PHILADELPHIA REFLECTIONS
Musings of a Philadelphia Physician who has served the community for six decades

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Subcultures
E pluribus unum refers to thirteen colonies peacefully becoming a single nation. But it applies to Philadelphia in a different sense. Philadelphia is a city of neighborhoods.

Haddonfield
Indian King Tavern Haddonfield is a bit of a secret. It's Philadelphia's "Main Line, East"

Indigents
With a long history of welcoming and assisting the poor, Philadelphia has always risked swamping the lifeboat by attracting more of them than it can handle.

Dislocations: Financial and Fundamental
The crash of 2007 was more than a bank panic. Thirty years of excessive borrowing had reached a point where something was certain to topple it. Alan Greenspan deplored "irrational exuberance" in 1996, but only in 2007 did everybody try to get out the door at the same time. The crash announced the switch to deleveraging, it did not cause it.

Financial Planning for a Long Retirement

How should an individual investor ensure they have enough money for retirement?

Such a person is often a professional or entrepreneur who has worked to accumulate wealth. Legions of "advisors" are lined up to take this money and manage it or else to sell "products" that promise to solve some problem or other.

A person who has created their career and their wealth from scratch by intelligence and hard work can also manage their investments themselves, or at least supervise the process from a position of strength created by knowing what needs to be done.

This collection of articles explains to the individual investor how to take control of their wealth. They may eventually decide to look for help from an advisor but they will retain control of their assets and they will know what to do.

Financial Planning videos on YouTube

Revisionist Themes
In taking a comprehensive view of a city, an author sometimes makes observations which differ from the common view. Usually with special pride, sometimes a little sullen.

Federalism Slowly Conquers the States
Thirteen sovereign colonies voluntarily combined their power for the common good. But for two hundred years, the new federal government kept taking more power for itself.

Right Angle Club 2010
2010 is coming to a close, a lame-duck session is upon us, and probably after that will come two years of gridlock. But the Philadelphia Men's Club called the Right Angle, keeps right on talking about the current scene. A few of these current contents relate to speeches given elsewhere.www.philadelphia-reflections.com/topic/137.htm

Education in Philadelphia
Taxes are too high, but the tax base is too small, so public education is underfunded. Drug use and lack of classroom discipline are also problems. Business and employed persons have fled the city, must be induced to return. Deteriorating education, rising taxes and crime are the immediate problems, but the underlying issue is lack of vigor and engagement by the urban population itself.

Special Education, Special Problems

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School Bus

President John Kennedy's sister was mentally retarded; he is given credit for immense transformation of American attitudes about the topic. Until his presidency, mental retardation was viewed as a shame to be hidden, kept in the closet. Institutions to house them were underfunded and located in far remote corners of a state. Out of mind. And while it goes too far to say there is no shame and no underfunding today, we have gone a long way, with new laws forcing states to treat these citizens with more official respect, and new social attitudes to treat them with more actual respect. We may not have reached perfection, but we have gone as fast as any nation could be reasonably expected to go.

However, any social revolution has unintended consequences; this one has big ones, surfacing unexpectedly in the public school system. For example, the king-hating founding fathers were very resistant to top-down government, so federal powers were strongly limited. So, although John Kennedy can be admired for leadership, the federal government which he controlled only contributes about 6% of the cost of what it has ordered the schools to do, and the rest of the cost is divided roughly equally between state and municipal governments. As the cost steadily grows, special education has become a poster child for "unfunded mandates", increasingly annoying to the governments who did not participate in the original decision. We seem to be waking up to this dilemma just at a time when the federal government is encountering strong resistance to further spending of any sort. The states and municipal governments have always been forced to live within their annual budgets, unable to print money, hence unable to borrow without limit. As Robert Rubin said to Bill Clinton when he proposed some massive spending, "The bond market won't let you."

The cost of bringing mentally handicapped individuals back into the community is steadily growing, in the face of a dawning recognition that we are talking about 8% of the population. Take a random twelve school children, and one of them will be mentally handicapped to the point where future employability is in question; that's what 8% means. Since they are handicapped, they consume 13% of the average school budget, and growing. The degree of impairment varies, with the worst cases really representing medical problems rather than educational ones. Small wonder there is friction between the Departments of Education and the Medicaid Programs, multiplying by two the frictions between federal, state and municipal governments into six little civil wars, times fifty. An occasional case is so severe that its extreme costs are able to upset a small school budget entirely by itself, tending to convert the poor subject into a political hot potato, regularly described by everybody as someone else's responsibility. There are 9 million of these individuals in public schools, 90,000 in private schools. They consume as much as 20% of some public school district budgets.

All taxes, especially new ones, are bitterly resisted in a recession. Unfortunately, the school budgets are put under pressure everywhere by a growing recognition that our economic survival in a globalized economy depends on getting nearly everybody into college. Nearly everybody wants more education money to be devoted to the college-bound children at a time when there is less of it; devoting 13% of that strained budget to children with limited prospects of even supporting themselves, comes as a shock. Recognizing these facts, the parents of such handicapped children redouble their frenzy to do for them what they can, while the parents are still alive to do it. It's a tough situation, because simultaneous focus on specialized treatment for both the gifted and the handicapped is irreconcilably in conflict with the goal of integrating the two into a diverse and harmonious school community, with equal justice to all.

As school budgets thus get increasingly close scrutiny by anxious taxpayers, handicapped children come under pressure from a different direction. It seems to be a national fact that slightly more than half of the employees of almost any school system are non-teaching staff. Without any further detail, most parents anxious about college preparation are tempted to conclude that teaching is the only thing schools are meant to do. And a few parents who are trained in management will voice the adage that "when you cut, the first place to cut is ADMIN." Since educating mentally handicapped children requires more staff who are not exactly academic teachers, this is one place the two competing parent aspirations come to the surface.

Unfortunately, the larger problem is worse than that. When the valedictorian graduates, the hometown municipal government is rid of his costs. But when a handicapped person gets as far in the school system as abilities will permit, there is still a potential of state dependence for the rest of a very long life. The child inevitably outlives the parents, the full costs finally emerge. We have dismantled the state homes for the handicapped, integrating the handicapped into the community. But when the parents are gone, we see how little help the community is really prepared or able, to give.

(1806)

Thank you, Sir, for a thoughtful article - perhaps the first of its kind outside trade journals. I am not a parent of a handicapped child; I grew up in a family of teachers, and saw the problems of budget and resource allocation in all its gory and complicated detail. It still kills me to hear my husband spout Lew Rockwell-esque obscenities (yes, I believe the word applies...) about school funding, while I continue to fund his comfortable retirement. Your last paragraph is a kicker..."when the valedictorian graduates, the hometown municipal government is rid of his costs." More specifically, in a financially distressed community, the "responsible adults" perceive the valedictorian as a present cost, rather than a future benefit, and exile their best and brightest, often permanently. Then they cry. Meanwhile, I read about Joseph Watkins, and in perhaps the saddest and most cynical move yet, ready to outsource the children of Chester Upland schools to Shenzhen Yaohua Experimental School. We are living in interesting times...
Posted by: Shelley Ashfield   |   Dec 3, 2014 9:34 AM

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