There's no such thing as a free lunch

09/17/2006
By From the Lowell Sun

By ANNE CHALUPKA and ROBERT FORRANT

Over the last few weeks readers of The Sun and cable television viewers have watched the City Council wonder where the 'free cash' went and what to do about a projected budget shortfall. This is interesting to us. First off, is anyone as confused as we are about putting together the words 'free and cash'? You were told as a kid that such a thing meant you did not work hard enough for it -- not that you could magically "project" it to spend before it was in your pocket. "Hi, I have some 'free cash' in my pocket to buy a car!" We don't think so.

Anyhow, the budget discussion comes in the middle of election season and should refocus our attention on the Greater Lowell economy, too-slow revenue collection, and who might make a good governor -- who might really jump start the state economy, introduce policies designed to create well-paying jobs and allow young people to live and work here instead of migrating to the South and Midwest.

A survey conducted by the Boston Globe (May 2006) found that Massachusetts residents' two main reasons for leaving the commonwealth are: 1) to find a better job (i.e. a higher salary) and 2) to find lower housing costs. Buying a home in Massachusetts will always be more expensive than buying a house in other parts of the country: This state has the mixed blessing of high property values coupled with notoriously overpriced housing.

The National Association of Realtors recently revealed that three of the 10 most overpriced locations in the country can be found right here in Massachusetts (Cambridge, Essex County and Boston). True, not everyone buys overpriced homes in pretentious locations, but this is a problem indicative of a larger trend: Despite a fairly high per capita median income, Massachusetts suffers one of the worst income-to-home value ratios in the country. And this brings us back to Lowell and the issues of jobs, income, and 'free cash'. It certainly appears that the region's housing market is in for a cool down and this will mean even fewer tax dollars will be collected here in Lowell, making demands on the city budget more severe in the coming years. Once more, where will the good jobs come from -- are they as easy to find as 'free cash'? No, not really.

In a tightly contested race such as this primary, endorsements are a lifeline for candidates: unions, newspapers and professional organizations have great potential to influence public opinion. Endorsements can allow voters to "go with the flow" or vote on apolitical loyalties rather than on the issues, and in this case the complex one of how do we get the state's feeble economy rolling again. Endorsements will continue to add up over the next few days, so it's especially important for voters in this region not to lose sight of the issues that will affect us: How do we generate robust employment growth? How do we translate the region's strengths in scientific and medical research into good employment opportunities?

We work and study at UMass Lowell and spend a portion of our time considering why regional economies prosper and why they sometimes slump. No matter what region we look at, no matter what books and articles we consult, there is consensus that the plague of layoffs and corporate restructurings, the off-shoring of jobs, plant closings and the slow decay of entire trades can only be prevented through investments in public education -- not through more cuts. The Legislature was good to UMass Lowell this past session, but overall Massachusetts ranks near the bottom in the country in spending on public higher education. This pattern adversely affects students, teachers, and in turn the state's future economic viability. Which candidate will turn this around?

Deval Patrick, Chris Gabrieli and Tom Reilly recognize the importance of revitalizing the Massachusetts economy. But it is difficult to ignore recent statistics revealing that Massachusetts workers are in trouble: Wages are growing at a slower rate than nearly every other state's; real wages (wages adjusted for inflation) have dropped steadily since 2003; our post-recession rate of employment growth is slower than all but six other states; and the gap between rich and poor continues to widen.

In Massachusetts -- where per-pupil spending was cut more than in any other state from 2002-2004 -- we know that issues of the economy and education go hand in hand. Here in Lowell while teachers, city leaders, parents and taxpayers argue over whether public-school teachers deserve a raise that will at least keep pace with the rising cost of living, we miss the bottom-line problem: It's the economy, folks! Sluggish job creation and the stagnant housing market are the culprits, not teachers responsible for educating our future work force, the work force which, by the way, will take care of many of us 'baby boomers' real soon. Do we want these folks ill-educated and angry -- or as smart as can be, well-versed in the leading ideas of the day?

Less funding for the public higher-education system has meant more financial burden on the student: total cost to the student (tuition and fees) has risen nearly 70 percent since 2001. Massachusetts is famous for its expensive colleges and universities -- but a few years ago, that meant Harvard and MIT, not Fitchburg State College and UMass Lowell. As the costs rise, maybe UMass Lowell really is 'Harvard on the Merrimack'! More and more, Massachusetts youth are pursuing their degrees outside the state for financial reasons and staying there, part of a so-called "brain drain" that poses a serious threat to the commonwealth's economic prosperity.

The candidates agree that to slow out-migration it is essential to create jobs in sectors that reward high skill with high wages. But where are these jobs? There is little evidence that tax breaks make a big difference when companies decide to relocate. Firms will come to Greater Lowell for an educated workforce, access to the major highways, and refurbished mill buildings that offer great space relatively cheap. To us, budget cuts to education and tax breaks for firms is paradoxical, at best: due to budget cuts higher education has become so expensive that it is driving potential skilled workers out of the state, so we should make more cuts from the taxes that fund public universities? This, much like the notion of 'free cash', is nonsense.

For now, Deval Patrick is right when he says that "85 percent of our public college and university graduates live and work in Massachusetts after graduation," but if the UMass system continues to raise tuition and fees, that number will drop. And if we do not pay attention to the economic health of older industrial cities like Lowell, Lawrence, Springfield and Worcester, we will continue to see the creation of two economies in the commonwealth: Rich suburbs with wonderful public education and access to private higher education for the young people living there, and nearly bankrupt urban centers debating the Alice in Wonderland-like term 'free cash' while things fall apart all around. In the upcoming primary election and beyond, voters in Greater Lowell must weigh candidates' positions on such issues as defense spending and renewable energy. But remember that we are in a position to directly affect the economic future of our region, a future whose success depends in large part on proper support for the public-education system that will equip future generations for success in the workforce.

Last Word: If you like soccer (the real football) take in a UMass Lowell women's or men's game. You won't be disappointed. And don't forget to support the Division 2 National Championship women's field hockey team. Student athletes work hard and deserve the city's support.