No Strings

Last Tuesday, I attended the middle school concert, which included my younger daughter who is a clarinet player in the band. The band section of the program was second on the schedule and I was hoping that the first part of the program would be brief. But once the players started playing, what came second in the program was no longer the major focus of my attention. It turned out that the first part of the program was the middle school IPad band and they were great. Their selection was Sunshine of My Love by Cream and it was as well performed as I had ever heard it. Ten middle schoolers with IPads and a mixing board had redefined what constitutes a band performance.

For both my daughter in middle school and my daughter in high school, being assigned IPads. The instant access to up-to-date information and the books available in the palm of your hand, are both tremendous steps forward. A calculator, dictionary, thesaurus, and so many other helpful learning tools are always right there whenever you need them. I would have loved this convenience when I was going to school. In my time in school, just getting a hand held calculator was in my opinion a major step forward.

What I haven’t liked is that the IPad allows for the playing of endless different games and also allows free access to social media and therefore too much time spent on social media. The same criticism can be leveled against the smart phones that so many kids in middle school and high school are totally reliant on. In a meeting earlier this week, the presenter noted that 25% of the high school students looking for information on colleges and universities access that information solely on hand held devices (smart phones). I think we all realize the days of glossy brochures are ending but for many of our potential college students, the days of using a computer to access information are also ending. The desired level of portability just isn’t there even in a laptop and our students, our potential students, and our children want the capability to always be at their instant beck and call.

Even with the sense that IPads are a mixed blessing, I am pleased that my kids are working with them in school. On a continuing basis there are more and more school related applications and assignments that make use of the IPads. IPads provide adaptive technology when needed, including large type, the ability to dictate and the ability to print. More textbooks are available on the IPad, and the access to information has in my opinion also led to an increase in our students’ knowledge base. Personalized assignments are next. These assignments reflect the strengths and weaknesses of the student and provide ongoing information to the teacher and ongoing feedback to the student.

There is a downside to being among the first to implement a new learning tool. The implementation isn’t instantaneous and there are issues yet to be resolved. On balance, I’m glad that they are working with IPads. All of education will be utilizing tablets as we move forward and my kids will greatly benefit from having experience incorporating this technology into their learning.

Kinky Product Differentiation

Kinky Boots is a wonderful new Broadway show. Absolutely topnotch and one of the best shows I have seen in years. It has energy, style, substance, great music, and is thoroughly enjoyable. It also has an excellent story which encompasses economics and marketing, as well as psychology. And I can’t think of a better way for learning to take place than a spellbinding presentation of what is basically a true story.

The story line revolves around Price Shoes which is a failing shoe company in England (losing out to low priced imports) that makes a “range” of shoes for men. Charlie Price, who has no interest in the shoe business, takes over when his dad suddenly dies and is faced with the prospect of firing people together with closing down the company. There is also a recommendation to turn the factory into a condominium project. While in London to arrange a sale of the shoe inventory, Charlie comes to the rescue of a women being harassed by a number of drunks. In the course of the rescue, the women accidently knocks Charlie out and he wakes up in her dressing room.

It turns out, however, that it is not exactly her dressing room. It isn’t the dressing room that is “not exactly;” rather it is the woman (Lola) who is in fact not a her and is instead a drag queen entertainer. Lola complains that there are no sturdy boots available that can easily handle the weight of male transvestites.

Charlie, however, seems to be at a loss of how to save the company. Coming to the rescue is a factory worker who says to Charlie that what they need is to change their product line and to differentiate into a niche market where there is a demand. Certainly excellent advice both from the vantage point of an economist as well as a marketing expert. We know that foreign competition is fierce in many product areas and we also know that product differentiation can make a very positive difference. By the way, I had a much easier time explaining product differentiation to my 11 year old than explaining the shoe needs of transvestites.

Charlie makes the decision that he will produce sturdy dress boots for male transvestites and that these boots will be designed by Lola. As you can imagine, not all the employees are thrilled with the transformation from producing a range of shoes for men to what is accurately described as producing shoes for a range of men. The story lines build until there is a major successful unveiling of Lola’s Kinky Boots at a Milan show. At the same time there is also an important message about respecting people for what they are.

It all comes together beautifully and this is a spectacular show that will run for years. And the show demonstrates the same lesson as Charlie’s shoe transformation. If you create a show that is very special from beginning to end, the demand will be there. Product differentiation is alive and well on Broadway. And Broadway has certainly put its best foot forward.

We Need to Talk

At this time of year, I’m always reminded of the spring a few years ago when I had University related events for 27 nights in a row in addition to all the normal day activities. Just as this period was ending, I bumped into a senior faculty member, now retired, who wanted to tell me that he was certain that the Provost was a glamour job and that he couldn’t imagine anything more fun to do in higher education.

Perhaps glamour and fun are not the most accurate descriptors. But the provost position provides an excellent vantage point to see clearly what is going on, on a college or university campus. And what I see clearly this time of year by going to honor society inductions, or our Latin Honors Recognition Convocation, or technology competitions, or distinguished faculty lectures, or senior athlete dinners, or recognition of Provost Scholars (who are straight A students), or graduations is all the excellence that is present on a university campus. We are fortunate to have so many students who have accomplished so much. And we are fortunate to have them taught by such an excellent faculty. It is actually a validation of all the good work done by faculty and others to see how much the students have accomplished.

While all the end of the semester activities are taking place on campus, this is the time of year that my school board related activities also increase. We are advocating for the budget we are recommending, we are preparing to ask the community to support a bond issue and we are also about to recognize all the student accomplishment that has taken place during the K-12 years of school. The schedule is such that just as the recognition events end on university campuses, they build up and peak at our elementary, middle and high schools. Once again it is terrific to see at the K-12 level all that our students have accomplished and once again it is the excellent work and dedication of the teachers that has made such a huge difference.

What doesn’t seem to take place at this time of year or, for the most part, at any other time of the year is the communication between K-12 education and higher education that could strengthen education at all levels. In a college or university, we work with the products of K-12 education. We know what works well and what needs to be enhanced and we know it on more levels than just standardized test results. But we rarely share information with our K-12 colleagues. In K-12 education, teachers know what would enhance the chances of success in higher education but here too the information is rarely shared.

My message is very simple: we need to talk.

Matilda

In Matilda, the outstanding new Broadway musical, Matilda’s parents are horrified that she is into reading. The mom, who didn’t want this child, is into her looks and her dancing while the dad, who didn’t want a girl, is into scheming to sell his used cars at new car prices. Even with these revolting parents and an even more revolting school director, Matilda perseveres over all evils with her love for learning and reading completely intact and hopefully a Tony on the way as well.

My kids are bright and good readers and hopefully have a home life and school environment absent the stress that Matilda encounters. But this week hasn’t been a good week for my younger daughter who has spent three days and 4.5 hours taking a reading assessment. These tests will be followed up this coming week with math exams. Now some background on the reading exam will be helpful to the reader. First, the exam is based in part on the new common core curriculum; however, the students are just being exposed to that curriculum now. Second, the exam is being scored much harder than the exam in previous years so that the expectation is that failures will be up by at least a third. And third, the exam is not so much a method for grading the students as it is aimed at grading the teachers.

What is New York State thinking? I have written before on using student test results to judge teachers. I know from firsthand experience that excellent teaching makes an important difference but the home environment is nevertheless crucial. Household conditions and the support mechanisms at home make an enormous difference and there is a strong correlation between these conditions and test results. Why then do teachers shoulder so much of the responsibility with only a limited opportunity to make the difference? Every child is not a Matilda, able to overcome tremendous odds against succeeding in school.

The jury on the common core curriculum is still out but there is no doubt that most of the students being tested have had limited exposure. How then can you justify that tests are oriented around the common core? Do we want kids to fail? Once again, not every kid has the resilience of a Matilda. Which, of course, leads to the most critical point which is that an increasing number of kids will not pass this exam. How do we explain to them that we are really not judging them via the exam? Or how do we explain that the material is oriented to a curriculum design that is not yet fully implemented? The reality is we will not be able to successfully convince our children that it really isn’t a reflection on them if they don’t pass. There is no question that self respect will suffer and that some children will feel inferior as a result.

But as I have indicated before, what will suffer the most is the love of learning. Too much of an emphasis on tests and tests which are too flawed will impact our children negatively. And while the story for Matilda ends happily ever after, I am not at all convinced that this will be the result for a significant number of children in New York.

Split Personality

My older daughter has wanted to see Jekyll and Hyde, the musical, on Broadway from the time that the announcement was made that the show as coming back to Broadway. She has not yet read the book but has seen an animated version and was fascinated by the story. I had read the book by Robert Louis Stevenson decades ago and my wife and I had seen the musical version on Broadway. I thought the music and the show were very good but my wife, who prefers that musicals be based on happy themes and have happy endings, was less than thrilled. When the announcement came out that the musical was coming back, she made clear—even before I had the opportunity to ask –that she was not willing to sit through it a second time. To accommodate my older daughter and also because I had enjoyed the show, I bought us tickets to see the revival.

During the same weekend as we went to see Jekyll and Hyde, we also went to see The Host, which is based on Stephanie Meyer’s novel. Having read the Twilight series (yes, it is true that I just don’t read economics), I like the story telling of Stephanie Meyer and was looking to see this story of mostly nice aliens (given they are aliens, I felt that saying good hearted was not appropriate) who had taken over the human race and invaded our bodies. The specific story line focused on Melanie, a human, whose body is taken over by Wanderer with the mission of helping to locate the non assimilated humans that Melanie had been in contact with. Melanie, who is very strong willed, resists and the story revolves around the relationship between Melanie and Wanderer, who are both housed in Melanie’s body. Without giving away too many of the details, Wanderer ends up helping Melanie and the remaining humans survive and the story ends with some humans and some aliens including both Melanie as well as Wanderer renamed Wanda (in a human body) enjoying each other’s company. This is as close to a happy ending as you could have under the circumstances.

Jekyll and Hyde doesn’t have the same happy ending and even the good music can’t lighten the murderous behavior of Mr. Edward Hyde, the violent alter ego of Dr. Henry Jekyll. Both are in the same body, signifying the good and evil that exists in all of us. Here, over time, Mr. Hyde becomes the dominant personality with murderous results. And once again, without giving away too many details, Mr. Hyde looks to get even with those who have wronged Dr. Jekyll/him. The story is clearly riveting and has stood the test of time.

There is a debate in education as to whether to emphasize fiction or non-fiction especially as kids are still refining their reading and comprehension skills. Both clearly have merit and both are essential for an educated person. The common core standards seem to emphasize non-fiction and there is clearly the impression that literature will take more of a back seat to information. I hope this isn’t true and that fiction and non-fiction will both share the front seat. I am not an expert in this area but I do know that over the years I have enjoyed reading fiction more than non-fiction and have been glued to more fiction works than non-fiction works. And fiction or non-fiction, I always appreciate the arts be it film or a Broadway musical and the way the arts help important stories live.

Chained

A chained CPI (Consumer Price Index) sounds like a very painful condition. Or it sounds like a price index that couldn’t be controlled and is therefore forcefully restrained. Thankfully, it is neither of these situations and is instead a more realistic way of assessing cost of living increases. As a small scale example, assume that the price of broccoli increases dramatically. If you assume that you will buy the same amount of broccoli as before, the impact of this price escalation will be far greater than if, given the broccoli price increase, you move decisively into having more green beans as part of your diet. In reality we make substitutions as prices of certain products escalate in comparison to other products. I have been very careful in my example, not to use dark chocolate because for a true chocolate lover it is inconceivable to substitute out of chocolate.

As Washington continues to grapple with sequestration, the White House is proposing limited cost of living increases in indexed social programs by substituting the chained CPI for the set market basket CPI presently in use. I think this makes sense. We do substitute, when possible, out of products that have increased in price to products that serve the same purpose but are more reasonably priced. And the impact is to moderate the price increase for our (slightly) revised market basket.

Any alternative we can contemplate to the present rigid sequestration formula will require spending reductions along these lines. The Simpson Bowles Moment of Truth Project has endorsed moving to a chained CPI. Given the impact of the CPI on Social Security and other benefits, their estimate is that this more accurate measure of inflation “would save $390 billion over a decade - $215 billion from spending, $125 billion from revenue, and $50 billion from interest savings.” They also estimate that the second decade savings “would reduce the deficit by over $1 trillion…” and “would reduce Social Security’s 75-year funding gap by one-fifth.” A chained CPI is also considered, for the most part, to be “distributionally neutral” with a similar percentage impact across various income levels.

The chained CPI proposal has the endorsement of not only the White House but also of the House of Representatives leadership. Where there are still differences is what will accompany the chained CPI In the deficit reduction legislation – will it be further cuts in spending or will it be further increases in taxes. Both parties are in a difficult position in regard to this issue. The Republicans would be hard pressed to support an additional tax hike and the Democrats would be hard pressed to reductions in benefits without further tax increases. But to the extent that each party will have to move so that this key part of any solution falls into place, we should have that movement now so that the economic recovery is the clear beneficiary and we have moved forward in a most meaningful way in reducing the deficit.

Auto Show 2013

My annual trip to the New York automobile show took place recently. I have been going to this show since the 1960s, even before I learned to drive, and have only missed one or two shows in all these years. My kids sometimes even act surprised that there were cars as far back as the 60s when I first started attending. For them, this is so long ago that they imagine horsepower had to be measured in terms of real horses in those days.

My interest in the auto show is always two fold. I am a car person, even though I grew up loving mass transit (and without a family car) and am still a tremendous mass transit advocate. And second, as an economist, I know that the automobile industry here and around the globe is a barometer of the economy. Based on what I saw yesterday, the automobile industry is not only a beneficiary of the improving economy, but, given the number of attractive cars available, the industry is also a cause of further economic strengthening.

The crowd yesterday seemed more optimistic and more positive than the crowds at any recent car show. This looked to me to be a buying crowd; fewer teens just looking for something to do and more adults in their prime car buying years. This is not a conclusion based on carefully constructed research; rather this was a gut observation based on years of observation. And the cars on display were responsive to the audience. There were lots of smaller cars, with excellent designs, desirable features, and good gas mileage in addition. And Detroit was as well represented with these cars than were the usual sought after foreign car manufacturers. A beautiful very compact crossover from Buick; a stunning Corvette; a stylish compact from Dodge; a distinguished and very contemporary intermediate from Ford were joined by a new front wheel drive very stylish sedan from Mercedes, more Minis, new VWs, a small BMW crossover; and the usual well styled and designed cars from Japan as well as, in recent years, from South Korea. When I spend as much time looking at Kias as I do looking at cars from the largest American and Japanese representatives, you know the automotive landscape has changed.

The gas mileage numbers have changed as well and this is not just because there are more hybrids and electric cars. Since many cars are smaller, they are inherently more economical. Well regarded long time brands are swapping 6 cylinder engines for 4 cylinder engines. The peppiness seems to remain but the operating cost is reduced. With so many attractive options to choose from, the desire for a new car is enhanced, more cars sold and the economy is helped to move forward faster. From the dark days at the end of the last decade to the impressive results today is testimony first of all the government policy that recognized the importance of the automobile industry and took the necessary steps to keep GM and Chrysler in business. It is also testimony to the US automobile industry that the cars from Ford, GM, and Chrysler are as competitive, attractive, and sophisticated as the major foreign competition. From a major drag on the economy to a major positive force in the economy, kudos to all involved in making this transformation happen. And, to make sure we are never in this position again, keep up the good work and don’t become complacent again. Be thankful for where you are today and do everything possible to keep the momentum growing.