Wednesday, June 23, 2010

Too Important to Fail

When the banks and brokerage houses almost imploded the economy through their chicanery, selling clueless investors mortgage-backed securities which the banks subsequently bet would be worthless, a rallying cry went up. "The banks are too big to fail!" And they were. So instead of the government breaking them up and regulating them as they should have done, the feds instead bailed them out to the tune of hundreds of billions of dollars. Taxpayer dollars. OUR dollars.

Of course, the banks and hedge funds have recovered now. They're back to minting money by doing the same old things they have always done. Mayor Bloomberg thinks this is a good thing, because as far as he's concerned, we should be thanking the bankers for having the grace to pay taxes like the rest of us. Many of us ungrateful citizens have neglected our civic duty to genuflect before the bilionaire class, mostly because many of us are unemployed, underemployed, or facing the threat of layoffs. It's hard get down on our knees when we're down on our luck. The attitude of gratitude takes a back seat when our homes are being repossessed and our furniture is being put out on the street.

I will admit that Obama did what he had to do to keep the country's economy afloat. The banks were too big to fail. But now we face a calamity of a different sort, much of which was precipitated by the bankers and their crushing effect on the economy.

We are facing a new crisis in education. As many as 300,000 teachers may be laid off nationwide. If that happens, class sizes will explode. Programs will be cut. Neighborhoods will be harmed. Teachers will leave the profession for good. The public education system as we know it will begin a prolonged downhill spiral from which it may never recover. An entire generation of young people will be cheated of a proper education because of a lack of funding.

All except the children of the wealthiest people, of course. Their kids are privately educated.

This could largely be avoided if President Obama and the congress got their acts together and pushed for the education stimulus bill that is currently languishing in the senate. The total cost of this bill would be about 23 billion dollars, or about thirty times less than the bank rescue cost us. It would prevent 300,000 teachers from joining the ranks of the unemployed.

Passing the education stimulus bill seems a no-brainer. It saves jobs, preserves schools, and costs a fraction of what it cost to save the banks. So what's holding it up? My guess it that education just doesn't seem too big to fail--at least not to the bureaucrats. What does it matter if a bunch of teachers lose their jobs? A lot of folks have lost theirs. And bigger class sizes? Well, those teachers who get to keep their jobs should just be happy that they're employed. If kids fail because their schools can't support them, well, that's just too bad. To the congress and the Obama administration, no school is too big to fail.

I'd argue, however, that each school, and the education system as a whole, is too important to fail. What good will financially sound banks be to a generation that can't compete in the global economy? It seems to me that supporting already wealthy bankers while allowing our children to go begging is precisely the wrong approach.

While it's fair to blame the politicians, we must also take some of the blame upon ourselves. We've allowed Washington and Wall Street to frame the debate. We argue whether senior teachers or newbies should be laid off, when we should be arguing that teachers are a resource every bit as important--in fact more important--than hedge funds to the future of our economy. Not one teacher should be laid off while bankers feast at the public trough.

Education is too important to fail. What shall it profit a nation to preserve the banks while losing its future?


NYC Educator said...

I'm afraid the nation's leaders see things very short-term. While they don't give a damn about us or our children, or preserving the middle class, they are really ruining the country with the same stupid ideas Bush used before President Hopey Changey took office.

NYC Educator said...

My point is this is not in their interest either--but they're too busy letting us eat cake to realize it.

MSSocialStudies said...

What is your take on the vote to get rid of the 5th and 8th grade social studies tests today? I'm unsure if this is good or bad for us social studies teachers. There is no way we will be off the hook for good. I have a feeling I'll be asked to teach a lot of ELA test prep next year...

Esteban Rodriguez said...

Mr. Talk,

You have it absolutely right, education is too important to fail. I have this creeping feeling that a bill will pass though. I don't think any politician want to see a bunch of teachers, educators, students and parents protesting on TV in September before the midterm elections.

However, I'm sure they are waiting until state governments wring every concession they can out of teachers.

Look what happened in NY. The legislature passed some radical changes to tenure and testing in order to get the Race to the Top money while the threat of layoffs in NYC scared the hell out of the general public. Then, magically the mayor found the cash to keep teacher's from being laid off.

BTW, MS Social studies,

Thank god they are thinking of axeing the S/S test in the fifth grade. I always thought it was such a big waste of time getting my kids to prepare for the test in November. Especially, when my administration for the last three years didn't even share the results with the teachers.

Esteban Rodriguez said...

Ugh! I apologize for the errors. It must be getting late.

Mr. Talk said...

MsSocial: I'm afraid there is no good news for any teacher as long as we have Mulgrew collaborating with BloomKlein. If they do away with SS testing, they will come up with some cheaper and perhaps even less reliable way of evaluating teachers.

My guess is that since many teachers will not have a test on which to be evaluated, it will ultimately be left to the interpretation of the principal. If your school decides to use portfolios as a measure, your principal can always find something wrong with them.

reality-based educator said...

The banks were NOT too big to fail.

Had they let AIG's counterparties go down, there would have been pain and heartache for lots of people, but ultimately that would have been a lot more cleansing systemically than what Bush/Obama did.

The system is STILL set up for collapse as the boys at Goldman, JP Morgan et al. continue to rig the Wall Street casino, overleverage, make risky bets, etc.

You can be sure that there will be ANOTHER crash, perhaps worse than the last one, and this time the gov't won't be able to bail the banksters out.

See here for what brings us to the next calamity:

And of course this has been enabled by the corporate crooks in BOTH parties -- and that includes President Hopey/Changey who got a financial reform bill that does nothing to forestall the next crisis and in Barry Ritholtz's words today at the The Big Picture wouldn't have stopped the last one.