As to the other debate: it is true that “Corporate Profits Reach All-Time High” is a headline of questionable worth (but unquestionable veracity) if that “all-time high” is measured in unadjusted “total dollars”.

But it is equally true that anyone who says “actually, corporate profits haven’t reached an all-time high if we measure them in terms of price-to-earnings ratio, or return-on-investment, or return-on-assets, or mumbo-on-jumbo”, is talking undiluted hogwash.

Still, as the recent crisis has amply shown and as anybody with any sense already knew anyway, undiluted hogwash is the lingua franca of the financial community. Hence it is not particularly surprising to find AnnJo fluent in it.

There are about 50 million school children in the US so that comes out to around $130 per student roughly. Plus some of that spending is for administration uses not classroom.

Johanna, in a country with a rising population and/or a rising money supply, both of which we have, one would expect, all other things being equal, that corporate profits expressed in total dollars would always be higher today than yesterday, much less than 10 or 20 years ago. That’s why a statement that corporate profits are “at an all-time high” if profits were measured that way could only be met with a response of “So what?” No useful conclusions can be drawn from that factoid.

Erm…and *you’re* accusing *me* of reflexive assumptions and bias? “This is a number that liberals use” is no evidence of its unreasonableness (or, for that matter, its reasonableness).

No, I don’t claim the P/E ratio is the only meaningful measure of corporate profits. Other reasonable ones would be ROI and ROA, but I’m not aware of that data being available for the S&P 500 over a long historical period, or maybe earnings relative to long-term Treasury yields adjusted by a risk premium, but that would take far more time to compute than I have available, and besides, who decides on the risk premium?

What is NOT a reasonable measure is something like total dollars of earnings unadjusted for inflation or for inputs necessary to create those dollars, and that’s the only measure I usually hear in the anti-business spin cycle.

Thanks for the defense, Maria, but people at opposite sides of an ideological line SHOULD challenge each other on rational grounds. I’m always optimistic that Johanna’s intelligence just needs a little more info or logical analysis to work with and it will overcome her reflexive liberal assumptions.

Because, in the richest country the world has ever known, it is unconscionable that anyone who has worked hard their entire life should be left destitute (“couch surfing with friends,” really?) when they become too old to work. Even if it is their own fault.

“If you are going to question someones statement why don’t you state the facts upon why you believe it is incorrect”

OK. I thought this was obvious, but I’ll spell it out: It seems to me that the total dollar value of corporate profits – not as a ratio with anything except perhaps some measure of inflation – is a perfectly reasonable and meaningful measure of corporate profits. If AnnJo thinks otherwise, I am curious to know why.

And while I certainly agree that the P/E ratio is a meaningful and useful quantity, are you really claiming that it’s the only meaningful measure of corporate profits? If so, why?

Raising the retirement age is entirely logical. It should be set at a very small percentage of time left based on average lifespan at the time of your birth, and adjusted every 5 years for the newly born.

A middle class is fairly new concept that popped up during industrialization, and it may end up being shortlived.

Johanna, interesting that you demand proof from Kevin when he disputes Ryan’s claim of “all-time high” corporate profits, but don’t expect any proof from Ryan.

Corporate profits have been higher for roughly 80-85% of the last century, if measured as a ratio to the price of the stock,. The current S&P 500 price/earnings (P/E) ratio is about 23.5. That means it would take 23.5 years of today’s earnings to earn back the price of the stock. Basically, if you bought a share of stock for $100, it would earn $4.25 a year. (That’s not necessarily what would be distributed to you as a shareholder, because earnings must also be used to pay down debt and to invest in new facilties or equipment and in R&D.)

In fact, this may be an overestimation of corporate profits, because I think that those companies with losses are all treated as having zero earnings, so their losses don’t offset the earnings of other companies within the S&P 500. And over 60,000 businesses filed for bankruptcy last year, compared to less than 20,000 in 2006.

So, no, corporate profits are nowhere near “all-time highs” if measured in any meaningful way.

Also, we can’t ignore the fact that the average life expectancy has increased by about 8 years since 1970. Can the corporations now raise the retirement age by 8 years…which is what we also need to do for social security?

Defined benefit plans really weren’t around very long. They had a life span of less than 40 years and were generally only offered by very large companies or companies that were unionized…and the government. Private industry realized fairly quickly that they weren’t feasible, at least at the exhorbitant rates initially promised (70% of salary for life….?)

And I scream about the cost of public pensions for the sake of my children…not for myself. I am sickened at the thought of the debt burden that we are passing along to our children.

The lower wages go, fewer people will retire early. Sounds great, but what this does is make the younger workers under or unemployed, and even less able to pay for those pensions.

The people screaming about the un-affordability of pensions are mostly middle class. Why? The middle class has less money now. Much more is concentrated at the top tiers. the middle class will feel the pinch of downturns more than ever.

Big money corporations and power-players are quick to point out that eliminating/cutting pensions is the panacea. Why? Because a race to the bottom, regarding worker expectations of reward, benefits shareholders.

Because if you don’t have a pension, why should public employees?

How about twisting that around…

Why do public employees have pensions, and we don’t? If we did too, then we would not have to worry as much about our financial future, we’d spend more money and grow the economy, and we would feel more comfortable weathering a recession without gutting the incentives that will keep our kids globally competitive.

Can corporations afford those pensions? Why not? The did for decades, during the 70s recession, and survived. They can afford to grow our top tier to an all-time high level of wealth compared to the middle class.

Pensions for all I say! The alternative? What if we drastically cut everyone’s pensions? Extended family households, retirement a luxury for the rich, and our most talented abandoning public service in droves. Is that what we want?

Now I teach high school computer art, advanced drawing and painting (our kids end up at Pratt, Cooper Union, Chicago Art Institute, etc.), and even taught elementary art for a year. (Just try to remember the names of the 450 kids you teach very week!). Teaching is harder.

You have to problem solve every other minute- it’s not for pansies. Emotional Intelligence is essential. Time management and people skills are critical. This in addition to being a proven expert in your field. Many of the teachers at my school have PHDs. We publish; we present at conferences. We offer AP physics, robotics, AP computer science, computer art that includes pro video editing software skills and 3D, latin, environmental science, music production, and a host of top level AP courses.

A master’s degree is required. (I have 2.) Plus 150 hours of pro development, out of the employees pocket, every 5 years, to stay licensed. (The equivalent of a college course ever single summer.) That’s several thousand off the top each year- even if you are only part time. And you often teach slightly different courses each year, creating new lessons over the summer. You engage hormonal sugar-hopped-up kids 20 at a time, not rational impulse-controlled adults.

My daughter is going to MIT, and her IQ tests at 173. Her public school teachers taught her almost everything she knows about bio-engineeering, so they must have pretty high IQs too! (not even the same district) She is in awe of some of them, and we have found them to be both expert and professional.

The “those who can do, and those who can’t, teach” is BS. Many teachers do both. Yes, there are crappy teachers, as in any field. And the educational system is funded in a way that maintains the current class structure, instead of using our resources to nurture the brightest regardless of zip code, as done by some of our best global competition.

But I can tell you where money is wasted. Inefficiency. I have to order all my supplies a year in advance. Down to the paper clip. There is no such thing as reimbursement or petty cash, so there is “safety” ordering to make sure we do not run out of staple items, and then kids have to bring in incidentals that pop up. We end up with too much of one thing, not enough of another.

If I want to book a computer lab for a non-computer class, I have to walk the length of the building 3 times back and forth to check every single lab and sign up in seperate notebooks. Meetings are announced, and activities promoted on paper, instead of online.

For over 10 years I was used to MS office meeting reminders, online conf room sign-ups, automatic inventory control ordering of supplies, and instant repair of tech issues so work was not held up (time is money.)

By comparison, public schools are downright primitive. If I want to order pizza with club funds for and end of the year party- I have to fill out 3 separate forms, have the club vote on it, the treasurer sign it, I sign it, and the district treasurer must sign it. I’l also need a W-9 for myself, and the whole process takes over a week. Is it any wonder teachers spend their own money on their classes? People are not required to respond to e-mail in a timely fashion, and I can walk half a mile to find a copier that is fully functional. If a company ran this way, it would be out of business.

When money is being wasted, it is rarely on staff, It is usually inefficient systems. As far as the pensions go, all industries offer incentives to get quality employees. If the product is important to us, then do what you must to get the best workers. And honestly, my brother was a garbage man, and made more than I do now. And he will get a better pension package. I’d focus more on Superintendents that are in bed with the BOE, and getting less top-heavy.

You also mentioned the rising cost of real estate when calcuating the increased cost of educating a child. In California it is common practice for a developer of a large community to “donate” land for a school. This is often a requirement of the planning commission…not just an act of generousity.

I close for the evening with another quote from a California Democrat.

The numbers in the big picture are almost too large to comprehend. A recent Stanford University study projected the state’s unfunded long-term pension liability at more than $500 billion – about seven times more than all outstanding voter-approved bonds, from stem cells to water projects to high-speed rail.

“I’m a Democrat – I believe in workers,” former Assembly Speaker Bob Hertzberg said in an online chat with Chronicle readers last week. “The folks who are receiving the pensions are paying for their kids’ tuition and form the middle class of this country. That being said … the current pensions are not sustainable and California must reform its pension system … those will be tough choices, but we have to make them.”

Can you support your statement about technology being the reason for the increased spending?

Excellent question, to which the answer is “up to a point”.

I have it on goodish authority that “US school districts spent a total of $6.45 billion for technology for the 2001-02 school year” compared to, on no authority at all but my own guess, a total of next to nothing for every year in the 1970s.

The source of that figure is a body called Quality Education Data, of whom I have never heard and who may for aught I know be staffed entirely by body-snatchers, thimble-riggers, accordion-players, Republican Senators and other villains of the deepest dye. Still, even if it is and even if the figure is therefore vastly inflated, it still “provides evidence” that schools in the United States spent in 2001 and continue to spend in 2011 a chunk of money on technology. Since if your evidence is to believed (as anyone’s at the sharp end should be) the schools spend nothing on books, anything they spend on technology at all is bound to be an increase.

One of the reasons I trust the figure, though, is that it was accompanied by a prediction of decline in future spending on technology that (more or less) mirrored a decline in the rate of acceleration of per-student funding for the next decade. But this may have been a fluke, as of course may any statistic.

Of course, you need to deduct from that figure the amount that schools would have had to spend on books (and, apparently, macaroni) instead, in order to conclude that spending on education is increasing in real terms for some reason other than a conspiracy to allow all retired public-sector workers to winter in Florida, while private-sector dentists are able to derive vast profits from the consequences of Kevin and DOT gnashing their teeth.

Tracy is quite correct – I don’t mean to refer to the giving of computers by schools to children (though alarming reports from the states of Maine and Massachusetts, where such an experiment was tried, have already reached my ears). Instead, I refer only to the use of technology as an educational medium within schools, and the cost thereof.

Not that I think it’s a bad idea – I think it’s essential. But I also think that it has been a greater contributor by far to the rise in per-pupil funding than the payment of pensions to retired teachers.

I should perhaps say here as some kind of disclaimer that I am not any of: a citizen of the United States of America; a professional in any form of education; a statistician; a physicist; a parent; a financial adviser; or an accordionist. If as a result none of you considers me fit company for conversation henceforth, I understand.