Tag: President Obama

Conflicted on 529s

If you like feeling conflicted, you’ll love being a libertarian thinking about President Obama’s recent proposal – and even more recent rescinding of that proposal – to essentially end 529 college savings plans. The President proposed killing the ability to use funds saved under a 529 plan tax free to pay for college, which would have gutted the program’s real value.

On one side, a libertarian should be aggravated by such a proposal. The goal certainly seemed to be income redistribution, generating new revenues from relatively well-to-do Americans and giving it to (presumably) less well-to-do Americans with free community college and expanded “refundable” tax credits. It also seemed intended to support a divisive, rhetorical war of the “middle class” vs. “the rich” (though certainly many people who use 529s consider themselves middle class). And unlike federal grants, loans, and those refundable credits that are often essentially grants for people who don’t owe much in taxes, 529s are about people saving their own money to pay for college, not taking it from taxpayers.

On the other side, libertarians – heck, everyone – should want a simple tax code that isn’t riven with special breaks, loopholes, and encouragements to do things politicians decide are worthy but which have massive negative, unintended consequences. And when it comes to higher education, those consequences are huge, including rampant tuition inflation, awful completion rates, major underemployment, serious credential inflation, and a burgeoning academic water park industry. And where does the federal government get the authority to incentivize saving for college in the first place? Not in the Constitution.

So how should libertarians feel about the demise of the President’s 529 plan? I guess a little sad, because the Feds simply shouldn’t be in the business of encouraging college consumption. Even more, though, they should feel angry, because we are so deep in a federally driven, college-funding quagmire.

TONIGHT: Cato Scholars Live-Tweet the State of the Union

#CatoSOTU

Tonight at 9 p.m. EST, President Obama will lay out his plans for the upcoming year in his sixth annual State of the Union (SOTU) address. What will the President’s words mean for liberty? 

Find out tonight: Cato scholars will be live-tweeting their reactions to what the president says—and what he leaves out. Following the President’s address, stay tuned for commentary on the Republican and Tea Party responses. Featured scholars will include everyone from David Boaz to Mark Calabria, Walter Olson to Alex Nowrasteh….and many, many more.

This is your chance to ask the experts what to expect from the policy world in 2015—and to add your two cents to the discussion. Follow @CatoInstitute on Twitter and join the conversation using #CatoSOTU

Community College Courtesy of the Federal Taxpayer? No Thanks

Word came out last night that in a speech in Tennessee today President Obama will propose that two years of community college be made free to all “responsible” students, primarily funded by federal taxpayers. But one look at either community college outcomes or labor market outlooks reveals this to be educational folly.

The fact of the matter, according to the federal government’s own data, is that community college completion rates are atrocious. The federal Digest of Education Statistics reports that a mere 19.5 percent of first-time, full-time community college students complete their programs within 150 percent of the time they are supposed to take. So less than 20 percent finish a two-year degree within three years, or a 10-month certificate program within 15 months. And that rate has been dropping almost every year since the cohort of students that started in 2000, which saw 23.6 percent complete. Moreover, as I itemize in a post at SeeThruEDU.com, even when you add transfers to four-year schools, the numbers don’t improve very much. Meanwhile, interestingly, the for-profit sector that has been so heavily demonized by the administration has an almost 63 percent completion rate at two-year institutions, and that has been rising steadily since the 2000 cohort.

The other huge problem is that the large majority of job categories expected to grow the most in the coming years do not require postsecondary training. Of the 30 occupations that the U.S. Department of Labor projects to see the greatest total growth by 2022, only 10 typically need some sort of postsecondary education, and several of those require less than an associate’s degree. Most of the new jobs will require a high school diploma or less.

Of course, one of the biggest problems in higher ed is that for so much of it, someone other than the student is paying the bill, tamping down students’ incentives to seriously consider whether they should go to college and what they should study if they do. This proposal would only exacerbate that problem, essentially encouraging people to spend two years in community college fully on the taxpayer dime while they dabble in things they may or may not want to do—and as they maintain a pretty low 2.5 GPA—then maybe focusing a little more when the two years is up and they have to pay something themselves.

Unfortunately, there is no way to look at this proposal (at least as it has been spelled out so far), investigate the reality of community college, and conclude anything other than it is a terrible idea.

DACA Did Not Cause the Surge in Unaccompanied Children

In June, 2012 the Obama Administration announced that it had authored a memo deferring the deportation of unauthorized immigrant childhood arrivals in the United States, a program known as deferred action for childhood arrivals (DACA).  The memo directed then Secretary of the Department of Homeland Security to practice prosecutorial discretion toward a small number of unauthorized immigrants who fulfilled a specific set of characteristics.  In essence, some unauthorized immigrants who had come to the United States as children were able to legally stay and work–at least temporarily. 

Did DACA Cause the UAC Surge?

Some politicians contend that DACA is primarily responsible for the surge in unaccompanied child (UAC) migrants across the border in recent years.  A recent House Appropriations Committee one-pager stated that, “The dire situation on our Southern border has been exacerbated by the President’s current immigration policies.”  Proponents of this theory argue that DACA sent a message to Central Americans that if they came as children then the U.S. government would legalize them, thus giving a large incentive for them to come in the first place.  Few facts of the unaccompanied children (UAC) surge are consistent with the theory that DACA caused the surge.

First, the surge in UAC began long before the June 15, 2012 announcement of DACA.  It is true that DACA had been discussed in late May 2012 but the surge was underway by that time.  From October 2011 through March 2012, there was a 93 percent increase in UAC apprehensions over the same period in Fiscal Year 2011.  Texas Governor Rick Perry warned President Obama about the rapid increase in UAC at the border in early May 2012 – more than a full month before DACA was announced.  In early June 2012, Mexico was detaining twice as many Central American children as in 2011.  The surge in unaccompanied children (UAC) began before DACA was announced.

Second, the children coming now are not legally able to apply for DACA.  A recipient of DACA has to have resided in the United States continuously from June 15, 2007 to June 15, 2012, a requirement that excludes the unaccompanied children coming now.   

Third, if DACA was such an incentive for UAC to come from Central America, why are so few Nicaraguan children coming?  They would benefit in the same way as unaccompanied children from El Salvdaor, Honduras, and Guatemala.  The lack of Nicaraguans points to other causes of the surge.

The timing, legal exclusion of the UAC from DACA, and lack of Nicaraguans indicate that DACA was not a primary cause of the surge.  Of the 404 UAC interviewed by the United Nations High Commissioner for Refugees since 2011, only 9 mentioned that U.S. laws influenced their decision to come to the United States.  Other American laws could have influenced the unaccompanied children to come but DACA is not the main culprit.           

Details on DACA

The DACA beneficiaries, at the time of the memo, would have to fulfill all of these requirements to have their deportations deferred:

  • Under the age of 31,
  • Arrived to the United States before reaching their 16th birthday,
  • Entered the United States without inspection or overstayed a visa prior to June 15, 2012,
  • Continuously resided in the United States from June 15, 2007 to the time of the memo,
  • Physically present in the United States on June 15, 2012, as well as at the time of requesting deferred action from United States Citizenship and Immigration Services (USCIS),
  • Been in school at the time of application, or have already graduated or obtained a certificate of completion from high school, or have obtained a general education development (GED) certificate, or are an honorably discharged veteran of the U.S. Coast Guard or the U.S. Armed Forces
  • Not been convicted of a felony, significant misdemeanor, or three or more other misdemeanors, and do not otherwise pose a threat to national security or public safety.

Beneficiaries of DACA were also allowed to apply for employment authorization according to the Code of Federal Regulations.  There is a debate amongst legal scholars over whether the administration’s grant of deferred action was legal.  Those who argue that DACA was illegal contend that the President overstepped his constitutional authority to defer the deportation of some unauthorized immigrants.  Those who argue that DACA was legal point to the general power of the Secretary of the Department of Homeland Security to defer enforcement action.  They argue that the Supreme Court has ruled that decisions to initiate or terminate enforcement proceedings fall within the authority of the Executive – an enforcement power used since the early 1970s.  Here is more of their argument.  This disagreement has not been settled.     

By the end of September, 2013, 580,000 requests for DACA were accepted by the U.S. government and 514,800, or 89 percent, were approved.  Seventy-six percent of the requests came from Mexicans.  Twenty-nine percent of the requests were filed from California, 16 percent from Texas, and 6 percent from Illinois.

Core Misinformation: Bad News for the Blame Obama Crowd

A favorite refrain of Common Core advocates is that their opponents are peddling “misinformation.” Well Core fans are quite adept at doing the same thing, and as a new Washington Post article reinforces, no case of this is more egregious than pretending that Core adoption was supposed to be “state-led” and “voluntary,” and federal coercion was just unwanted Obama administration interference. That is simply not true: Core crusaders wanted federal involvement from before the Common Core was even given its name.

On numerous occasions I have cited the 2008 report Benchmarking for Success, from the Core-creating National Governors Association and Council of Chief State School Officers, as indisputable evidence that Core supporters wanted federal pressure to push state adoption of common, internationally benchmarked standards. That report – written before there was an Obama administration – says explicitly that Washington should “offer funds” and provide “tiered incentives” to push states onto common standards. It was a call reiterated on the website of the Common Core State Standards Initiative, though it was eventually removed.

Despite this crystal clear evidence, Core defenders have continued to imply that federal intervention has all been the unwanted, unappreciated pushiness of President Obama. Indeed, just last Friday, Michael Petrilli of the Core-supporting Thomas B. Fordham Foundation said it again in a discussion with AEI’s Mike McShane. Go to the 28:50 mark to hear Petrilli say, “I think many of us could make the argument that this whole thing would have played out very differently if the Obama administration had just stayed out of it.” And Petrilli is not alone in suggesting that the Core initiative was always supposed to be fed-free. Oklahoma Governor Mary Fallin (R), signing a bill removing her state from the Core last week, implied the same thing, saying:

Unfortunately, federal overreach has tainted Common Core. President Obama and Washington bureaucrats have usurped Common Core in an attempt to influence state education standards. The results are predictable. What should have been a bipartisan policy is now widely regarded as the president’s plan to establish federal control of curricula, testing and teaching strategies.

Obviously, based on Benchmarking for Success alone, this is utterly misleading. But what the Washington Post has now reported, in a piece largely about the role of Bill Gates in pushing the Core, is that Core supporters not only suggested that there be federal incentives, they worked with the Obama administration to get them:

Duncan and his team leveraged stimulus money to reward states that adopted common standards.

They created Race to the Top, a $4.3 billion contest for education grants. Under the contest rules, states that adopted high standards stood the best chance of winning. It was a clever way around federal laws that prohibit Washington from interfering in what takes place in classrooms. It was also a tantalizing incentive for cash-strapped states.

Heading the effort for Duncan was Joanne Weiss, previously the chief operating officer of the Gates-backed NewSchools Venture Fund.

As Race to the Top was being drafted, the administration and the Gates-led effort were in close coordination.

Note that the article goes on to say that an early draft of RTTT mentioned the Core by name, but supporters objected that that would be too much for some states to handle. Instead, in contrast to what the article suggests, to be fully competitive for grants the regulations required adoption of standards common to a “majority” of states – not just “high” standards – a parameter that only included Common Core.

Now, I don’t think this will happen, but at this point it would at least clear the air for Core supporters to openly admit that they always wanted to employ federal pressure, and gladly worked with President Obama to get it. At the very least, it would make their own accusations of “misinformation” a little more tolerable.

Afghanistan: Obama’s War

Last week, when President Obama made his trip to Bagram Air Base in Afghanistan, he claimed that “America’s war in Afghanistan will come to a responsible end.” This turned out to be the greatest applause line of his speech. With his assertion, Obama, in effect, declared himself the hero of the Afghan war – the one who put an end to that nightmare. But what Obama failed to mention was that it was his war, and that nothing but unattractive scenarios lie ahead for that war-torn state. Indeed, Afghanistan might just continue to hold down its ranking as the most violent country in the Global Peace Index.

This gloomy prognosis would not have surprised Thomas Jefferson. Yes, Jefferson’s words point to a fundamental truth, “Governments constantly choose between telling lies and fighting wars, with the end result always being the same. One will always lead to the other.”

Graciana del Castillo, one of the world’s leading experts on failed states, has just written a most edifying book on the Afghan war (Guilty Party: The International Community in Afghanistan. Xlibris, 2014). Del Castillo’s book allows us to finally understand just what a fiasco the Afghan war has been.

Why is Afghanistan, as Bob Woodward correctly termed it, Obama’s war? Del Castillo’s sharp pencil work shows that during the period 2002-2013, $650 billion have been appropriated for the Afghan war effort, and a whopping $487.5 billion of that (or 75%) took place after President Obama took office (see accompanying chart).

If one pulls apart that $650 billion price tag, a variety of interesting sleights-of-hand emerge. For example, about $70 billion was disbursed to what is euphemistically termed reconstruction. But, in reality, 60% of this $70 billion (or $42 billion) was actually spent on beefing up the Afghan National Security Forces. And not surprisingly, 75% of the $42 billion spent on national security forces was spent under President Obama’s watchful eye.

To put these outsized numbers into perspective, just consider that the total cost of the Afghan war from 2002-2013 amounts to $7089 per American taxpayer (based on the number of income tax returns). More revealing is the fact that the annual expenditure rate under the Bush administration was already $222 per taxpayer. Then, it exploded to an annual expenditure rate of $1329 per taxpayer under President Obama.

In addition to laying out the phenomenal spending magnitudes on President Obama’s watch, del Castillo demonstrates just how unsustainable all this Afghan spending is. For example, in 2013, the United States financed over $5 billion of the $6.5 billion needed to field the Afghan National Security Forces. This $5 billion of U.S. financing was roughly 10 times more than the Afghan government actually spent from its own revenue sources. In fact, the U.S. funding of Afghan forces was almost three times the total revenue collected by the Afghan government.

To put Afghanistan’s financing gap into perspective, the Afghan government estimates the total fiscal deficiency that they will face over the next decade would amount to a whopping $120 billion. Considering that a July 2013 Washington Post/ABC poll showed that only 28% of Americans say the war in Afghanistan has been worth the cost, it is unlikely that the U.S. would even contemplate continuing to finance the house of cards it has built at anything close to these estimates.

And if this isn’t bad enough, consider that the countryside has been forgotten and neglected during the war years. It is here where 75-80% of the population resides, and produces its livelihood. The rural population has done what is only natural – farm a cash crop. And, the most attractive cash crop in Afghanistan is poppies. Not surprisingly, the poppy plantations have greatly expanded, from 75 thousand hectares in 2002 (near the start of the war), to over 210 thousand in 2013, surpassing the previous peak of 190 thousand hectares in 2007. Just another small example of the collateral damage associated with war and misguided economic policies in Afghanistan.

At West Point, Obama Seeks to Reassure Foreign Policy Elite

Foreign policy in the United States is an elite sport. Unless there is a big Iraq- or 9/11-style disaster, the public mostly ignores foreign policy, because it can. The United States is extremely safe, but it runs an expansive, ambitious grand strategy that keeps elites busy and the public largely uninvolved. President Obama will give a speech tomorrow at West Point defending his foreign policy and answering elites who have begun to grow bored with it.

The president seems to view foreign policy mostly through a domestic political lens. While he opposed an Afghanistan surge, he ordered one anyway, likely for fear of the domestic political implications of defying the generals’ request for more time and more troops. Ideologically, Obama fancies himself a realist in the mold of Reinhold Niebuhr, although no actually-existing realists think his policies resemble realism. During the 2012 presidential campaign, Obama found himself particularly captivated by an essay from Robert Kagan—a neoconservative Romney adviser—that urged Americans to wade ever more deeply into world politics. If there were any doubt that the two political parties agree on U.S. foreign policy, Obama’s accord with Kagan should have demolished it.

But the president has begun to irritate both the right and left halves of the foreign policy establishment by declining to intervene more forcefully in Syria and in Eastern Europe. Obama will likely play to nationalist themes in his speech tomorrow, reassuring the foreign policy elite that he endorses their project and explaining to Americans that their special place and special responsibilities in the world necessitate a costly, globe-girdling grand strategy. News reports indicate the administration is contemplating sending anti-aircraft weapons to the Syrian opposition, and that the president will criticize Russian behavior in Ukraine during an upcoming trip to Europe. In addition, the foreign policy establishment has breathed a collective sigh of relief with the announcement that the president will keep nearly 10,000 U.S. troops in Afghanistan beyond his previously-announced 2014 withdrawal date.

Regular Americans should view the speech for what it is: a cynical sop to the insular clique of Beltway elites who view themselves as the vicars of liberalism on earth, and the rightful possessors of hundreds of billions of American tax dollars to do with what they will.

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