AT&T Wants All That and a Box of Chocolate

Last week, AT&T’s CEO lamented his company’s inability to find enough skilled workers to fill the 5,000 jobs he promised to repatriate from India. The chief executive, Randall Stephenson, reportedly said he “is especially distressed that in some U.S. communities and among certain groups, the high school dropout rate is as high as 50 percent.”

He then attempts to validate his concern saying, “If I had a business that half the product we turned out was defective or you couldn’t put into the marketplace, I would shut that business down.”

Hmmmm. High school dropouts are defective products? That’s a bold, bordering on ridiculous, statement, given the number of millionaire and billionaire entrepreneurs that dropped out of school.

What’s worse is that he is blurring the contexts. His comments about the issues of dropout rates in the U.S. are real concerns. The underlying causes are cultural and political in nature. Often these rates contribute to or stem from our high rates of illiteracy, immaturity, teenage drug abuse and general lack of self-accountability necessary for developing a successful career.

That is not the problem AT&T is facing.

Stephenson wants to pay high-school graduate wages to college-educated engineers (not technicians, but engineers). Like he can do with workers in India.

Yes, our education system is a problem for many in our country. I’ve written about that problem before a couple of times recently. But don’t even try to equate that problem with the fact that someone wants highly-educated employees to work for wages far below what’s fair.

Sure, outsourcing to India has been a huge cost-saving measure for many companies. For the long-term, though, that’s not going to be good for business. Someone at AT&T apparently recognized that fact, since they promised to repatriate 5,000 jobs. Whining about the fact that comparably educated people here earn more isn’t going to help the cause.

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The Cost of Education

At the end of the school year, we are packing up and moving to Phoenix. My wife, the reason we are going, is heading out sooner to start a new job.

Last week, I was talking to our accountant about the move, and he asked about the education out there. Public education in Phoenix is actually pretty good. Something we’re not used to here in South Louisiana.

About 40 years ago, there was a major shift toward private and parochial schools away from public. I’m sure it had started before that, but the change was evident. Since then, standardized testing scores of those students have become some of the worst in the nation, the schools themselves aren’t safe and there is an enormous amount of waste.

Many might want to argue that the problems are because we don’t place a high enough priority on education, so we must not invest enough. Sadly that assumption isn’t true. The State of Louisiana spends $12,000 annually per child for public education. That is about the same as some of the private schools in the New Orleans area and about double a parochial high school tuition.

So I wonder why the cost is so high with so little benefit to the students. I’m sure some of it goes to security, including metal detectors and guards. And of course we have to pay for administrators, teachers and building maintenance. Oh yeah, the state superintendent of schools received a $50,000 raise this year, making him the highest paid in the Gulf Region—by more than double. The results still aren’t there. Maybe it’s an efficiency problem. How much waste is in the system? What changes can are possible to really put those dollars to work for the students?

Maybe it’s a scale problem. Perhaps there is so much overhead relative to the number of students that the cost per child is inflated. But without great results, that is unlikely to change. Parents that can afford to send their kids to other schools that demonstrate better outcomes are going to.

That’s not to say that all public school students are poor performers. Quite the contrary. We have a number of bright kids in those schools. But those kids are thriving in spite of the system, not because of it.

There are a few groups trying to make a difference. Hurricane Katrina was a bit of a blessing for the New Orleans public schools. Because of the damage and apathy on the part of the school board, charter schools were able to come in and rework a number of schools. Some of them are showing improvements. At the same time, though, the state board has just lowered the standard for the LEAP tests, the tests that measure the performance of fourth and eighth graders and allows them to advance.

I have my own crazy ideas for fixing education. People will mock most of them, I’m sure, which is fine if you have something better to offer. Here are some of my thoughts:

• Longer school days (9 – 5), with time set aside during the day for completing homework through mandated study hall
• Year-round schooling, giving students 2 – 3 weeks off about 4 times per year
• Subjects covered in relation to each other (what were the mathematical concepts that led to scientific discoveries and how did those affect history, literature, thoughts about religion, etc.)
• Coordinated education programs such that all states are required to meet the same benchmarks

This would be an enormous investment. Absolutely. But the payoff will be even bigger (see my earlier posts The Purpose of Education and Needed Wake-up Call?).

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Us and Them

The ongoing fights between the two major political parties are tiring and useless. Sure it’s nice to always have a large group of people to blame for your own problems. But really, other than re-elected, what does it get you?

What’s worse is that the Democrats and Republicans have brainwashed their followers so much that they honestly believe that they couldn’t possibly support someone from the other party.

The media doesn’t really help either, with all of their political reports leading with either the party name or some euphemism to represent the group.

I have two potential solutions.

First, let’s stop forcing people to choose a party affiliation when they register to vote. That way, instead of separating ourselves by party affiliation, we do it based on the actual issue. No one would have to “break ranks with the rest of the party” to stand up for their own principles.

It’s akin to using a social networking model. People support you based on whom you identify as your friends and the groups to which you belong. It would be OK to support gay rights and the war in Iraq, to be anti-abortion and pro-gun control, and be a fiscal conservative supporting social causes, because you aren’t tied to specific things you can and cannot do publicly based on some label.

Yeah, you could register as an Independent, but then is all the other Independents versus the big two.

Maybe there’s too much ego, pride, or fear of working together to accomplish something to abolish this arcane, unproductive party system. Which leads me to my other solution.

Instead of holding party primaries to come up with one Democrat and one Republican to duke it out, let’s just play it like they really want. The party with the most registered voters wins the seat. Then they put up their candidates for everyone to decide who actually holds the office.

It would save millions of dollars and be a far more efficient way to run elections. We might even end up with elected officials that most people like and that can work together.

Do I really think this could happen? Maybe, but not in my lifetime. When I was in college in the early 1990s, I wrote a paper about a look into the future of political parties. In it, I predicted that Democrats and Republicans would cease to exist as they do today because people would revolt against their constant backbiting and inability to truly serve those they represent. However, with our inability to do anything without labeling things or people in any other way than “us” and “them”, we ended up with yet another two-party system. Much like the way we ended up with the ones we have now.

In reality, I like my first idea a lot more. It’s much closer to how real people live their real lives. Maybe Facebook will develop a political platform. I wonder who would be the first to join.

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The Purpose of Education

Last week, I served as a Junior Achievement volunteer for my six-year-old’s first grade class. A rewarding experience, even with the hyperactivity at the start of the day.

Anyway, as I stood there one morning while they worked on an activity, it suddenly hit me that every bit of education we do is so that children grow up to be productive members of society. Not necessarily to enjoy that society, just be productive in it.

It’s just the way it is. And there isn’t a whole lot we can do about that. Except, we can seek greater fulfillment in our life’s work, even if that means we hold 50 different jobs in our lifetime. Sure, the pay may not be as good, but that might not be a bad thing in our over-consumptive culture.

Besides, what is the point of working for pure accumulation of wealth? It can’t buy love or happiness. It’ll pay for comfort, certainly. But actual joy? Nope. In fact, it often leads to dysfunction and high alimony payments.

From the time we are born until we finally hang it up some 70 years later (more or less), our purpose is contributing to the greater good. Our education, in theory at least, is based on that premise. We complete our schooling and enter the workforce, both paid and unpaid. We produce and consume. We save for retirement or depend on the contributions of others. Or work until the day we die.

It’s inescapable. We might as well make the most of it.

Are you doing what you love? Do you find joy in your work? If you could do anything in the world, without regard to money, what would it be? Are you doing that now?

What’s holding you back?

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Needed Wake-up Call?

After The Air Force’s decision last week to go with a Northrop Grumman-Airbus tanker, sparks are flying. Maybe this is a much needed wake-up call.

Some key points about the situation:

• The Air Force followed the rules for awarding contracts as dictated through the Buy American Act
• Congress granted exceptions to France, Spain, Germany and other European nations for the Buy American Act, which essentially considers those countries as American
• Boeing lost the contract because, according to the Air Force, they were outperformed on 9 critical measures
• Some members of Congress believe the Air Force should have considered the number of American jobs involved before awarding a significant portion of the contract to Europe’s Airbus, which is not allowed in the Buy American Act

In addition, some have complained that Europe subsidizes Airbus’s operations too much, and that should have been considered. There are two things wrong with that stance.

First, assuming they are being honest in their assessment, the Air Force based the decision on performance measures not price.

Second, if the U.S. government were to subsidize government contractors, they would be paying those corporations to lower their costs for government contracts. It’s like me going to the grocery and paying them $10 so that I can pay $10 less at checkout. It is a ridiculous concept. Also, Boeing lost to the partnership led by Northrop Grumman, a U.S. company. So, there would have been little if any benefit to any subsidizing scheme.

Besides, with the current value of the dollar, I’d be surprised if Boeing weren’t less expensive.

Some things we can do:

• Invest more in education, making us more competitive
• Invest in developing new technologies, even if that means raiding the world’s best and brightest and bringing them here
• Avoid re-writing the Buy American Act such that we are no longer able to acquire the very best; if we want the very best to be made in America, then see the two bullet points above
• Instead of fighting what appears to be a fair process, try negotiating with Airbus to manufacture more, if not all, of the tanker here, not just the assembly

I am all for more American jobs. Just read some of my other posts. But I don’t believe we should put ourselves in the position of potentially making inferior products simply so we can say it was made here. We have to be smart about how we go about making it happen.

And if we don’t have the expertise here (which I doubt), then let’s go get it and make it our own.

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Finally Calling People Out

Yesterday, while answering questions from the Senate Judiciary Committee, FBI Director Robert Mueller did the unthinkable—he called out the people he had asked privately for additional funding in a public forum. You can hear NPR’s report here.

His frustration comes from the fact that violent crime is on the rise, yet makes it only to number 8 on the FBI priority list. He is forced to do more with less, based on counter-terrorism mandates from the Bush administration.

Say what you will about Mueller, I’m certainly not one of his biggest fans, but he finally did the right thing by calling people out. No there is no money available. He’s asked for it and been told no. Domestic crime problems cannot be a top priority.

Earlier this week, this story came out about the Urban Institute’s assertion that the proliferation of iPods has led to the increase in crime. While there may be some truth to that, I would argue that the problem stems from underfunded law enforcement focusing on protecting U.S. citizens from each other.

I’ll agree that the threat of terrorism requires certain protections. As does the threat of devastating hurricanes. As does the threat of gang violence, drug lords and white collar crime.

Maybe, just maybe, the problem is that we have made some unwise moves over the last eight years or so, leading to the largest deficits this nation has ever seen, an ever-weakening dollar and skyrocketing oil prices. All resulting in our collective inability to protect ourselves, sadly, from ourselves.

So here are some of my ideas, though making them work may not be so easy or popular:

• Implement a monetary policy to strengthen the U.S. dollar
• Allow Bush’s tax plan to expire and design one that actually supports the majority of the U.S. population
• Cut much of the waste currently in the defense budget, estimated at nearly $8 billion (in fairness, Congress has, except from the wrong places and replacing those cuts with pork)
• Give more funding law enforcement funding for domestic initiatives without diminishing counter-terrorism

And this only addresses one major issue. There’s more to come. I’m on a bit of a roll.

What say you?

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Our Own Fault

As a follow up to my post here earlier this week, this just came out from the AP. Key statement from the article:

“OPEC President Chakib Khelil told reporters the global market is being affected by what he called ‘the mismanagement of the U.S. economy,’ and that America’s problems were a key factor in the cartel’s decision to hold off on any action.”

It looks like we are our own worst enemy, when it comes to the economy. Let’s see who else we try to blame before finally looking in the mirror.

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Can We Save Our Economy?

I’m starting to think that I need to spend a lot more time on my iPod. A few weeks ago, I wrote a post on this blog called “Arrogance Kills”. In there, I reference Parag Khanna’s essay “Waving Goodbye to Hegemony”, in which he argues that America is losing its superpower dominance to the European Union and China. In particular, referring to China, he writes:

“In America’s own hemisphere, from Canada to Cuba to Chavez’s Venezuela, China is cutting massive resource and investment deals. Across the globe, it is deploying tens of thousands of its own engineers, aid workers, dam-builders and covert military personnel. In Africa, China is not only securing energy supplies; it is also making major strategic investments in the financial sector. The whole world is abetting China’s spectacular rise as evidenced by the ballooning share of trade in its gross domestic product.”

Then, on February 7, NPR runs this story, saying, “As major U.S. financial firms stagger under problems caused by the mortgage crisis, foreign governments, from the Middle East to China, are stepping in to invest billions in the faltering banking giants.”

Yes, that is billions with a b, not a typo.

And China is playing a larger role in this than most of us realize. To the tune of (again, not a typo) $1 billion per day.

James Fallows wrote an excellent piece for the January/February 2008 The Atlantic titled “The $1.4 Trillion Question”. Here are some key points from his piece:

• China’s foreign reserves are now the largest in the world, estimated at $1.4 trillion
• 70% of those reserves are in U.S. dollar assets
• Most of China’s U.S. investments are in Treasury notes and federal-agency bonds
• The annual interest payments on those investments have equaled or lagged the decline in value of the U.S. dollar to the RMB (in other words, their U.S. investments are breaking even or losing money)

The reason for this is three-fold. First, we have become overly reliant on overseas production, particularly from China. Outsourcing is not a bad thing, in and of itself, when done in moderation.

Second, we have not put the proper monetary policies in place to keep the dollar from its continued decline in value.

Third, as the federal government accumulates more and more debt, we end up borrowing from foreign nations, namely China, who is awash in cash from their production of our goods.

We cannot stay on this path. We need to boost the value of the dollar for the long-term. We need policies allowing smaller companies to compete with stateside production against multi-nationals relying on cheap labor in developing nations. And we need to realize that our ability to survive as the United States of America means that we will have to learn to consume less or pay significantly more.

Or, we can all start learning to speak Mardarin.

By the way, after a quick review of their campaign websites, only Barack Obama and John McCain (of the major candidates) begin to address these issues, though neither mentions China by name.

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