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December 09, 2009 - Image 4

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The Michigan Daily, 2009-12-09

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4A - Wednesday, December 9, 2009

The Michigan Daily - michigandaily:com

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Edited and managed by students at
the University of Michigan since 1890.
420 Maynard St.
Ann Arbor, MI 48109

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Unsigned editorials reflect the official position ofthe Daily's editorial board. All other signed articles
and illustrations represent solely the views ofttheir authors.
Clearing the air
Michigan legislature must pass indoor smoking ban
Most people are familiar with the negative health risks
associated with smoking. To improve the health of
workplace environments, 37 states have enacted some
sort of statewide ban on indoor smoking in public places. While
the Michigan legislature has repeatedly taken up this issue, leg-
islators have been too stubborn to compromise and approve a bill.
With the state Senate likely to take up the issue again later this
week, legislators must finally agree on and pass a version of the
bill that will protect the health of workers and make reasonable
exceptions for certain businesses.

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Expect the unexpected

Bills to ban smoking statewide aren't new
to the Michigan legislature. Last year, a bill
that would have banned smoking in public
areas like restaurants and bars died before
it reached the governor's desk. Ultimately,
the Senate and House of Representatives
couldn't agree on exempting some busi-
nesses from the law. The bill that the legis-
lature takes up later this week will likely be
similar, and will face a similar debate over
whether to make exceptions for businesses
like cigar bars and casinos.
The dangers of secondhand smoke are
the primary reason a smoking ban should be
enacted. According to the Centers for Dis-
ease Control and Prevention, 1,300 people
die from smoking-related causes every day
in the United States. Complications from
secondhand smoke are thought to be respon-
sible for 11 percent of these deaths. Most peo-
ple can lessen their risk by avoiding smokers,
but those who work in smoke-filled environ-
ments don't have that option. A smoking ban
would create environments free of health
risks for emnployees of restaurants and bars
who currently have no choice but to risk sec-
ondhand-smoke exposure to keep their jobs.
Critics of a ban have said that it would
hurt businesses, driving away custom-
ers who smoke. But the opposite may be
true. Smoke-free environments are attrac-

tive to potential customers. Non-smokers
could frequent establishments that they
may have previously avoided, as there are
far more non-smokers than smokers. And
evidence from states that have passed simi-
lar laws is good news for the ban. Tax rev-
enue and demand for liquor licenses, for
example, increased in New York after the
implementation of a similar indoor public
smoking ban.
That said, some exemptions to the ban are
understandable. It's probably unreasonable
to expect businesses that exist for the sole
purpose of smoking and tobacco use - like
cigar shops and smoke bars - to close their
doors to smoking. Losing the ability to let
their customers smoke would be tough for
them, and Michigan's economy can't afford
to lose any more small businesses. And it
could be expected that people who choose
to work in these establishments are aware
and accepting of the consequences of sec-
ondhand smoke.
If these exemptions are what this bill
needs in order to pass, the legislature
shouldn't mind them. Michigan workers in
bars and restaurants need the protection
that this bill will offer them. State legisla-
tors must not fail - once again - in their
obligation to protect employees from the
dangers of secondhand smoke.

t is hard for me to listen to our
president and members of his
economic team talk about finan-
cial matters with-
out laughing. I
understand that
they see the econ-
omy in the same
way that many
University students
see the world -
as a machine that
should only be
operated by those VINCENT
who understand it PATSY
best. They believe
that matters of eco-
nomic consequence
can only be trusted in the hands of an
elite group of policymakers, and they
label the rest of us with terms like
"capitalists" or the "labor force." For
them, our job title is our sole contribu-
tion to the overall economy.
This view is wrong. People are not
inanimate objects or cogs in some
economic machine. Everyone is a
capitalist, a laborer, a consumer and a
producer at the same time, and their
preferences simply can't be predicted
by even the most intelligent experts
in President Barack Obama's Cabinet
or in University lecture halls.
Economics, as a science, deals with
the fact that all people make deci-
sions that affect the world around
them in order to survive. Every per-
son has goals and some sort of idea
to achieve them. Economics does not
deal with how to attain these goals
or what these goals are - such topics
are covered by psychology, philoso-
phy and other disciplines.
No matter what you do, you are
making an economic decision. Every
decision to buy this food or that, hang
out with this friend or not or watch a

certain TV channel counts as an eco-
nomic decision. We subconsciously
order these preferences based on
their subjective value to us. In other
words, whatever you are doing right
now, (reading this column, for exam-
ple) ranked higher on your value
scale than other possible options
(like reading the lead story on the
front page).
obviously, your preference only
becomes obvious after the fact. I
can't predict what you were going to
do. I can only hope that by writing an
excellent column, I can attract read-
ers. I have no ability, no matter how
keen my insights into your mind, to
predict every action you make, and
therefore, I can't plan an econobmy
around you.
Of course, it makes sense that most
mainstream economists - and cer-
tainly the ones who have the presi-
dept's ear - do not stress this view.
Like many people, they don't want to
confess their limitations by admitting
the personal nature of economics.
These economists focus on deter-
mining if this or that political policy
would be better or worse. What is
lost is the key nature of economics,
namely that the field is largely based
on individual preferences that can't
be planned.
For example, if the supply of a
good falls, we don't know precisely
how much the price will fall because
we can't know consumers' subjec-
tive values. All we know is that laws
of economics exist that drive the
price downward. Economic laws tell
us direction and tendency of price
movements, not what the final num-
ber will be.
Inevitably, because they can't
accurately predict the market chang-
es, economists focus on long-run

equilibrium. The problem is that
they study a wholly unreal situation.
The world as it is today is one of con-
stant change. You don't know if later
today you will run into an old friend
or if you will be hit by a car. Prices of
goods, such as the stock market, are
constantly moving and changing in
an unpredictable manner.tBecause
the real world is difficult to model
mathematically, economists make
concessions and assumptions before
developing equilibriums. This is what
is studied in Econ 401 and 402 at the
Economists can't
predict human
For these economic models to work
in real life, we would need to live in
the world of Bill Murray in the movie
"Groundhog Day," constantly repeat-
ing the same actions over and over
again. Every person would need to
keep buying the same goods, walking
in the same shoes, spending each day
doing the same homework while lis-
teningto the same music, etc. But this
isn't the world we live in - nor one
we would ever want to live in.
In the real world, people can't be
treated as variables in an equation
that the state can manipulate to serve
some societal goal. This is the funda-
mental point of economics that most
experts either don't understand or
won't admit.
- Vincent Patsy can be reached
at vapatsy@umich.edu.



Nina Amilineni, Emily Barton, Jamie Block, William Butler, Ben Caleca, Nicholas Clift,
Michelle DeWitt, Brian Flaherty, Emma Jeszke, Sutha K Kanagasingam,
Erika Mayer, Edward McPhee, Harsha Panduranga, Alex Schiff, Asa Smith,
Brittany Smith, Radhika Upadhyaya, Rachel Van Gilder, Laura Veith
Student right to question Come on, people. Let's get creative.
Ritan Ingali
underage drinking laws LSA "enio"
I commend Brian Hurd's astute reasoning in Climate c Conf ce
his viewpoint on Monday (G.L Joe deserves a
beer, 12/07/2009). He nicely outlines the prin- isgoodfort environment
cipal problem behind lowering the drinking
age: That states' hands are tied if they want to
pave their roads. TO THE DAILY:
I have an idea for disentangling the drink- I am proud to know that my fellow University
ing age from highway funding, though it would students, faculty and alumni are in Copenhagen
admittedly take some aggressive lobbying of at this moment for the United Nations COP15
Washington. Have all states announce their Climate Change Conference (University group
intention to lower the drinking age back to 18 headed to Copenhagenfor Climate Change Confer-
by 2020. ence, 12/07/2009). Students on campus in a wide
Each state's highway funding budget is cut range of groups have been deeply involved in the
by 10 percent, but the federal government can youth climate movement this year, and the large
use that extra revenue to form a fund that pro- youth presence in Copenhagen is a testament to
vides grants, tax incentives and low interest our strength and commitment.
loans for states to develop robust public trans- While a legally binding treaty is very unlikely
portation infrastructure. We can call it the to come out of the conference, Iam excited about
"Let Our Roads Grow Potholes, but At Least the progress made today by the United Sates.
We Can Drink Without Having to Drive Act," Environmental ProtectionAgency Administrator
which will create the "Beer for Buses (and Lisa Jackson released her agency's long-awaited
Trains) Fund." Endangerment Finding, officially declaring glob-
An alliance between advocates of lowering al warming pollution a threatto public health. It
the drinking age and advocates of develop- places the EPA in a position to regulate green-
ing better public transportation would be far house gas emissions and gives President Barack
more than just a marriage of convenience. It Obama the ammunition he needs to promise
could be a symbiotic relationship that creates real emissions reductions while he is at the UN
just enough synergy to actually get something climate negotiations in Copenhagen. I earnestly
done. hope that Obama will show true leadership and
Maybe Michigan could even be the pilot announce his support for science-based global
state. The bidding war that could result warming pollution cuts. We have a long way to
between developers who want to construct go, but this is a start and Iam optimistic.
the infrastructure might attract businesses
and perhaps even provide a much-needed job Hannah Clark
surge. Public Policy senior
Readers are encouraged to submit letters to the editor.
Letters should be less than 300 words and must include the writer's full name
and University affiliation. Letters are edited for style, length, clarity and accuracy.
All submissions become property of the Daily. We do not print anonymous letters.
,iend letters to tothedoily umich.edu.

The Daily is looking for a diverse group of strong, informed, passionate
writers to be columnists for the winter semester. Columnists write a
700-800 word column every other week on a topic of their choosing.
If you are an opinionated and talented writer, consider applying.



College too costly? Blame gov't


Economic issues typically don't
resonate with us college students,
as many of us are insulated against
the burden of taxes, unemployment,
outsourcing of jobs and even gas
prices. But one issue that unequivo-
cally affects college students is the
ever-increasing cost of tuition. The
best explanation I have heard for the
phenomenon was delivered in a few,
simple words: No government inter-
vention in education means no inflat-
ed tuition.
Before World War II, most Ameri-
cans didn't attend college. For indi-
viduals who did, it was inexpensive
relative to today's figures. In many
cases, the student worked for a few
years before or during school to save
up enough to pay for college and grad-
uated without debt.
This rarely happens today due to
the existence of an exorbitant num-
ber of government-guaranteed loans
and grants available to students. The
problem with such a system is the
development of an educational-indus-
trial complex in which individuals
become slaves to debt who are forced
to pay off loans long after graduation.
The benefactors of the scheme aren't
the students but rather the banks,
universities and politicians.
Tuition data for the University's
Law School show the effect of gov-
ernment intervention. Adjusted for
2009 values, yearly tuition at the
Law School in 1950 was $1,884 for
state residents and $4,037 for out-of-
state students. In 1950, the inflation-
adjusted, median personal income
was $18,103, meaning that students
would have earned enough to pay off
a year of tuition less than three

Fast forward 60 years: tuition for
the Law School is currently $41,310
and $44,310 for in-state and out-
of-state students, respectively. The
median personal income is approxi-
mately $25,000. Today, the average
American would have to work more
than 18 months to afford a year of
What caused the difference? Before
World War II, there were no govern-
ment loans or grants. When these
things did not exist, college was inex-
pensive and affordable. Government
intervention in education has caused
costs to skyrocket.
Besides driving up the cost of
education, the government is driv-
ing down its value. Since fewer indi-
viduals went to college before World
War II, people didn't stay in school
very long before they joined the work
force. Today, however, with guar-
anteed loans, droves of Americans
obtain college degrees. Thus, the
value of the degree has diminished.
This is basic supply and demand. To
stand out, a student must obtain a
graduate degree or Ph.D. These stu-
dents spend more years in college,
accumulate more debt and delay their
entrances into the work force, where
they can actually make money.
Today, anyone who wants to go to
college has access to a loan co-signed
by the government. Students then bid
and compete against one another for
spots at universities with government
money. There is no restraint on the
demand, which causes an increase
in prices. Universities love this, as it
enables them to increase admission
costsknowing that the gover ment

will guarantee the debt. If anything,
college tuitions should be decreas-
ing. We are currently in a recession
and demand for highly skilled work-
ers has diminished. Unemployment is
high, and incomes and the economy
are shrinking - yet college prices
continue to rise.
Could colleges afford to charge
$30,000 a year if government loans
did not exist to support this artifi-
cially created demand? The answer
should be obvious. These programs
mean that colleges have no incentive
to bring down costs.
Let's examine a hypothetical'sce-
nario. If the government announced
that it would eliminate educational
aid programs for the next fiscal year,
there would be a drastic decline in
enrollment. Most people wouldn't
be able to afford outrageous tuition
prices. Would this mean that colleges
would continue to operate with empty
classrooms or shut their doors and go
out of business? Of course not - cql-
leges would adapt by slashing outlays
to lower operation costs, which would
subsequently make attendance more
affordable for students.
Instead of having people go to col-
lege for a devalued degree and grad-
uate with 25 years of future debt,
students can work for a few years
after high school and gain valuable
real-world experiences before choos-
ing to obtain degrees for significantly
lower costs. The benefits of reconsid-
eringmisguided federal aid programs,
which have jacked up the price of a
college education while devaluing it
in the process, are crystal clear.
Ale plies is an LSA junior.

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