Jessica Bakeman reports on politics and education policy in Capital New York’s Albany bureau. In a recent article focused on MaryEllen Elia, our recently appointed New York State Education Commissioner, Ms. Bakeman reflects on what may be a new strategy to fix the persistent problem of failing schools in pockets around the State.

In essence, Ms. Elia’s plan seems to rely on a “tough love” approach with district leaders and parents from the lowest performing NYS schools: ‘You have 2 years to fix these failing schools, or the state will do it for you’.  http://www.capitalnewyork.com/article/albany/2015/07/8572658/elia-delivers-tough-message-leaders-struggling-schools

Unlike some observers, I strongly believe that the root cause of failing schools is not directly linked to teachers, administrators or common core.

The primary failure begins when we as a society allow virtually all of our lower-income children to be concentrated into just a few school districts — while continuing to operate dozens of boutique public school districts which serve children from predominantly upper income households.

Extensive research tells us that if we continue to follow this model, it will ensure that the achievement gap will continue to grow.

Whether accomplished through housing choice or school choice: economic, social and cultural integration at the K-12 level has been proven to be the best solution to close the achievement gap.

New York State allows and encourages public school districts to form around — and to exclusively serve — residents of villages, towns, neighborhoods and cities. The impact of this ‘home rule’ approach to public education has created de facto segregation which has produced more egregious and dangerous consequences than the issues debated in the Brown vs. Board of Education case which was decided in 1954 – 60+ years ago!

We can witness how “Separate and Unequal” has become the standard across New York State, very clearly corroborated by NYS Education Department statistics which prove that economic and racial segregation in housing translates directly to school inequality, which results in disparate student outcomes.

There really is no place for personal or private agendas on the part of our appointed and elected officials. Public officials are expected to set a positive example for all people, affirming that our elected leadership is fair, honest and forward thinking.

It may very well be that Commissioner Elia — appointed by the NYS Board of Regents — has been tasked with sweeping the truth under the rug, because she is not talking about the only viable solution, which is to reform NYS Education regulations, many of which date to the late 19th Century.

I can grasp the enlightened self-interest of homeowners in Pittsford, Scarsdale, Briarcliff Manor, Bronxville (or in dozens of other public school districts in NYS which serve students from upper income households) who want to fight for their autonomy to keep ‘those other children’ out of their schools.

These are the very same wealthy and politically active adults who wield undue influence over our elected officials in Albany.

With that said, I’m dubious that any meaningful reform can take place until the specter of political influence is removed from our public education system.

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Zero Sum Game

January 12, 2014

Our elected officials love to make noise about ‘holding the line on taxes’ — whether at the federal, state, county or local level.

In the private sector, we know there are 2 ways to improve fiscal efficiency. One way is to increase revenues, either by selling more products or raising prices on existing products. Another is to reduce costs.

The public sector is much more complex, because of the layers of government which often overlap and have some redundancy.

One thing is clear: if the federal government cuts back on safety net services to reduce costs, the need for those services is still there. Provision of services (or some substitute) thus rolls down to the state, county or local level. In the jargon of economists, that’s known as the ‘Zero Sum Game’.

I live in the City of Mount Vernon in lower Westchester County NY.

Westchester has a very large share of residents who are among the wealthiest Americans. Some call their Westchester residence home, while others use their Westchester property as a secondary or tertiary residence. Because of these very wealthy families who own extraordinary properties, Westchester has one of the highest median property values in the United States, and is ranked 1st of the 3143 U.S. counties in order of median property taxes.

What they fail to mention is that most properties in Westchester County are taxed by 3 different entities: The County (18%); the municipality (22%); and the school district (60%).

For me and my Mount Vernon neighbors, the estates of the landed gentry might as well be on another planet.

Those of us who live in Mount Vernon are seeing the effects first hand of what happens when politics gets in the way of reality. We experienced a very contentious and hard-fought battle for the office of County Executive in the second half of 2013.

The incumbent, Rob Astorino, campaigned relentlessly on his Tea Party platform of No Tax Increases!

Despite the fact that county property taxes in Westchester typically represent less than 20% of the total property tax burden, the sound bite of No Tax Increases, combined with a consistent message that his opponent – in his role as Mayor of New Rochelle – had raised taxes on New Rochelle property owners, Mr. Astorino gained the support of a number of factions, including some elected officials, and he was re-elected.

Now, because the County has not increased taxes, it has cut funding for vital services, and guess where the vital services are most needed?

Cities like Mount Vernon, Yonkers, New Rochelle, Peekskill are left holding the bag. No funding from the County for services? City taxpayers pick up the tab in their City budget, instead of spreading the tax burden across the broader County tax base and allowing property owners in all areas to share the cost of services which tend to impact most on lower-income areas.

A recent report ranked 4 Westchester towns — including Briarcliff, Lewisboro, Irvington and Pleasantville — as some of the safest areas in New York State to live. Those folks can well afford to pay for great schools, plenty of police, etc. in part because they don’t get burdened with covering the costs of services in less affluent communities.

Here in Mount Vernon, we have an elected City Council member who was a vehement supporter of Rob Astorino in his re-election campaign, loving the promise of no tax increases. Now, the City taxpayers are facing an 8% City tax increase in order to maintain some semblance of vital services which the County will no longer provide due to budget cuts.

Our City Council member is visiting somewhere in the Twilight Zone, creating her own illusions of reality, and she has supporters who believe in her?

Let me warn you folks: Don’t drink any of her Kool Aid! And, be very careful of the messages you hear on the election trail!

The Wal-Mart Paradox

July 10, 2013

With annual revenues in the $450 billion range and a global workforce of more than 2 million, Wal-Mart can’t avoid being in the cross-hairs of labor advocates because it may be the world’s largest employer. And, there are consistent allegations of worker mistreatment.

Wal-Mart started with good intentions, it seems.

Sam Walton opened the first Wal-Mart store in Rogers, Ark. in 1962. The strategy was very simple: low prices and good quality. By 1967, the Walton family owned 24 stores, ringing up $12.7 million in sales.

As it grew, it seems the company may have lost touch with the mission.

Today, it seems that Wal-Mart has become a predator.

It seems that when Wal-Mart comes into a community, it builds a vast, low-rise supercenter — often on land that hadn’t been developed before Wal-Mart showed up.

The chain now has 698 million square feet of store space in the U.S., up from 530 million in 2005. Its U.S. stores and parking lots cover roughly 60,000 acres.

Beyond the negative environmental impact, Wal-Mart destroys local economies through its predatory pricing practices. It generally destroys and decimates local, family-owned businesses; it hires people right at the margin: low wages; variable work hours; marginal benefits.

Wal-Mart invariably is the beneficiary of huge direct public subsidies and benefits, which include: free land; infrastructure assistance; below market financing; outright grants from state and local governments around the country; and property tax abatements, often called PILOTS.

On top of that, taxpayers indirectly subsidize the company by paying the healthcare costs of Wal-Mart employees who don’t receive coverage on the job and instead turn to public programs such as Medicaid.

Today, the extreme wealth of Sam Walton’s family is shocking.

While most Americans have done our best to work hard, be honest, fair and ethical, there seem to be a few pirates who have a different agenda.

The Walton family is dripping in wealth — from ill-got gains? – and, if so, that really concerns me.

The Walrus has tried to stay on the sidelines on this stuff, thinking that reason and common sense would prevail.

Late on Saturday, July 9, House Speaker John Boehner said that he had given up on the potential for a bi-partisan effort to reach a rational $4 Trillion deficit-reduction plan tied to a proposal to increase the federal debt limit.

The major impediment seems to be an unwillingness among Boehner’s fellow Republicans who seem determined to oppose any package containing proposals that could be construed as a tax increase.

I happen to be a member of that small group of people who rely almost entirely on earned income, and fall into the Alternative Minimum Income (“AMT”) calculation for federal income tax purposes.

My sense is that any ‘tax increases’ contemplated in the proposed deficit reduction legislation would actually result in tax relief for me and my family.

I’m thinking that in a reformed income tax strategy, some of the Hedge Fund guys will no longer be able to claim that their income should be taxed as capital gains – at a 15% rate.

Hedge Fund Managers make their money by charging their clients two fees. The first fee is a “management fee”, frequently two percent of the assets under their management. The second fee is a “performance fee”, typically twenty percent of the income from those assets above a threshold level.

This 20 percent share of the investment returns from hedge funds is known as “carried interest” and under current tax law, hedge fund managers are allowed to claim carried interest as a long-term capital gain, currently subject to a maximum tax rate of 15 percent, rather than being taxed as ordinary income, currently subject to a maximum federal tax rate of 35 percent.

My reaction: That’s a racket.

These folks are often betting to crash the U.S. economy and take the rest of us down, and when they win, they pay taxes at 15%, where the rest of us are getting raped and pillaged at 35% or more.

If they only understood what is really going on, the TEA Party folks would have a valid reason to be pissed off…..