Dear All:
The bears and the mountain lions have not gotten me yet. This is not why I haven’t been writing. Moving, particularly between countries, is hell.
I am still drinking from a fire hose, but so that I don’t completely lose everyone’s interest, I have decided to post a speech that I wrote a while ago. Wrote but never delivered. The intended audience is college students and the theme of the speech is that the government is always a conspiracy of what is against what could be. In other words, a conspiracy against the young in general and college students in particular. This is attached below.
Of course, I would love to give this speech in the wild. So, if anyone has access to college speaking schedules and thinks that this would be a worthy addition, please let me know. I would also use this as an occasion to create a video of the speech.
I apologize in advance for the length. As a speech, it would take about 20-25 minutes.
Roger Barris
Evergreen, Colorado
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Thank you for the invitation to speak to your graduating class. I have been looking for an opportunity like this. Because I want to give you a message that is probably very different from what you have been hearing over the last four years. Here it is:
Government is, always and everywhere, a conspiracy of the present against the future. A conspiracy of what is against what could be. In other words, a conspiracy against you.
What does this mean?
But before we get into this subject, I have to give you a little warning. A trigger warning, if you want to consider it that. Because many of you are not going to want to hear what I have to say, particularly about the first subject: the value of the piece of paper you are about to receive. Your diploma. But we are long past the days of comforting lies or omissions. We have to look at this squarely in the face.
Now, your diploma. It has cost you four years of your life. You might also have borrowed a small fortune to pay for it. Yet, too often, it is a huge lie.
Many of you will struggle to find a job. When you do find get a job, 40% of the time you will be underemployed – you might even become one of the 115,000 janitors and the one-quarter of salespeople with a college degree.
Yes, after four painful and expensive years, you could end up pushing a broom or peddling sneakers for a living.
Someone may have told you that college grads earn a lot more than those without a degree. For a great many of you, this is also a lie.
Even before going to college, you were probably smarter and better educated than the average, so you would have earned more money anyway. Adjust for this and the benefit of college erodes. Even more important is what you study. If you are were in engineering, college is usually a good deal. As for you Medieval French poetry majors…frankly, you don’t want to know.
And you are the winners. Remember all the students who dropped out along the way? For them, the results are grim. And grimly predictable. If you did badly in high school, there was a very good chance that college would be no different. Frankly, these students got suckered into a really poor investment of time and money.
Now, of course, you should be free to study whatever you want in college. But you should also be able to do this without piling on a huge amount of debt. So we have to look at the cost of college.
You all know how expensive medical care is in America. Well, do you know what has increased even faster than the cost of medical care? That’s right: the cost of your diploma, which is now four times greater than in the 1980s, even adjusting for inflation.
The reason for this should be obvious, at least to those of you who took Economics 101. Prices result from supply and demand, and the US government has been subsidizing the demand for college for quite a while. Through things like student loans, which now equal $1.4 trillion, second only to home mortgages as a form of household borrowing. And the government will give a student loan to anyone, regardless of what you study and regardless of how you do in school.
Remember what happened when mortgage lenders in America started giving loans to anyone with a pulse? House prices rocketed. College is no different. A study by the Federal Reserve found that, for every dollar given in student loans, 65 cents got converted into higher costs.
Let me repeat that. 65 cents of every dollar you borrowed did not go into improving your education. It went into higher salaries for professors, more college administrators – which have grown 10 times faster than the growth of tenured professors – or that fancy new gym that you never used. Yet, none of these things will pay off your student loans. The responsibility for that will be entirely yours.
Now, I know what many of you are thinking: Just make college “free” and the problems of cost and debt will go away.
But the problem here is that there is nothing that’s “free.” When people say that something is “free,” what they really mean is that someone else is paying for it. In the case of college, that “someone else” is taxpayers who are typically poorer than the people who go to college. People who think that college should be “free” are actually calling for a transfer from the relatively poor to the relatively rich. They are the opposite of Robin Hood.
And remember supply and demand. Make college completely “free” and the demand for it will explode. And so will its cost. The quality will continue to go in the opposite direction.
The first rule of holes is that, when you are in one, stop digging. The people calling for “free” college are reaching for a bigger shovel.
These increased costs might have been worth it if the quality of your education followed the same path. But the figures here are equally depressing.
Much of the expansion of college education – encouraged by everyone around you and financed by Washington – has been at the expense of quality. Tests at the beginning and end of college show that the ability of college students to reason and analyze are little improved. Study habits have gotten worse. Students in the 1960s spent 40 hours a week studying; now, it’s 27.
Meanwhile, grades have continued to inflate. In the mid-60s, the average grade was a C or C+. Now it is a full grade higher. And this is no different at our “elite” colleges. At Harvard, the average grade has gone from a C+ in the 1950s to an A-.
Colleges have become diploma mills, interested mostly in keeping the students passing through and the money flowing.
But employers are not stupid. They have noticed. So whatever benefit college graduates historically received, you can bet it’s lower now. Graduates are like someone standing up at a concert. The first ones get a better view. But now that everyone is standing, no one sees better, but everyone gets tired legs.
And what are they telling you now? If you really want a better view, you need to climb a light stanchion. You need to go to graduate school!
Let’s sum up. A great many of you have been sold a bill of goods. You’ve incurred huge debts for a diploma that will benefit you very little. The quality of your diploma has decreased and your attempts to stand out have been washed away by a government-funded arms race that students can only lose. And the professors and administrators, and the politicians who support them and are supported by them, can only win.
That’s the money side. Even more important is the time you have wasted. Time that could have been spent getting real skills that would allow you to get a real job – or to start your own business. Things like “boot camps” or vocational training or apprenticeships. Or any one of a thousand other ways that I can’t even think about but which a free market would create if the entire system were not massively distorted by the government and their allies in education.
I call it the “Education Machine.” It talks about the best interest of the students. But in reality it cares a lot more about itself.
But college is not the first time that the Education Machine has let you down. One of the reasons why everyone wants you to go to college is because you have learned so little in your kindergarten to 12th grade years.
Not all of you. There are some great schools. But please don’t call them “public.” Better to call them “regional.” Because if you showed up at one of these great schools, but you didn’t have the right address, you weren’t welcome. And the problem is that having the right address often costs a fortune in rent or the price of a home.
If Central Park was like a “public school,” you would need to own a $40 million apartment on 57th Street to get in.
So, no more “public schools.” Let’s call them “government schools.”
Outside of these schools, what you experienced was probably something very different. In our worst government schools, education takes second place to survival.
But don’t blame the lack of money. Because we have been lavishing more and more money on our schools. Since the 1970s, the country has, after inflation, doubled the amount of money spent per student in K to 12 education. But while the line showing the amount of money spent has headed for the sky, the line for results is flat: math scores are 2% better, reading scores, less than 1%.
The problem isn’t money. The problem is monopoly.
Nearly everyone can see the problems with a monopoly in the private sector, but these same people often think that a monopoly in the public sector is perfectly fine. But people are people, and they don’t suddenly change when they begin to draw a government paycheck. Take away the competition, take away the need to respond to the customer, and the end result is always the same: paying too much for too little.
This is why economists and reformers have been trying to inject competition, and consumer freedom and choice, for years. With things like private schools, vouchers and charter schools. And why this has been so heavily resisted by the Education Machine. Despite plenty of evidence that these reforms improve not only the education of the direct participants but also force the government schools to up their game.
Competition works. Everywhere.
The charter and voucher schools would also be much freer to innovate and build on what works best. Maybe some of you didn’t have enough or good enough science and math teachers in school. Or maybe your best teachers were not rewarded with additional pay and responsibility. Ever wonder why? A big part of the reason is that the Education Machine insists that teachers are paid on seniority and not merit or skills. Schools can’t pay more to hire a good computer science teacher, even though that person has a dozen other job opportunities. And they can’t reward a young teacher no matter how good he or she may be.
And think about it: what kind of person would work in conditions where he or she can’t be rewarded based on merit? Or can’t be fired based on poor performance? Is that the kind of person we want to trust with the responsibility for educating the future?
Have any of you seen the movie Stand and Deliver? You are all too young, but you should go home and illegally stream it. It tells the story of Jaime Escalante, an amazing, inspiring and demanding math teacher in East Los Angeles. Yes, that East Los Angeles. Escalante’s classes routinely accounted for one-quarter of all the Mexican-American kids who took the AP calculus exam in the entire country. And they smoked it! More important, they went onto great careers in science, teaching, law and other areas.
Escalante was a hero, right? Not to the Education Machine. He made the other teachers look bad. He was driven out of school by the long, grey line of jealous mediocrity.
Here’s a basic rule in life: you get what you incentivize. And the Education Machine has aimed for a comfortable mediocrity for far too long. It will continue to do so until something changes. And that something is competition.
What does this have to do with the theme of the government as a conspiracy against the future? Everything.
The current system has served you very poorly, but it serves the teachers and administrators very well. There are a lot of them. They vote. They are organized. They donate money to political campaigns – a lot of money. And, unlike you, they are not just passing through. This is their life. And they will fight to defend it.
So, the Education Machine is huge example of maintaining and expanding a what is that has served you – what could be – very badly.
Let’s look at some others.
You’re out of college. You’re young. You’re mobile. You are hungry for new experiences, new places and new challenges. You can go anywhere and chase any opportunity. But you have one problem. You still need a roof over your head and a bed to sleep in. And in many places – San Francisco, Silicon Valley, New York, Boston – it’s just too damned expensive.
Now, why is that? You have been told many reasons and you might have even believed some of them. It’s greedy landlords. It’s foreigners buying properties and then letting them sit empty. It’s speculators. But this is all wrong. There is one reason and one reason only: rules that make it too difficult to build new housing.
It’s the law of supply and demand again. In the case of college tuition, we had government-fuelled demand. In the case of housing supply, we have government-restricted supply. The end result in both cases is the same: prices that are too high.
The system we have is crazy and rife with conflicts of interest. Who decides whether new houses and apartment buildings are allowed? Well, it’s the voters who already live there. Very often in their biggest investment. So you’re asking them if they are willing to allow additional homes to be built to compete with the biggest investment they have.
Can you guess the answer?
It’s called NIMBYism – “Not In My Backyard.” It is a giant example of the government always favoring what is over what could be. And, in this case, what could be is you in the reasonably priced house or apartment that you will never have because what is won’t allow it to be built.
Because what could be doesn’t vote. And what could be doesn’t have political allies.
But even if you can afford to move to where the good opportunities are, your problems are not over. Maybe you need a licence to do your job or set up your business. Back in the 1950s, only one in twenty occupations required a license. Now it is one in four.
The usual excuse is that this is to protect the public. But this is just more self-serving bullshit. We have licensing now for things like interior decoration, tree cutting and dog walking.
Have you heard the story of the two African-American women who wanted to open a hair-braiding salon but couldn’t because they didn’t have a cosmetology licence? They are still suing the government for this right.
These licenses often require a year or more of expensive school to obtain, effectively locking the poor and minorities out of these positions. And making it even more difficult to move to opportunities, because the licenses don’t transfer from state to state.
We have Yelp. Angie’s List. Google ratings. Amazon ratings. Word of mouth at hyper speed with social media. And a thousand other ways to judge the services we use. All of which are much more useful, and much more used, than any government certification. And yet the number of required certificates grows.
These laws have nothing to do with protecting the public. They have everything to do with protecting what is from the competition of what could be. And once again, as the new kids on the block, what could be is you.
Economists call this “crony capitalism,” but a much better name would be “crony statism.” Because it only works because the government enforces the rules.
There is only one way to stop crony statism. And that is not to reform the state – people have been trying to do that for centuries and it has never worked. The only way to get rid of crony statism is to cut down the “state.” To cut down its power to reward it friends and punish its enemies. Because a big state is always a crony state.
And so long as what is votes, lobbies and protests, a big state will always choose it over what could be. A big state will always chose it over you.
Minimum wage laws have the same effect. A Nobel Laureate economist once called these laws “a tax on the young and unskilled.” That was you a couple of years ago when you were looking for a summer job and some work experience. Especially if you come from a poorer background. A minimum wage job is not a great job, but for most people it is a start on the road to something better – a start that teaches important skills like client service and responsibility. But you can’t get on the employment ladder if someone has cut off the first rungs.
People who tell you that minimum wage laws don’t reduce jobs are just wrong. They are probably the same people who think that we should tax sugary drinks to reduce obesity, cigarettes to reduce cancer and carbon to reduce global warming. They rightly think that raising the cost of these activities will reduce them. But raising the cost of hiring someone will have the same effect. People who think otherwise have a serious problem of logical consistency.
Now, let’s look at some other big ways that what is is crushing what could be.
Things like Social Security and Medicare. When Social Security started, the retirement age was 65 years and the average life expectancy was 61 years. Now the average life expectancy is 79 years and the retirement age hasn’t changed . In the 1960s, there were over five workers paying into Social Security for each one taking benefits, and the program seemed to work. Now there are between three and four paying in for each one taking benefits, and the program is losing money each year. And the ratio of workers to retirees is only going to continue getting worse. If nothing changes, then within 10 years these entitlement programs are projected to consume 100% of Federal tax revenues, meaning that anything else – the post office, national defense, Sesame Street on PBS – will require borrowing.
I’m sure you see the way this is going. And it doesn’t look good for you.
The government always lies about the numbers. So you won’t see these figures when they talk about the deficits or national debt. But the Social Security system is currently about $30 trillion in the hole. Medicare is even worse: about $40 trillion. In total, that is almost four times the size of the entire US economy.
There is a iron rule in finance: that which cannot be paid, won’t be. Which means that Social Security and Medicare will have to change. But it won’t change for the current beneficiaries and the old – this is the most powerful voting bloc in America. It will be changed for you, but not before you haven’t paid trillions into the system. Trillions for which there will be no one to reimburse you.
In this game of financial musical chairs, you will be the ones left standing.
Obamacare is more of the same. It’s another tax on the young and healthy, to benefit the old and sick. Now, you can argue that the young and healthy should help the old and sick. And maybe some of you feel that way. But you can’t argue that this subsidy should be hidden with words like “employer mandate,” “individual mandate” and “community rating.” This is sheer cowardice. If the politicians want the young to subsidize the old even more, then let them have the courage to request this honestly.
The guy who designed Obamacare said it best: “Lack of transparency is a huge political advantage. And basically, call it the stupidity of the American voter or whatever, but basically that was really, really critical for the thing to pass.”
He’s talking about you.
And last of all, we have the national debt. About $20 trillion at last count. Or about $60,000 for each person in America. Or, more relevantly, about $100,000 for each person below the age of 45 since the old aren’t going to pay for this. You are.
The national debt is a form of theft against victims who haven’t been born yet. Or at least, victims who don’t vote yet. Which means you.
I could go on, but I think that we can stop now. Hopefully you have heard enough. Hopefully you are convinced.
There was once an economist who offered a prize for the best definition of the government. The winner was “government is the great fiction through which everybody tries to live at the expense of everybody else.”
But this definition is too innocent. It implies that anyone can win the zero-sum game. It isn’t that fair. The loser is guaranteed to be you. Because the government is always a conspiracy of a visible, noisy, voting and donating what is against a what could be that can’t do any of those things.
It is always a conspiracy against you.