Fact: Chris Christie "failed to carry [his] burden."

New Jersey Superior Court judge Peter Doyne (acting as an appointed special master) issued his report on how the Christie $1 billion budget cut will hurt the most at-risk students.

"The difficulty in addressing New Jersey's fiscal crisis and its constitutionally mandated obligation to educate our children requires an exquisite balance not easily attained," wrote Doyne, according to the Star-Ledger. "Something need be done to equitably address these competing imperatives. That answer, though, is beyond the purview of this report. For the limited question posed to the Master, it is clear the State has failed to carry its burden."

HuffPo

"Despite spending levels that meet or exceed virtually every state in the country, and that saw a significant increase in spending levels from 2000 to 2008, our 'at risk' children are now moving further from proficiency," he said.

NJ.com

Saturday Cartoon Fun: GOP Budgeting Edition

Friday Bonus Cartoon Bonus Fun: We'll Get To It Edition

Let Them Eat....Um, Less

Senate Makes Further Cuts to Food Stamps to Pay for Medicaid, EduJobs

...And they expanded the cuts to SNAP [food stamps]. A CBO score released last night shows the revised version more than pays for itself, reducing the deficit by $1.37 billion over the next ten years. SNAP benefits face a $11.9 billion rollback starting in April, 2014. A family of three can expect their benefits to drop about $50 a month...[emphasis mine]

An Hour Of Franken Sanity On The Floor Of The Senate

Yes, he should be president!

No Nukes

From swimming freestyle:

It's a mystery to me, though, why there continues to be that much interest in nuclear power. The only way nuclear power is funded, and this is true all around the world, is either via government loan guarantees or public ownership. Utility companies are unwilling to make the investment on their own, the cost per kilowatt of electricity produced is higher than existing, albeit dirty, methods, and the nuclear waste disposal issues are still unresolved.

According to one recent analysis, the cost of building nuclear power plants has approximately doubled in the last seven years (due to things such as increasing materials costs). As it stands, this means that the cost of electricity from new plants would be around 8.4 cents per kilowatt hour, compared to about 6 cents per kilowatt hour for conventional fossil fuel plants.

A little bonus No Nukes Nostalgia (David Lindley is my hero):

Reaction Of The Day: digby

California, the 8th largest economy in the world, is in fiscal trouble. Here are some frightening outcomes for California that seem to be headed our way:

The scary stuff from digby and her perfect reaction:

At least 200,000 children are slated to lose eligibility for Healthy Families, with that number growing to 900,000 if the program is gutted entirely.

Nearly 90 percent of the 400,000 recipients of In-Home Support Services stand to lose care under Schwarzenegger's best-case scenario, and state reimbursements to providers of those who remain would be slashed to minimum-wage levels. Otherwise, the program would be abolished, throwing 350,000 caregivers out of work.

For Medi-Cal, Schwarzenegger has proposed clamping new limits on health services while raising premiums and patient co-pays if he gets the extra federal money he wants. Medi-Cal for legal immigrants in the country less than five years would be eliminated, unless they were pregnant.

If additional federal funds fail to arrive, some 450,000 Medi-Cal recipients would be stripped of eligibility and most optional adult benefits, such as reimbursements for hearing aids and other medical equipment, would be scrapped.

All these health care programs being cut are especially worrying. These patients will logically be coming into the already stretched emergency rooms, costing far more money, so the only real purpose here must be to let them die. I can't see how it will work otherwise.

The good news, though, is that the most productive members of our society are making 8 figure bonuses this year. At least we don't have to worry that the really important people are being unfairly compensated for all their hard work, so that's good. [emphasis TFT's]

Reich Explains Obama's Economic Policy: Revolutionary!

Bob Reich was nice enough to offer a free correspondence course on Obanomics yesterday. You should read it. You should read everything Dr. Reich writes!

Is Obamanomics Conservative or Revolutionary?

There are two ways to see Obamanomics.

The first, much preferred by the White House, is as a set of initiatives so modest as to hardly merit a raised eyebrow. Yes, steps must be taken to deal with the current economic crisis. But assuming the economy recovers next year, Obama's budget projects that government spending by the end of the decade will drop to around 22.5 percent of GDP, which is about where it was under Reagan.

What about those tax hikes on the wealthy? Obama merely restores the top two marginal income tax rates to what they were in the 1990s, the capital gains rate to its lowest level during that same prosperous decade, and the rate on dividends to a level even lower than it was in the 1990s. And even these modest reversions to the 1990s will affect only the wealthiest 3 percent of Americans, and not until 2011. Ninety-seven percent of small businesses won't pay a dime more. True, the very rich won't be able to deduct quite as much as they can now for their mortgage interest and charitable donations, but this is hardly revolutionary, either. In fact, it's another throwback -- to the limits in place under Ronald Reagan. All told, taxes are projected to total 19 percent of GDP by the end of the decade. That's even lower than it was in the late 1990s.

Modest as they are, these taxes will generate enough revenue to pay for half of what's needed for universal health care, and still reduce the deficit by about $750 billion over ten years -- to 3.1 percent of the GDP by the end of the decade.

But isn't universal health care itself a pretty radical step? Not according to this view. The other half of what's needed to pay for universal health care will come from health-care savings that are also necessary to keep the current big health-care entitlement programs -- Medicare and Medicaid -- affordable. It's just common sense: Allow government to use its bargaining leverage under Medicare and Medicaid to lower drug prices, strengthen Medicare pay-for-performance incentives, and institute better disease management, prevention, and health information technologies.

What about the environment? Isn't cap and trade a huge deal? Not at all. Instead of heavy-handed regulation it's a market solution to the problem of global warming. Government merely sets an overall cap on the amount of carbon dioxide to be allowed into the atmosphere, which drops annually, and then requires firms to bid for permits to pollute within that overall cap. Firms can buy and sell permits to each other; they can innovate to reduce pollution even further. Such a system will generate enough revenues to give 95 percent of Americans a yearly refundable tax credit of $400, and also finance research and development of renewable energy and a modernized electricity grid.

But isn't Obanomic's approach to educational reform expensive and intrusive? No. By this view, it's very mainstream and incremental -- and doesn't impose on the prerogatives of states and locales. It expands the tax credit for college tuition to $2,500 a year and increases Pell Grants to $5,500 yearly -- almost negligible increases, given how fast tuitions are rising. It cuts subsidies to banks participating in the student-loan program, which is exactly what Bill Clinton did, and it provides some funds for early childhood education.

So there we have it: Obamanomics as pragmatic, incremental, centrist, even conservative.

But there's another way to view Obamanomics -- as an economic philosophy exactly the opposite of the one that's dominated America for more than a quarter century.

The basic idea of Reaganomics was that the economy grows from the top down. Lower taxes on the wealthy make them work harder and invest more, and the benefits trickle down to everyone else. Rarely in economic history has a theory been more tested in the real world and proven so wrong. In point of fact, nothing trickled down. After the Reagan tax cuts, increases in the median wage slowed, adjusted for inflation. After George W. Bush's tax cuts for the wealthy, the median wage actually dropped. Meanwhile, most of the income went to the top. In 1980, just before the Reagan revolution, the richest 1 percent took home 9 percent of total national income. But by 2007, the richest 1 percent was taking home 22 percent.

Obamanomics, by contrast, holds that an economy grows best from the bottom up. Obama's program increases taxes on the top, and uses the proceeds to raise the living standards of average Americans by giving them lower taxes, better schools, and more affordable health insurance. That may not seem very radical, but compared to the last quarter century it's revolutionary.

Reaganomics didn't believe in public investment, except perhaps when it came to the military. Everything else was considered government spending, which was assumed to be wasteful. Hence, the cuts (adjusted for inflation) during Reagan, Bush I and Bush II in education, job training, infrastructure, and basic research and development. And the reluctance to expand health insurance except when it came to corporate welfare for the pharmaceutical industry.

But Obamanomics is a commited to these forms of public investment. And there's good reason: In a global economy, capital moves to wherever it can get the best deal around the globe. That means capital and jobs go to nations that can promise high returns either because labor is cheap and taxes and regulations low, or because labor is highly productive -- well educated, healthy, and supported by modern infrastructure.

Which do we want? For the better part of the last quarter century our implicit economic strategy has tended toward the first. But that's a recipe for lower wages and lower living standards for most Americans, along with widening inequality. The only resource that's uniquely rooted in a national economy is its people -- their skills, insights, capacities to collaborate, and the transportation and communication systems that link them together. Everything else -- including capital, technology, designs, even plant and equipment -- can move around the globe with increasing ease.

Bill Clinton talked a lot about the importance of public investment but he failed to do much about it because he came to office during an economic expansion, and the major worry was excessive government spending leading to inflation. Obama comes to office during the biggest downturn since the Great Depression, and although he doesn't talk much about public investment his plan represents the largest commitment to it in forty years.

Reaganomics' third principle was that deregulated markets function better. They do, in many respects, but not always. And when they don't, all hell can break loose. Energy markets were deregulated and we wound up with Enron. Carbon emissions weren't controlled, and now we face global warming. Financial markets were deregulated and we have a global meltdown. Obamanomics, by contrast, accepts that government has an important role in setting the rules of the capitalist game: Setting an overall cap on carbon emissions, ensuring that products and foods are safe, maintaining the solvency and security of financial companies.

Under Reaganomics, government was the problem. It can still be a problem. But Obamanomics recognizes there are even bigger problems out there that can't be solved without government. By building the economy from the bottom up, recognizing the central importance of public investment, and understanding that markets cannot function without regulation, Obamanomics finally reverses and repudiates the economic philosophy that has dominated America since 1981.

If you look only at the small print, Obamanomics looks conservative. If you look at the big picture, it's revolutionary.

California Education Funding: It's Over!

If I recall, some years ago state employees got IOU's instead of real money. I can't live too well on IOU's. Please, please, let's fix this fucked up country!

Time for an Education Bailout? California’s Schools Will Likely Need One

The latest numbers from California suggest that the state is running out of money so quickly that it may have to start to pay its bills with IOUs. It is uncertain what the impact of the state’s problem will be on schools, but it looks bad, and is getting worse by the day. In November, the state’s Legislative Analyst estimated a budget gap of around $28 billion between now and June 2010. The annual budget is just over $100 billion with around 40 percent of that going to schools (K-12 and community colleges) (see report here). The budget gap has jumped in the last week to $40 billion, and the urgency is mounting to act fast before the state runs out of money. The Governor has started a debt clock that ticks at $470 for each second of inaction (here) The State Treasurer has suggested that the state may have to stop all construction projects because it will run out of funding paying for its constitutional obligations.

The Governor called a special session in Nov with a lame duck state legislature to address a then smaller gap, and the session ended with no results. He declared a new special session with a new Legislature in December and started with generally the same mix of new revenues and cuts. The political battle is over how much of this gap will be covered with cuts vs. new revenues. The Governor and legislative Democrats (majority party in both houses) are proposing a mixture of new taxes and program cuts, with many differences between the two. In contrast the legislative Republicans are calling for programmatic cuts to solve the problem.

So What Does All of This Mean for Schools?
Schools have been waiting to see how bad the cuts will be. Today’s news suggests that it could be pretty bad. The Senate and Assembly Republican (minority party) weighed in with a proposal that was heavier on the cuts than on the new revenues (here). Combined their plan would address $22 billion of the $40 billion hole. And of that $22 billion roughly half ($10.6 billion) was reduction to K-14 education (K-12 schools and community colleges which are funded together through a constitutional minimum guarantee). In addition they propose significant reduction to early childhood programs. Since this year is already half over, there may not be a lot that schools can do to reduce costs significantly in the current school year, although they better save onto every unobligated nickel. And, while this proposal was quickly blasted by the Governor and the Democrats (here), it is important to recognize that this proposal only addresses half of the problem. So, if the state is going to solve the $40 billion hole, it may take this level of cuts to education or higher plus additional cuts and new taxes.

Why the Rest of the County Should Care.
One in every eight students in the US is educated in California. California current funding per pupil is already below the national average, and near the bottom if adjusted for cost of living. Because of its modest funding and high costs, California schools have smaller staffs than schools in other states – larger class sizes and fewer administrators and other support staff. Take off another $10 billion in funding, and class sizes will balloon even more. At what point does it become a national interest to keep schools from going under. Is it time for the federal government bailout for education? I think this would be a better investment in our future than many of the other bailouts being provided.