Obama's Bailout - And how it saved us

"The Bailout", a phrase that signifies taxpayer money given to a company as a loan, primarily under the first term of President Obama.

I see the outlook of an American; why do these companies, which have caused substantial harm to the American economy, be given millions of dollars? News agencies frequently report to the public that these funds are used to pay off high-level executives; from that standpoint, the American taxpayer is being cheated.

CBS Nightly News reported tonight about the ongoing controversy surrounding a failed solar company, Solydra, that was given $500 million. Hastily, Republicans point the finger to the White House, seizing this opportunity to strengthen the image of their party and weaken that of the Democrats. Seems as if Americans are still angered over corporations using their taxpayer dollars.

However, the stimulus package that was passed back in January of 2009 certainly was beneficial. Though there may be occasional, disappointing failures (and in this case, a $500 million one), many American companies would not be able to stand if it weren't for President Obama. And American companies mean that at least some American workers will be employed, extremely necessary given the fact that we are facing unemployment at twice the natural rate.

Bank of America, headquartered in Charlotte, received this government loan and was able to fully pay it back. This bank allows the economy of North Carolina to thrive and was on the verge of collapsing like its sister Wachovia (bought by Wells Fargo). Evaluate the situation: American banks such as Lehman Brothers have collapsed, and other companies are in dire need of money to continue operations. Contrarily, I understand that the common citizen will be irritated by this demand and even mistrusting of both the government and these corporations.

The bottom line is that had some of these companies not been given this money, they would have failed, which would have led to the unemployment of more Americans. Furthermore, foreign companies would have been able to gain more market share in the American economy; if we look at just banks, I'm sure that Barclays, HSBC, UBS Group, Credit Suisse, and Deutsche Bank wouldn't mind having their American counterparts eliminated.

To me, it seems as if what the American government did was extremely interventionist, directly opposite of what Adam Smith suggested in his Wealth of Nations. But hey, like mercantilism, maybe heavy intervention from the government is the only way you can keep the economy of a country alive at times? 

Standardized Tests...and why they're pointless

Well, I should start off by saying that they certainly aren't pointless, and to a degree, have the potential to segregate accomplished students from not-so-accomplished students. But why are students mandated to take these exams for nearly all top-tiered colleges and universities?

It makes sense; school grades cannot be "standardized" throughout the country, and only a standardized test administered throughout the nation can do so. But this raises a few alarming questions:

Why must it be the SAT or ACT? 
Studies have consistently shown that the SAT and ACT are relatively poor predictors of college success. There certainly are many instances in which a scorer has a sub-par GPA but near-perfect scores and vice versa; so who is more "ready" for college?

Of course, high school grades have shown to predict college success nearly three times more accurately than the SAT or ACT can. However, several other standardized tests also have the capability to estimate how well an individual will do in college, and in my opinion, much better than the SAT or ACT. Take the SAT Subject Tests for example; this exam, still administered by the CollegeBoard, will measure knowledge in a particular subject area. Essentially, a student will learn the course content in a high school class and subsequently take the test, thus directly measuring how much the student has retained.

Critical thinking cannot be compared to knowledge in any regard, which is why I believe the SAT Subject Tests are the best exams currently available to high school students. Though the SAT or ACT may measure the capacity to learn (and I'm sure they don't), isn't it ultimately what you've learned what matters? Just a thought.

Why are these exams privatized?
For the 2011-12 school year, I noticed both a spike in the price of the SAT and ACT at rates higher than inflation. I understand that both the CollegeBoard and American College Testing companies are not-for-profit organizations; however, what is generally disregarded is that these companies operate as corporations seeking a profit and compensate their employees with high paychecks and bonuses...the children of employees even have their college tuition paid for.

It isn't so much the prices that bother me, but more so the amount of power that the CollegeBoard wields. For example, CollegeBoard administers the Advanced Placement (AP) exams, and though the International Baccalaureate (IB) system of Britain can be considered a competitor, it is regularly not offered in American high schools.

Inevitably, the price must deter some testers from taking the exams multiple times, something that is truly unfortunate. I do understand that disadvantaged students are allowed two free attempts, but I am also aware that many of my peers have taken the SAT or ACT nearly four times, something impossible for these disadvantaged students.

The United States government may not possess the resources to administer a federal standardized test (and if it did, it would have the efficiency of the USPS), but I do believe that there should be stricter regulations that the CollegeBoard and American College Testing companies should be subjected to. Preventing obvious oligopolies would be a start, even for not-for-profit organizations.