Archive for March, 2010

What are the real motives behind the 12,000% alcohol tax?

Wednesday, March 31st, 2010

If you live in California and you drink beer, or wine, or distilled spirits, you have probably heard about the proposed constitutional amendment to raise taxes on alcohol by staggering amounts. If not you can read about it here at the LAist.

One thing that really stood out to me in the proposal was this;

(c) Fifteen percent for the funding of grants for naturopathic treatment and recovery programs for alcohol addiction.

It seems very odd that such a significant amount of grant money would be directed specifically towards naturopathic treatments. So a little snooping turns up the following in LinkedIn.Not much information can be found about the 21st Century Wellness Initiative, and it would be hard to know if this is even the correct Kent Whitney. However we can locate Kent M and Josie Whitney to the San Diego area. A reverse white page search shows a San Diego household with a Kent M Whitney and a Josie B Whitney living here;If this wild conjecturing is true, this plan is actually kind of clever, create a constitutional amendment to provide $900M of funding to a tiny industry and be positioned to make use of the grant money. At this point it is impossible to connect enough dots to come to any real conclusions. Is the Kent Whitney in LinkedIn the same Kent Whitney behind the tax increase proposal? Is 21st Century Wellness Initiative a naturopathic prevention or treatment program? However, if it does turn out to be true let me be the first to say, “Kudos to you Kent Whitney!”

Teacher’s Pay, Is It Too High?

Tuesday, March 9th, 2010

Buried in the article POWAY: PUSD to send layoff notices, appeal ‘God banner’ decision was this little gem;

Poway resident Scotty Blackman told the board he was launching an initiative to reduce the salaries of all state employees, including teachers, by 35 percent to 45 percent to make them comparable with the private sector.

Blackman said California teachers earn an average of $85 an hour, a figure he calculated by dividing annual salaries by 7-hour workdays over a 183-day work year.

Teachers also have very good health care benefits as well as a CalSTRS, the California State Teachers Retirement System. In addition to providing retirement benefits, CalSTRS also offers other perks like home loans. California teachers do pay 8% of their salary automatically into the retirement program.

This sounds like a sweet deal, doesn’t it? Let’s look even closer at the retirement benefits, a teacher who starts at age 50 and retires at age 56 earns $2,500 to $3,000 per month for the rest of their life.

Certainly, in light of these facts, it sounds like a good idea to reduce teacher salary. However simplifying the facts down this much can obscure the truth. Anecdotal evidence supports the premise that most teachers are working far more than the seven contracted hours per day.  Were we to reduce pay it is likely that at some point districts would be forced to order teachers not to work outside of assigned hours. Similar things have happened in other industries that attempted to reduce pay to reflect contracted work rather than actual work.

Teachers are also required to earn continuing education credits to remain qualified to teach in the classroom, some of these hours are provided through sponsored district programs, but many times the teachers themselves must pay for the training and work extra hours outside of their contracts for study.

The use of average salaries is also very misleading. Teacher pay is not merit based, it is a combination of years of credited experience and education credits. The average age of the existing teacher pool therefore skews the average salaries. We are nearing the retirement age for a mass of baby boomer teachers. These teachers are among the highest paid and will be replaced with new teachers drastically reducing the average salaries downward. As far as the retirement system goes, participation in CalSTRS, which is mandatory, can reduce or eliminate Social Security benefits, even survivor benefits from a spouse.

Here is the kicker, private sector salaries are typically set by the free market principles of supply and demand. If there a excess of talented labor then employers can find employees willing to work for lower wages. However, in this country there is a critical shortage of qualified teachers, especially math and science teachers. Artificially reducing pay would be detrimental to attracting qualified people into the teaching profession.

The New York Times reports that the US will need a million new teachers by 2014, nearly a quarter of the existing teachers. How will we attract quality teachers with artificially low salaries?