Summer Schooling, Pitzer College, and The New York Times

The New York Times has a piece about how colleges are offering more and more courses during the sumer. Here's the Pitzer College mentions.

In 2004, Pitzer College in Claremont, Calif., stopped renting classrooms to youth groups and began offering regular courses. Pitzer’s president, Laura Skandera Trombley, says this lets the college use the campus in the way it was intended (no more squealing grade-school campers on the quad) and gives undergraduates what they want. “Students had been asking for flexibility with their schedules,” Dr. Trombley says.

.....

Timothy Campos, a Pitzer junior, is taking watercolor and Chicano/Chicana literature this summer. “Art takes a lot of time outside the classroom,” he explains.

Mr. Campos is typical of students who think strategically. As a double major in sociology and Chicano studies with a minor in studio art, Mr. Campos, also Latino Student Union president and a community organizer for day laborers, says summer classwork will help him avoid a senior year in which he is under pressure to create. “I didn’t want all the art to pile up on me,” he says.

Mr. Campos has a year-round job in the admissions office that in summer comes with a free dorm room (which he has to open for campus tours) and helps pay for the added expense of summer school: financial aid covers only 75 percent of tuition for high-need students at Pitzer. During the school year, about 85 percent of all of Mr. Campos’s expenses are covered.

Summer students here are concentrated in Atherton Hall, the coveted “green” freshman dorm. That meant Mr. Campos, a self-described “artistic dresser,” had to move the contents of his room from Mead Hall, about 50 feet away, including his collection of hats, shoes and objects reflecting his fascination with skulls.

Like most things in the New York Times, it gets the story half right. The real reason is that this whole process of summer school goes on is that there is a market for it. But why is there a market?

Yes, students are having to resort to taking classes during the summer, but it isn't because of what the students want, but rather what they need. Often, due to increasing demands placed on students before they graduate (number of requirements, anyone?) and inflexibility on the part of tenured professors to teach more sections of required courses, some students are left high and dry.

If only Claremont McKenna would allow us to take classes during the summer to knock down some of those ridiculous requirements, but alas, after sophomore year you can only take your summer classes at a four-year college that gets prior approval.

William Voegeli in Los Angeles Times

Keep the Capitol out of capitalism

Rather than trying to fix the markets, Washington should just lay down some clear rules.

By William Voegeli

July 27, 2008

Americans are souring on the idea of free markets, according to some newspaper reports. Gas at more than $4 a gallon, plummeting home values, a volatile stock market, tightening credit and mounting job losses are said to have undermined the consensus, politically dominant for a generation, that the heavier burden of proof falls on those who want the government to intervene to correct the market, rather than on those who believe that the market should be allowed to correct itself.

For capitalism's defenders, having to face skeptical audiences could prove beneficial. Capitalism, like most ideologies, has received dubious assistance from its most zealous publicists. "The market" becomes the focus of every grievance when people have been encouraged to believe that it is the best system imaginable.

The stronger argument is that capitalism is the best system available. Prices set in markets convey information about "demand" -- how widely and avidly various goods and services are desired -- and "supply" -- how difficult or risky it is to make these goods and services available. These are not fixed properties but are reflections of tastes and technologies, whose constant evolution is reflected in constantly changing prices. As Cass Sunstein, a Harvard law professor who writes frequently on political economy, puts it, "the knowledge of individuals, taken as a whole, is far greater than that of any commission or board, however diligent and expert. The magic of the system of prices and of economic markets is that they incorporate a great deal of diffuse knowledge."

The diligent experts who administered the federal oil-price-control programs of the 1970s quickly learned this. They took the country's crude oil supply and tried their best to figure out how much of it should be refined to produce gasoline, diesel fuel and home heating oil. The result? Massive supply disruptions, lines around gas stations and "odd-even" plans that told drivers whose license plates ended in the "wrong" number that they would have to wait until the next day to fill up. Ronald Reagan abolished the price regulations on his eighth day in the White House.

What's remarkable is that the recent jump in global oil prices has driven up the price of petroleum products but has not resulted in gas lines or Rube Goldberg rationing schemes. Prices, set in markets, are allocating a scarce resource more efficiently and knowledgeably than government planners ever could.

The motives of those who call for new government interventions into the economy have more to do with moral sentiments than economic analysis. They want government to serve the people by thwarting the predations brought on by the "hubris" and an "overt lack of concern" for others among "corporate leaders," to use the words of Sen. Jim Webb (D-Va.).

One problem with this populist morality play is that it can't tell us anything useful about specific economic problems. Blaming the oil companies' greed for high gas prices, for instance, assumes a cause-and-effect relationship that violates a basic rule of science: You can't use a constant (greed) to explain a variable (gas prices). The only way to make the accusation stick is to say that greed, somehow, is also a variable. The energy industry's chief executives went through an exceptionally greedy phase earlier this year and crude oil prices skyrocketed. In recent days, however, they've been waking up feeling about 15% less greedy, and prices have receded.



The other problem is that "serve the people" is a noble sentiment but an imprecise marching order. The next wave of government regulations that follow from it will be guided by a principle no more exacting than, "Let's give this a try and hope it works." The resulting adhocracy is likely to saddle the country with policies it may regret.

Indeed, government policies to correct the market are often, in reality, correcting the last round of government interventions in the market. Fannie Mae and Freddie Mac, for instance, were set up by Congress in 1968 and 1970, respectively, as "government-sponsored enterprises" with a mandate to increase home ownership. Both are corporations owned by shareholders, but, as government-sponsored enterprises, they are exempt from taxes that ordinary corporations must pay, and they do not have to comply with accounting standards that govern other companies. Above all, the implicit but universal understanding in the world's capital marketsthat the U.S. government would bail them out if helping home buyers led to some excessive risk-taking has produced Freddie's and Fannie's current financial woes.

Last week, the House passed a bill that would greatly increase the level of government intervention in the market. Among other things, it would make the government's bailout guarantee explicit, authorize the government to lend Freddie and Fannie money and buy their stock, and create a tough regulatory agency to keep an eye on their business practices.

The willingness to give government-sponsored enterprises still more governmentally conferred advantages shows that interventionism does political as well as economic damage. As the political scientist Theodore Lowi demonstrated 40 years ago in "The End of Liberalism," the American way of intervening in the market is not for Congress to pass laws distinguishing legal from illegal conduct. Rather, lawmakers delegate decision-making powers to regulatory agencies, which are assigned the hopeless task of perpetually tweaking the government's "standards" to make sure every interest group is "part of one big policy-making family." The result, Lowi says, is "a government that is unlimited in scope but formless in action." It "replaces planning with bargaining" and subjects its citizens to "policy without law."

This infinitely malleable regime puts entrepreneurs who excel only at making their customers happy and their investors rich at a disadvantage, relative to those adept at forging and using political connections. The point is not that the principles of laissez faire are sacred. Rather, it is that the economy and the government work better when capitalists stick to capitalism and legislators stick to legislating. The next era of reforming capitalism will only avoid the mistakes of previous ones if we insist that legislators make capitalists adhere to clear rules rather than murky ones they are required to renegotiate endlessly.

William Voegeli is a visiting scholar at Claremont McKenna College's Henry Salvatori Center.