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Make Work Homework

A few years ago my son who is now in middle school got some vocabulary homework for English. It was a pretty long list of words. He was supposed to write the meaning of each word and then use it in a sentence. And then, get this, draw or download a picture from the internet that illustrates the word. The homework took thrice as long as it would have without the illustrations.

Now if you think about it, if the child has learnt to use the word in a sentence, there is little value in an illustration. Especially, since most of the words pertained to intangible things like “blatant”. If it were an art class I can still see some value in an exercise where students reflect and then draw a picture depicting “blatant”. But not for 50 such words and not for an English class.

There is a phrase for this kind of work. Its called “Make Work”. Basically teachers are giving homework just to make up the 3 hours or whatever of homework they need to give per day. Like many issues, there is economics behind Make Work Homework.

Public schools and most private schools in the US have a student-teacher ratio that has gotten higher and higher over time. Obviously, there are cost reasons for this. The primary driver of cost efficiencies in a school is the average number of students in a class.

A teacher spends time on preparing for class, grading homework and other small activities. The time required for preparing for class does not vary by the number of students in class. It also goes down with experience. But grading homework varies directly with the number of students. And it can add up to quite a lot of work. If the teacher is hard pressed for time, she can’t reduce the amount of homework given to students. But she can give the kind of homework that takes less time to check. The example I cite above is exactly that kind of homework – with asymmetric workloads for student and teacher.

I believe this is the root cause of Make Work Homework. It takes a lot of time for the student to draw an illustration and very little to eyeball it while grading. This asymmetry works in favor of the teacher. She can give the prescribed amount of homework and still keep her grading workload low.

This is not to say that anything requiring an illustration is Make Work. Not at all. Sometimes it is absolutely necessary. Visual learning can be very powerful. And sometimes it can be justified with the argument that children learn in different ways and at different paces. What may seem like gratuitous drawing and coloring to one student may be essential reinforcement of what is being taught in class for another student.

But a lot of what passes as homework for our children, is the product of a teacher trying to reduce his workload.

Copenhagen – the Mother of all Negotiations

Who hasn’t been in a tough negotiation? If nothing else, negotiating with your kids can often be most difficult. But the negotiations at Copenhagen summit and next year on climate change are going to be the hairiest negotiations you can ever imagine.

An FT article [pay wall] shines some light on why the negotiations were so difficult. The biggest reason is of course that these are multi-lateral negotiations. And different groups have different interests. Developed countries want developing countries to make commitments on emission reductions while not over committing themselves. They also want transparency in developing country emission measurement.

Developing countries don’t want emission reductions to get in the way of development. They want developed countries to pay for clean technology.

There are a also a whole bunch of developing countries in Africa who are not significant emitters but will feel the brunt of climate change. They have nothing to give in the negotiations but a lot is at stake for them.

And then there are also a few heads of state like Chavez, Morales and Ahmadinejad, who simply use the stage to take potshots at the US and the West. But they still have to be invited to party.

Obviously, 170 independent actors can never achieve any consensus. So groups were formed. US, UK, Germany, France as representatives of the developed countries and China, India, Brazil and South Africa as representatives of the developing world. But this still wasn’t enough to get an agreement. The bulk of the world’s emission in the next 20 years is going to come out of the US and China. If only these two countries had sat down and thrashed it out, we would have had a deal.

The world is not going to be happy with their leaders if they don’t put their shoulders to the wheel and get a deal together soon in the new year.

The Numbers Behind the Numbers

This week’s big news was that the US economy lost the fewest jobs in a month since the beginning of the recession. There were reams and reams of news and opinion on the matter. Quotes from the White House, Republicans, Democrats, Wall Street and Economists. But I got stuck on the third paragraph of the first news item that I read on the matter on NYT

In the best report since the recession began two years ago, only 11,000 jobs disappeared last month, the government said on Friday, and the unemployment rate actually dipped, to 10 percent, from 10.2 percent the previous month.

What’s the math that allows the unemployment to go down when 11,000 jobs were lost? Did the denominator suddenly go up? Did all the returning Indians suddenly decide to go back to the US like Shiva Ayyadurai?

The answer seems to be

Not only did the rate of job losses drop to 11,000 but losses in the previous two months were revised down by 159,000.

which is not really offered as an explanation but as an aside by FT. But the numbers look like they should be able to explain the drop in unemployment. Does anybody have the official explanation?

Economics by its nature is complex. Good reporting should make it more accessible. Not leaving obvious questions unanswered would be a start.

Here’s How You Manage Healthcare Costs

There is a terrific piece in the WSJ today about Narayana Hrudalaya and Dr. Devi Shetty called The Henry Ford of Heart Surgery. Narayana Hrudalaya has successfully “mass produced” heart surgery, in the process reducing its price by an order of magnitude. More »

Wall Street Bonuses are Not the Real Issue

This month the biggest Wall Street companies reported their quarterly earnings. JP Morgan Chase and Goldman Sachs reported bumper earnings, Citgroup and Bank of America, not so good. But if you leave out write downs on debt, everyone had a great quarter in their capital markets businesses. Billions have been budgeted for year end bonuses.

As could be expected, the issue of Wall Street compensation raised its head again. And this time there is the weight of the federal government behind it. Banks that have taken TARP money will see their executive compensation capped. And the Federal Reserve has suggested that all large banks that fall under its jurisdiction will be reviewed on on going basis to ensure that executive bonuses do not produce risk taking behavior that could put the banking system at risk.

There are several memes that get mixed up in any discussion about Wall Street compensation in the media. Add a lot of emotion from a distraught public and it becomes for a tangled mess where the media feeds the furore but there’s no real understanding of the underlying issues. Let’s see if we can parse the issues out. More »

Financial Transaction Tax

Philippe Douste-Blazy, the Chairman of Unitaid and the former French foreign minister writes in an op-ed in the New York Times about how the world could come up with the funds to meet the United Nations Millennium Development Goals

The one untapped source that could easily provide the amount of money needed is the foreign currency market, which handles almost $800 trillion in trades annually, all of which is untaxed. A tiny levy of 0.005 percent on transactions involving the world’s most traded currencies — the dollar, the euro, the pound and the yen — would raise more than $33 billion annually for development, while not hurting the market or affecting the average international traveler.

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What’s So Difficult About a Gas Tax?

Tom Friedman in his latest column Real Men Tax Gas writes about a gas tax that could potentially fund healthcare, reduce the deficit and still have some leftover to make it up to people who can’t afford the tax:

Such a tax would make our economy healthier by reducing the deficit, by stimulating the renewable energy industry, by strengthening the dollar through shrinking oil imports and by helping to shift the burden of health care away from business to government so our companies can compete better globally. Such a tax would make our population healthier by expanding health care and reducing emissions. Such a tax would make our national-security healthier by shrinking our dependence on oil from countries that have drawn a bull’s-eye on our backs and by increasing our leverage over petro-dictators, like those in Iran, Russia and Venezuela, through shrinking their oil incomes.

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Does Complexity Have Regressive Social Effects?

I have written about the virtues of simplicity in business before. But when I look around things are getting more and more complex.

Take the tax code for instance. The US tax code is so complex it is almost impossible to deal with for the average tax payer. An example of this is the Flexible Spending Account.

The FSA is supposed to give the tax payer a tax deduction on healthcare expenses that are not covered by their health insurance. It includes deductibles, co-pays and some kinds of health care expenses that are typically not covered by health insurance.

So far there’s not much you can object to. But the implementation is where it gets tricky. At the beginning of the year the employee must elect the amount to be deducted from their pay towards funding their FSA account. They can’t spend more than what is pre-funded in their accounts. If they spend less, they lose the money!

To me this seems hare-brained. If you are expenses go way over say because of some dental surgery expenses where the copays are high, you are out of luck if you didn’t foresee this at the beginning of the year. If your expenses are well under at the end of the year, you either lose the money or in the last month go hog wild buying OTC drugs that you don’t need. Who wants to see their own money go waste?! More »

Pay for Performance is Difficult to Implement

In the current debate on healthcare I’ve started hearing something that is quite familiar – pay for performance. The notion is simple – doctors should be paid based on patient outcomes not on the volume of work (fee-for-service). Its intent is easy to agree upon, but terribly difficult to implement.

In the Consulting and IT Services we have seen performance or outcome based pricing go through the entire hype cycle without getting any adoption to speak of. It’s not that customers didn’t want it enough or that vendors dragged their feet. It is just too hard to do. As a result, whenever I have seen pay for performance in contracts they have been in the form of bonuses that have never been big enough to impact vendor profitability seriously.

Pay for performance will be difficult to achieve in US healthcare as well. For reasons that are not very different from why they didn’t work in the IT industry. Here are the challenges: More »

More on IT Unpolicy

In my previous post IT and the Role of Government I objected to Atanu Dey’s arguments against having an IT policy for India. He proposed, what I called an “IT Unpolicy” – basically, do nothing.
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