An International Final Four: Which Country Handles Student Debt Best?

From today’s New York Times:

Although an American college degree remains a good investment on average — the higher earnings for most graduates justify the cost— millions of borrowers are in default on their loans.

Policy analysts generally agree on a need for reform, but not on which path policymakers should take. Can America learn anything from other nations? We gathered experts with a range of perspectives, from America and abroad, and asked them to compare the systems in Australia, Britain, Sweden and the United States.

We chose this grouping of nations because they highlight important differences both in loan repayment systems and in related policies such as tuition and loan limits, not necessarily because they all belong among the best systems in the world. In the spirit of March Madness, we devised a bracket-style tournament, seeding the countries so that those with more similar systems would meet in the semifinals.

Sweden vs. United States

Sweden and the United States differ in whether the monthly loan payment remains the same over time and in the number of years borrowers can repay their loans.

The average American borrower with a bachelor’s degree leaves college with $28,400 in debt. Students can borrow for both tuition and living expenses, although loan limits make it hard for an undergraduate to borrow more than $45,000 over four years.

In Sweden, average debt levels are similar — the equivalent of around $21,000 — even though students borrow only for living expenses (Swedish universities do not charge tuition). Interest rates are also very low; the rate for 2018 is now 0.13.

In the United States, borrowers are required to begin making payments six months after leaving college. By default, payments are set so the whole principal and interest, which is tied to the market rate at the time the loan is made (currently 4.45 percent), will be paid off in equal monthly installments paid over 10 years.

American borrowers can opt into alternative repayment plans, including plans that tie payments to income or that start lower and increase over time. Income-based plans offer forgiveness of any remaining balance after 10 to 25 years, but enrolling in these plans requires making a request to the servicer and filing paperwork annually. If you miss the paperwork, you are put back into a 10-year repayment schedule, but can ask to re-enroll. There are a large number of plans that are hard for borrowers to navigate, especially in times of financial stress.

Swedish borrowers, on the other hand, pay off their loans over a much longer period. Borrowers can be in repayment for up to 25 years, with the typical borrower paying for 22 years.

Read the complete article here.

Tariffs bad news for American economy, including workers and consumers

From today’s The Hill:

There’s never a good time for tariffs. American workers and consumers will pay dearly for the Trump administration’s short-sighted action to protect an industry that shows no signs of needing any protection—the market values of the five largest steel companies have more than doubled over the past five years. Yet with a major infrastructure spending bill set to come through Congress over the next year, Trump’s tariffs are bad policy with even worse timing.

While a small amount of people will benefit from the proposed tariffs, many more will be harmed. The American steel industry employs roughly 140,000 workers, but industries that rely on steel to create their products—the ones who will suffer directly under the tariffs—employ 6.5 million workers. A recent study by the Trade Partnership found that the direct cost of tariffs on employment would be 18 jobs lost for every one created. On net, 470,000 Americans could lose their jobs.

The Trade Partnership’s study fits with the lessons of recent history. In 2002, President Bush instituted protective tariffs on foreign steel imports. After just a year in which steel prices rose by up to 50 percent, steel production was insufficient to meet demand, 200,000 Americans lost their jobs, and the tariff was dropped. A mere fifteen years later, these lessons have already been forgotten.

Nor will other countries sit idly by as Trump restricts trade. Well over 10 million Americans’ jobs are supported by exports—jobs which would be at risk in the case of a trade war. Already, the European Union has prepared a ten-page hit list of potential targets of retaliatory tariffs should Trump’s steel and aluminum tariffs go into effect.

American consumers will be harmed as well. A combination of new steel tariffs and lumber tariffs imposed last year mean that the cost of new homes is likely to continue rising—nearly half of steel imports go towards construction. Other American staples such as cars and canned beer are also set to see price spikes resulting directly from tariffs.

Read the complete article here.

Will Trump’s Tariffs Help or Hurt American Workers? Contrasting Views

From the New York Times:

The Case for Trump’s Tariffs and ‘America First’ Economics

Robots Are Coming, and Sweden Is Fine

From New York Times:

From inside the control room carved into the rock more than half a mile underground, Mika Persson can see the robots on the march, supposedly coming for his job here at the New Boliden mine.

He’s fine with it.

Sweden’s famously generous social welfare system makes this a place not prone to fretting about automation — or much else, for that matter.

Mr. Persson, 35, sits in front of four computer screens, one displaying the loader he steers as it lifts freshly blasted rock containing silver, zinc and lead. If he were down in the mine shaft operating the loader manually, he would be inhaling dust and exhaust fumes. Instead, he reclines in an office chair while using a joystick to control the machine.

He is cognizant that robots are evolving by the day. Boliden is testing self-driving vehicles to replace truck drivers. But Mr. Persson assumes people will always be needed to keep the machines running. He has faith in the Swedish economic model and its protections against the torment of joblessness.

“I’m not really worried,” he says. “There are so many jobs in this mine that even if this job disappears, they will have another one. The company will take care of us.”

In much of the world, people whose livelihoods depend on paychecks are increasingly anxious about a potential wave of unemployment threatened by automation. As the frightening tale goes, globalization forced people in wealthier lands like North America and Europe to compete directly with cheaper laborers in Asia and Latin America, sowing joblessness. Now, the robots are coming to finish off the humans.

Read the complete article here.

Proof Retail Jobs Don’t Need to Be Bad

From today’s New York Times by Eduardo Porter

Bethamy Magrow is grateful that the minimum wage in New York City is rising to $13 at the end of next month. Earning the current minimum of $11 an hour at a Times Square fashion retailer and scheduled to work some weeks for only 19 hours, the 25-year-old sales worker realizes she doesn’t quite clear New York’s poverty line.

It would be nice if her schedule didn’t change so much from week to week, she told me, so she could set up her doctors’ appointments in advance. But at least New York bars retailers from changing the schedule from one day to the next. In any case, jobs she has had at Whole Foods and Pokéworks, a restaurant on Union Square, were no better or worse.

Millions of Americans have similar stories to tell. For all the talk about the “end of retail,” it is one of the largest employers in the country, accounting for about one in eight workers in the private sector. For every miner toiling in the United States, there are almost 25 retail workers. Manufacturing, the apple of President Trump’s eye, doesn’t employ nearly as many.

Typically paying full-time employees less than $33,000 a year, well below the midpoint across the economy, retail jobs have become the work of the lower class, the main source of support for Americans left behind by economic change.

This raises a fairly urgent question: If retail work sets the living standard for so many low-income families, why doesn’t it get more attention?

Read the entire article here.

In the Fight Against Poverty, Work Is Our Most Powerful Weapon

From today’s Harvard Business Review by Leila Janah:

Fourteen years ago, I left suburban Los Angeles to teach English in rural Ghana. I’d expected, like so many young people with bleeding hearts and big dreams, to make a difference by donating my time as a schoolteacher for six months. Upon arrival in the village, I was shocked to discover that my students, avid listeners of Voice of America and BBC radio, already spoke English quite well, and some could speak to me about President Clinton’s state visit to Africa. These were blind or partially sighted kids from families earning less than $3 a day.

How was this possible? I’d learned from countless TV specials on war and poverty in the continent that Africans needed aid. They needed us to send food and clothes and to build wells and schools. But on the ground, almost every poor person I spoke to told me the same thing: “We don’t want aid, we want work.” I spent the next four years studying development economics at Harvard, designing a special major to focus on African development, and later working at the World Bank to further understand the problem of poverty and how to fix it.

My conclusion after all this time isn’t so novel. But it bears repeating because we’ve lost our way: Work is the most powerful weapon we have to fight poverty and all its downstream effects, from child malnutrition to maternal mortality, both domestically and abroad. We need to modernize workforce training, incentivize companies to hire low-income people, and encourage consumers to support those organizations that #GiveWork, not aid.

Last year, the 2,000 largest companies spent an estimated $12 trillion on goods and services, a lot of it directed to suppliers that mine or harvest raw materials or make and grow things in poor countries. The fair trade movement was a strong first step in working to access these reserves of capital to fund poverty reduction directly. Started in the 1950s, it pushed purveyors of commodity goods like coffee, chocolate, sugar, and cotton to adhere to a rigorous set of core principles, including deliberately working in marginalized communities and paying living wages. And the results have been good. For example, Starbucks sources all its European espresso beans from fair trade certified producers, and Dutch company Fairphone sells the world’s first entirely fair trade Android phone, with batteries made from ethically mined minerals.

But I believe we now need something broader and simpler to mobilize companies and consumers to think differently about aid: a model called “impact sourcing,” which pushes for workforces (whether directly employed or employed through suppliers) to be economically diverse enough to include some of the world’s most disadvantaged people. This shift could, by our estimation, lift millions out of poverty in a single year.

Read the entire article here.

Congress Must Act on DACA: The Dreamers Need a Vote, Not Talk

From today’s New York Times by David Leonhardt:

Paul Ryan offered some warm words about Dreamers. Marco Rubio went further, distancing himself from President Trump’s new immigration policy by tweeting a passage from the Bible. John McCain was blunter still, calling the decision “wrong.”

But words aren’t enough. They’re not nearly enough.

Ryan, Rubio, McCain and the other members of Congress have the power to do something in response to Trump’s decision to subject the 800,000 Dreamers — law-abiding people who entered the United States illegally as children — to potential deportation. Congress can pass a law that removes the threat hanging over them and lets them continue with their lives.

If Congress doesn’t act, yesterday’s expressions of concern are mere hypocrisy.

“I have zero patience for empty virtue signalling on this,” Susan Hennesseyof Lawfare tweeted, in response to Rubio. “You’re a member of Congress. Don’t tell us how sad and pious you are; pass a law.”

Greg Sargent of The Washington Post noted that Congress should pass a law quickly, given the uncertainty plaguing Dreamers.

Brad Smith, Microsoft’s president and chief legal officer, said Trump’s move had shifted Microsoft’s lobbying priorities. “The entire business community cares about a tax reform,” Smith told NPR. “And yet it is very clear today a tax reform bill needs to be set aside until the Dreamers are taken care of.” Smith also suggested Microsoft would try to block the federal government from deporting its Dreamer employees.

From the political right, Reihan Salam has argued that Trump’s move creates an opportunity for a bipartisan bill that both helps the Dreamers and rewrites immigration law to admit more skilled workers and fewer relatives of recent immigrants.

It would be easy enough for Congress to pass a simpler bill, focused on Dreamers. The House passed one in 2010. It also won 55 Senate votes — a majority but not enough to overcome a filibuster. Among those who didn’t vote yes: McCain, Lindsey Graham, Susan Collins and two Democrats still in the Senate, Joe Manchin and Jon Tester.

In The Times, Javier Palomarez explains why he quit a Trump advisory board yesterday, Paul Krugman breaks down the economics of the decision and the Editorial Board offers its take.

How the wealth gap between restaurant goers and their servers is​ widening

Andrea Gillette lined up the bottles of fruit-flavored cocktails behind the bar. The guy who leans a ladder against the big chalkboard to write out the day’s fresh fish selection had just about wrapped up.

Floors were swept, sliced lemons were crammed into a plastic bin, the trendy garage-door-style windows facing the shaded patio thrown open. Corey Ahrens brewed coffee.

Chip Kasper, the general manager, called out to the weekday crew at Fish City Grill, a bright, modern seafood restaurant at CityLine, a massive$1.5bndevelopment 20 miles north of downtown Dallas. Anchored by an almost 10,000-worker State Farm campus, CityLine also features a crop of buzzy fast-casual spots, a Whole Foods Market and a salon offering eyelash extension packages for upwards of $300.

It’s one of a handful of projects that have shifted the economic center of gravity of the nation’s fourth largest metro area; as a result, the northern suburbs of Dallas are some of the fastest-growing cities in the country.

“Got nine minutes to pre-shift!”

A little over a year ago, Fish City’s owner was worried this wasn’t going to happen.

In the roughly two decades since Bill Bayne and a partner opened Half Shells – the seed of what would become a chain of 20 restaurants – Bayne said he and his wife, who now own the Fish City company, have made a point to remember the names of workers at every level.

He takes pride in his ability to retain workers in an industry that sees high turnover. Still, as he prepared to open the chain’s outpost at CityLine he encountered an unanticipated hurdle.

He couldn’t find workers.

Bayne recalled sending his longtime kitchen manager, Frankie Argote, to “ride the rails” in search of people who looked like they might be cooks and to restaurants, where he asked managers whether they had employees who might be able to pick up more shifts. Argote recalled coming back and asking his boss, “Do we want to be cooking or serving?” Because he was struggling to find enough people to do both.

“This [location] has been probably the most challenging,” Bayne said.

As major corporate employers have swarmed places such as CityLine and the areas that surround them, a corresponding explosion of restaurants and bars has left business owners such as Bayne tapping into an almost-dry well of talent. Over the last five years, the number of jobs in food services and drinking places in the Dallas-Plano-Irving metropolitan division increased by 30.4%, according to Bureau of Labor Statistics data. That’s almost twice as fast as growth in those jobs nationally, which was 17.9% for the same time period.

But thanks to a range of factors, the fertile job-hunting fields north of Dallas are essentially off limits to many prospective workers.

Read the entire article here.

The Maddeningly Simple Way Tech Companies Can Employ More Women

From the New York Times, August 15, 2017 by Katherine Zaleski:

I am the co-founder of a company that helps clients find ways to diversify their work force. We recently set up an interview at a major company for a senior African-American woman software engineer. After meeting with the hiring panel, she withdrew her application, telling us she felt demeaned by the all-white male group that failed to ask her any questions about her coding skills. She described how one of the men had made it clear to her that she wasn’t a cultural fit and that therefore they didn’t need to proceed with technical questions.

I hear stories like this regularly, as I work with companies in Silicon Valley and beyond who want to bring more women onto their tech teams. Higher-ups declare their intention to hire more women. But the actual hiring is still all too rare.

There’s a continuing debate about the reasons for the lack of diversity in the tech sector, including candidate pools that are mostly male, and stubborn, superficial notions of what it means to be a “cultural fit” for an organization — the template for which is often based on young white men. But at least one small component of this problem is immediately solvable: Many companies are alienating the qualified women who want to work for them, and who they want to hire, during the interview process itself.

While Silicon Valley companies are enthusiastically putting money into STEM programs in schools and nonprofits focused on diversity, with the goal of creating a richer pipeline of talent in 10 years, they’re missing opportunities to make simple, immediate improvements by changing how they communicate with women who are sitting across the table from them now.

Read the entire article here.

In Sweltering South, Climate Change Is Now a Workplace Hazard

From today’s New York Times by Yamiche Alcindor

GALVESTON, Tex. — Adolfo Guerra, a landscaper in this port city on the Gulf of Mexico, remembers panicking as his co-worker vomited and convulsed after hours of mowing lawns in stifling heat. Other workers rushed to cover him with ice, and the man recovered.

But for Mr. Guerra, 24, who spends nine hours a day six days a week doing yard work, the episode was a reminder of the dangers that exist for outdoor workers as the planet warms.

“I think about the climate every day,” Mr. Guerra said, “because every day we work, and every day it feels like it’s getting hotter.”

For many working class people, President Trump’s promise to make America great again conjured images of revived factories and resurgent industries, fueled by coal and other cheap fossil fuels. Such workers gave more of their votes to Mr. Trump than they did four years before to Mitt Romney, helping him eke out victory in November with narrow wins across the Rust Belt. Latino votes fell off for Democrats as well,from the 71 percent that went to Barack Obama in 2012 to the 66 percent that went for Hillary Clinton last year.

But to Robert D. Bullard, a professor at Texas Southern University who some call the “father of environmental justice,” the industrial revival that Mr. Trump has promised could come with some serious downsides for an already warming planet. Professor Bullard is trying to bring that message to working-class Americans like Mr. Guerra, and to environmental organizations that have, in his mind, been more focused on struggling animals than poor humans, who have been disproportionately harmed by increasing temperatures, worsening storms and rising sea levels.

Read the entire article here.