UT's Plan to Promote On-Time College Degrees: Will Financial Incentives Help?

The good folks out at Texas's other flagship research university have concocted a plan to create incentives for undergraduate students to complete their degrees on time. The university will forgive portions of students' unsubsidized federal student loans (those are the student loans that accrue interest while the student is in school) for students who stay on schedule to complete their degrees. The press release announcing the plan says, in part:

The University of Texas at Austin is testing a program to measure whether students can be encouraged to complete their degrees quickly by offering them forgiveness of the most expensive loans they must borrow to attend the university....

For this pilot project, the university will select 200 freshmen entering in the fall of 2013 who have been awarded Federal Direct Unsubsidized Loans on the basis of financial need. Half of the students would be offered loan forgiveness in the amount of $1,000 on the principal, plus interest accrued if they successfully complete 15 hours of their degree requirements by the end of each semester. The other half would be offered $2,000 in forgiveness, plus interest accrued, if they successfully complete 30 hours of applicable degree requirements by the end of the academic year.

UT's goal to increase timely completion of students' degree programs is laudable. Yet, I doubt that this program will successfully reduce students' time to completion.

In-state tuition at UT is roughly $10,000 a year for in-state students and $25,000 annually for out-of-state students. Throwing in room, board, fees, books, transportation, and other costs, and Texas residents can can expect to spend over $24,000 a year to attend UT with nonresidents shelling out between $40,000 and $50,000 annually. An incentive of $2,000 for staying on track to complete a degree in four years is great and all, but it amounts to something like 2-4% of the average cost of attendance at UT. If a student is not dissuaded from extending their time at the University of Texas by the relatively large price-tag of staying an extra year (or two), it seems unlikely they will be convinced to do so by the pilot program's relatively modest tuition rebate.

A bigger problem is that the program seems to misconceptualize why students aren't finishing degrees on time in the first place. Students (and their families) have huge financial incentives for finishing degrees on time. By doing so, they avoid the expense of additional education and earn the ability to work full-time with the wage premium that accompanies a college degree. Many students stay in school longer than four years despite costs (and opportunity costs) for doings so that are orders of magnitude larger than the UT pilot program's rebate. The problem, therefore, is unlikely to be redressed by marginal and naive price adjustments.

In my experience, many students who extend their time in college beyond four years tend to fall into one of two categories. The first are students who were not academically or personally ready for college when they arrived as freshmen and have stayed beyond a fourth year to re-take courses they failed or did poorly in when they first arrived. The second are students who got off-schedule due to various circumstances beyond their control: illness, childbirth, financial problems that required leaving school or taking on paid work at the expense of a full course load, etc. Neither of these groups are likely to be pulled onto a four year degree program by the lure of a couple of thousand dollars of tuition remission.

Instead, universities, including UT, will have to do the harder work of making sure that incoming freshman are placed in appropriate courses given their level of preparedness (including remedial courses if need be) and providing services and support to students with common personal and economic problems to help them stay on track for timely completion of degree programs when possible or to return to a normal academic program as soon as possible. These tasks are especially daunting for public institutions like UT and Texas A&M, who have limited control over their own admissions and enrollment given various state mandates. Yet, universities that take seriously their educational missions in general, and the growing imperative to help students manage the costs of their education by completing their degree programs in a timely fashion in particular, should not be satisfied with superficial efforts. Indeed, a serious effort to investigate the problem of extended degree completion, to understand its causes, and to develop effective interventions should be a top priority for UT and higher education as a whole.

Income Taxes, Payroll Taxes, and the 47%

Yesterday, Mike Bailey from Georgetown University (h/t Brendhan Nyhan) discussed results from a YouGov survey which finds that 78% of Americans believe they pay income taxes, even after they have been primed to consider the distinction between "income taxes" and "payroll taxes."

When Mitt Romney’s 47% comments came to light, many were surprised that Romney’s claim that only 47% of households pay income taxes is, in fact, true....

What’s going on, of course, is a disjuncture in the technical and ordinary usage of the term “income tax.”  Technically, the income tax is a progressive tax on income that does not include the “payroll taxes” paid to support Social Security and Medicare.  In ordinary usage, however, these payroll taxes are often considered federal income taxes – after all, on April 15, payroll and income taxes are rolled into the bottom line owed to the federal government....

The most recent YouGov/Economist poll asked, “Do you pay federal income taxes?”  Seventy-eight percent said they do. Given that about 54 percent of households pay federal income tax that suggests roughly 24 percent of respondents report that they pay federal income taxes, but do not.

The upshot, as the title of Bailey's post reports, is that only 22% of Americans know that they are part of the 47% that pays no income tax. The result is interesting and suggests that Mitt Romney has a bit of a rhetorical advantage on the issue of distributing the tax burden since more than half of the people indicted by Romney's 47% comment don't think he's talking about them. Bailey adds a bit of an editorial to this analysis, though, criticizing Mitt Romney for being disingenuous about the income tax/payroll tax distinction.

What this means is that there is important political slippage between the tax policy debate in Washington and the way it is heard by many Americans.  For Romney, this slippage is convenient as discussing income taxes as if they were all or even a majority of federal taxes paints the current tax system in a particularly unfavorable light.

Convenient is not correct, however.  Everyone who discusses taxes should report the full context on taxes so that Americans working with common sense views of income taxes are not misled.

I completely agree with Bailey that the American people deserve a full and fair reporting of the context of the national debate on taxes. Respectfully, though, I disagree with him about the source of the "slippage" in the way many many Americans understand their federal tax burdens.

In fact, most of the misunderstanding about "income taxes" versus "payroll taxes" arises directly from the existence of a "payroll tax" that is separate from the "income tax" in the first place. The problem is worse than that, though. The the federal government often refers to payroll taxes as "contributions" that individuals make to "earn" various "insurance" payments. Indeed, the federal that authorizes payroll taxes is called the Federal Insurance Contributions Act (FICA).

If the payroll tax is just an income tax by another name, why isn't it just called an "income tax" and included as part of the rest of workers federal income taxes?

It is no accident. The framers of the Social Security program intentionally separated the system of taxation that would support retirement insurance from the rest of the federal government's revenue collections. They didn't want workers to think of FICA payments as ordinary taxes. They wanted to create the illusion that working people were paying into a system to "earn" benefits that would be paid back to them later rather when they retired. Of course, Social Security does not work like that. It works like any other welfare program. People who are working now pay taxes to fund payments to people who are now retired. When those of us who are presently working retire in the future, our Social Security payments will be funded by taxes collected from people who are working then.

The separation of "federal insurance contributions" from income taxes was an intentional effort to obfuscate the nature of the Social Security program (and, later, Medicare) to insulate the programs fro subsequent political opposition. As President Franklin Roosevelt famously explained:

We put those payroll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program.

Roosevelt knew exactly what he was he was doing. By "submerging" this part of the state, Roosevelt and the other parents of Social Security (and subsequently Medicare) successfully and fundamentally shaped the way that most people think about their payroll taxes and old age entitlements. A quick conservation with nearly anyone who is retired or near retiring will almost certainly show you that she thinks---no matter how conservative she may be otherwise---that she has a "right" to the Social Security and Medicare "benefits" that she "earned" by making her "contributions" over her whole working lifetime. This sentiment is not some abstract social contract business in her mind. It is a concrete, transactional and contractual reality.

The folks who are down on Mitt Romney for blurring the distinction between payroll taxes and income taxes and who also support continuing Social Security and Medicare in their present form as near universal, publicly financed entitlements through separate payroll taxes are trying to have their cake and eat it too. Mitt Romney's rhetoric about the 47% assumes a distinction in the contributions that people make to the federal government that was created by political liberals to manipulate public perceptions of massive transfers of income in order to insulate those programs from political attacks. Romney did not create that distinction and, to the extent that Republicans' desire to debate and reform old age entitlements are frustrated by the distinction, he and his party do not benefit from it.

So, by all means, let's have an open, fully contextualized debate about federal tax policies. But, the openness should start by recognizing that "federal insurance contributions" are just ordinary income taxes and that Social Security and Medicare are just ordinary income transfers. Unless and until the official and political vocabulary used to describe the nation's old age entitlements changes, we should not be surprised that many Americans misunderstand the nature of their tax obligations. Likewise, those who support the separation of income taxes and payroll taxes to protect old age entitlements from political opposition have little room to criticize politicians who try to capitalize on that separation for other purposes.

Texas A&M's proposed stadium expansion: Does this seem like a good idea?

The Texas A&M University System (TAMUS) is proposing to spend $425-$450 million to expand and renovate Kyle Field, the football stadium on the system's flagship campus here in College Station. To help fund the project, TAMUS has asked area local governments (the city of College Station, the City of Bryan, and Brazos County) to pitch in $38 million. If the local governments fail to pay up, TAMUS has threatened to relocate home football games during the renovation. A recent study commissioned by the Bryan-College Station Chamber of Commerce claims that relocating Texas A&M home games for a season would cost the area $63 million in direct business activity.

A few thoughts:

1. The proposed stadium expansion will cost a minimum of $425,000,000 to add a maximum of about 15,000 seats to the stadium. Average season ticket prices are now $360. Presuming the project actually produces the maximum expansion at the minimum cost, the expansion would generate $5,400,000 of extra ticket revenue each season at current season ticket prices. At that rate, the expansion would pay for itself in just under 79 years. Even if we double the marginal revenue estimate to $10,800,000 to account for concessions, increased ticket prices in the newly renovated stadium, etc., the project would still take almost four decades to pay for itself. Obviously, the situation is more complicated than that since I have not accounted for inflation, borrowing costs, the potential to sell naming rights, etc., but even these rough calculations show that it will take a long time, even under favorable circumstances, to recapture the expense of the stadium expansion.

2. Where in the world will TAMUS get half a billion dollars?

3. The costs of the renovation are staggering---an up-front estimate of nearly half a billion dollars. The opportunity costs are even more staggering. What else could the university or the state of Texas buy for half a billion dollars?

Just for comparison, Texas A&M bought Texas Wesleyan University's Law School for $25,000,000 (depending what you count) and TAMUS will start up a national center for researching and manufacturing vaccines for $285,000,000. So, for the same amount of money TAMUS wants to spend on adding 15,000 seats to the football stadium, it could build another national vaccine research and manufacturing center, buy five law schools, and still have $15,000,000 to kick around.

4. What are the savings from shuttering Kyle Field for a year during the renovations? The stadium as currently configured holds about 87,000 people, paying an average of $360 per season. That's $31,320,000 a year plus concessions, parking, etc. If the team leaves town, that's almost certainly fewer ticket sales plus sharing revenue with the owner of another venue, the cost of managing "home" games in another city, etc. Even if local governments don't buy a home season for $38,000,000, its seems like the financial incentives for moving a season might be pretty spare.

5. The Oxford Economics study of the impact of losing a home football season claims that the direct economic cost of a season away would be $63,000,000 and the total (direct and indirect) loss would be $86,000,000. Taking the study totally at face value, it is still not self-evident that local governments should pay $38,000,000 to buy a home season from TAMUS. The estimated losses are revenue figures. Not all of that money stays in town. A lot of leaves for out-of-town wholesale suppliers, etc. Even the report admits that the $86,000,000 figure includes only $21,000,000 in lost household income. Meanwhile, the $38,000,00 season ransom would be a real out-of-pocket expense for the local communities, which would mean that much less money in the local economy to begin with. It's not immediately evident to me that buying a home football season at that price is a good deal for the affected communities.

6. Colorado State University wants to spend $250,000,000 to build a stadium from scratch. The University of Houston's new stadium is expected to cost $105,000,000. Why does it cost 2-4 times as much for TAMUS to expand its stadium capacity by about 10-15% as it does for other institutions to build new facilities from scratch?

Diplomatic Security in Libya

I am no expert on international security, but Susan Rice's appearance on This Week seems to cast a pretty unfavorable light on the administration's handling of security for the American diplomatic mission in Libya in a pretty poor light.

First, the administration's claim that the attacks at the U.S. consulate in Benghazi and at other American diplomatic facilities around the world last week were totally spontaneous and uncoordinated is contradicted by a variety of independent reports. The UK's Independent reports that the United States received specific warnings about attacks in Eqypt and Libya at least two full days before the riot in Cairo and the assault in Benghazi. CNN reports that Libyan officials had warned American diplomats that the security situation in Benghazi was unstable. The president of Libya claims that post-attack investigations leave little doubt that the assault on the consulate was planned.

If the administration's line is not correct, then the United States either failed to act on (general or specific) warnings about emerging danger in Benghazi or failed to detect a serious security threat to its diplomatic mission in Libya.

Even if the administration's line is correct, it's attitude toward security in Libya seems pretty flip. Ambassador Rice admitted that there was no military security at the consulate in Benghazi  or the embassy in Tripoli, claiming that the "circumstances" didn't indicate that level of security and that the Libyan diplomatic mission was "relatively new."

Unlike other embassies around the world, Rice said there were no Marines present last week to protect the consulate in Benghazi, or the main U.S. embassy in Tripoli, saying the U.S. presence there is “relatively new” since the revolution that overthrew former dictator Moammar Gadhafi.

“There are not Marines in every facility. That depends on the circumstances. That depends on the requirements,” Rice said. “Our presence in Tripoli, as in Benghazi, is relatively new, as you will recall. We’ve been back post-revolution only for a matter of months.”

Again, I am not a security expert, but Libya is obviously a country under a tremendous amount of stress. It deposed its long-time dictator only a few months ago and a variety of internal and external forces have been jockeying for influence and power ever since. So, we have an unstable country with lots of heavy weaponry from a revolt floating around and foreign and domestic Islamists trying to stake out claims on the new Libyan state and the "circumstances" don't justify Marine guards for U.S. diplomatic missions? Or, maybe they did and the State Department just didn't have time to get around to it over the last few month?

The claims that the circumstances didn't justify military security and that the mission was too new to have set such security up are not necessarily exclusive, but Ambassador Rice's statements imply that there was a determination that no such security was necessary and that there was a failure to setup such security in time. Together, they leave me wondering exactly how military security is allocated to U.S. diplomatic missions in general and what didn't work in Libya.

All told and the presidential campaign aside, there are serious questions still unanswered about the attack in Benghazi and the murder of Ambassador Christopher Stevens.

If Zakaria Plagiarized Lepore, Did Lepore Plagiarize Cramer?

As the New York Times reports here, Time magazine writer and CNN host Fareed Zakaria has been suspended from both of these positions for a month after he admitted plagiarizing an essay by Harvard University historian Jill Lepore in an column he wrote for Time. Zakaria has admitted that he made a "terrible mistake" and a "serious lapse," and he has been suspended from Time and CNN. I don't read or watch Zakaria on anything like a regular basis, and he apparently has a history of "borrowing" from other journalists' work. Whatever.

According to the New York Times, here is Lepore's original (which you can also read, in full, here):

As Adam Winkler, a constitutional-law scholar at U.C.L.A., demonstrates in a remarkably nuanced new book, “Gunfight: The Battle Over the Right to Bear Arms in America,” firearms have been regulated in the United States from the start. Laws banning the carrying of concealed weapons were passed in Kentucky and Louisiana in 1813, and other states soon followed: Indiana (1820), Tennessee and Virginia (1838), Alabama (1839), and Ohio (1859). Similar laws were passed in Texas, Florida, and Oklahoma. As the governor of Texas explained in 1893, the “mission of the concealed deadly weapon is murder. To check it is the duty of every self-respecting, law-abiding man.”

And, here is Zakaria's (and here's the link to the full Time piece):

Adam Winkler, a professor of constitutional law at UCLA, documents the actual history in Gunfight: The Battle over the Right to Bear Arms in America. Guns were regulated in the U.S. from the earliest years of the Republic. Laws that banned the carrying of concealed weapons were passed in Kentucky and Louisiana in 1813. Other states soon followed: Indiana in 1820, Tennessee and Virginia in 1838, Alabama in 1839 and Ohio in 1859. Similar laws were passed in Texas, Florida and Oklahoma. As the governor of Texas (Texas!) explained in 1893, the “mission of the concealed deadly weapon is murder. To check it is the duty of every self-respecting, law-abiding man.”

So, here's the question: Did Zakaria actually plagiarize?

Though many institutions and organizations have distinct definitions, in general, I understand plagiarism to be the representation of someone else's intellectual work as your own. In this case, the intellectual work being reported by both Lepore and Zakaria is Adam Winkler's.

Zakaria clearly cites Winkler's historical work.

Does his close paraphrasing of Lepore's paragraph summarizing Winkler's work require an additional citation?

Lepore's paragraph does not make an intellectual contribution distinct from Winkler's book. Though her essay uses the paragraph to support a unique intellectual effort, the summary of Winkler's work, taken alone, is not something that need be cited.

Indeed, Lepore's summary of the early state gun control laws is a fairly close paraphrase of Winkler's original. Here are key sentences from Winkler’s book, Gunfight, that Lepore summarizes, perhaps paraphrases, in her New Yorker essay:

No gun control law was more common in the late 1800s—on the frontier and elsewhere—than bans on concealed firearms.  According to the gun rights historican Clayton Cramer, concealed carry laws were among the earliest type of gun control laws adopted in the years after the American Revolution. The first bans on possession of concealed weapons in public were adopted in Kentucky and Louisiana in 1813. Indiana banned concealed carry in 1820, Tennessee and Virginia in 1838, Alabama in 1839, and Ohio 1859 (p. 166)… The intent of these laws was the same as that of many forms of gun control today. As Governor James Stephen Hogg of Texas said at the time, the “mission of the concealed deadly weapon is murder. To check it is the duty of every self-respecting, law abiding man” (p. 167).

As Winkler makes clear, the history of early state gun laws is not his own work. Rather it is due to Clayton Cramer.

This is from Cramer's book Concealed Weapons Laws of the Early Republic (an online excerpt from the book on his website http://www.claytoncramer.com/books/concealed.pdf).

The adoption date for the state laws prohibiting or regulating the concealed carrying of deadly weapons in the early Republic would appear to be: Kentucky, February 3, 1813; Louisiana, March 25, 1813; Indiana, January 14, 1820; Georgia, December 25, 1837; Tennessee, January 27, 1838; Virginia, February 2, 1838; Alabama, February 1, 1839 (p. 2).

The source of the quotation from Governor Hogg used by Winkler is Gun Violence in America: The Struggle for Control  by Alexander DeConde (p. 98), though it is available elsewhere.

Winkler cites Cramer as the source of his summary of early state gun laws and paraphrases him and also takes a quote from DeConde. Lepore cites and paraphrases Winkler (making Winkler seem like the source of the original historical facts), but fails to cite either Cramer or DeConde. Zakaria cites Winkler and paraphrases Lepore but fails to cite Lepore, Cramer, or DeConde.

Is Zakaria a plagiarist? Is Lepore? Is Winkler's phrasing of the date summary too much like Cramer's?

No. No. No.

Everyone involved in this episode, such as it is, are making reference to historical facts, which are usually (but not always) subject to a "common knowledge" exception to most citation requirement. Here, though everyone is citing their own immediate source of the information they are passing on so that careful and interested readers can track the provenance of the historical record. No one is copying anyone else word for word, and everyone is describing a simple chronology that cannot help but be described in very similar language. (Go ahead and try to write a few sentences that describe the order in which states adopted these laws or ratified the Constitution or whatever and see if you don't come up with something similar.)

At the end of the day, Winkler did nothing wrong in summarizing Cramer and DeConde's work. Lepore did nothing wrong in repeating Winkler's summary. Zakaria did nothing wrong in passing along that summary of historical facts (except, given his admission of cribbing from Lepore, not reading Winkler's book).

Plagiarism is, of course, very serious business in journalism, academia, and any other intellectual enterprise. Zakaria was certainly flirting with plagiarism by closely paraphrasing and nearly copying Lepore's essay. Yet, he did not, in fact, copy her writing exactly. Instead, he repeated the same historical facts she did and cited the source from which he understood them to be drawn. Zakaria's work is poor journalism for failing to actually check his source, but it is not plagiarism.