Archive for February, 2007

02 22nd, 2007 8:03:34 AM
By cmcgregor

My "grammar school," as they called them then, had three classrooms and an auditorium with a stage.  Three teachers, including the principal, taught grades one through eight in those three classrooms.  There would be a lesson for the first grade, with second and third graders also in the room, then a second grade lesson, with first and third graders listening in, and so on.  Each room had a pot-bellied stove, and we didn't get indoor plumbing until I was in the sixth grade.

I didn't know to feel deprived except that my mother, who had graduated from high school and had taken a few college courses and taught school some before I started, kept talking about sending me to a better school about 20 miles away.  I, of course, wouldn't hear of it.  She did, however, send me to the larger school five miles away when I was in the eighth grade rather than waiting another year for high school there.

I don't know what kind of arrangements had to be made, if any, to get permission for me to catch the high school bus. I don't recall it being a big deal.  What was a big deal that year was that I was the only new kid in the eighth grade, and it would be another year before my grammar school buddies would join me in high school. 

My new class had a room and a teacher of its own. I suppose I learned more there than I would have in my old school.  What stands out in my memory of that year, however, is a fight with school bully and my embarrassment at taking too long to cut some kindling to start the fire in the stove.  It was the first time I'd had the honor of being asked, but, because I didn't live on a farm like many of my classmates, I had no experience in that particular endeavor. I can still feel the humiliation coming back into the room late and short on wood.

Four years later, in 1960, I graduated third in a class of 33, behind Sheridan Thompson and Winnie Jenkins, and I didn't think it was fair that boys had to compete with girls for grades.  As I recall, only three people in my class went on to college.  Not going to college was never an option for me, not because of my Mother, but because of my Dad.

My Dad dropped out of school after the seventh grade to work in the sawmill. He also hauled timber out of the North Georgia mountains, and, at one point, hauled oranges up from Florida.  Some time in my pre-school years he rented an old building across the road from our tiny house and opened a "filling station." At about the time I started to school, he built a truck stop on the top of the hill about a quarter mile up the road.  His idea was that trucks would naturally slow down as they climbed the hill and would be more likely to stop. 

His marketing campaign was two hand-made signs out front: "Free Coffee to Truckers" and "3 Cent Discount to Truckers," i.e. three cents per gallon of gas (gasoline) or diesel fuel.  He left it up to the truckers whether to show the discount on the receipt or not.  I pretty much grew up at that truck stop from the first grade to college, working the night shift full-time during my last two high-school summers.  Later, I would say I was raised by long-haired waitresses.

Doyal's Truck Stop was open 24 hours a day, 7 days a week-the 24/7 abbreviation wasn't around then as I recall.  The day was divided into two 12-hour shifts, the day shift and the night shift.  When the night man who pumped gas didn't show up, my Dad would have to work the night shift in between his two day shifts-dozing was inevitable, but sustained sleep was not possible.  

My Dad's lack of education showed up in several ways:  he had a check writing machine so he wouldn't have to write out the amount of the checks in script.  His writing was pretty much limited to numbers and his signature.  He had no accounting or control system to speak of; so he pretty much had to be present to keep employee theft down.  On those few occasions when my mother talked him into going to Sunday school with us, he would have to practice reading the assigned Bible verses in case he was called on.  My Dad was not dumb; he was smart, actually.  But he lacked "book learning."

What I'm leading up to here is that my Dad had to work very, very hard to make a living, and, because of that and for as long as I can remember, his mantra was "Bobby, you've got to go to college so you won't have to work as hard as me."  There simply were no ifs, ands or buts about it.  He viewed education in very practical terms.  It was the way out of poverty and manual labor.  A "good education" was the only road to an easier and better life.

These early lessons in the value of education didn't come hard to me.  They made sense to me when I was five years old, and they kept making sense. They were intuitive.  How could you argue with the obvious? I grew up assuming that everybody with eyes could see how the world works, and that, as soon they could afford it, they would insist on their kids graduating from high school. By affording it, I mean as soon as they could do so without the extra hands on the farm.

I apologize to the readers, if any, for getting stuck in the fifties.  I've had Georgia on my mind lately because of the current issue of high school dropouts in Texas and how school choice might help fix the problem.  I couldn't help thinking of my Mother's modest and partially successful effort to exercising choice on my behalf.  But, just to complete the story . . .

I graduated from high school in 1960, from the University of Georgia in 1963.  I won a National Defense Education Act fellowship (thanks to Sputnik) and went on to graduate school.  I later got a Ph.D. in Economics and became an economist at the Richmond Fed.  I had a 36-year career at the Fed, including the 1991-2004 period as President of the Federal Reserve Bank of Dallas.  I served the next two years as Chancellor of the Texas A&M University System, before coming to my current job with the National Center for Policy Analysis.

When I was President of the Dallas Fed, we had several educational programs for high school students and teachers, and I became aware of the excellence of Texas' best.  I thought I had been a pretty good student in high school, but my experience paled in comparison to most of the Texas students I met who were finalists in our essay contests and Fed Challenge competitions.  I knew I was just meeting the "cream of the crop" of Texas students, but it wasn't until I became Chancellor that I realized how far down the other end of the spectrum reached.  Most public Texas universities are accepting high school graduates that require considerable remedial work before they are able to work at the college level. Our high schools are turning out some of the best graduates in the world and some of the worst in terms of achievement.

I still didn't realize how bad the situation was until I recently saw a study on Texas high school dropouts sponsored by the Milton and Rose Friedman Foundation. It estimates the average high school graduation rate in Texas at approximately 67 percent, with much lower rates in the major urban school districts. While the main victims of this appalling statistic are the dropouts themselves, they also impose large extra costs on Texas taxpayers. Counting just three categories of costs– reduced tax revenue, higher Medicaid costs, and higher incarceration costs–Texas taxpayers spend more each year on dropouts than they spend on them while they are still in school. The study goes on to estimate the substantial savings to taxpayers by reducing the dropout rate through only a modest program of school choice.  You can download the study, The High Cost of Failing to Reform Public Education in Texas, at www.friedmanfoundation.org/txfiscal.pdf.

02 19th, 2007 7:59:13 AM
By cmcgregor

From time to time people have suggested that I write a book.  I tell them I don't think I have a book in me–a few paragraphs, maybe, but not a whole book.

In wavering back and forth on the question of whether to blog or not to blog, I finally decided to give it a try.  Maybe an informal blog will be a good place for some of those paragraphs. Or, maybe not.  We'll see.

Where I've Been

I'm new to the National Center for Policy Analysis, having joined NCPA in January 2007. Prior to that, I had a 36-year career in the Federal Reserve System, including 14 as President of the Federal Reserve Bank of Dallas. As Dallas Fed President, I served all 14 years on the FOMC with Chairman Greenspan and almost 3 years with Chairman Bernanke when he was a Fed Governor. In November 2004, I retired from the Fed to become Chancellor of The Texas A&M University System. I retired from that position a little over two years later.

More biographical information is available on http://www.ncpa.org/, or on my personal web site, http://www.bobmcteer.com/. The latter contains some old speeches, articles, etc. from my past. I assume most of the serious and semi-serious new stuff will go here or elsewhere on the NCPA site. Extreme foolishness will continue to be directed to my personal site.

Where I'm Coming From

NCPA is a natural fit for me at this stage of my career. I've known NCPA's founders, John and Jeanette Goodman, since the early 1990's when the NCPA and the Dallas Fed worked together on joint conferences and seminars. NCPA had good ideas and speakers and we had a good auditorium and food service. We understand comparative advantage. I share NCPA's classical liberal viewpoint on most economic issues, although John assures me there's no litmus test for NCPA fellows. In addition to wanting to play economist again and comment on and influence economic policy, I'm following the lead of  Kinky Friedman when he said he wanted a career that didn't require his actual presence. He found it as an author of mystery books; maybe I'll find it as an author of mysterious paragraphs. As Kinky's spiritual advisor, Billy Joe Shaver, put it in a song: He has it down to one moving part and that moving part is him.  Billy Joe played at my Dallas Fed farewell party. (See photos on http://www.bobmcteer.com/.) Like Billy Joe, I've been to Georgia on a Fast Train; I wasn't born no yesterday.

NCPA is best known for its work on social security and medical issues–John is considered the father of medical savings accounts. I plan to focus on macroeconomic issues–monetary policy, fiscal policy, taxes–and, to some extent, education, especially school choice.  Milton Friedman was my North Star as an economist, and school choice is his great unfinished business.

Anglo-Saxon, or, as I prefer, Cowboy Capitalism, is not perfect, but it serves us pretty well in this new global information economy.  It can be improved by tweaking, however.  Our great vulnerability, however, is our education system, especially below the college level. I became an advocate for school choice as an economist and policymaker.  As Chancellor of a large state university system, I learned just how great the need is, especially in our beloved state of Texas. We have work to do. We have a long way to go and a short time to get there.