Monday, August 13, 2012

Even Worse Than it Looks: The Path to Prosperity

I'm hoping the 2012 election turns into a battle of ideologies between the Obama and Ryan camps. One can quote stats until the cows come home, but what's really at stake is the American peoples collective vision of the country: Low tax, low government service, minimal wealth redistribution, high economic inequality versus moderate tax, moderate government service, moderate wealth redistribution, moderate economic inequality. Lets say Mexico (0.476) versus Switzerland (0.303), with the US (0.378) as status quo and Denmark (0.248) as a high tax, high government service, high wealth redistribution, low economic inequality reference [1].

I think I understand the ideology underpinning Mr. Ryan's proposal, that government get out of the way and allow individuals to sink or swim on their own merits. I can see how this makes intuitive sense, prima facie. It has that truthiness that warms ones heart in sound bites.

In Paul Ryan, I see a man who has benefited from a tremendous amount of accumulated privilege and entitlement, a man who was born with a low probability of descending into the ranks of America's increasingly permanent underclass [2]. A man for whom, because of his accumulated privilege, meritocracy in America may even seem like a reality. A man for whom, in his single minded pursuit of an ideological lala-land, would disregard the detrimental impact of his proposals on all but the wealthiest Americans.

Fact: 90% of his tax cuts (3) accrue to the top 20% of the US household income distribution, those with incomes above $100,000/year (4).

Fact: He continues a trend of making the US Federal income tax less progressive [5]

Fact: Total taxation rates, not just US Federal Income tax, are a fairer comparison of relative tax burden across income groups. Total Federal, State and Local government expenditures run about 40% of GDP ($6T / $15T) [6].

Fact: While the US Federal Income tax is progressive, state and local taxes are on aggregate regressive. On balance, it's a wash for the top half of the income distribution [7].

Fact: You could cut all non-defense discretionary spending and still run a small budget deficit [6].
Corollary: The Ryan plan probably won't be revenue neutral (3).

Fact: 3/5 of Federal outlays are redistributive, generally from the middle-aged, healthy and wealthy to the old, sick and poor [6]. Think pension, healthcare and welfare.

Supposition: A Ryan-esque budget would transition the US from a slightly progressive (progressive for Federal Income tax; regressive for most everything else) tax regime to a regressive regime. How you might ask? Reduction in transfer payments and increased state/local spending to counter-act Federal declines. 1/6 of Federal spending is transfer payments to state and local governments, mostly in health care, education and transportation. Less these programs be completely forfeit, the states would raise spending (and consequently taxes) to partially counter-act these cuts in direct Federal outlays and transfer payments. In essence, you're replacing progressive Federal revenue with regressive state/local revenue to pay for a reduced form of the same services/redistribution. To add a bit more regressiveness to the mix, note that this ignores the role that the Federal government plays in wealth redistribution from wealthier to poorer states.

Simply compare the US before-tax Gini (0.486) to the after-tax, after-transfer Gini (0.378) and one can see that without a progressive aggregate tax system and some wealth transfers from the more to the less fortunate, the US would be an altogether more economically unequal place, a place where the meritocratic American dream is even further out of reach than I would like to imagine.

1. After-tax, after redistribution total population late-2000s Gini as reported by the OECD.

PS. Full text of The Path to Prosperity available here.

Friday, June 1, 2012

A Step in the Right Direction: The NIH Career Symposium

The NIH Career Symposium, now in it's 5th year, was held at the main campus in Bethesda on 18 May 2012. The crowd was mostly NIH postdocs, with smattering of graduate students from around the east coast. I personally talked to non-NIH affiliated graduate students from Hopkins, Maryland and Duke.

They expressed their frustration that an event like this couldn't occur at their home universities. Any 'career panels' available packed with academics, and maybe the occasional industrial scientist, not a true glimpse of the possibilities beyond the bench. Part dismissiveness by their respective faculties, for which bound cheap labor isn't really a problem per se. Part blissful ignorance on the behalf of students, until it's too late.

The tone was subdued, what I imagine addict recovery would be like. We're collectively admitting a terrible mistake - being addicted to science. And like any addiction, recovery is a long and painful process. I could feel a collective wince of the audience whenever a panelist laid the truth bare: for all but a few industrial research positions or the pipe dream of a tenure-track position at a research intensive university, a postdoc is at best a waste of time, and a worst an obstacle of the worst kind, a demon of your own making.

Alas, there is hope. The event was well organized. The panels diverse. The speakers engaging. My personal favorites were Fraser Brown, a PhD/JD patent attorney with Cooley, and Jennifer Kimmel, a protein chemist with Kraft. Dr. Brown was great because of his biting wit, cynical hilarity, and brutal honesty. Dr. Kimmel's optimism and informed enthusiasm were refreshing.

Since their words are better than mine, I've summed them up, transcribed the day of the symposium:
Symposium quote cloud...


I also noted down a few comments from people I spoke to afterwards:
...and a few comments.

Events like this need to be happening annually at every graduate school and postdoc employing research institution in the country. If not individually, then in local collaborations. They must be designed to reach three key audiences:
  • Undergraduates considering a PhD. They must have a more accurate idea of the abysmal job prospects within science, and how woefully under prepared most PhDs are for jobs away from the bench.
  • Graduate students in the valley of shit. They need to make an accurate assessment of whether to forge ahead or cut their losses and run. If they decide to stay, they must understand what is needed to adequately prepare themselves for the tough road ahead, a road in which their professoriate-centric network will be of little aid. The only consolation, a little time to weigh options.
  • Postdocs wanting to stop postponing their life in the blind hope of a tenure-track position. They need to sift their experiences and identify an area to transition to as quickly as possible. This will be painful. This will require a redefinition of their self-worth and self-identity. But it is a necessary first step to abandoning their long-held dream and spinning-up for a new career trajectory, one most likely very far from where they intended.
And to the NIH OITE, thank you. I hope to see an event with even more diverse speakers, more postbacs reconsidering a PhD and more local non-NIH graduate students at the trailhead of recovery.