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EconomicPolicyInstitute June 6, 2008

Graduation rates are better than portrayed
Much current literature understates U.S. graduation rates, including Education Week’s new “Diploma Counts” annual report, which maintains that only 71% of U.S. high school students graduate, with the number dropping to 55% for blacks and 58% for Hispanics. EPI President Lawrence Mishel and economist Joydeep Roy argue in a new paper [PDF] published at the Education Policy Analysis Archives that these estimates are substantially below actual graduation rates, especially for minorities. Nobel-prize winner James J. Heckman and Paul A. LaFontaine joined Mishel and Roy in issuing a statement this week warning researchers and policy makers to remain cautious in relying on the “exceedingly inaccurate” data used in the Education Week report.

Test scores alone don’t fully measure school performance
In the June 2008 issue of The School Administrator, EPI Research Associate Richard Rothstein reviews why exclusive reliance on quantitative measures–such as test scores as mandated by No Child Left Behind–have been found inadequate in other public sectors and in the private sector. There is no reason to think schools should be any different. This article summarizes a longer paper Rothstein prepared for the National Center on Performance Incentives.

Military contract shuts out U.S. jobs
A new EPI Briefing Paper, Bailing out on America, shows that an Air Force decision to award a contract for military tanker aircraft to a consortium that includes Europe-based Airbus would cost at least 14,000 new U.S. jobs. The contract–now under review–would also give the winner a leg up in securing future contracts for these aircraft, meaning a loss of even more jobs in the future. The United States is the lone country in the developed world to make these types of purchases without regard to domestic employment or the competitiveness of its domestic aerospace industry. (News release [PDF])

Bush budget scrutinizes unions, lets employers skate
President Bush wants to spend approximately $2,500 per union to ensure compliance with reporting and disclosure laws. By contrast, his budget proposes only $26.08 per employer for the enforcement of labor standards laws, including overtime rules, child labor laws, and the Family and Medical Leave Act, among others. Read about it in this week’s Economic Snapshot.

A fix for retirement
Washington Post business columnist Martha M. Hamilton had high praise for a new book by EPI board member Teresa Ghilarducci in her June 1 column, “A system that needs to be retired.” As Hamilton wrote:

“Economist Teresa Ghilarducci, author of When I’m Sixty-Four: The Plot Against Pensions and the Plan to Save Them, said creating a new plan is better than tinkering with a bad system to make it better… What I like about Ghilarducci’s proposal is its boldness–the idea that it is better to create a new model than to keep retrofitting a system that presents unacceptable risk for so many workers. Even though defined-contribution plans are being improved, the changes will come too late for some and will be of no use to the vast universe of workers who do not participate in retirement savings plans, many of whom work for small businesses or for themselves.”

Ghilarducci will discuss her book and the plan to improve retirement security at EPI in early July. Stay tuned for details.

From the EPI Blog
Ross Eisenbrey
Corporations Are Stealing Your Constitutional Rights: Forced Arbitration Clauses
Lawrence Mishel
Chair Yellen Is Right: Income and Wealth Inequality Hurts Economic Mobility
Ross Eisenbrey
Businesses Agree—It’s Time To Raise the Minimum Wage
Josh Bivens
Right Thing for Wrong Reason? Why Recent Stock Declines Should Not Motivate Fed Interest Rate Moves
Robert E. Scott
Jack Lew Sees No Evil: Treasury Fails To Name China as a Currency Manipulator for the 12th Time
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