The Fed Can’t Fix What Ails the Economy
By Gerald P. O’Driscoll Jr.
This article appeared in Real Clear Markets on July 21, 2014.
In Congressional testimony this week, Federal Reserve Chair Janet Yellen pointed to several economic maladies warranting continued activism by the central bank. But what ails the U.S. economy cannot be fixed by monetary policy.
This has been an exceptionally weak recovery when gauged by the labor market. About half of the decline in the unemployment rate can be accounted for by “discouraged workers,” who have dropped out of the labor force and are no longer actively seeking jobs. For that reason, the unemployment rate is increasingly becoming a misleading gauge of the labor market.
In Monday’s Wall Street Journal, Mortimer Zuckerman wrote cogently of “The Full-Time Scandal of Part-Time America.” As he put it, “Way too many adults now depend on the low-wage, part-time jobs that teenagers would normally fill.”
Low economic growth is one reason that job growth has been weak. Growth in full-time jobs has also been slowed by Obamacare. The act mandates that employers provide health insurance for those working 30 hours a week or more. The predictable consequence is that employers are reluctant to hire full-time workers. Better two half-time workers than one full-time employee.
There are many other forces at work in labor markets, few of which are influenced by anything the Fed does. Until recently, there were extended unemployment benefits. These discouraged workers from actively seeking jobs. That effect combines with benefits, like food stamps, to act as a tax on taking a job. Casey Mulligan, an economics professor at the University of Chicago, has written extensively on the employment tax. If people don’t take jobs, employment cannot grow.
Some of what occurred in the recession is a continuation or acceleration of trends long in place. The male labor force participation rate has been declining since 1950. It was about 87% then, and is 69.2% today. The overall labor force participation increased for a long time because of rising participation by women. That has flattened now.
The fact that men increasingly do not work has profound social consequences. But, again, this is not a problem that monetary policy can address.
Janet Yellen has long been associated with the belief that the central bank can influence employment. She has also commented on the weakness in current labor markets, and the fact that the numbers overstate strength there.
Yet yesterday she observed that the labor market is improving more quickly than expected, and therefore the Fed might raise interest rates sooner than expected. Perhaps the Yellen Fed has decided to declare victory, and extricate itself from the trap of its own making. But that does not change the fact that labor markets remain weak.
It is hubris to claim the Federal Reserve can control variables, like the unemployment rate and labor market weakness, over which they have no systematic influence. But Fed policy is not just ineffective; it is malignant.
The main effect of Fed policy has been to create asset bubbles in financial markets, decoupling these from the underlying economy. As we learned painfully in the recent financial crisis, overheated asset markets are not a source of strength – they the source of future problems.
Killer snake in Lake Hopatcong? State says it’s unlikely
Traps were set. Sunbathers and boaters were asked to keep a wary eye. The waters and shoreline were searched and searched again. And again. (Hinchliffe/The Bergen Record)
Ridgewood Guild Movies in the Park Features Frozen July 9th
Sponsored by Backwoods
Fearless optimist Anna sets off on an epic journey-teaming up with rugged mountain man Kristoff and his loyal reindeer Sven-to find her sister Elsa, whose icy powers have trapped the kingdom of Arendelle in eternal winter. Encountering Everest-like conditions, mystical trolls and a hilarious snowman named Olaf, Anna and Kristoff battle the elements in a race to save the kingdom.
Movies in the Park returns for the summer season. Memorial Park at Van Neste Square at 9PM – Bring a blanket or chair and enjoy this free movie presented by the Ridgewood Guild!
Border Meltdown: Obama Delivering 290,000 Illegals To U.S. Homes
The vast majority of 50,000 unaccompanied youths and children who have illegally crossed the Texas border during the last few months have been successfully delivered by federal agencies to their relatives living in the United States, according to a New York Times article.
A second New York Times article report revealed that officials have caught an additional 240,000 Central American migrants since April, and are transporting many of them to their destinations throughout the United States.
The 290,000 illegals — so far — are exploiting legal loopholes that allow them to get temporary permits to stay in the United States.
Experts say that President Barack Obama’s administration has failed to close the loopholes and is unlikely to deport more than a small percentage of the illegals, despite the high unemployment rates among American Latino, African-American and white youths, and the strapped budgets of many cities and towns.
The president’s policy has caused protests by frightened citizens in towns such as Murrieta. But Obama’s allies — such as La Raza, an ethnic lobby for Latinos — are eager to escalate the conflict and to paint the protestors as racists. Those protests may escalate before the November elections.
Petition Making the Rounds to Stop Work on Underpass Lane Closures
Reader says this is circulating… decide for yourself
I just signed the petition “Ridgewood, NJ Village Council: Stop Work on Underpass Lane Closures until a Comprehensive Traffic Study is Done and Resident Input is Heard” on Change.org.
It’s important. Will you sign it too? Here’s the link:
Stop Work on Underpass Lane Closures until a Comprehensive Traffic Study is Done and Resident Input is Heard
Petition by
Ridge Woodian
Ridgewood, NJ
Ridgewood passed and is implementing a plan to remove two lanes of traffic at the Franklin Ave underpass. No one was given advance notice, no public input was sought, no comprehensive traffic study was done and the plan is very flawed with serious potential safety and traffic consequences.
This area is already a known bottleneck and removing lanes stands to:
1. Create major traffic backups on Godwin, West Ridgewood, Franklin Aves and Broad Street;
2. Cause drivers to divert onto residential side streets, filled with kids, to avoid the underpass. They are already diverting onto Doremus, Ackerman, Heights & Crest;
3. Hurt downtown businesses, by pushing West Side residents to shop in Midland Park instead of Ridgewood to avoid the underpass traffic;
4. Plus, the plans include an ill-conceived bike lane, which is also to be used by Emergency Vehicles (Police, Ambulances and Fire) to bypass the single-lane traffic. This is a blind curve and children riding here will be hit! Drivers entering the plan’s very limited turn lanes will also have to cross this bike lane. It makes no sense, yet the Village is going ahead with this dangerous plan.
Village Residents want the Council to stop work until a comprehensive traffic study is done (ASAP!) and input from Residents is heard. While we support changes that improve traffic and safety, this one does neither and has the potential to make both situations worse.
Even though work has started, we believe there is still time for the Village to modify the ill-conceived parts of the plan. They can narrow the proposed median in order to maintain 2 lanes of vehicle traffic each way, while elimating the unecessary, death-trap bike lane. They can still proceed with certain desirable elements of the plan, like the sidewalk bump out to narrow the crosswalk on Broad Street, etc.
Ridgewood must not proceed with the flawed plan. The risks of completing the project as-is far outweigh the benefits.
To: Ridgewood, NJ Village Council Stop Work on Underpass Lane Closures until a Comprehensive Traffic Study is Done and Resident Input is Heard
The Division’s Turkey Restoration Project represents one of the greatest wildlife management success stories in the history of the state. By the mid-1800s, turkeys had disappeared in New Jersey due to habitat changes and killing for food. Division biologists, in cooperation with the NJ Chapter of the National Wild Turkey Federation, reintroduced wild turkeys in 1977 with the release of 22 birds. In 1979 biologists and technicians began to live-trap and re-locate birds to establish populations throughout the state. By 1981 the population was able to support a spring hunting season, and in December, 1997, a limited fall season was initiated.
There is now an abundance of wild turkeys throughout the state with turkeys found wherever there is suitable habitat. In South Jersey, where wild turkeys had been struggling just a few years ago, intensive restoration efforts have improved population numbers significantly. The statewide population is now estimated at 20,000 – 23,000 turkeys with an annual harvest of approximately 3,000 birds.
Youth turkey hunters aged 10 to 16 with a Youth License can obtain a “Y” permit which allows them to hunt in any hunting period in the zone that they obtain a permit for during the spring season. Youth hunters aged 10 to less than 14 must be under the supervision of a licensed adult who is at least 21 years of age. The adult does not have to have a turkey permit, but they do have to have a regular license. This regulation applies until the youth takes a turkey. After taking a turkey, the youth is subject to the same hunting period and zone restrictions as an adult. There is also the special statewide Youth Turkey Hunting Day each year.
Turkey permits are awarded via a lottery followed by over-the-counter sales for both the spring and fall seasons. Lottery application periods are January 25-February 22 for the spring season and August 1-31 for the fall season.
Put education back into state, local hands
By Scott Garrett
Many pundits claim America’s K-12 education system is stagnant and doesn’t equip our nation’s youths with the skills necessary to remain globally competitive in the 21st century. In response, President Obama has recommended the adoption of Common Core standards, a uniform set of benchmarks that must be met by students at the end of each grade. The president has sold Common Core as an innovative set of national standards that will achieve academic excellence.
Unfortunately, we have heard all of this before.
More than a decade ago, President George W. Bush’s No Child Left Behind was signed into law. At the time, NCLB was advertised as dynamic, flexible and federally driven — education reform that would advance academic achievement through accountability. Today, NCLB is considered a failure. After spending billions and enacting rigid punishments for failing schools, no discernible academic improvement was achieved.
The centralization of education did not begin with NCLB. For half a century, Washington has pursued control of the classroom by attaching strings to federal education dollars sent to the states. Yet despite spending roughly $2 trillion and decades of increased federal regulation, reading scores remain flat, education costs have more than doubled, student-teacher ratios continue to decline, high school graduation rates remain unchanged since the 1970s and achievement gaps persist.
The tradition of federalized education has failed our students. And on this tradition the president proposes to double down.
Common Core is the predictable result of the Obama administration’s coercion of cash-strapped states. In return for a state’s adoption of Common Core, the administration promised the states a share of a $4.35 billion bounty.
Some officeholders don’t trust people outside Washington to come up with solutions. I disagree.
Some officeholders don’t trust people outside Washington to come up with solutions. I disagree. Rather than centralizing education, I believe that states and localities — those closest to the students — should set academic standards. The state and local governments are our laboratories of democracy. By promoting innovation at the state and local level, where parents and teachers have a louder voice, we provide ourselves with the opportunity to replicate our successes and learn from our mistakes.
But arrogant, top-down dictates, such as Common Core, rob us of this opportunity. We should allow federalism to work and defer to local experience.
That is why I’ve introduced the Local Education Authority Returns Now Act. The LEARN Act would allow states to opt out of federal education regulations and retain the dollars that would have been sent to Washington by reimbursing the taxpayers through a tax credit. The process is simple, straightforward, and empowers parents, teachers, school boards and local officials.
The LEARN Act works in three steps. First, a state decides that strings attached to federal money are hampering the ability of parents and teachers to educate their children as they see fit and enacts a law opting out of the federal program. Second, the Treasury Department determines how much money an opt-out state is entitled to. Finally, the taxpayers of the opt-out state receive a tax credit to reimburse them for the funds diverted to Washington. This method immediately cuts the authoritative and financial strings of the federal government, allowing states to set appropriate education standards.
The future of our nation depends on our ability to educate and train the generations that will carry on the legacy of freedom and prosperity. Today, states must focus on complying with federal mandates rather than cultivating an atmosphere that allows our educators to effectively educate our students.
We’ve experimented with centralized education before, and it failed. We cannot merely replace one set of federal dictates with another. The time has come to put our children first by returning control to those who know them best.
Rep. Scott Garrett is a Republican representing New Jersey’s 5th Congressional District
Solar panels topple over at Teaneck elementary school
MONDAY FEBRUARY 17, 2014, 7:42 PM
TEANECK SUBURBANITE
A Teaneck police officer surveys the damage from a collapsed large solar panel in the Bryant Elementary School parking lot on Tryon Avenue. The structure toppled over Saturday night after the weekend snow storm dumped heavy snow and ice in the area. The panel has trapped cars parked underneath.
Ridgewood Police Warning – Potential Dangers of Playing in Giant Snow Piles
The accumulation of the past snow storms have formed giant piles of snow at the Graydon Pool parking lot and in other areas throughout the Village. These piles are potentially exciting places for children to play, not realizing the potential danger. As the temperatures change and at some point warm up, the snow can shift and the inner structure compacts to trap anyone climbing on the piles. We encourage parents and caregivers to discuss with their children the dangers of climbing on and playing in these snow piles, so that they remain safe in the winter weather
Photo credit: Boyd A. Loving Ridgewood crash pushes Audi into snowbank; driver freed by firefighters
Boyd A. Loving
February 14,2014
3:24 PM
Ridgewood NJ, Ridgewood firefighters required shovels to free the driver of an Audi sedan who was trapped inside of her vehicle after it was broadsided by a BMW SUV on Friday afternoon, and pushed into a snowbank. The accident occurred at approximately 2:20 PM in front of 81 North Maple Avenue, Ridgewood. No one was injured in the collision, but the Audi and BMW both sustained major damage and were removed by separate tow trucks. One summons was issued to the BMW’s driver in connection with the crash. The BMW was exiting the King’s Shopping Plaza and collided with the Audi, which was traveling northbound on North Maple Avenue.
Obamanomics: Obama Democrats’ troubling view on work
By Michael Goodwin
February 9, 2014 | 1:34am
Among its many stamps, the Postal Service has a series called “Made in America, Building a Nation.” The strip of “forever” stamps is a collection of iconic photographs of 20th-century industry featuring men and women toiling on railroads, skyscrapers and factory floors.
A celebration of work and workers, the series quotes Helen Keller saying, “The world is moved along, not only by the mighty shoves of its heroes, but also by the aggregate of the tiny pushes of each honest worker.”
My, oh, my, how times have changed. America now has a government that views work as a trap and celebrates those who escape it.
That is the upshot of last week’s remarkable exchange over ObamaCare. It began when the head of the nonpartisan Congressional Budget Office reported that the interplay of taxes and subsidies in the law “creates a disincentive for people to work.” The report predicted the mix would lead to fewer hours worked, costing the equivalent of nearly 2.5 million jobs.
NJ Transit’s problems continue days before Super Bowl XLVIII
Wednesday, January 29, 2014 Last updated: Wednesday January 29, 2014, 6:45 PM
BY KAREN RO– USE
STAFF WRITER
The Record
Wednesday’s drama wasn’t part of NJ Transit’s playbook.
Just days before Super Bowl, the agency tasked with transporting thousands of ticket-holding fans to the Super Bowl saw two trains break down, stranding more than 800 passengers, and problems with its website.
Train problems began at 10:30 p.m. on Tuesday when a New York-bound train carrying 27 passengers stopped under the Hudson River as the result of a downed overhead wire and a loss of power, said NJ Transit Spokeswoman Nancy Snyder. The passengers were trapped in the tube for several hours as temperatures dropped.
Driviing on snowy or icy roads requires special attention to safety. Althought it’s impossible to have ideal road conditions 365 days a year, there are certain precautions you can take to make winter driving safer. Here are some tips and suggestions to help you get ready for the hazards of winter.
How Obamacare Discourages Work and Marriage
The Heritage Foundation
11/25/2013
We were told that Obamacare was supposed to be compassionate toward the needy in America.
While President Obama and his fellow liberals may have held the best of intentions while ramming Obamacare through Congress, the law’s policies are far from compassionate toward the uninsured and Americans with low and modest incomes.
In fact, the law perpetuates some of the country’s worst trends that trap people in poverty. It includes disincentives for individuals to marry and for Americans of low and modest incomes to work. Discouraging work and marriage will only perpetuate poverty and income inequality, not alleviate them.
Discouraging Work
The way Obamacare calculates federal premium subsidies and cost-sharing subsidies includes several “cliffs.” A person might qualify for a hefty subsidy at his current income, but if he gets a raise and makes a little more, that Obamacare subsidy disappears.
At these cliffs, individuals and families will actually benefit more by working less because additional earnings could cause them to lose thousands of dollars in taxpayer-funded subsidies.
Families facing these kinds of poverty traps may ask the obvious question: If I will lose so much in government benefits by earning additional income, why work?
Rather than encouraging hard work, initiative, and entrepreneurship, Obamacare instead undermines these essential American values.
Discouraging Marriage
Obamacare contains not one, but two penalties on marriage—one for families with low and moderate incomes and another for families with higher incomes. By continuing failed policies that undermine the institution of marriage, Obamacare will accelerate a root cause of income inequality in the United States.
Here’s an example. A 50-year-old non-smoker making $35,000 per year would qualify for a sizable insurance subsidy, according to the Kaiser Family Foundation’s insurance subsidy calculator. The individual’s premium would be capped at 9.5 percent of income, resulting in an insurance subsidy of $2,065 paid by the federal government.
However, if this 50-year-old is married to another 50-year-old who also makes $35,000 per year, the couple would receive no insurance subsidy at all. This couple would incur a marriage penalty of $4,130 in one year—equal to the $2,065 that each individual could have received if they were not married.
As Urban Institute fellow Gene Steuerle has said: “Our tax and welfare system thus favors those who consider marriage an option—to be avoided when there are penalties and engaged when there are bonuses. The losers tend to be those who consider marriage to be sacred.”
Obamacare sends a clear message that reliance on government is preferable to these traditional American values—work and marriage.
Our health care policy should not be undermining these foundations of society. For a more commonsense approach to health care reform, check this out.
A good read, and important information for Ridgewood residents to familiarize themselves with if our school district is to avoid remaining mired in the political and cultural trap that is the Common Core State Standards Initiative…
November 25, 2013 The Progressive Myth of Creativity
By Bruce Deitrick Price
Creativity has been a big theme in progressive education for more than 75 years: We are constantly lectured (see https://www.americanthinker.com/2012/06/progressive_educations_war_on_knowledge.html) that kids need music, art, theater, etc. This theme is now metastasizing into an oppressive dogma. But, why?
Ken Robinson, the guru of creativity, is famous for saying “We are educating people out of their creative capacities.” (see https://www.youtube.com/watch?v=iG9CE55wbtY) The premise seems to be: if kids do arty things, they will end up being artists. Empirically untrue. Conversely, Robinson says that if children do something rigorous and academic, they will be prevented from being creative. Dangerously untrue.
Rearranging knowledge in new ways is arguably the very essence of creativity. (see https://anniemurphypaul.com/2012/11/the-false-dichotomy-between-facts-and-creativity/) It follows that the systematic acquisition of knowledge is one of the best things you can do if you want to be creative. (see https://www.supermemo.com/articles/20rules.htm)
Furthermore, there are habits of mind or consciousness that can be developed only through practice and discipline. It’s always been understood that students learn by mastering basic skills and then by completing more and more difficult projects, not empty make-believe projects, but real projects such as speaking French, understanding American History, or figuring out how computers work.
Professor Robert Weisberg wrote a book called “Creativity, Genius and other Myths” where he stated: “There is evidence that deep immersion is required in a discipline before you produce anything of great novelty….There is this concept that genius has leaps of insight way beyond everybody else. If you look at the background of these people, there is much more of a progression. They don’t make leaps — they build in small pieces.” In short, Weisberg says that drills do not stifle creativity. They engender it. (see https://www.improve-education.org/id39.html)
It’s fascinating to observe how many famous writers started off as doctors and lawyers. What could be less creative than a premed and medical curriculum? What could be more stifling than studying to be a lawyer?
John Grisham, Erle Stanley Gardner, Scott Turow, Wallace Stevens, Henry Fielding, Louis Auchincloss, David Baldacci worked as lawyers. There is nobody more creative than Wallace Stevens.
Zane Grey, Anton Chekhov, Robert Ripley, Michael Creighton, Somerset Maugham, Arthur Conan Doyle, Oliver Wendell Holmes, Robin Cook, and William Carlos Williams were doctors.
Question for education professors: Anthony Trollope was a postal inspector. He wrote three hours each morning before going off to work. He published 47 novels. How would you propose to make Trollope more creative?
Let’s stipulate that creativity is a good thing and should be encouraged. So are sports a good thing; but nobody proposes that we transform schools into gymnasiums. The problem is Ken Robinson’s overstatement “Creativity now is as important in education as literacy, and we should treat it with the same status.” The next sound you hear will be children struggling to read, and traditional textbooks being tossed in the trash.
The pattern for the last century is that our Education Establishment is always looking for ways to justify dismissal of the traditional curriculum. One day they’ll assert straight out that academics are a waste of time. The next day they’ll argue slyly that we need to devote more time to nonacademic goals, such as creativity, critical thinking, or dressing for success.
The key to understanding all this confusion is to note that “progressive” educators are socialist educators. They want children to end up more or less equal (a result which they call social justice). So they pretend to care about creativity. But what they really care about is making sure that little time is left for children to learn who George Washington was.
Ken Robinson made a famous speech about creativity several years ago. (see https://www.youtube.com/watch?v=zDZFcDGpL4U) He railed against the so-called “factory method of education.” One video has been viewed 11 million times. There are only 3 million teachers in the US. Apparently, our Education Establishment loves the message in this speech and forces it on everyone. “Factory method” is code for children going to class on time, sitting at desks, and memorizing stuff. “Factory method” is what most education has been for thousands of years, long before there was a factory. Such schools are orderly and designed to achieve educational progress. That seems to be what progressive educators can’t stand.
Robin Eubanks, an attorney who wrote the new book “Credentialed to Destroy: How and Why Education Became a Weapon,” sees the road to serfdom everywhere in our educational system. In a recent blog she wrote: “Only an electronic color billboard in Times Square could be more explicit. It is indeed slam dunk time in our effort to show that the education reforms known as Common Core or 21st Century Skills or social and emotional learning are actually a means of gaining much broader transformations.”
That would be the same “fundamental transformation” that Barack Obama bragged of achieving. That would be the drive to impose socialism on this country.
Does that strike you as something new? It’s not. John Dewey launched this offensive a century ago. (see https://www.americanthinker.com/2012/10/john_dewey_is_a_fraud.html) Our Education Establishment is defined by this offensive. A word to the wise: whatever these people recommend is probably designed to do the exact opposite of what they claim. More creativity? No, you’ll just be an ignorant serf.
Robin Eubanks wants a different future: “Unfettered by government seeking to restrict what any American can know or do, we can prosper again.”
Finally, can creativity even be taught? John Saxon who created Saxon Math and other highly successful curricula, famously said that creativity cannot be taught. All you can do is create a context where creativity can express itself. (see https://www.rightsidenews.com/2012062223739/life-and-science/health-and-education/the-legend-of-john-saxon-math-warrior.html)
But I’ve often wondered, if creativity could be taught, how do you do it? Speaking as a writer and painter, I don’t think you teach ordinary students to be creative by having them do so-called creative things. What then? What would fit in with elementary school subjects and work for everyone? I start thinking about mazes and optical illusions, puzzles and riddles. I start thinking about checkers, bingo, Chinese checkers, and card games such as as Go Fish and War. And let’s not forget simple machines, models, electric circuits, and tools. Especially let’s not forget Aesop’s fables and maxims of all kinds. (Why is it true that a stitch in time saves nine??) Kids do most of these things for fun. They stimulate the mind to be more flexible and opportunistic. You see problems, you try to solve them. So it would be easy to build an enjoyable “creativity curriculum” from toys and games, a curriculum that would encourage creativity and logic, and as well arithmetic and reading.
Bruce Deitrick Price explains education theories and methods on his site Improve-Education.org
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