Thursday Edition


1. The Lowered Standards Trend

A new analysis by The Economist found high school graduation rates nationwide have gone up even as average SAT scores have plummeted, suggesting schools are dropping standards to get pupils their diplomas. (The Economist)

Chart: The Economist

Across the U.S., graduation rates increased from 74% to 87% between 2007 and 2020. Studies also show grading became easier over time, with discrepancies between classroom grades and performance on standardized tests.

This can’t be explained by compositional effects. Theoretically, more students taking standardized tests would result in new demographics, which might skew the results. However, the share of students taking ACT or SAT exams actually decreased from 78% in 2007 to 68% in 2022.

In recent years, elite public high schools, like Thomas Jefferson in Northern Virginia and Stuyvesant in Manhattan, eliminated admissions tests as a way to get more underrepresented minorities into the schools. Some schools have even done away with 8th grade algebra for equity reasons.

Bubba’s Two Cents: For years now, a number of institutions have lowered their standards — It’s happened in the military with reduced physical standards for women. It’s happened with medical schools lowering their academic standards for admission. We’ve seen it with colleges making standardized tests optional for applicants. A handful of states no longer require licensed attorneys to pass the bar. The question now is what are the consequences of these policies and are they worth it?

2. America Needs More Plumbers

The U.S. is facing a plumber shortage, which is impacting households and businesses with higher costs and delays. (Bloomberg)

The industry is having a tough time recruiting young people due to the perception of plumbing as physically demanding and sometimes dirty work.

About 42,600 job openings for plumbers, pipefitters and steamfitters are expected each year for the next decade.

  • As of May 2022, the average yearly salary for these professions was $65,190, above the national average of $61,900.

  • The plumber shortage cost the economy about $33 billion in 2022, with a projected shortage of 550,000 plumbers by 2027.

Job openings in other skilled trades are also on the rise. Since the start of 2023, there have been over 770,000 job listings for skilled workers, posted by almost 95,000 different employers in the U.S.

  • Demand for carpenters, stonemasons, and construction laborers has surged by 23%, 45%, and 18% respectively, from March to May.

Apprenticeship vs. College: In the last decade, college enrollment dropped by 15%, while apprenticeships increased by over 50%. Currently, there are about 15 million college students and 800,000 apprentices in the U.S.

Bubba’s Two Cents: There’s been a lot of debate lately about whether colleges have gotten too focused on ideological B.S. and their quality has declined. Tack on skyrocketing tuition, and some people are wondering if college is still worth it. The short answer is that economically it is. But Americans, and especially conservatives, are starting to look toward alternatives, such as trades like plumbing.

3. Blame the Gunmakers?

The city of Chicago is suing Glock, a major firearms manufacturer, claiming design flaws in handguns are making it easy for people to modify the weapons to fire automatic rounds. (Chicago Tribune)

An excerpt from the city of Chicago’s complaint: “Instead of taking reasonable action to put an end to the modification of its pistols by civilians, Glock has made the business decision to continue profiting from the sales of its easily modifiable guns to the civilian market.”

In the past two years, Chicago police recovered over 1,100 modified Glock pistols used in shootings and other violent crimes. The problem is piling onto gun violence that is already much worse than the national average.

  • In 2020-2021, 79% of homicides nationwide involved a firearm.

  • In Chicago, that number was 93%.

The Glock case is part of a growing wave of lawsuits against gun manufacturers, similar to past actions against the tobacco and opioid industries. States like New York, California and Delaware are creating laws to get around the 2005 Protection of Lawful Commerce in Arms Act, which shielded manufacturers and dealers from liability for shootings committed with their products.

  • The families of victims in the 2012 Sandy Hook school shooting settled with Remington for $73 million over the company's marketing practices, potentially setting a precedent for future litigation.

Bubba’s Two Cents: If gun manufacturers are being reckless or negligent in designing their products, then, sure, it makes sense to hold them accountable. But is that solving the problem? Mexico is suing U.S. gunmakers for arming Mexican gangs, while Chicago and Memphis sued Kia and Hyundai because their cars were easy to steal. At some point you’ve got to wonder if these are cases of the government deflecting blame from underlying problems which are much harder to solve.

4. The Latest Blow to ESG

The Texas Permanent School Fund (PSF), set up in 1845 to support public schools in Texas, has decided to end its contract with BlackRock, which manages $8.5 billion of the state’s money. (Fox Business)

The PSF cited BlackRock's environmental, social and corporate governance (ESG) investment policies as the reason for pulling the plug. Specifically, the fund’s administrators accused BlackRock of boycotting fossil fuel producers, a violation of a 2021 Texas law.

Texas State Board of Education Chairman Aaron Kinsey: “BlackRock’s dominant and persistent leadership in the ESG movement immeasurably damages our state’s oil & gas economy and the very companies that generate revenues for our PSF. Texas and the PSF have worked hard to grow this fund to build Texas’ schools. BlackRock’s destructive approach toward the energy companies that this state and our world depend on is incompatible with our fiduciary duty to Texans."

2023 was the year of ESG backlash. Last year, investors pulled more than $14 billion from green investment funds, leading to the closure of 32 funds and at least five dropping their eco-friendly goals. By mid-year, 37 Republican-controlled state legislatures had pushed through 156 bills opposing ESG investments.

Bubba’s Two Cents: BlackRock is an institutional investor — like many other institutions (whether media or academia or business) the company jumped on the trend of promoting social causes at the expense of its core mission. In BlackRock’s case, it abandoned basic investment principles, like maximizing shareholder wealth, and pushed things like the green agenda instead. The backlash that BlackRock’s facing now is a natural outcome of its choices.

5. The Pandemic Disconnect

Only 41% of Democrats say the pandemic is over, compared to 59% of Americans generally. (Gallup)

Even more shocking: The share of Democrats who say the pandemic is done has actually declined since May 2023, when over half said it was over. 46% of Democrats say the country will “never get back to normal.”

79% of GOP supporters say we’re done with the pandemic. Since April 2022, the majority of Republicans have believed the pandemic was over.

Bubba’s Two Cents: For years, I’ve told anyone who would listen that a major problem is that society and culture are now downstream of news and media, yet we don’t trust mainstream sources. This is a prime example: Democrats report much higher levels of trust in the mainstream press, yet studies show U.S. news coverage of the pandemic was “shockingly negative” compared to international coverage. Fast forward several years, and we can see the impact.

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