No winning: Incentives

Lately in my home state of North Carolina, there's been a lot of talk about corporate incentives. The way it works is straightforward: A company makes noises about considering locating in such-and-such places, and then turns around and asks state and local governments what it's worth to them to locate there. A special tax cut, an outright rebate, land arrangements, utility support, etc.

The result is that state and local governments are competing with each other to bid for a share of tax dollars and economic development. It's like the prisoner's dilemma: If one town/state offers incentives, and the other doesn't, they win with a low bid and take home a large benefit, reduced slightly by the cost of the incentive. If none offer incentives, one location gets the maximum possible benefit - a crapshoot, but a fair one. If a bidding war springs up, it turns into a crapshoot with a low payout.

The best strategy for all of us on the tax-paying end would be for nobody to offer any targeted incentives at all; the best strategy for each individual location is to bid up to the anticipated value of the prize. In which case the corporation comes out ahead, and the rest of us experience a slim net benefit. Throw in the griping about unfair taxation, threats to relocate from existing industries unless they get a similar break, and some bad math by legislators and town councils, I think the rest of us are outright losing the incentive game.

Gripes about the housing process so far...

The most talked-about part of the offer my graduate school sent me was the graduate housing guarantee. Having read it, and gone on to read the most recent internal committee report on the housing guarantee, and then read the rates quoted on the website, I thought that this meant that I would have some variety of affordable housing. Barely affordable, but affordable.

What I didn't read was the noise-filled, flash-intensive website of a private subcontractor, who runs the other graduate housing units, the ones that the university doesn't actually own. The rent is much higher in these privately-run "luxury apartments."

Seriously? You're going to use the word "luxury" in describing graduate student housing? Someone's priorities are messed up. If I had gone on to read those rates, and realized that my school was going to put me in one of the expensive apartments, and that they would be asking for two rent payements prior to even moving in... well, the  offer would have looked a lot less attractive.

The margin for housing to be considered "affordable" is 30-35% of income. By that standard, in order for the cheapest rent in the housing run by the private subcontractor to be considered even marginally affordable by Federal terms (35% of income spent on rent), you need an income of $26,000. Which is more than they pay graduate students. And to afford a single? Over $40K. This is enormously different from the units the university actually runs themselves.

And may I go back to the front-loading, and the silly fees? Application fee of $20. Security deposit of $150. $12.95 extra for them to process a credit card payment through a fourth party (how many middlemen are taking a cut?) and the first two months' rent due August 1st and September 1st when the move-in date is September 19th. Graduate student orientation? Guess. It's the 17th, and if you want to move in early, you get charged extra.

If I had known all of this earlier, I might have decided that thal school's financial support was simply unworkable. As is, now, I will find a way to manage to make ends meet, but you can bet I'm not happy about it. The fees are the most ridiculous part. I'm paying an 8.6% fee to reduce your paperwork? Even Paypal does not charge so much - and taking it out on the payee?

Perhaps in California, students are accustomed to going neck-deep in debt to afford housing, and it's considered essential to have a "resort-style" swimming pool at your apartment complex, etc. But where I come from, graduate students aren't interested in paying an extra $300-$500 per month to live in more luxurious digs. They're interested in having enough left over for groceries and just maybe putting something aside to work on those student loans they accumulated as an undergrad.

I know, I know, this is how the subcontractors make a mint and get their boat payments. But you'd think if the university was aware that problems affording housing both drive away prospective graduate students and prevent existing graduate students from making it through the program in a timely fashion (or at all, in some cases), they'd try to make sure the housing they were offering was affordable. And they are aware. I read the survey results cited in that report.

Seven problems in US elections

1. Primaries. They're fixed in such a way that different states matter different amounts for different parties' candidates, and in some cases, the primaries either don't matter or, in areas with by-party primaries and landslide support for one or the other party, decide all too much.
2. The electoral college. Contrary to popular opinion, the electoral college amplifies the effect of large states and makes small states matter less. In practice, since politics is regional, this means a few states have disproportionate leverage and gain special treatment from presidential candidates.
   
3. Plurality voting. There are tons of better alternatives, from instant runoffs to the Borda count to approval voting.
4. "Third party" candidates. See #3 - there are better ways to do elections that aren't nearly as vulnerable to the spoiler effect, but while you have a plurality election, third party candidates have at best the effect of trying to make sure that the two major parties don't completely ignore their radical wings.
5. Campaign finance. There are good things about the system in place, but that doesn't mean it can't still be fixed.
6. The public polling horserace. I like to follow the polls just as much as the next person, but I think sometimes we spent too much effort trying to figure out what groups are "key" to an election and who will win by how much.
7. The median voter theorem applies to public perceptions, not reality. We really could use better honesty, accountability, and more clearly differentiated options that don't simply talk past each other in code designed to reach the base and bypass the moderates.