Relevant and even prescient commentary on news, politics and the economy.

Medicaid Expansion in Michigan

States refusing to expand Medicaid to 133% of FPL has repercussions for those making less than 100% FPL. The PPACA was intended to setup State Exchanges where people could buy healthcare insurance and if they had an income beyond 133% FPL (Federal Poverty Level). Subsidies in the form of a tax credit would be given to each participant (sent to insurance carrier) based on their income. Remember, I said the PPACA was designed for those with incomes >133% FPL? While those with incomes >100% FPL can get subsidized healthcare insurance in the Exchanges, those with incomes <100% FPL can not get subsidized healthcare insurance in the exchanges and they would be covered by Medicaid. The states threatening to not expand Medicaid will leave a hole in healthcare insurance coverage. If the states do not expand Medicaid for single and childless married adults and expand it for married adults with children with incomes <100% FPL, they will not be able to get subsidized coverage on the exchanges either. Many state legislatures are not mentioning this to the constituency in the hope they can blame it on the PPACA, President Obama, and the Democrats. Here is how it is playing out in the State of Michigan . . . “the expanded program would cover as many as 450,000 Michiganders, according to projections. Michiagn State Senator Hune said there is evidence that about half of those in the expanded income category already have coverage of some kind” Press and Argus local newspaper. Michigan State Senator John Hune (my district) is worried about adding 450,000 more uninsured people to Medicaid if they expand it under the PPACA . I could understand the concern if:

• It was not funded. The Medicaid expansion is fully funded up to 100% for the first 3 years and gradually drops to 90% in 2020. The 90% still exceeds the unenhanced Federal Government Medicaid funding of 66% presently given to Michigan for Medicaid. Federal Medical Assistance Percentage (FMAP) for Medicaid and Multiplier, State Health Facts, The Henry J. Kaiser Foundation.

• The State of Michigan already covered adults with and without children up to 100% of FPL. Michigan does not cover up to 100% of FPL for any adult. Jobless Adults with children are covered under Medicaid if they are <37% of FPL. Working adults with children are granted Medicaid coverage at <64% of FPL. Single adults were once covered at <35% FPL if jobless and <45% FPL if working. The program is closed for single adults and married childless adults. Adult Income Eligibility Limits at Application as a Percent of the Federal Poverty Level (FPL), January 2013 The Henry J. Kaiser Foundation.

Recently, the Republican dominated Michigan State Senate went on vacation rather than voting, leaving the PPACA Medicaid Expansion issue to be decided upon when they return in Fall. State of Michigan Senator Hune’s reasoning was the lack of time (two days) to decipher the Medicaid Expansion. Now this happened in an automotive state where people who work in the automotive industry usually end up losing vacation and holiday time when a production line shuts down or a shipment needs to go out. Myself, I have faced such issues when managing a $200 million/year warehouse for a major Tier One. We hung around until the issue was resolved. This is also happening 2 years after the PPACA has passed, been decided as constitutional by SCOTUS, and rolled out piece meal. So why can’t they give up a couple of days and give it a yes or no vote?

The Republican dominated Michigan State Senate and “other opponents” to the PPACA are not acknowledging the resulting hole in coverage which the PPACA will not cover. Those people who do not have an income of at least 100% FPL will not be eligible for PPACA subsidies in the State Insurance Exchanges. For example, a working women with one child making $10,000 per year is at 64% of FPL and is ineligible for a subsidy to assist in paying the ~$4,900 insurance premium levied from the State Insurance Exchange. Pre-SCOTUS PPACA June 2012 decision, the Federal Government could force states to expand the Medicaid coverage by withholding funding already allocated to states for Medicaid. Since the 5-4 majority SCOTUS ruling, SCOTUS determined the Federal Government and Congress can not force states to expand Medicaid. Using the Kaiser Interactive Subsidy Chart, one can see in the chart below, the working Michiganders caught between 36% of FPL and 100% of FPL would not be eligible for PPACA Subsidies in the eventual Michigan Healthcare Insurance Exchange.

Subsidy1

So why is Michigan State Senator John Hune so concerned about the addition of these Michiganders to Medicaid when there is no other comprehensive coverage for those with income < 100% FPL; secondly, the funding is at 100%, drops to 90% in 2020, thirdly it is a net gain for Michigan; and finally Medicaid improves upon what they may now have (telemarketed mini-meds) and would result in healthier workers? Perhaps, Senator Hune is attempting to appease a Tea Party constituency as his reasoning otherwise lacks common sense. Missing out on the funding for additional Medicaid coverage is only one aspect of the issue as there other gains to be realized from expanding. Michigan’s Economy Will Benefit from Expanding Medicaid, Families USA and Michigan Consumers for Healthcare points to a host of other benefits Michigan will forgo if it does not expand Medicaid.

• In 2016, the new federal dollars would support approximately 18,000 new jobs across all sectors of Michigan’s economy, a 0.32 percent increase over the number of current jobs in the state. This is not limited to health care jobs. Because of the multiplier effect (described above), jobs would be created in a wide range of business sectors throughout the state.

• The increased federal funding and jobs created are projected to increase economic activity in Michigan by nearly $2.1 billion starting in 2016.

• From 2013 through 2022, the Medicaid Expansion could save Michigan ~$350 million in uncompensated cost, as more people would be insured. This would offset the decreased percentage in 3 years.

• Hospitals also absorb uninsured healthcare costs. It is estimated another $317 million could be saved with the Medicaid expansion.

• In 2008, the costs of uncompensated care increased family health insurance premiums by an estimated $1,017.

• Increased state revenue from more people working.

• In this conservative get a job or get out of the state of Michigan, insured constituents would be healthier and more productive in jobs.

Solely because of politics, the Republican held Senate in Michigan is stonewalling the Medicaid Expansion at the expense of thousands (6,000 in Livingston County alone) of their constituents. Again as taken by Henry J. Kaiser Foundation, there are 1.9 million people in Michigan who have incomes <100% FPL who would not be eligible for subsidies on the PPACA State Insurance Exchange. Only adults with children are eligible today for Medicaid and only if their income is a much lower percentage than 100% FPL.

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The PPACA Sky is Falling . . .

Chicken Little

Quelle Surprise, The White House Administration has decided to give “some” companies with >50 employees a one year extension in order to prepare and comply with the PPACA mandate. Given the amount of resistance the PPACA has received from the states in preparing for it and the House of Representatives, this delay should come as no surprise at all. While everyone has rushed into the fray claiming it is proof the PPACA is failing, the delay impacts a fraction of the employers with >50 employees. 94 – 96% of the ~200,000 employers who fall into this qualification already offer comprehensive healthcare insurance. The delay was to allow the 4 to 6% of the employers (8,000 to 12,000 employers) time to decide what they will offer. Former health policy administrator Ezekiel Emanual had this to say as reported by Bloomberg Health-Law Employer Mandate Delayed by U.S. Until 2015:

“Former White House health policy adviser Ezekiel Emanuel, now vice provost at the University of Pennsylvania, said today on MSNBC’s Morning Joe that the delay of implementation of the employer mandate will impact a limited number of companies. ‘I actually don’t think this is that big a deal,’ he said.

‘The provision only applies to employers who have 50 or more employees’, Emanuel said. He estimated that there are 200,000 total employers in the U.S. impacted and that “94 percent already offer health insurance” to employees.

‘We need to look for 2020 rather than moment to moment for changes in the system,’ Emanuel said.

Obama has confronted opposition from Republicans at every turn of the law, which passed Congress with only Democratic votes and was later challenged before the U.S. Supreme Court.

Only 16 states have agreed to set up the new exchanges, or marketplaces to sell insurance to people who don’t get it at work. Twenty-four states have refused to expand Medicaid, as called for under the law, according to Kathleen Sebelius, Obama’s secretary of health and human services.

Congressional Republicans, who have vowed to try to repeal the law, have refused Obama’s requests for about $1 billion more to help enact the statute and ensure it runs smoothly. Instead, they’ve started multiple investigations into the implementation.

Nor is this the first time Obama has been forced to scale back the law’s features. In March, the administration said small businesses wouldn’t be able to give their workers a choice of health plans in exchanges set up just for them. In January, a plan to create new nonprofit insurers in states was curtailed after Congress capped funding for the companies.”

Reports of companies limiting workers to 30 hours per week to avoid offering them healthcare insurance has been in the news with food chains and WalMart leading the way. It does not quite work that way as reported by Maggie Mahar at Health Beat Blog; The Employer Mandate is Postponed: What Does This Mean For Obamacare? Is Ezra Klein Right–Should the Employer Mandate Be Repealed?. Maggie goes on to say:

As I explained in a recent post, what the critics don’t seem to understand is that the ACA requires that employers offer health benefits if they have “30-time full-time employees or full-time equivalents.” Two workers who put in 15 hours a week equal one full-time equivalent. In other words, the government doesn’t count heads, it counts hours. To figure out how many “full-time employees and full-time equivalents” a business owner has, the government will add up the hours that all of his employees work, and then divide by 30.

The employer who cuts 12 of his 40 full-time employees to part time, and hires another 12 part-time employees to fill in the holes in his work schedule will wind up with 28 full-time workers and twelve “full-time equivalents.”

He will not have to insure the part-time workers, but he will be required to offer benefits to the 28 who actually work 30 hours a week.

As far as WalMart, people are already complaining about the lack of stocked shelving and service. This plays into the hands of WalMart competitors such as Target and Costco who appear to have their employees well being in mind. Should the Employer Mandate be removed. Some interesting commentary from Maggie Mahar. In 2009, Ezra Klein argued against the employer mandate and recently the same argument surfaced again.

“Again he quotes CBPP: ‘The employer mandate and penalties ‘would likely influence employer decisions about which of their employees to let go when they trim their workforces to cut costs, such as during a recession’ Workers from low-income families would cost the firm significantly more.’

Yesterday Klein repeated the argument, writing that ‘Eliminating” the employer mandate, or at least utterly overhauling it is probably the right thing to do.’

Maggie: I disagree. I admire both Klein’s Wonkblog and the CBPP, and applaud most of what each have written about health care reform. But in this case the argument is based on the false assumption that employers will choose to pay a penalty of $2,000 to $3,000 per employee rather than provide insurance. What both Klein and CBPP overlook is what Klein himself has explained in the past:

‘People simply misunderstand why employers offer health-care benefits. They’re not doing it as a favor to employees. . . Employers offer health insurance because employees demand it. If you’re an employer who doesn’t offer insurance and your competitors do, you’ll lose out on the most talented workers. An employer who stopped offering health benefits would see his best employees immediately start looking for other jobs.’

Research also shows the health benefits improve productivity and reduce absenteeism. As I pointed out: not long ago:: “This explains why 95% of employers with more than 30 workers offer insurance.”

The sky has a long way to fall before it hits your head. Do not be fooled by the commentary lacking substance. The habitual naysayers and pols are having a field day with this revision in implementation when the problem is only a small portion of the total. Most employers are ready to go forward.

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Productivity & Effective Demand: An Intriguing and Disturbing Story . . .

Edward Lambert at Effective Demand; Effective Demand = Effective Labor Income/(cu*(1-u)) points to the result of an economy left to maximize Profits at the expense of Labor. I have my own version or underlying causes of this issue and Edward gives the economic side of it.

I am going to show a graph of Productivity against Effective demand. It is an intriguing and a disturbing graph. Let me start by giving the equation for the productivity used in the graph.

Productivity = real compensation per hour: business sector/(labor share: business sector * 0.78)

The data for this equation comes from this graph at FRED.

The equation for effective demand is…

Effective Demand = real GDP * (labor share: business sector * 0.78)/TFUR

TFUR (total factor utilization rate) = capacity utilization * (1 – unemployment rate)

Let me just show the graph and then start explaining . . .

Productivity and Effective Demanda

The graph shows quarterly data from 1967 to the 1st quarter of 2013. The red dashed line is a trend line for the data. We can see that from 1967 to 1997, the plot stayed very tight on the trend line. There were deviations from this line during times of shocks and recessions. But it is very interesting how closely the plot followed the trend line before 1997.

Before 1997, the plot going below the trend line was associated with a recession. The explanation of this is that effective demand rises more during a recession because of more available capacity of labor and capital. At the same time. productivity tends to fall behind the trend line due to rising labor share, not falling real compensation.

When the plot goes above the trend line, productivity is ahead of effective demand. Productivity rises due to labor share settling down and real compensation rising. Effective demand tends to stay still during the expansionary phase of a business cycle. The economy grows up to the effective demand limit and then gets set for a contraction.

We used to have a balance between productivity and effective demand. The economy moved directly on top of the trend line for many many quarters. And now the economy has lost that balance. Since the late 90’s it is a fleeting moment when productivity and effective demand come together on the trend line.

Before 1997, there was very little movement away from the trend line. Then something unusual happened between 1997 and 2001, the dotcom bubble years. The plot went progressively below the trend line even though there was no recession. Productivity was rising during these years, but effective demand was rising at such an unusual rate that productivity could not keep up with it. Effective demand was being artificially created and inflated. The recession of 2001 followed the same unusual path as before the recession.

In 2002, the economy had to make an adjustment. Productivity had to rise or effective demand had to fall. During the housing bubble years (from 2002 to the quarter right before the 2008 recession), productivity rose, while effective demand basically stayed steady. The plot went back above the trend line showing that productivity was beyond the capacity of effective demand and that productivity was at a non-sustainable level. The economy sustained this high level of productivity in the face of low effective demand for a few years, but eventually the correction would come in 2008. The correction was a collapse.

Look at where the economy is now. Since the end of 2010, the plot has barely moved from a productivity just below 1.4 and an effective demand around $14.1 trillion. The plot is way above the trend line and has been just sitting in the same spot for over 2 years. Effective demand is too low for the current productivity in the US. This is an economic bomb building energy that will eventually go off when real GDP approaches $14.1 trillion.

A friend of mine had a dream a few nights ago, where a spirit said that the economy is dying. The graph above would lead one to think the same.
Think about it… where can the economy go now from here?
There are 2 options . . .

Option #1 looks at the equation for Productivity: You have to lower productivity by increasing labor share in relation to real compensation.

1. If you lower real compensation, labor share would fall, but it would have to fall slower than real compensation. Keep in mind though that a lower labor share would lower effective demand too, which would work against the objective. However, if labor share actually rose in the face of lowering real compensation, you would see an economic contraction. So lowering real compensation is not a good option.
2. On the other hand, if you raised labor share faster than raising real compensation, productivity would come down as effective demand increased from higher labor share. This is a safe and sensible way to correct the huge imbalance we find ourselves in.

Option #2 looks at the equation for Effective Demand: You have to increase effective demand back up to $16 trillion. There are two options here as well.

1. Utilization of labor and capital would have fall. (TFUR in the equation above would have to fall.) This would mean a rise in unemployment, which would mean another collapse.
2. Labor share would have to rise. This would also have the beneficial effect of lowering productivity, as long as real compensation rose moderately.

As we can see, the only real option to avert another collapse is to raise labor share of income. This is not likely as businesses are even now fighting an increase in just the minimum wage. Businesses are trying to maximize their profits and do not want to raise labor costs. Yet this objective of theirs is going to kill the economy.

The graph above shows that there is a bomb ticking, and it is a bigger bomb than we saw in 2008. Higher productivity in the face of low effective demand is unsustainable. Yet, we have been sustaining it for over 2 years now with an incredible expansionary monetary policy in the face of an incredibly low labor share of income.

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Corporations Never Had It So Good

by Linda Beale

Corporations Never Had It So Good

The  press is covering the GAO‘s latest report on corporate taxes:  Corporate Income Tax: Effective Tax Rates Can Differ Significantly from Statutory Rate(May 30, 2013). The study, looking at income and taxes reported in financial filing statements for 2008-2010, was conducted because

Proponents of lowering the U.S. corporate income tax rate commonly point to evidence that the U.S. statutory corporate tax rate of 35 percent, as well as its average effective tax rate, which equals the amount of income tax corporations pay divided by their pretax income, are high relative to other countries. However, GAO’s 2008 report on corporate tax liabilities (GAO-08-957) found that nearly 55 percent of all large U.S.-controlled corporations reported no federal tax liability in at least one year between 1998 and 2005. Id. (from “highlight”).

The report looks  good for corporations.  The GAO report shows that corporate taxes paid to the US are going down, down, down.  Corporations paid 15.3% in 2008, 13% in 2009 and only 12/6% in 2010–that’s less than have the corporate tax rate of 35% for each of those years! The proportion of federal revenues raised from corporate taxes has been decreasing over the years as well–the GAO reports that for 2012 it is estimated that corporate taxes will have raised only 242 billion, compared to 1.1 trillion in individual taxes and 845 billion in payroll taxes.

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Senate Finance Leaders push "blank slate" to tax reform

by Linda Beale

Senate Finance Leaders push “blank slate” to tax reform

Senators Baucus and Hatch, the Chair and ranking minority member of the Senate Finance Committee, respectively, launched a bid for completing a Code reform before Baucus leaves office with a letter to Senators telling them that they should get their bids in within the month for any tax expenditures they want to preserve. See Letter from Baucus and Hatch (June 27, 2013).

At first glance, this doesn’t sound like a terrible idea. There are, indeed, too many tax breaks in the Code for huge estates, owners of capital, Big Oil, Big Pharma, “Non-Profit” hospitals, and corporate executives’ deferred pay. Wiping them away and then thinking through things fresh might be a part of a process for real tax reform that makes sense.

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SCOTUS Rules Again . . .

As found on our Open Thread of June 28, 2013, jurisdebtor decided to leave a gem behind. Juris debtor can be found on his Blog J.URIS D.EBTOR, My Own Meanderings Through Economics, Law, and Policy Having been in the courts for the last decade, I find this to be a good interpretation of what one might expect from the courts. It is never what you believe it to be coming from the gods dressed in black sitting behind their pulpit looking down at you (there is distinct reason for this). The days of Gideon are forever past (happy fiftiest Gideon in 2013). Try writing SCOTUS yourself today.

Don’t Let DOMA Fool You — the Supreme Court is Restricting Your Rights By David Cole, Washington Post, 6/28/2013. As taken from the Open Thread, jurisdebtor posts David Cole’s appraisal of SCOTUS decisions as rendered by the Kennedy Court (my interpretation).

The Supreme Court’s 5 to 4 decision to strike down a key part of the Defense of Marriage Act was undeniably historic, a victory not just for gay rights advocates but for anyone committed to advancing equal rights in America.

It was also an anomaly.

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Recess Appoint Mel Watt

Congress is in recess, actual recess with no pro forma sessions.  Barack Obama can recess appoint people.  Tomorrow Ed DeMarco could cease to be acting director of the FHFA (Federal Housing Finance Agency).  I think that Obama should, indeed must, recess appoint Mel Watt to be FHFA director.

As acting director DeMarco has blocked all efforts to relieve homeowners who can’t pay their mortgages.  His argument was that his job as Fannie/Freddie conservator was only to minimize the loss to the Treasury from the rescue.  Note the past tense.  This argument ceased to be operative when he vetoed a  proposal to use TARP money so that relief would cost Fannie and Freddie less than nothing.

I think the easiest way to reconcile DeMarco’s behavior with the rational utility maximizing hypothesis is to assume his aim is to minimize US GDP.

As is well known the current recovery is anomalous because of declining public spending and stagnant home construction at an extremely low level.  In contrast consumption, investment in equipment and software an net exports have behaved normally.  It is clear that nothing will be done about public spending.  An oddly widespread view is that the very sluggish recovery of housing construction shows that we must focus on the Fed, because … well I don’t get the rest.  I think it is clear that the key public entities which is failing to do its job is the FHFA and Congress.  While Congress is out of town, Obama can solve one of those huge problems.

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Poetic Justice for Justice Alito. Maybe.

U.C.-Berkeley law professor Goodwin Liu’s nomination to the Ninth Circuit Court of appeals was killed a couple years ago by Senate Republicans upon the pretext that Lui had trashed Alito to the Senate Judiciary Committee in testimony during Alito’s confirmation hearing.  Lui predicted that Alito as a justice would be exactly what Alito as a justice is.  Now that Lui’s prediction has proven spot-on*, Obama should nominate him, not for the Ninth Circuit but for Supreme Court upon Ginsburg’s retirement in a year or two.

It would be at least some small poetic justice for this justice.

But Alito’s demeaning, denigrating treatment of litigants and counsel is emblematic of a veritable hallmark of the Federalist Society-affiliated appellate judges.  Certainly not all of them do that, but also certainly, several high-profile Reagan/H.W. Bush-era appellate appointees have made that type of conduct a mark of peer prestige, and others, who don’t naturally have that personality—including some appointed by Clinton—emulate it.  Something about being in with the in-crowd.  It is, or at least for a long time was, the cool thing for them to do.

*The link is to a terrific article in Slate today by Mark Joseph Stern.  But credit also must be given to the Washington Post’s Dana Milbank, who in a column published earlier this week was, I believe, the first of the now-several commentators to report on this. 

—-

UPDATE: I posted a similar comment to Stern’s article in the article’s Comments thread on Slate.  In response, a commenter called Bigmouth wrote:

While I’d love to see Liu on the Supreme Court, I’d like to see the President pick fights he can actually win lol.

To which I responded:

This is one he would win if he chose to pick that fight. The high profile of the matter, coupled with the under-recognized importance of the generational change among voters–particularly the growing importance of the Millennials–and the overdue, very public highlighting of Alito’s votes and his conduct on and off the bench, would win it for Obama.

Not that I expect that lackluster, gutless wonder to actually pick this fight. But if he does, he’ll win it.

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Ms. Wendy Davis Goes to Austin, TX

As if the scene was taken out of “Mr. Smith Goes to Washington”, the 13 hour filibuster by Texas State Senator Wendy Davis succeeded in killing SB537 by minutes. The vote failed to happen in the allotted time killing the bill for the time being. While filibustering the passage of the bill, Texas State Senator Wendy Davis could not visit bathroom facilities, take a sip of water, lean on any pedestal or desk, receive assistance from anyone else, and had to remain on issue.

“On Monday, the Texas State House voted overwhelmingly to pass a draconian proposal Texas SB537 that would ban all abortions after 20 weeks, as well as adding stringent new restrictions on how clinics get licensed. The intent was clear: Supporters of the bill, known as SB 5, openly acknowledged that the law would have closed 37 of the state’s 42 clinics, leaving hundreds of thousands of women in Texas and neighboring states like Oklahoma with no way to access abortion care. With a conservative majority in the State Senate and the support of Governor Rick Perry, the measure seemed certain to become law.”

The vote happened at 12:02 PM two minutes too late to be passed. Attempts to postdate the time to earlier than 12:00 PM by Republicans met with challenges from the Democrats and the Media until the time was conceded.

Raised by a single mom and at 19 a single mom herself, Texas State Senator Wendy Davis has been leading the charge for women’s choice. The impact of her challenges has been felt with her offices allegedly being fire-bombed due to her support on Planned Parenthood. 31% of the women in Texas are uninsured. The passage of this bill would have closed down 37 of the 42 abortion clinics in Texas leaving residents of Texas and Oklahoma with few places to turn to.

The closure would not only place an undeserved economic burden on pregnant women who would have no place else in which to turn. The closures would have come on top of state-directed counseling designed to discourage them from having the procedure, a mandatory ultrasound where the provider describes the fetal image and a mandatory 24-hour wait.

It is not too often we see a person with the courage literally take a stand in a hostile environment for what they believe is right.

Mr. Smith: “I always get a great kick out of that part of the Declaration of Independence. Now you are not going to have a country that can make these kind of rules work, if you do not have men that learned to tell human rights from a punch in the nose.”

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The Solution to the Economy: Raise Social Standards and Social Efficiency

Guest post by Edward Lambert as taken from his Blog Effective Demand

Yes, the economy is a concern. There are problems to sort out. The problems run deep. What is the solution?

The solution to the problems of the economy will be found through “Social Efficiency” and raising the social standards that have been declining through the years. I will present 3 examples of lowered social efficiency, grade inflation in schools, the minimum wage and finally low interest rates. My purpose is to show that nominal interest rates need to rise, but that real wages must rise in unison too. 

Grade Inflation at Yale University

Let’s go to Yale University and see an example. Yale is currently working on a solution to its grade inflation. Grade inflation is when more students get A’s than before.

“…a full 62 percent — nearly two-thirds — of grades awarded in Yale College, the university’s undergraduate school, are A or A-. (That wasn’t case four decades ago, when just 1 out of 10 grades awarded fell in the A range.)”

Grade Inflationb

This quote is taken from an article about the problem of grade inflation at Yale. There is a comment below that article by Adam Glover. . .

“What do they call the person who graduates first in their medical class? Doctor
What do they call the person who graduates last in their medical class? Doctor
Rather than worrying about grades, I’m more concerned that students are sacrificing real learning for a better GPA.”

The problem is that standards, and more importantly, Social Standards of quality have been lowered. The issue of grade inflation at Yale is just one isolated example of declining Social Standards around the world. Just this week we see cheating in the schools of China is rampant, even as parents try to bribe teachers so their children get better grades.

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