Tag Archives: Elizabeth Warren

Yes, Sen. Warren Has a Gender Gap; Just Not the One You Read About

Two conservative outlets called Warren a hypocrite on gender pay. Her record isn’t great, but they didn’t tell the whole story.

Tuesday was Equal Pay Day, the day dedicated to raising awareness of the alleged gender pay gap—or the oft-reported idea that women make 77 cents for every dollar a man makes. Largely the result of women being more likely to take time off or work in lower-paid jobs and industries, many hijack this topic to advocate for more workplace regulation or signal their rage about sexism (despite the statistics showing a more complicated story).

It’s fair for the idea of a gender pay gap to frustrate many on a visceral level. Although the dramatic statistics often cited are not accurate, it’s true that women are more prominent in lower-paid professions and roles. This happens for many reasons—anything from social conditioning that makes it harder to ask for raises to needing flexibility for childrearing.

But these shoddy statistics are used as a talking point by those trying to push legislative agendas, especially on the left. Senator Elizabeth Warren has, in particular, been an outspoken proponent for leveling the gap. As she tweeted last year: “Equal pay day isn’t a national day of celebration. It’s a national day of embarrassment.” Unfortunately, her outrage fails to show self-awareness, on some level.

Sen. Warren’s own office seems to be afflicted by the same issues she’s publicly decrying. The Daily Caller and Washington Free Beacon recently reported on this, claiming that her employees experience a gap of about $20,000 for median annual earnings, by gender. Ah, the hypocrisy!

As nice as it would be if the story were that simple, there are several caveats that come with Senate staffer pay reports; bonuses could inflate salaries, no distinctions are made between part- and full-time employees, and some staff could be interns or working for multiple offices. Relying too heavily on these statistics is irresponsible without more context.

Read more at The Daily Beast

Business and Government: A Regulatory Love Affair

Corporations love regulations—and so do politicians from both political parties. Big firms can allocate resources such as personnel and capital to work through complex regulations, but small firms cannot. The reason so many companies have headquarters in Washington, DC is because it is where political profit is made by lobbying the government instead of providing a service to consumers. In the realm of political profit, the company with the most money, lobbyists, and connections wins, and small businesses and consumers are left to fend for themselves in the “free market.” Regulations are used by big corporations and politicians at the expense of consumers and small businesses.

Corporations use regulations to retain and expand their market share in their industry. Politicians pass regulations at the behest of corporations and get rewarded with campaign contributions. For example, Dodd-Frank was viewed harshly by the banking community, but has it really been so bad for them? Since the implementation of Dodd-Frank, there has been a dramatic decrease in the number of small independent banks; over 800 independent banking institutions closed from 2007 to 2013. In an economic brief conducted by the Federal Reserve Bank of Richmond titled Explaining the Decline in the Number of Banks since the Great Recession, economists found:

New [bank] entries are more likely when there are fewer regulatory restrictions. After the financial crisis, the number of new banking regulations increased with the passage of legislation such as the Dodd-Frank Act. Such regulations may be particularly burdensome for small banks that are just getting started.

In another paper titled Reforming the Regulation of Community Banks After Dodd-Frank, economists from the Federal Reserve Bank of Saint Louis found:

If the patterns of consolidation continue and community banks are forced to merge, consolidate, or go out of business because of the cumulative regulatory burden, one result will be an even greater concentration of assets on the books of the “too big to fail” banks.

Even Elizabeth Warren and Bernie Sanders admit that Dodd-Frank has failed by lamenting how “too big to fail” banks are bigger than when the recession began. Their flawed solution, however,  is to fix failed regulation with more regulations.

Regulations increase the cost to produce goods and services, and those costs are passed onto the consumer. Increases in regulation also strangle innovation. Why open a small business when there are thousands of regulations on the federal code? The Small Business Association’s website cites advertising, marketing, labor, employment laws among several others that must be followed before starting one’s business.

The more cost it takes to open a business, the more risk. And the more risk, the less people are going to open businesses and innovate. That is why corporations and politicians love regulations, because it keeps competitors out and protects their market shares. All to the detriment of small businesses and consumers.

Department of Education: Judge, Jury, and Executioner

The Obama administration continued its attack on independent higher education this week. Officials with the Department of Education (ED) found that the Accrediting Council for Independent Colleges and Schools (ACICS) failed to comply with 21 different federal standards to retain accreditor status. The report suggests revoking ACICS’s status, which would essentially force it to close its doors at the hand of ED.

Many lawmakers are on a headhunt for accreditors, such as ACICS, including Senator Elizabeth Warren. The Senator called for the end of ACICS, despite being one of the largest accrediting institutions in the country. She stated in a letter that there was a “failure on the part of ACICS to serve as an effective guarantor of institutional quality.” With ED’s power to revoke status to accrediting institutions, the federal government is effectively threatening to shut down hundreds of institutions and businesses that provide private, for-profit education. The government is invested because students can receive federal loans for school if they attend an accredited institution.

For-profit universities have been under surveillance for years. The middle-man function that accreditors play in higher education does the job that consumers themselves should be doing: looking into the colleges and universities that they intend to apply to. The creation of accreditors has only solidified the hold that the federal government has on higher ed, in the form of strings attached to funding.

The acts committed by sketchy for-profit institutions should be incriminating enough. There’s no justifiable need for the ED or accrediting agencies to hound on institutions of higher education. If a student chooses to attend a for-profit institution that lacks accreditation, let them. Students are consumers of the education they wish to purchase, and with that comes every responsibility that every other consumer has: the risk and research that comes with a purchase. If an institution is failing, let the free market and flow of information allow it to fail.