Saturday, February 28, 2009

The Bush owned economic crisis

Yes, Democrats participated in causing it.

William K. Black
Assoc. Professor, Univ. of Missouri, Kansas City; Sr. regulator during S&L debacle
As a white-collar criminologist and former financial regulator much of my research studies what causes financial markets to become profoundly dysfunctional. The FBI has been warning of an "epidemic" of mortgage fraud since September 2004. It also reports that lenders initiated 80% of these frauds. When the person that controls a seemingly legitimate business or government agency uses it as a "weapon" to defraud we categorize it as a "control fraud" ("The Organization as 'Weapon' in White Collar Crime." Wheeler & Rothman 1982; The Best Way to Rob a Bank is to Own One. Black 2005). Financial control frauds' "weapon of choice" is accounting. Control frauds cause greater financial losses than all other forms of property crime -- combined. Control fraud epidemics can arise when financial deregulation and desupervision and perverse compensation systems create a "criminogenic environment" (Big Money Crime. Calavita, Pontell & Tillman 1997.)
The FBI correctly identified the epidemic of mortgage control fraud at such an early point that the financial crisis could have been averted had the Bush administration acted with even minimal competence. To understand the crisis we have to focus on how the mortgage fraud epidemic produced widespread accounting fraud.
Don't ask; don't tell: book profits, "earn" bonuses and closet your losses
The first document everyone should read is by S&P, the largest of the rating agencies. The context of the document is that a professional credit rater has told his superiors that he needs to examine the mortgage loan files to evaluate the risk of a complex financial derivative whose risk and market value depend on the credit quality of the nonprime mortgages "underlying" the derivative. A senior manager sends a blistering reply with this forceful punctuation:…
These two documents are enough to begin to understand:
the FBI accurately described mortgage fraud as "epidemic"
nonprime lenders are overwhelmingly responsible for the epidemic 

the fraud was so endemic that it would have been easy to spot if anyone looked 

the lenders, the banks that created nonprime derivatives, the rating agencies, and the buyers all operated on a "don't ask; don't tell" policy 

willful blindness was essential to originate, sell, pool and resell the loans 

willful blindness was the pretext for not posting loss reserves 

both forms of blindness made high (fictional) profits certain when the bubble was expanding rapidly and massive (real) losses certain when it collapsed 

the worse the nonprime loan quality the higher the fees and interest rates, and the faster the growth in nonprime lending and pooling the greater the immediate fictional profits and (eventual) real losses 

the greater the destruction of wealth, the greater the (fictional) profits, bonuses, and stock appreciation
Black: The Best Way to Rob a Bank is to Own One.

Read the entire post

Thursday, February 26, 2009

The Failure of NCLB

This is time for a change for our society and in our schools. We face a marked crises in the economy, the banking system, government, politics, families, communities and in the schools.
All children deserve a good education to participate in our democracy. Lack of education is a ticket to economic hardship. The more years of school that a student completes, the more money they are likely to earn as adults and the better their chance to get and keep a good job. Unemployment is highest among school dropouts as is incarceration for crimes.
We need to invest in urban schools, provide equal educational opportunities in these schools, and to recruit a well prepared teaching force that begins to reflect the student populations in these schools. We must insist on equal opportunity to learn, without compromise.
The No Child Left Behind Law

The school reform movement from 1983- 2008, including NCLB, was largely driven by corporate goals and corporate thinking. Corporate rule was established through the corporations influence and contributions to elected officials and their funding of “research” institutes. (Emery, 2007) This corporate view of school reform –called neo liberalism in economics- came to dominate the media and the government. Non corporate goals such as freedom, extending democracy, equal opportunity were driven from the curriculum and driven from the reform packages.
The corporate view, or neo liberalism , is more than an economic policy. It is also a political project which considers people primarily as consumers and negates or limits their view as citizens and as political actors. A glaring example of this is the development of charter schools and the vast expansion of private for profit higher education, ie. National Univesity, University of Phoenix, etc. As Robert Reich argues in Supercapitalism : the Transformation of Business, Democracy and Everyday Life , democracy ( including in school policies) has been over whelmed by capitalism and the corporate culture. The U.S. has experienced a corporate take over of our politics ( Reich, 2007). Corporate interests presently hold the majority of power in Washington and they established and protect the No Child Left Behind Law with its emphasis on testing and accountability. As corporate domination grows, non corporate institutions like schools and unions lose their access to the media and to the public conversation about schools and democracy as well as multiculturalism. Neoliberalism takes money from public systems, such as public schools, and transfers that money to private consumption thus public institutions lose resources. Developing democracy requires one form of education, pursuing neoliberalism requires a very different form of education. And, at present, clearly the neo-liberal agenda is winning particularly as advanced in law in the No Child Left Behind act of 2001 and stalled for re-authorization in 2008.

President Bush worked with political leaders in both parties to pass PL 107-110 - The No Child Left Behind Act In 2001. He considers it one of the major victories of his tenure. NCLB made assessment based reform (testing) and accountability the central components of a new national policy on school reform. The results of NCLB and the accountability drive are now in: like Katrina relief, NCLB has been a dismal failure.
On national tests given by the U.S. Department of Education, student achievement is either flat (as in 8th grade reading) or has improved less than in the days prior to NCLB. NCLB is bad policy because it is punitive to schools. It has caused nearly 40% of the nation's schools to be labeled "failing," and by 2014 over 90% of the schools will be declared to be failing. It is stupid to not recognize the differences between really failing schools and schools that are doing quite well. Under NCLB when a school is struggling, there is little help on the way, just more tests, more punishment: Fire the staff; close the school; turn the school over to private entrepreneurs (profiteers) , etc. 

Rather than facing the inequality of resources between schools, the NCLB imposed school reform efforts stress standardized testing. Current testing measures the ability to memorize small bits of information. It cannot measure critical thinking skills, the ability to function in a community or commitment to democratic principles. NCLB Testing has not improved schools, improved school funding, nor improved teaching.
NCLB and its state by state equivalents argue that the education system should operate primarily in service of the economic system. This is a business model of public schools, and we can see how well business is operating in the finance, credit, and banking system. This corporate view of school reform –called neo liberalism in economics- came to dominate the media and the government.
A substantial opposition to the re-authorization of NCLB developed in 2008. Its passage was blocked in Congress . NCLB will be re-written and re-authorized in 2009. NCLB testing does not, unfortunately, provide teachers with useful information on what to do to improve student learning and instruction. It also does not provide resources to improve the schools while it ignores the substantial inequality of resources in both schools and neighborhoods.
NCLB required that states develop their own standards and tests and that states must use test scores to determine if children are learning grade level skills in mathematics and reading. These requirements led to a narrow test driven curriculum which emphasizes reading and math in the early years.
According National Assessment of Education Progress (NAEP) data there has been little improvement in student reading scores and only a small improvement in math scores. In California, with its large ELL population, there has been no measured improvement in scores by ELL students . At the same time The U.S. has one of the highest rates of high school drop outs in the industrialized world as well as one of the highest rates of incarceration for young people, particularly African American and Latino males.
The Bush Administration used NCLB sanctions including shifting money from public schools to private charters to respond to failing to raise test scores. The new Obama Administration has appointed Arne Duncan, as Secretary of Education and Russylynn Ali, as director of the Civil Rights division of the department. Both believe that more testing, not less testing, will improve schools.
The U.SA. spends less per student than 16 other modern industrialized countries . And, California spends less per pupil than 47 other states when you adjust the figures for cost of living differences. The recent California budget crisis, where schools were again cut by over $ 11.6 billion dollars demonstrates the failure of the political system to adequately fund some of our schools.
Let us be clear about the reality of schools in our nation. Some middle-class schools could benefit from reform, but most middle-class schools work rather well. Most schools in urban areas, however, are unable to provide the equal educational opportunity. There will be no significant change in the quality of urban education without substantial new funds allocated to these schools. In the current economic crisis, while federal funds are being added, state funds ( over 80% of the school budget) are being cut. There will be no substantial school reform under these budget conditions.
When schools succeed for the middle class and fail for working-class students and students of color, schools contribute to a crippling division along economic and racial lines in our society.

Monday, February 23, 2009

Citigroup robs the bank- and you and I- again

Citigroup's Clever Plan to Screw Taxpayers Again

From The Business Insider, Feb. 23, 2009:

So Citigroup (C) has proposed that the US taxpayer and other preferred shareholders convert up to $75 billion of preferred stock into common stock, thus bolstering the company's tangible equity and putting it in less desperate need of a complete takeover.

And what will the US taxpayer get for this preferred stock conversion? 40% of the company for some of its $45 billion of preferred, say reports. The reports add that Citigroup's goal here is to keep the US's ownership under 50%, so this won't be a de facto nationalization.

Well, that's nice for Citigroup...and another ream-job for taxpayers.

Citigroup's common equity is currently worth $10 billion. If the US were to convert all $45 billion of its preferred at the current stock price, it should end up with 80% of the company, not 40%.

For the US to convert $45 billion of preferred to common and only get 40% of the company, Citigroup's existing common equity would have to be valued at $65 billion, not $10 billion, and the conversion price would have to be about $10 a share. Or the US would only be able to convert $4 billion of its $45 billion, which wouldn't help Citigroup's tangible equity ratio much.

So is that what Citigroup is trying to do here? Persuade the US goverment to convert to common stock at a price miles above the current trading price, screwing the US taxpayer yet again?

Or does Citigroup have some other secret plan up its sleeve whereby it can take up to $75 billion of debt (preferred stock) off its books and not end up diluting its current shareholders 90%?

Friday, February 20, 2009

Soros on the economic crisis

Soros sees no bottom for world financial "collapse"
Fri Feb 20, 2009 9:26pm EST
NEW YORK (Reuters) - Renowned investor George Soros said on Friday the world financial system has effectively disintegrated, adding that there is yet no prospect of a near-term resolution to the crisis.

Soros said the turbulence is actually more severe than during the Great Depression, comparing the current situation to the demise of the Soviet Union.

He said the bankruptcy of Lehman Brothers in September marked a turning point in the functioning of the market system.

"We witnessed the collapse of the financial system," Soros said at a Columbia University dinner. "It was placed on life support, and it's still on life support. There's no sign that we are anywhere near a bottom."

His comments echoed those made earlier at the same conference by Paul Volcker, a former Federal Reserve chairman who is now a top adviser to President Barack Obama.

Volcker said industrial production around the world was declining even more rapidly than in the United States, which is itself under severe strain.

"I don't remember any time, maybe even in the Great Depression, when things went down quite so fast, quite so uniformly around the world," Volcker said.

(Reporting by Pedro Nicolaci da Costa and Juan Lagorio; Editing by Gary Hill)

California Budget and Education

State Superintendent Discusses Impact of Budget on Education

by Jack O’Connell
State Superintendent of Public Instruction

I’m pleased to see the Legislature finally put its differences aside and took action to end this protracted stalemate. While this budget is not ideal to any extent the uncertainty and instability for schools created by the lack of an agreement is over.
This budget will reduce the current year Proposition 98 funding level by $7.4 billion, which includes about $2 billion in reductions to program and revenue limit funding, as well as $4.6 billion in deferrals and the redesignation of funds. While the state budget agreement resolves the massive state shortfall, we must recognize that part of the solution essentially transfers our state cash flow problem to local schools and districts, and these cuts will impact our students.
The budget agreement also provides additional flexibility to transfer funding between about 40 programs which may assist school districts in continuing to provide the educational services their students need. I hope that district leaders will use this flexibility effectively to manage local educational needs while maintaining a focus on raising student achievement and closing the achievement gap.
I am glad that the budget agreement did not include the very successful class size reduction program in the list of categoricals subject to flexibility. Keeping class sizes low benefits students in the critical early grades when they are learning to read and establish a foundation in understanding mathematics.
Other vital programs, including child nutrition, special education, economic impact aid, our apprenticeship programs, and partnership academies also were not included in the new flexibility. These programs serve some of our neediest children and it is appropriate to preserve their effectiveness.
During the next few days, my staff will continue its review of the language in the proposed ballot measure affecting the Proposition 98 maintenance factor, which is intended to provide the $9 billion in repayments owed to public education. 

The painful budget process at our state and local school district level calls out for reform of California’s dysfunctional budgeting process. It is time for a sincere and frank conversation about reform. Central to this conversation is the idea of throwing out the two-thirds vote requirement to pass a budget and simply using a majority vote. Nearly every state in the nation and Congress, as well as counties, and cities use majority votes to pass their budgets. California should follow suit.
I understand that the minority party may feel that this would make them irrelevant to the process but, if anything, it would hold their majority party colleagues even more accountable.
Most importantly, a simple majority vote would protect our schools and districts from the instability they are forced to endure anytime the Legislature cannot reach a budget compromise.
It is time to bring about substantive changes to the way we do business in Sacramento – we owe the people of California this much.
Jack O’Connell is the elected State Superintendent of Public Instruction for the state of California.
Posted on February 20, 2009
And, a candidate for Governor.

Thursday, February 19, 2009

House Republicans scramble for the money

House Republicans, as a group, may take great pride in the goose egg they offered President Obama's stimulus package. But now the unanimous opposition is struggling to bring that money home.

Republicans will be working hard to make sure the money they opposed ends up benefiting their home districts, highlighting the political tightrope they walk in this economic crisis. The Democratic Congressional Campaign Committee is watching House Republicans -- and reading local media -- closely and is only too happy to highlight any happy talk about a stimulus Republicans voted against.

Back in his home district, Rep. Blaine Luetkemeyer (R-MO) found some nice things to say about the plan.

"Within the stimulus package there is some Pell Grant money, which is a good thing. It helps students be able to pay for their education and that's kind of a long term stimulus effect there. I mean obviously that's not gonna provide a job in the next 120, 180 days, but the ability of someone to get an education is an economic development tool," Luetkemeyer said at a local college. He was there, in another inside-outside Washington twist, to celebrate an earmark for a college building.

He lamented that there would be far fewer such earmarks in the future. "If they go back to the rules, it will make it very difficult to get earmarks through the next two years because number one we don't have any more money, we just blew it all on this stimulus package. Although, we're gonna have to print some more in order to be able to bail out the financial institutes and the automobile manufacturers," said Luetkemeyer.

Ken Spain, a spokesman for the National Republican Congressional Committee, said that the quotes aren't hypocritical, but rather demonstrate that Republicans did support a stimulus in general, just not the one Democrats presented to them.

"We would like to thank the DCCC for circulating these comments. They are proof-positive that Republicans stood willing and ready to support commonsense measures in the stimulus package until Nancy Pelosi unfortunately chose to undercut President Obama's message of bipartisanship by including absurd pork-barrel spending projects such as millions to protect a mouse in the San Francisco Bay, golf carts for government bureaucrats, and STD prevention funds. Republicans said 'yes' to a true stimulus package, but unanimously said 'no' to putting the politics of pork before the needs of the middle class," said Spain.

Rep. Don Young (R-AK) put out a press release saying that he "won a victory for the Alaska Native contracting program and other Alaska small business owners last night in H.R. 1, the American Recovery and Reinvestment Act."

In California's Inland Empire, battered by the economic downturn, the mostly Republican delegation is happy the stimulus passed, too, according to local news reports.

"Even the Republican lawmakers who oppose the bill say such projects are needed in the region," the local paper reports.

"All along he has believed infrastructure spending, in particular, should provide a boost to the Inland Empire's economy," a spokesman to Rep. Jerry Lewis (R-CA) said.

"While we philosophically have different opinions, we're obligated to make sure this money is spent properly," said Rep. Ken Calvert (R-CA). "All of us in the Inland Empire will do what we can to direct as much money as we can."
From: The Huffington Post.

California adopts budget; wastes $10 million

California has adopted a difficult budget. The CSU system and the UC system will face significant cuts. The CSU has already been cut $246 million this year. ( for cuts in K-12 see other posts on this blog).
These cuts will lead to keeping students out of the CSU and refusing to pay salaries as bargained for in the last contract.
However, here is $10,000,000 that can be saved.
The legislature and CTC have imposed an expensive, redundant accountability system TPA/PACT on teacher preparation – one the state cannot afford in its current budget crisis. It is a gross injustice to add funding for performance assessment of future teachers into the budget when our schools are having to increase class sizes, lay off teachers, reduce career technical education, cancel transportation, and delay long needed school reforms.
Legislators, Senators and Assemblymembers , including my Senator, have been advised of this boondoggle. They have chosen to not cut these funds. That is, they choose to cut class sizes in k-12, lay off teachers, and violate contracts rather than examine this sweetheart deal for a few tenured profs.
There is no evidence that TPA/PACT are valid measures of good teaching. To the contrary, our experience tells us that one-time all-or-nothing tests like the TPA/PACT are among the poorest possible ways to predict the likelihood that a test-taker will be an excellent California teacher. The implementation of TPA assessment was initially contingent upon state funding. But SB 1209 in 2006 removed the funding requirement and required implementation of the TPA throughout the CSU effective July 1, 2008, imposing a new low quality accountability system on teacher preparation programs in addition to the performance assessments currently in place, without providing the funding needed to pay for the new program. The solution is obvious. Rescind this provision of SB 1209.
In times of crisis we should fund important things. This $10 million should be cut from the CSU budget and used for other vital, impacted interests.

For a detailed description of the problems of pact see;

Tuesday, February 17, 2009

California budget crisis

This is not going to the edge. This is going over the cliff and then looking to see if your parachute opens.
So much for Republican responsibility.

Monday, February 16, 2009

California Budget Crisis: Business tax breaks

Business the big winner in California budget plan
Firms would get nearly $1 billion in breaks, while the average person would pay higher taxes five ways. Republicans say the plan would create jobs, but others dispute the claim.
By Evan Halper
February 14, 2009
Reporting from Sacramento -- The average Californian's taxes would shoot up five different ways in the state budget blueprint that lawmakers hope to vote on this weekend. But the bipartisan plan for wiping out the state's giant deficit isn't so bad for large corporations, many of which would receive a permanent windfall.

About $1 billion in corporate tax breaks -- directed mostly at multi-state and multinational companies -- is tucked into the proposal. Opponents say the breaks will do nothing to create jobs, and the Legislature has rejected such moves repeatedly in the past. But now, to secure enough Republican votes to pass a budget that would raise taxes on everyone else, the Legislature is poised to write them into law with no public hearings at a time when the state treasury is almost out of cash.

The tax breaks were inserted into the spending plan during private meetings between legislative leaders and Gov. Arnold Schwarzenegger. Less than 24 hours before today's scheduled vote, the proposals had not yet been printed in bills and made available to the public, but legislative leaders acknowledged them.

Most of the cost to the state -- or $690 million -- would come from changes in the way corporate taxes are computed, lowering the amount owed by many large companies. Smaller tax breaks are included for Hollywood production companies and small businesses that hire new employees.

"This is a pure giveaway for the vast majority of corporations that will benefit," said Lenny Goldberg, executive director of the California Tax Reform Assn., a union-backed nonprofit. "They will walk away with a great deal of money at everybody else's expense."
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Saturday, February 14, 2009

Stimulus contains billions for schools
Stimulus Includes $5 Billion Flexible Fund for Education Innovation

By Maria Glod
Washington Post Staff Writer
Saturday, February 14, 2009; Page A10
Education Secretary Arne Duncan would have $5 billion under the stimulus bill to back new approaches to improve schools, a fund that could prod states to raise standards and reward top teachers as the Obama administration presides over a massive infusion of federal education aid.
The Race to the Top Fund, as Duncan calls it, is part of about $100 billion the bill would channel to public schools, universities and early childhood education programs nationwide, helping stave off teacher layoffs, keep class sizes in check and jump-start efforts to revamp aging schools.
But the windfall also could mark the beginning of a deeper transformation of schools seven years after the No Child Left Behind law mandated an expansion of testing and new systems for school accountability.

"This is what I see as just an absolute historic opportunity," Duncan told reporters yesterday. He said the stimulus bill would help the Obama administration hammer three themes: "First and foremost, protecting children. Secondly, saving and creating jobs. And third, pushing a significant reform agenda."

President Obama in recent days has repeatedly stressed a bold approach to improve public education. In a surprise foray out of the White House last week to read to schoolchildren, he chose a D.C. public charter school as a backdrop.

"What I've asked Arne Duncan to do is to make sure that he works as hard as he can over the next several years to make sure that we're reforming our schools, that we're rewarding innovation the way that it's taking place here," Obama said at Capital City Public Charter School.

Obama campaigned on promises to increase federal funding for schools, responding to complaints from teachers unions and many educators who have long argued that Washington has made demands on schools without paying its fair share. But he also said he would shake up the status quo, drawing on a host of methods, including performance-pay plans with teachers' blessing, alternative teacher training programs and charter schools, which are publicly financed but independently run.

The stimulus presents an unheard-of opportunity to push both agendas -- at least in the short term.

"You're not creating winners or losers," said Brown University education professor Martin West. "It's a lot easier to innovate when you can do it with new money."

Even as school leaders line up projects to overhaul old schools and seek ways to soften budget cuts, they also are on the lookout for innovative programs worthy of federal dollars and the national spotlight.

Arlington County Superintendent Robert G. Smith said he might seek a grant from Duncan to expand a program that provides extra support for Latino and African American students in Advanced Placement classes.

Montgomery County Superintendent Jerry D. Weast said federal backing for innovation is "a smart move" because some of the best school reform strategies percolate from the ground up. "The reason why Montgomery County does so well . . . is innovative teaching and learning, so there's no doubt our people have great ideas."
Over two years, the stimulus bill would funnel $53.6 billion to states to prevent layoffs and create jobs, and the bulk of that would go to schools and universities, including funds to modernize aging buildings. Another $25 billion would help students who are disabled or in poverty, groups the federal government has long pitched in to educate.
The package includes $17 billion to increase the maximum Pell Grant for needy college students by $500, to $5,350, and about $4 billion to expand federal preschool classes and child-care programs.

Duncan's $5 billion fund would be a pot of discretionary money much larger than any of his predecessors had, former education secretary Margaret Spellings said. It would allow Duncan to award grants to states that show progress in boosting student achievement, and he said it would support efforts to create better tests and shore up data systems to track student achievement.
He said he also would seek to use the fund "to really challenge states and partner with them to dramatically raise standards . . . and think very differently about how we recruit great teachers, reward them, recognize and incent them."

The fund would include $650 million to support partnerships between schools, or schools and nonprofit groups, to "scale up what works," Duncan said. Separately, the stimulus bill would include $200 million for teacher performance-pay programs.

Alexa Marrero, spokeswoman for Rep. Howard P. "Buck" McKeon (Calif.), ranking Republican on the House Education and Labor Committee, said there is broad support for many of the initiatives Duncan is likely to push. But she said education policy should be crafted through debate over reauthorization of the 2002 No Child Left Behind law, not as part of the stimulus package.

"Congress has really worked hard to set out a path for reforming No Child Left Behind and for education reform more broadly," Marrero said. "The fact that legislation that is supposed to be about economic stimulus is being used to enact substantive education reform without the benefit of open debate and the inclusion of the American people, that's where the concern lies."

Education committee Chairman George Miller (D-Calif.) said the fund will be critical to improving professional development for teachers and creating career incentives for those who take on additional responsibilities.

"This is a very serious amount of money in its total amount for education," Miller said. "Both the president and the secretary do not want to lose a year or two in the efforts to achieve reform that are necessary to create a modern, effective school system throughout this country."

Friday, February 13, 2009

State Budget and school funding

State Budget Requires Public Democracy Not a Cone of Silence

By Marty Hittelman
California Federation of Teachers

The Legislature and governor are on the verge of agreeing to a state budget that would not be in the best interest of most Californians. It would greatly harm public education, public health programs, and working people. It continues the financially disastrous tradition of reducing targeted taxes and creating new tax loopholes each year in order to convince Republican legislators to vote for the budget, a consequence of the state's dysfunctional two-thirds legislative supermajority requirement. The ‘budget’ bills also strip hard-won rights from working people that have nothing to do with a state budget, in order to satisfy a particular group of businesses.

The proposed reductions in education programs amount to more than $5 billion this year and $3 billion next year. This will continue to hamper our educators' ability to deliver the best education we can to the state's six million K-12 students and 2 million community college students. The CFT believes that education should be seen as an investment in California's future, not as a target for budget cuts. Students' progress will be slowed if the increased class sizes incorporated into this budget occur. In addition, the bill seeks to rewrite the guarantees of Proposition 98 to K-14 education without a vote of the people. This is clearly contrary to state law.

In creating so-called ‘flexibility’ for school district and college administrations to move funds out of categorical programs and into district general funds, the Legislature and governor do not solve the problem of our underfunded educational
system. Instead, this provides a tool for administrators to eliminate class size reduction (CSR), adult education, occupational skills, early childhood education, professional development, part-time parity pay and other necessary programs.

Most of these programs are directed at the needs of disadvantaged and working class students. Eliminating these programs along with cutting Prop. 98 is only taking California backwards. There must be an evaluation of specific categorical programs and a discussion of flexibility at the policy level. This decision should not be made solely for financial reasons.

We are opposed to the spending cap included in this budget. This spending cap creates a ceiling on future spending at a time when the economy is at an historic low. Under this spending cap, no improvements in any public services or public works infrastructure will be possible in the future, no matter how much the economy grows or how vital the need. The cap provisions also allow the Governor to make unilateral budget cuts without legislative approval-a direct assault on the balance between the Legislative and the Administrative branches of state government.

The proposed ‘single sales factor’ tax provision is a loophole worth over $750 million per year and will only help corporations avoid paying their fair share of taxes. This bit of chicanery comes on top of an accumulation of more than twelve billion dollars per year in lost revenue to the state of California over the past fifteen years. Each year, in order to convince enough members of the minority Republican Party to reach a two thirds vote for a budget, Democrats have agreed to tax cuts and new tax loopholes, mostly for the wealthy and corporations. Added together, these cuts amount to more than the current state budget deficit. During these extraordinary budget times, when education, our universities, health and human services are facing such deep cuts, this enormous tax giveaway is unconscionable.

Finally, the budget is no place to be eliminating hard won labor rights. Issues such as state holidays and overtime provisions for state workers should be bargained, not taken away in attempt to appease business interests. We are opposed to negotiating policy issues that have no relevance to the budget process.

The problems we see in this budget bill could have been addressed if there had been full and open hearings instead of secret legislative leadership discussions under a ‘cone of silence’ with the governor. The CFT believes that government functions best and in the interests of the most people when it is conducted in public, not behind closed doors. It also functions best when, as in virtually every
other state, it is run on the basic democratic principle of majority rule.

Unfortunately, that is not the practice today in California.

In short, we are disappointed with the work of the legislative leadership, and urge all legislators to vote ‘No’ on the budget package, and to tell their leaders and the governor to go back and do it right-and in public.

Marty Hittelman, a community college math professor from Los Angeles, is the President of the California Federation of Teachers (CFT) which is a member of the American Federation of Teachers (AFT). The CFT represents faculty and other school employees in public and private schools and colleges, from early childhood through higher education in California.

Posted on February 13, 2009
From: California Progress Report

Learn to Organize

Feb. 21,2009. Session.Free.

Organizing in the Style of the Obama Campaign and Cesar Chavez (Organizing to Change) Duane Campbell,
We will use changing No Child Left Behind as a vehicle for discussion of how to organize for change.
10:30 Am. Feb. 21,2009. As a part of the Multicultural Education conference at Sac State.
Free. Open to the public.
For more information:

details at :

Youth Rising – Radical Healing and
Activism in the Post Civil Rights Era
Saturday, February 21, 2009
9 A.M.
University Union, Sacramento State, 6000 J. Street. Sacramento

Keynote Speaker: DR. Shawn Ginwright. Associate Professor. San Francisco State University

Tuesday, February 10, 2009

Arne Duncan and NCLB

From U.S. News and World Report, Thursday, February 5, 2009. See
What Arne Duncan Thinks of No Child Left Behind
The new education secretary talks about the controversial law and financial aid forms
By Eddy Ramírez , Kim Clark

Newly minted Education Secretary Arne Duncan has big plans for improving the nation's schools. His first order of business is drumming up support for a stimulus measure that includes an unprecedented $140 billion for education. The 44-year-old former leader of Chicago Public Schools says the money will modernize schools, help stave off teacher layoffs, and spur meaningful reforms. "The fact is that we are not just in an economic crisis; we are in an educational crisis," he says. "We have to educate ourselves to a better economy."

The subsequent item on his agenda will be fixing the Bush Administration's No Child Left Behind law. His opinion of it: "I think we are lying to children and families when we tell children that they are meeting standards and, in fact, they are woefully unprepared to be successful in high school and have almost no chance of going to a good university and being successful."

But Duncan is also interested in other people's opinions. He's meeting with the heads of the two national teachers unions and, if and when the stimulus passes, he plans to travel the country to gather input from school officials and families about ways to improve the federal testing law. Duncan also says he is in the market for ideas to rename the law.

He discussed some of those plans in an interview with U.S. News. Below are highlights of that conversation.
On a federal stimulus for schools: Duncan says a large chunk of the $140 billion destined for education will help states maintain and create jobs. "My concern is that hundreds of thousands of good teachers, not just bad teachers, are going to go, and that would be devastating," he says. "It is to no one's advantage if class size skyrockets or librarians get eliminated or school counselors disappear."

Duncan says the federal stimulus for schools would give him unprecedented leverage to innovate and improve schools. The stimulus provides for $15 billion in discretionary funds that he says he will give to states that agree to implement the following three pieces: expanding early childhood education, creating better student assessments, and improving teacher quality. "If we can bucket all these together and work with set of states with significant resources to make this happen, I think it's a game changer."
On fixing No Child Left Behind: As the former leader of Chicago Public Schools, Duncan lived through what he called the unintended consequences of President Bush's No Child Left Behind law. Duncan supports the focus on accountability for student achievement, but he wants to make the law less punitive. "I know there are schools that are beating the odds where students are getting better every year, and they are labeled failures, and that can be discouraging and demoralizing," he says.

Duncan also wants states to adopt academic standards that are more rigorous and aligned with those of other leading nations. "The idea of 50 states doing their own thing doesn't make sense," Duncan says, referring to the current patchwork of standards and tests. "I worry about the pressure because of NCLB to dummy those standards down."

Duncan says he is concerned about overtesting but he thinks states could solve the problem by developing better tests. He also wants to help them develop better data management systems that help teachers track individual student progress. "If you have great assessments and real-time data for teachers and parents that say these are [the student's] strengths and weaknesses, that's a real healthy thing," he says."

Asked if he will push for passage of a new version of NCLB, Duncan says that he first wants to go on a cross-country listening tour and that he hopes that Congress will reauthorize a new version of the law late in the year. "Having lived with this, I have a good sense of what makes sense and what doesn't," he says. "But I want to be clear that I want to get out there and learn from people. And I think ultimately we should rebrand [the law]."

Asked what he would call a new version of the law, Duncan answered, "Don't know yet. I'm open to ideas."
On higher education: Duncan did not offer too many concrete ideas on higher ed. He says community colleges will play a vital role for an extraordinary number of adults who need training for new jobs in the health, technology, and green sectors. That's why he wants to make sure that more students are prepared for college and leave college with a degree.
He says he will offer colleges incentives to graduate more students on time. "We need to get dramatically more of our students not just into college but through college," he says. Duncan also wants to remove barriers to college by making it easier for students to complete financial aid forms. "You need a Ph.D. to figure [the FAFSA] out," he says. "I think we have to simplify information and get information to students and families earlier.
PHOTO SIDEBAR: Arne Duncan, Secretary of Education

Sunday, February 08, 2009

Nationalize the Banks : Baker

Published on Sunday, February 8, 2009 by Beat The Press
Dealing With Bankrupt Banks: Nationalization or Welfare

by Dean Baker

The media continue to do more to misinform the public than to inform
them when it comes to plans for fixing the financial system. Following
the absolute worst in journalistic practices, a front page Washington
Post article explains the Obama administration's policy by telling
readers that the "approach reflects Treasury Secretary Timothy F.
Geithner's philosophy of how governments should respond to financial

Trees had to die for this garbage? The reality is that the reporters
have no clue as to what Timothy F. Geithner's philosophy of how
governments should respond to financial crises. The reporter knows
what Timothy F. Geithner told them, so why don't they just stick to
passing this information along to readers instead of speculating about
his innermost thoughts?

The excursion into philosophy deflects readers from the real issue.
Mr. Geithner wants to use taxpayer dollars to keep bankrupt banks in
business. In effect, he wants to tax teachers, fire fighters, and Joe
the Plumber to protect the wealth of the banks' shareholders and to
pay high salaries to their top executives. No readers of this piece
would understand that this is the process being described.

The Post editorial page carried on with this deception. An editorial
on saving the banks dismissed nationalization because it would involve
the government in running the banks. Then it discusses the idea of
buying bad assets and warns, "but there is a huge risk that the
government would badly overpay in the first place."

Actually, this is not a risk, this is the point. If the government
paid the market price for these assets the banks would be bankrupt and
we would be back to step 1, nationalization. The point of buying the
bad assets is to pay too much, so that the banks can get enough money
to stay solvent. (It is worth noting that deciding how much the
government will overpay, and to whom, also involves the government in
running the banks in a really big way.)

It would be nice if the Post and the rest of the media would report
honestly on the bank bailout and stop trying to conceal plans for a
massive redistribution of wealth to the bank shareholders and their
top executives.

Dean Baker is the co-director of the Center for Economic and Policy
Research (CEPR). He is the author of The Conservative Nanny State: How
the Wealthy Use the Government to Stay Rich and Get Richer ( and the more recently published
Plunder and Blunder: The Rise and Fall of The Bubble Economy. He also
has a blog, "Beat the Press," where he discusses the media's coverage
of economic issues. You can find it at the American Prospect's web

Friday, February 06, 2009

Organizing for Social Change

Session A
10:30-11:30 a.m.
Organizing in the Style of the Obama Campaign and Cesar Chavez (Organizing to Change NCLB), Duane Campbell, Democratic Socialists of America

Youth Rising – Radical Healing and
Activism in the Post Civil Rights Era
Saturday, February 21, 2009
8:30 am – 2:00 pm
University Union, Sacramento State

Keynote Speaker: DR. Shawn Ginwright. Associate Professor. San Francisco State University.

15th. Annual Multicultural Education Conference.
Free. Open to the Public.
8:30 AM. – 2 P.M.

Wednesday, February 04, 2009

State of the Schools in California : O'Connell

State of Education Address, February 3, 2009 Excerpts
Superintendent O'Connell on the status of education in California.
Back to State of Education Address, February 3, 2009
Good morning. Thank you all for being here.
Today in California we face a defining moment for public education. We gather at a moment of great uncertainty. But I want you to know that I stand before you today hopeful. Hopeful for the future of our country, hopeful for California, and hopeful for our public schools, even at this difficult time.
Yes, these times are turbulent with no clear skies ahead. The national economic downturn and the budget shortfall facing our state are creating havoc in every one of California's schools and districts. Every teacher, every principal, and every superintendent I speak with wonders how we will make it through the next school year.
Friends, the state of public education is precarious. Beyond the immediate crisis, and even more alarming to me, is the long-term future of our common education system. If we continue down the road we are on our public schools and our state itself face certain, perhaps irreparable, damage.
Let's look at the immediate crisis: With more than half of the school year completed, our schools are faced with staggering, immediate budget cuts. The budget being negotiated may result in current-year reduction to education funding of $10 billion. These cuts are nothing short of breathtaking:
Hayward Unified plans to lay off as many as 170 teachers and increase class sizes from 20 to 32 students.
In Merced, as in many other school districts, school bus transportation is on the chopping block.
In Lake Elsinore, not only are veteran teachers being given incentives to retire, schools are putting duct tape over light switches to save on electricity.
And on and on all over this state.
And as painful as these midyear cuts are, we can expect worse over the next two years: Larger class sizes and fewer classroom aides. Outdated textbooks, longer bus rides or no buses at all. Less support for English learners and for our neediest schools. Fewer librarians, counselors and nurses. Districts are choosing between hiring a math teacher and buying math books. Most tragically, these cuts come at the same time that the need for investment in better schools and more support services has grown.
The number of homeless students in our schools increased nearly 19 percent in the 2006-07 school year, and we know that percentage is rapidly growing. Hunger is also on the increase. Our schools served 28 million more free school lunches in 2007-08 than the year before. Historically, subsidized school lunches have increased by 1 percent a year. Between September 2007 and September 2008, we saw an alarming 12 percent rise.
The students behind these percentages are the students who need more time in school, not less, more adults on staff who care, not fewer.
We know downturns like this hit the most vulnerable among us the hardest. It's the children in our schools struggling to learn the English language or those who come from poverty or who live with a learning disability that will be the first to feel the pain of cuts. Sadly, this comes after a long-term California focus on closing achievement gaps that is just now starting to show modest progress.
Let me be crystal clear, all of our progress as a high-expectation state is at risk unless we commit ourselves now to being innovative, flexible, and focused as never before. It is time for us to prioritize and to focus on only those things we know are working to close the achievement gap and help all students succeed.
Read the entire statement at

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