukee develop its new School of Freshwater Science and downtown engineering campus."
According to one City Hall insider, the Mayor has concluded that the new campus should be built in downtown Milwaukee.
Whether this is a bargaining chip aimed at getting the County to reduce its price or a recognition that a downtown location maximizes the investments economic development potential in a more student friendly location, it is welcome news.
The Milwaukee Journal Sentinel has editorialized several times in favor of the County Research Park in Wauwatosa and buried the story when the Milwaukee Common Council endorsed a downtown location.
The paper claims there is a fire wall between the editorial page and the newsroom. If so, one would think that the Mayor's change of heart on the engineering campus's location would be worthy of coverage.
The Milwaukee Journal Sentinel (MJS) is nothing but consistent when it comes to editorializing on labor relations. While it expresses regret over the loss of family supporting jobs and Milwaukee's nationally high and very stubborn poverty rate, it has never missed an opportunity to push for wage or benefit concessions for unionized workers.
A year and one half ago, when the economy was expanding with corporate profits the highest since the Gilded Age and labors’ take the lowest, the editorial board urged three separate groups of local employees to agree to concessions.
First, County employees were urged to be “realistic”and praised for accepting higher health care premiums and scaled back pension and sick leave benefits.
Then Milwaukee’s Harley Davidson workers were urged to accept lower wages for new employees and changes in their health and pension plans even as Harley generated record revenues and rewarded its executives with huge compensation increases.
Shortly afterwords, the editorial board urged Kenosha’s Chrysler Engine Plant employees, members of UAW Local 72, to "be realistic" and accept “painful concessions” from the company's new owner, the private equity firm, Cerberus, even though Cerberus hadn't even asked for them.
More recently, it has supported eliminating firefighter and Milwaukee County jobs and opposed requiring employers to provide their employees with paid sick days. But its recent editorial that advocates letting the U.S. auto industry with its 3 million middle class jobs go out of business takes the cake. It blithely ignores that the U.S automobile industry is:
the backbone of America's manufacturing sector
responsible for 1 out of every 10 private sectors jobs and $150.7 billion in personal income
critical to America's national defense
The editorial also ignores that failure would cost $156.4 billion in government revenues over just three years at a time when the economy is reeling, unemployment soaring and the deficit approaching one trillion dollars.
Not only does the MJS editorial advocate allowing the Big Three to go bankrupt, but it targets the United Auto Workers Union (UAW) and its middle class members for unjust criticism. It is so loaded with tired, inaccurate and anti-labor rhetoric it could have easily have been cut and pasted from a 1970s' Heritage Foundation report.
Here's what the MJS editorial writers alleged about the UAW and its members and the facts:
A second bailout won't make up for decades of mismanagement and union intransigence...
The U.S automobile industry has been mismanaged. Congress has responded by appropriating $25 billion to assist the industry in developing a new generation of energy efficient vehicles and green technologies. But the industry's current crisis is driven by the credit markets collapse and the resulting recession. One million three hundred thousand (1.3 million) private sector jobs have been lost causing consumer spending to decline for the first time since the early 1970s. As a result, car sales for all auto companies including Toyota have plummeted.
The Big Three are seeking a bridge loan to help it deal with the most severe economic downturn since the Great Depression.
The UAW has been anything but intransigent. The 2003 and 2007 contracts cut billions of dollars in costs for the Detroit 3. In 2007, new hire wage rates were halved to $14 per hour, new hires got reduced health care benefits and were not included in the existing defined benefit health plan. In addition the creation of the VEBA for retiree health care saved the companies $33 billion in future health care obligations.
The UAW has also allowed many sub assembly operations traditionally done in-house to be outsourced to suppliers and has agreed that certain non-core functions like housekeeping could be contracted out to lower paid workers.
The Detroit 3 and the UAW have been operating as if they were in bankruptcy for the last several years. One hundred thousand (100,000) autoworkers have lost their jobs in just the last two years as auto companies have closed plants and reduced capacity.
The overhaul should include severe cost reductions and the end of onerous union rules that hamper productivity.
The UAW long ago recognized that world class quality and high levels of productivity are essential. The UAW at plants like the Chyrsler Engine Plant in Kenosha and the GM Assembly Plant in Janesville have worked in partnership with management to improve quality and productivity. The Chrysler Kenosha Engine plant has been recognized as an industry leader in team based manufacturing techniques modeled on the same operating systems used by Toyota.
But bankruptcy is a system for reorganization - companies continue to operate in Chapter 11. Jobs would be lost, lots of jobs, and a bankruptcy for any of the three companies would be painful. But all 3 million jobs tied to the industry would not vanish. Other companies have emerged from bankruptcy stronger. The airlines repeatedly have foundered only to re-emerge.
The truth is, the Big Three would most likely face a Chapter 7 liquidation not a Chapter 11 reorganization. It is highly unlikely that the Detroit 3 could get debtor in possession financing to continue operating or that consumers would buy cars, the 2nd largest consumer purchase, from bankrupt companies.
It's astounding that the MJS would suggest that the U.S. airline industry is a model. That industry has been a basketcase for almost thirty years. It is currently hemorrhaging billions of dollars and tens of thousands of middle class jobs while reducing routes and capital investment and increasing fares. It is a model for the failure of deregulation.
The truth is, the government has delayed this day of reckoning for years. It bailed out Chrysler in the late 1970s, imposed quotas on Japanese imports in the 1980s, and for decades let the Detroit automakers build gas guzzlers under sham federal fuel-efficiency standards. For its part, the UAW kept fighting for expensive benefits and embracing a 1950s worldview even as the automakers were crashing
The Chrysler bail out was an unmitigated success story. When the federal government offered its help, Chrysler was responsible for one out every one hundred private sector jobs, most located in urban areas. The loans were repaid in full ahead of schedule. A viable Chrysler continued to exist providing family supporting jobs, health care and pensions to tens of thousands of workers and retirees around the nation and in Wisconsin.
Quotas were never imposed on foreign automobile competitors, although Japanese companies adopted voluntary trade restraints in the early 1980s.
Perhaps the MJS editors are confusing the Big Three with Harley Davidson which successfully restructured under the protection of actual quotas.
It is also untruthful and irresponsible to maintain that the UAW embraced a 1950’s mentality as the automakers were crashing. As a result of the 2003 and 2007 contracts the cost gap between the Detroit 3 and Toyota will be eliminated.
Anyone who has been inside a UAW represented Ford, GM or Chrysler plant recently will attest to the strong union commitment to streamlined work rules designed to build high quality vehicles at low cost.
According to the authoritative Harbour Report, the UAW represented Chrysler Belvidere assembly plant was the most productive car assembly plant in the United States in 2007 topping every foreign owned plant. Another UAW plant, a Chrysler joint venture engine plant in Dundee, Michigan was the most productive engine plant in this country last year.
Wisconsin is the home to hundreds of automotive supplier firms such as Johnson Controls, Dana Holding Company, Charter Wire, and Stratech. Tens of thousands are employed at these companies. We have begun to see the impact of GM's shutdown in Janesville which now has the highest unemployment rate in the state. We simply cannot afford to allow this critical industry to go bankrupt. Congress should provide the Big Three with a bridge loan to help it survive the current recession and retool for the next generation of green vehicles and middle class jobs. The MJS should listen to our new President. It needs to reexamine its blind faith in market fundamentalism with its anti-labor animus and support policies that actually promote the middle class and family supporting jobs.
John Drew, UAW Local 72 President (1996-2004), UAW International Representative Region 4
Dale Sievert’s recent Milwaukee Journal Sentinel letter criticising Barack Obama reminds me of Mark Twain’s maxim:
”There are three kinds of lies: lies, damned lies and statistics.”
Sievert notes the richest 1% paid 39.9% of federal income taxes. But Sievert's is cherry picking. Income taxes are only one of several federal taxes.
Sievert ignores the impact of Social Security (6.2%) and Medicare (1.45%) taxes. Middle class workers pay a much higher percentage of their income in these taxes since the Social Security tax is zero percent after $102,000. For the self employed these tax rates are an even higher, 15.2%. And social insurance taxes do not apply to capital gains and dividend income, most of which goes to high income folks.
If you include the taxes Sievert ignores, the average federal tax rate for the richest 1% falls to 22%, the lowest tax rate paid in at least 18 years.
How does the 22% rate paid by the super rich compare to what the middle class pays?
Taxpayers making between $100,000 and $200,000 paid nearly the same rate, 20.6%. Those in the $50,000 to $75,000 range paid 17.4%; even taxpayers earning a very modest $40,000 to $50,000 paid 15.8%.
Sievert also ignores that the richest one percent's portion of national income has soared to its highest level since 1929.
Put simply the richest 1% pay more in income taxes because they are making so much more than everyone else. But their federal tax rate is not much higher than that paid by firefighters, welders, nurses and machinists.
Barack Obama’s proposal to roll back some of the Bush era tax cuts on folks making over $250,000 is a sensible and fair way to ensure that we have the resources to pay for social investments like education, healthcare, research and development, increased regulation of imports, security and infrastructure required to keep the country strong and its people safe and prosperous.
Two weeks ago the Milwaukee Journal Sentinel (MJS) exposed the Neighborhood Schools Initiative (NSI) as a massive failure and waste of taxpayer dollars. A few days alter the Milwaukee Metropolitan Chamber of Commerce (MMAC) and selected voucher advocates met behind closed doors to discuss how to reform the Milwaukee Public Schools (MPS) and Mayor Barrett called for an audit of MPS's finances declaring every option should be explored.
But as Joel McNally and Barbara Miner point out it in two separate articles, the MMAC and MPS voucher advocates, including former Mayor John Norquist, designed and promoted, with the support of the MJS, the NSI, not the current MPS board's leadership.
The MPS Board members who supported the NSI were the very same folks, John Gardner, Bruce Thompson and Jeff Spence, who sold voucher schools as the market solution to the failures of Milwaukee's Public Schools in the early 1990's.
They have now admitted that voucher schools are not the panacea they originally claimed. The Journal ran a series on this a few years ago. But rather than dismantle this multi-million dollar, failed experiment and focus the state's scare educational resources on improving MPS, they now argue Milwaukee has a system of schools which face the common challenge of educating Milwaukee's largely poor and minority children.
In recent articles, the MJS has failed to acknowledge that current the current MPS Board leadership, including its President Peter Blewett, newly elected MPS Finance Chair Michael Bonds and Jennifer Morales were opponents of the NSI and vouchers.
A review of the record suggests that it is politically more palatable to Milwaukee's elites to beat up on this struggling urban school district, scapegoat teachers, their unions, and the elected MPS board of directors, and promote changes in governance than it is to provide MPS with the resources it needs to serve the children who depend on it.
On Saturday, the Milwaukee Journal Sentinel’s editors wrote that the $146 billion fiscal stimulus passed by the House of Representatives should be amended to “expand aid for food stamps, heating assistance or unemployment compensation…”
They are right that these increases should be included in any stimulus package designed to jump start the failing economy and assist those most in need.
But the paper’s Business section article on the unemployment report completely undermined the editorial’s policy proposal by suggesting people are losing their jobs because they lack “versatility,” “perseverance, and a commitment to “hard work.”
Strangely entitled “jobs for the diligent” the article explains the devastating impact of unemployment by focusing on someone who quit his job to pursue an entrepreneurial dream more than a year ago-before unemployment began to rise. His situation is very different than the millions nationally who are losing their jobs because the economy has slowed. The former voluntarily terminated his employment, is ineligible for unemployment benefits even if they are extended, and is currently working. The later are involuntarily unemployed.
During cyclical downturns firms reduce production and cut their operational costs. One of the easiest and quickest to way to accomplish cost reductions is to furlough labor. Hence, the increase in unemployment.
The article liberally quotes a retired healthcare executive who says: “…businesses are suffering too...”and they need “’versatile employees who can stick around and contribute to profitability….”
The problem is you can’t stick around and contribute to profitability when you’re given a pink slip.
Workers are getting laid off because the housing bubble burst, credit’s tight, consumption’s down and the economy is contracting, not because they lack versatility or a work ethic!
Last month the nation lost jobs for the first time in five years- 17,000 in total. The month before the unemployment rate rose significantly. Over the past three months only 42,000 jobs were created per month, far less than the 150,000 needed to absorb new labor market entrants.
The number of people who have been unemployed for more than six months is now 1.38 million. Long term unemployment has not been this high since the 2001 recession when Congress last extended unemployment benefits.
Most economists recognize that the official unemployment rate significantly undercounts the number of unemployed by failing to recognize those who have dropped out of the labor market, discouraged workers, and the involuntary part-time.
Milwaukee with the fourth highest unemployment rate in the nation has a serious and growing unemployment problem.
Hard working, diligent people are losing their jobs through no fault of their own. The ranks of the long term unemployed are growing. The MJS editorial board is right-Congress needs to add extended unemployment benefits to its stimulus package.
In the Journal Sentinel's Quick Hit (12/20/2008), Mabel Wong warns that: "Anecdotal observations from laymen..." regarding global warming "...don't prove anything."
She, of course, is right about this.
But then Ms Wong provides us with nothing less than anecdotal evidence!
The obvious purpose is to undermine the international scientific community's consensus that global warming is a real threat that demands immediate and decisive action.
Yesterday the former top commander of American forces in Iraq, Lt. General Ricardo Sanchez, blamed the Bush administration for a "catastrophically flawed, unrealistically optimistic war plan” and denounced the current addition of American forces as a “desperate” move that would not be successful.
Why did the Journal Sentinel bury it on page 4?
Sanchez public criticism of the Bush administration's prosecution of the war is surely bigger news than the tragic deaths of four people at a horse show in Madison, the paper's lead story.
