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Young Americans are caught between two contradictory messages. On one hand, they’re told to go to college, to maintain pace with new technologies and job requirements. On the other hand, they’re told to “get out”—because, for most, a college education is simply unaffordable.

The American Dream, for them, looks more and more like “the sunken place.”

The Institute for Higher Education Policy [ht: mfa] is the latest group to document the unaffordability of a college education. While students from the highest income quintile (from families earning around $160 thousand or more) can afford most of the more than 2,000 colleges studied, low- and moderate-income students (bringing in around $69 thousand or less) can only afford to attend a tiny percentage of those colleges.

The Institute bases its conclusion on an “affordability benchmark” (the so-called Rule of 10, the idea that 10-year savings plus part-time earnings should cover the entire cost of a four-year degree) compared to the net price of a college education (equal to the cost of attendance minus grant aid). They then illustrate their findings with ten student profiles: five dependent students representing a different income quintile, and possessing attributes based on national averages for students in their quintile (Sonja, Hakim, Ava, Sergio, and Maria), and five independent students characterizing the diverse array of personal and family circumstances among independent students (Anthony, Traval, Aneesa, Jon Sook, and Mohammed).

As readers can see from the figure at the top of the post, while the student from the highest income bracket could afford to attend 90 percent of colleges in the sample, the low- and moderate-income students with fewer financial resources could only afford 1 to 5 percent of colleges.

Colleges were most dramatically unaffordable for students near the bottom of the income distribution, including all five of the independent students. Out of more than 2,000 colleges, nearly half (48 percent) were affordable for only the wealthiest student (with a family income over $160,000) and more than one-third (35 percent) were affordable only for that student and the next wealthiest (with a family income over $100,000).

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Not only do working-class students face financial barriers in attempting to enroll in most colleges, which they can only afford by burying themselves and their families under mountains of debt. They’re also far less likely to complete their students, often because working long hours to finance their education gets in the way of their studies (not to mention all the other activities traditionally associated with being in college).

As the authors of the report conclude,

This inability for low-earners to afford an education or improve their station erodes belief in a nation founded on the rejection of entrenched social stratification.

The only question for the nation is, will this educational horror film have a happy ending?

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We don’t need Louisiana Detective Rodie Sanchez coming out of retirement to solve the crime against the members of the working-class currently being committed in the United States.

We already know many of the details of the crime. We also know the identities of both the victims and the serial killer. The only real mystery is, what’s the country going to do about it?

The investigation itself is being painstakingly carried out by Anne Case and Agnus Deaton (pdf). They show, with abundant statistics, that mortality trends in the United States run counter to those in other rich countries, where they have been steadily declining for decades.

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The headlines, of course, have been about one group—middle-age white non-Hispanics with a high-school degree or less—whose mortality rates, especially those attributed to “deaths of despair” (drug overdoses, suicides, and alcohol-related liver mortality), increased from 1998 through 2015.* The focus in on that group for a number of reasons, including the fact that increasing rates for them (as against blacks and nonwhite Hispanics) have all but erased the racial gap in mortality among non-college-educated Americans—and, of course, because of the prominence of “white working-class” voters in explanations of Donald Trump’s electoral victory.

But we also need to go beyond the headlines and understand that, while rates for different ethnic and racial groups in the United States have moved in opposite directions in recent decades, the rates for working-class blacks and Hispanics are still very high—and, in recent years (as can be seen, in the case of blacks, in the chart at the top of the post), they’ve also begun to rise.

That’s the real crime story. All three groups within the American working-class—whites, blacks, and Hispanics—are being killed at abnormally high rates compared to the populations of other rich countries.

And the serial killer? Case and Deaton have a much more difficult time working in this area. That’s because they follow the headlines and emphasize the differences in the long-term trend rates and lose sight of the larger picture. So, they discount the role played by income inequality and, instead, endorse Charles Murray’s story about the decline in traditional American virtues among working-class whites (which I wrote about back in 2012).

The fact is, the labor-market factors identified by Case and Deaton—which have negatively affected whites, blacks, and Hispanics with a high-school degree or less—have become more severe as inequality has soared and the social safety net ripped apart in the United States from the early 1970s onward. The upward trend for whites and the narrowing of the racial gap, as significant as they are, shouldn’t hide from view the more general problem (as I wrote about in 2015) of a large and growing gap between the life expectancies (for both men and women) of those at the top and bottom of the distribution of income in the United States.

American TV is currently captivating viewers with stories of people accused of committing horrific acts. It’s time, however, to focus on the story of an economic system that has created its own killing fields.

 

*Mortality increases for whites in midlife have also been paralleled by morbidity increases, including deteriorations in self-reported physical and mental health, and rising reports of chronic pain.

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Image  —  Posted: 26 March 2017 in Uncategorized
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Trickle-up economics, by any other name. . .

According to a new study of the distributional effects of the Republicans’ American Health Care Act (as introduced on 6 March 2017 and modified on 21 March 2017) by the Urban Institute and Brookings (pdf),

Upper-income families would receive net benefits from the tax and spending changes proposed in the AHCA, and lower-income families would experience net losses. Higher-income families benefit the most from the tax cut, with 70.6 percent of the tax reductions in 2022 received by those with incomes over $200,000 and 46.2 percent of the tax reductions received by those with incomes over $1,000,000. Reductions in federal funding for health benefits would hurt lower-income families the most; families with incomes below $30,000 would sustain more than three-quarters of the losses in benefits. Taking both tax and benefit changes into account, the largest average gains under the AHCA would go to those with the highest incomes ($5,640 on average for those with incomes over $200,000), and the largest average losses from the AHCA would go those with the lowest incomes.