HIGHER ED GETS HIT:
In the past few months what started as a banking crisis has spread through a wide array of disparate social sectors, and funding for higher education has not been immune. State budgets and school endowments have felt the effects, and the government has recently taken drastic action to ensure continued access to student loans.
On November 20 the
Education Department
announced it would shortly begin buying $500 million per week of publicly guaranteed private student loans to supply liquidity to a faltering market. According to experts, unguaranteed private loans will shrink this year by roughly one-third, from $19 billion last academic year to between $12 billion and $13 bil- lion this year. To stem the collapse, Congress recently increased federal loan limits by $2,000, and with applications for federal aid up 20 percent in the first six months of this year, the move may have come just in time.
Talk of legislating a mandatory 5 per- cent endowment payout is circulating in Congress, but endowments are not what they once were.
Moody’s Investors Service
estimates they may devalue by as much as 30 percent this fiscal year.
Harvard
‘s massive endowment, the largest in higher ed, has already diminished by 22 percent since the end of June, a loss of about $8 billion–and this doesn’t include losses in Harvard’s private equity or real estate holdings.
Smaller institutions are not faring any better.
Grinnell College
, a private Iowa liberal arts school, has watched its endowment shrink by 25 percent, from $1.47 billion to around $1 billion, and tuition hikes may be in the offing. With this in mind, students have been turning to state schools, with applications at
Binghamton University
, a New York public institution, up 50 percent.
But many of these schools are facing budget cuts. In California, Governor
Arnold Schwarzenegger
has proposed cutting $65.5 million from the University of California system and $66.3 million from the California State University system. In his speech he quoted
Eleanor Roosevelt
, saying, “The things that we refuse to meet today always come back at you later on.” Given recent events, a shrinking education sector will surely be a case in point. COLE ROBERTSON
THE BLAME GAME:
It’s true–our favorite Diva of Derision,
Ann Coulter
, has her jaw wired shut for the next few weeks. But don’t worry, there are still plenty of voices out there letting us know who is to blame for this year’s economic crises, from the mortgage meltdown to Detroit’s malaise. Let’s play the blame game!
Stanley Kurtz
on subprime mortgages: “The real problem, we’ve been told, lay with Fannie Mae and Freddie Mac. In fact, however, ACORN is at the base of the whole mess. ACORN used CRA and Democratic sympathizers to entangle Fannie and Freddie and the entire financial system in a disastrous disregard of the most basic financial standards. And Barack Obama cut his teeth as an organizer and politician backing up ACORN’s economic madness every step of the way.” (National Review Online, October 7)
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Sean Hannity
on subprime mortgages and the auto industry: “The federal government and the Democrats, they forced these banks, through the Community Reinvestment Act, to make these risky loans. The risky loans started the subprime mortgage crisis, which impacted all these financial institutions, which needed government bailouts. In other words, government caused that problem. Government trade policy, energy policy, CAFE economy standards, safety standards, they caused the problems in Detroit. So now we’re going to double down on the very root cause of our economic decline by including government more?” (Hannity & Colmes, November 24)
Rush Limbaugh
on Fannie Mae and Freddie Mac: “They were Democrat piggy banks, which is exactly what they were set up for. Everybody in the know saw this coming. The Bush administration saw it coming. The people that saw it coming were beaten down to a pulp by Democrats who did not want to lose the concept of affordable housing for the constituents.” (The Rush Limbaugh Show, November 25)
BLOODY FRIDAY:
When Black Friday took a bloody turn this year at a Wal-Mart on Long Island, where a pre-dawn crowd burst into the closed store and trampled to death
Jdimytai Damour
, a 34-year-old employee and Brooklyn native, commentators minced no words in describing the tragedy. A Shopping Guernica, mourned a headline in the next day’s New York Times. Hell-Mart, screamed the front page of the New York Post, above a photo of the riotous bargain hunters pressing through the shattered doors like so many frenzied piranhas.
But if the image of deadly American shopaholics verged on the grotesque, it also obscured a more banal story of abuse that is tragically run-of-the-mill at the nation’s largest employer.
Wal-Mart
workers, on average, make less than $20,000 a year, around 20 percent less than retail workers elsewhere in the industry. Damour, one of 25,000 seasonal, temporary employees Wal-Mart will hire this year, most certainly made even less; and though Damour was brought on to accommodate the larger crowds expected during the holidays, a lawyer representing his family claims he was given no training in crowd control.
Less than half of Wal-Mart’s 1.4 million employees receive no health insurance from their employer, well below the national average for companies of its size. The company has been exposed for repeated violations of wage-and-hour, child labor, and race and gender discrimination laws, as well as systematically ignored workers’ compensation claims filed by employees injured on the job. In recent years, maintenance workers and stockers have been locked in Wal-Mart stores overnight and threatened with dismissal if they use the emergency exits.
Damour’s death is a tragedy, a gruesome metaphor for the end of the era of American hyper-consumerism. But no less tragic is Wal-Mart’s chronic mistreatment of its workforce, which has become the lowest common denominator in a gutted American economy, dragging down wages and labor standards across the country. Damour deserved better–and so do his surviving co-workers. MAX FRASER
