Terrible headline. “Asia” isn’t a thing apart from a region on a map. These are separate countries doing their own thing.
Equally annoying is when folks say “Asian” as an ethnicity. That’s glossing over a whole bunch of different countries that have relatively little to do with each other apart from being in the same general area on the planet.
School districts do have an issue with those without bona fide residency attending school there. It’s a big source of fraud that hurts those paying taxes in the districts. I’m all for strong enforcement of those rules, but this goes too far.
In most cases it’s not too hard to figure out who is committing fraud here. Families tend to rat each other out. It’s more a question of if the district is enforcing the rules.
Is using the surveillance state the solution to this problem though? I personally don't think so. There are other solutions, utility bills in the families name, ownership/rental documents, etc. Will there be some number of people that cheat the system? Absolutely. Will there be some number of people that learn about the license plate trackers and buy a $500 beater and park it on the right street to "beat them"? Also absolutely.
Personally, I think schools shouldn't be funded solely by the taxes of residents that reside within their bounds, but as a collective pool of all tax revenue. That'll not happen in my lifetime though, too many people bought houses in "the right neighborhood" to get their kids into the "good" school that there would be so much push back that no politician would dare touch it. Especially since those people are typically also the ones with the money.
The person in the article provided proof in the form of a mortgage statement, which should establish that they pay tax to the district. Where they spend their time outside of school hours seems irrelevant.
> Will there be some number of people that learn about the license plate trackers and buy a $500 beater and park it on the right street to "beat them"? Also absolutely.
I believe they’re using LPR at drop off and pick up too, so parking a $500 junker somewhere isn’t a workaround. They would have to drive to the parked car every morning, transfer into it, drive it to school, return to the parking location, swap cars again, and then repeat the entire routine for pick up. It all technically could be done, but as a parent who knows what it’s like to hustle multiple kids to school in the morning I doubt this routine would be a common workaround.
> There are other solutions, utility bills in the families name, ownership/rental documents, etc.
Will these cause injustice and false positives even more than license plate tracking? What is your point?
> Personally, I think schools shouldn't be funded solely by the taxes of residents that reside within their bounds, but as a collective pool of all tax revenue.
Are you talking about undemocratically forcing a restructuring all school financing everywhere in order to avoid one school doing a $1K/mo license plate tracking contract to make sure kids live in the district that they're attending school in? What is the principle that you're trying to uphold?
> Are you talking about undemocratically forcing a restructuring all school financing everywhere in order to avoid license plate tracking? What is the principle that you're trying to uphold?
No, I'm talking about changing how schools are funded by making funds more evenly distributed across districts. Giving the kids in the "bad" areas the same opportunities as those in the "good" areas. Right now, if you can't afford that four-five-six-seven-hundred thousand dollar home, you aren't afforded the same level of public education as someone else who can. And doing so democratically, which is why I mentioned it'll never happen because no politician would be able to run on that. Their opponents would be outfunded by the top 10% to keep the status quo.
And this is coming from someone who own's a home in a "good" district. Where we got a total rebuilt elementary school 4 years ago, a new middle school actively being build, and a new high school that opened 3 years ago. Why should my kids have access to everything newer and better just because we can afford to live out in the suburbs, than someone else who isn't working in the cushy tech industry and instead is busting their ass only to live in poverty?
Newer does not mean better, or even imply it. Money spent on facilities has almost no correlation to educational outcomes.
What matters are the peers you go to school with, supported by decent curriculum and moderately competent teachers. None of which is expensive. Oh, and administrators who actually care about teaching being done vs. being terrified of the lawsuit fairy.
It’s the peers that matter by far the most - and that means parents. Parents that are self-selecting into good districts tend to skew heavily towards “involved” and some definition of functional. This can mean being able to and buying a home or rent an apartment in a good district, or finding some clever and/or creative workaround to get the same outcome. The latter is even better in most cases since those families are motivated at an even higher level to make sure it’s a success.
The best school I went to as a kid was a private highly selective school in “the ghetto” where my dad lived growing up. Nearly every kid there was on some form of subsidized or full ride tuition, with very “working class” parents. The facilities were barebones at best. The vast majority of kids had parents who held them to extreme expectations even if they didn’t have financial means or even time to be highly involved day to day.
The uber rich brand new high school I went to the next year in the suburbs wasn’t even close.
The difference was in the kids who attended the school and the expectations put on them for both classroom behavior, engagement, and work ethic. Shitty disruptive kids were kicked out within a matter of days so as to let kids who wanted to be there actually learn.
Anything beyond that is close to a rounding error for outcomes.
The inner city school district I pay taxes into spends more per student than many of the suburbs. You could triple it again and get zero change in outcomes - in fact so far since living here school budgets are inversely correlated with outcome, although I don’t see a causation there in either direction.
Schools that are allowed to be ran like schools and hold students to high expectations and standards do well. Schools that are ran like social programs trying to correct for all of societies ills do not. It’s pretty simple in the end.
You run it as a school, since that's what a school is for. Otherwise you fail at both being a school and a poor replacement for the social programs you're trying to do on the side.
For example - a school is not a correction facility. If a student is violent, they do not belong in school. Get them out and put into a proper facility designed for such things. It's not the school's problem anymore to think about.
The results speak for themselves on the topic.
A school is to educate students who are there, present, and want to be educated. They will fail at any other task.
Uh what's undemocratic about the state legislature, which created the current system of small local districts, Changing how schools are funded and governed?
Small parroquial government entities that are funded inequitably are bad, actually. And the current system of schools districts is a legacy of segregation and white flight. Local government boundaries are entirely arbitrary, should the city let water or fire services suffer in one council district because it doesn't produce enough taxes to support it?
A child's academic opportunity shouldn't be determined by their zip code and parents income. Everyone should have access to free high quality public schools.
Surveillance State? They already have all kinds of data on you, including your child’s vaccination records, security cameras throughout the building, supposed home addresses, and parental information. I assume you have to have your ID scanned before entering the building. LPR does not offer anything revelatory from a personal freedoms perspective.
Tracking license plates to look for unusually activity is an easy win for both fraud prevention and security from more serious threats.
So? My employer has my SSN, address, work history, etc. but I don't want them to know about where I go on the weekends. It's a fallacy to say that just because an entity knows a lot about you that it's OK if they know everything about you.
Can’t speak for Chicago, but in my city the schools get similar funds on a per-student basis yet still have very large differences in academics from school to school.
The reason parents try to get into different schools isn’t to chase funding, it’s to get into the one with the best outcomes. A lot of that comes from parental involvement and having a critical mass of engaged students and parents, not the dollar amount spent on each student.
I'm glad that's how it works where you live. In Illinois, most school funding comes directly from property taxes, meaning rich areas get more.
For state funding, they use a system called EBF which is better than straightforwardly giving out money based on local property taxes. However, it is far from fair. As an example, part of the calculation is what's called a "regionalization factor" - where funding is reduced for areas with lower local average incomes.
"A lot of that comes from parental involvement and having a critical mass of engaged students and parents, not the dollar amount spent on each student."
FYI, parent engagement is also heavily proportional to parent income/property prices.
Very hard to be engaged at school with double/triple working class jobs.
Then "school district fraud" shouldn't be a problem. If a parent is willing to committing a crime to get their kid into a good school, they're heavily engaged and involved.
School sizes do change over long time horizons as demographics grow. This is true.
But school buildings have limited capacity and teacher:student ratios should be maintained. These cannot be changed instantly. Planning happens according to people actually living there, so if a lot of people are circumventing the rules and cheating their way in it breaks the system.
Not even very long horizons. For example, a hot housing market can cause a rush of young families into a district as older retirees cash out and move to Florida or whatever. Schools adapt to this.
I agree following rules is important. What kind of example are you setting for your kids, right? But having some perspective is also important.
In Chicago subrubs school funding is largely based on local property taxes. Expensive neighborhoods have better funded schools. Of course there's also federal funding for poor schools so really the worst funded schools are the ones where everyone is lower middle class but the best funded schools are in the richest districts. Of course as you point out parental involvement is more important than funding, but they tend to be correlated and funding still matters.
This isn't 'fraud' in any meaningful moral sense, it is a rational reaction to immoral, unjust school funding models that perpetuate systemic inequalities based on the zip-code you can afford. I'm sure schools have a duty to police this in their mind, sure, but I side with parents trying to evade the boundaries they've been put because they weren't born rich enough.
I don't disagree. It's a legal fraud, but it's not a moral fraud. I do not view "the law" a neutral arbiter of morality, and given what is happening in the US right now I hope you don't either.
What am I supposed to be reading here? The article? The short snippet of commentary about it? The back-and-forth comments on the commentary?
Your link seems to have nothing to say about inequitible school quality based on unfair, racist, classist propety tax funding models. How about this one which followed cohorts for 40 years and found substantial differences in life outcomes correlated* to school funding levels (PDF ALERT!): https://gsppi.berkeley.edu/~ruckerj/QJE_resubmit_final_versi.... Crucially this looks at life outcomes, not just test scores.
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*Just in case someone wants to remind me or anyone else that correlation does not equal causation, I will say "I know" and "in longitudinal studies, time operates as an exogenous variable that adds substantial evidence of causality in well-designed research.
If you have proof of home ownership and proof of legal guardianship of the child, what’s the problem?
I can see it being a problem if e.g. a bunch of family members are putting their kids in a school district based on a single home owned by a grandparent. But if that grandparent was also the kid’s legal guardian, fair enough!
Ok, how big of an issue? How many students? How much wasted on fraud? I went to a top school where sometimes students tried to fake residency. It was essentially a non issue in the grand scheme of the potential waste for a school district to generate.
All of the children get an education, but you have to divide up the attendance across the available schools.
A single child going to the incorrect school isn’t going to break the system, but when it starts happening at scale it starts diluting the per-student funding in a district, increasing class sizes (reducing the teacher to student ratio) and eventually puts the school over limits and forces nearby children who should be going there into schools that are farther away.
One or two students don't make a difference. But if a number of people lie, then that dilutes the experience of the legit students. So it's not just as simple as you make it sound.
Here's an extreme example. One boy I know went to a school from kindergarten. He was tall and expected to start on the basketball team. Suddenly,in his junior year, several great players showed up from out of nowhere. There were lots of rumors about whether they were legitimately allowed to enroll, but in the end several lifelong students were bumped from the team. The coach was happy. The principal loved the idea. The kids presumably enjoyed the new school. But there were several others who lost an opportunity.
There are downsides to open door policies like you're endorsing. Most of the time, they're not so visible. But when resources are finite, people get hurt.
I wonder if perhaps the noise of families ratting each other out is getting too loud. This sounds like a solution to cut through the noise and have their own data. Like you said, this does go a bit too far. It also does not seem to properly equip the school district with factually correct info. Metal on wheels isn't a good data point for "You live here".
The kind of district where people would rat each other out at any rate that would cause non-trivial amounts of work is going to be full of exactly the kind of people who wouldn't see anything wrong with treating a circuitous 3rd party ALPR enforcement system as authoritative and would have the spare $$$ to pay for such a boondoggle.
> School districts do have an issue with those without bona fide residency attending school there
How does this work? Do parents use a friend’s address to register for the school? Is there no way for the state-run school to check against tax records?
Private credit is cracking and lending standards are tightening behind the scenes. If you’re not building cash reserves right now you’re going to wish you had. The distressed opportunities ahead go to whoever kept dry powder while everyone else was chasing growth.
If your business is light on free cash flow (ie everyone in AI at the moment) buckle up as there are storm clouds ahead. If you’re running a business that relies on external cash (VCs, loans/bonds, etc) to keep things going things will get very ugly.
This is not my field of expertise, but I modeled keeping cash reserves to buy distressed assets. Unless I was able to perfectly predict the crash, the outcome was still better to not time the market.
> If you’re running a business that relies on external cash (VCs, loans/bonds, etc) to keep things going things will get very ugly.
Honestly thrilled to hear it. The AI bubble needs to burst so we can find out what's actually useful, start requiring real business models again, and get rid of all the noise and waste.
The problem is all these over-leveraged sectors will drag everybody else. And guess who will be bailed out? Heads they win, tails everybody but them loses.
> The problem is all these over-leveraged sectors will drag everybody else
Well, the good news is that's what good public policy is for, to blunt the impact of the damage with strong anti-trust enforcement and careful cash injections to weak-but-critical areas of the economy to help stabilize in rough times.
Now, hang on for just one moment while I crawl out from under this rock and take a look at who we have entrusted to set our public policy.
The problem is, what assets remain of a company that doesn't own anything material? OpenAI, Anthropic - they don't own datacenters that could be auctioned off. All they own is training data and trained weights, and both are relatively worthless.
The game that all the AI companies are playing is to be the last dog standing at all costs, because that kind of dominance is a money printer.
Well it only took 5 years of destroying responsible savers with every policy imaginable to make sure they get crushed by those who availed themselves of the negative real rate loan inflation machine. How many people are left remaining that were dumb enough to take that strategy and are still standing? If you were operating on a cash basis for the last 5 years you were mostly wiped out by people leveraged to the 9s on debts and meanwhile your buying power was erased.
Interest rates on things like CDs and low-risk bonds have been decent for a while now. It’s not been painful to sit on cash reserves provided you were smart about where the cash was parked.
It’s not an either/or, it’s just a question of who was participating in the boom while preparing for storms ahead vs those all in on the boom.
What implodes in the period ahead are things that are massively over leveraged and can’t absorb a hit without doubling down again with more funding/loans and such. These are the folks and companies that get wiped out.
You're not wrong it's always good to have cash but certain allocations could have done 50%-100% return on investment while a CD brought ~5.5% for a while. Look at S&P since 2021. Knowing when to transition from cash, liquidity, other instruments is what kills/allows people to survive. We can't all do the same thing, it's almost as if it's economic ecological evolution, random death.
In actuality, the CPI is lower than inflation because technological advancement, automation, and economies of scale (due to globalization etc) are driving consumer prices low. In other words, if factories are still producing things like they were 20 years ago, the CPI would have been much higher, and that higher number is closer to what should have been the inflation number.
> if factories are still producing things like they were 20 years ago, the CPI would have been much higher, and that higher number is closer to what should have been the inflation number
This is an impossible counterfactual to test. In reality, tracking value across time requires adjusting for immeasurable preferences. This is why inflation is really only a useful measure for personal purposes across periods of years. It’s only macro economically interesting across a generation and close to meaningless longer than a human lifespan.
I think it's so obvious that no testing is needed, but generally I don't disagree with your take.
The thing is one really needs to understand what "real yields" mean when investing in bonds, i.e. it means your purchasing power with respect to cheap commodities tracked by the CPI is preserved, but it doesn't necessarily mean "value" (whatever that means in the abstract) is retained.
> it means your purchasing power with respect to cheap commodities tracked by the CPI is preserved
CPI isn't a measure of commodities. And "CPI" is a bit of shorthand, given there are pretty much as many measures of consumer and producer prices as there are economists.
> it doesn't necessarily mean "value" (whatever that means in the abstract) is retained
This is what any measure of inflation ultimately seeks to measure. Purchasing power is intrinsically tied to the basket of goods and services its measuring. That basket varies across people and time as preferences vary.
A better measure is what % of the total money supply you have.
I.e. you started out with 2e-20 % of the total money, and after 5 years you now have 1e-20 % of the total money, then whatever happened to CPI, you've been diluted and you would probably have been better off investing in something else other than cash.
That makes sense in theory, but in reality what "total money supply" is is a complete can of worms and basically impossible to measure
Interest rates on things like CDs and low-risk bonds have been decent for a while now. It’s not been painful to sit on cash reserves provided you were smart about where the cash was parked.
Just make sure you can unpark it, else you're SVB.
Decent is fine if you're about to retire and want to avoid risk but I wouldn't recommend parking your wealth in CDs/bonds if your retirement is still 15+ years out, personally. The government has to print money to bail itself out which means things are going to inflate quite a bit, just look at what gold has done in anticipation of this.
Banks bailed out the hedge funds in '98, then the taxpayer bailed out the banks in '08, then the government bailed out the taxpayer in '20... now monetary policy from the fed has to prevent the government from defaulting.
The only reason it’s buying back the stock is because the price has been destroyed by the company’s underperformance. Also yes buybacks will reduce profit but an unprofitable company doing buybacks is not a healthy one.
Agree with the above general assessment that this is a company doing layoffs to address years of bad decisions and underperformance, and the broader issue of SaaS valuations as folks question valuations there. Just another case of “AI” as a PR puff excuse to avoid simply admitting this is about correcting prior bad management decisions.
TIL that 20-30% revenue growth year over year is underperforming.
Atlassian does >$1B/year in free cash flow. the GAAP losses are almost entirely stock-based comp, which is non-cash. the buyback exists specifically to offset that dilution.
> buybacks will reduce profit
wrong. its a balance sheet transaction. cash goes down, shares go down.
I don’t think anyone believes this is because they are becoming more efficient because of AI. It may be a bit because AI makes their products even less attractive than they already were.
Not really relative to broader options in tech. The big money goes to the consulting leaders, but most of these folks look like glorified grifters more and more as time goes on.
Ultimately AI may be a big threat to the sort of “advisory” work McKinsey historically focused on.
That information is likely already in the hands of various folks as I highly doubt the authors were the first to find this glaring security issue, they’re likely only the first to disclose it. If McKinsey has hard data that nobody else exploited this now would be a good time to disclose that given what sounds like an extremely severe data leak.
The chat messages are very very sensitive. You could easily reverse engineer nearly every ongoing Mck engagement. The underlying data is not as sensitive, its decades of post-mortems, highly sanitized. No client names, no real numbers.
Is it though? Managing teams to not torpedo your company with stupid stuff like this is kinda core to “good management.” The evidence would indicate they’re not very good at that either.
It’s a self fulfilling prophecy. They’re extremely expensive so they must be good so they must be worth it. And because at that level measurement is extremely subjective it’s mainly about the vibes.
Fair take, but you'd be hard pressed to find much resemblance to any advice McK gives to its own practices.
Pre-AI, I always said McK is good at analysis, if you need complicated analysis done, hire a consulting firm.
If you need strategy, custom software, org design, etc. I think you should figure out the analysis that needs to be done, shoot that off to a consulting firm, and then make your decision.
IME, F500 execs are delegation machines. When they wake up every morning with 30 things to delegate, and 25 execs to delegate to, they hire 5 consulting teams. Whether you hire Mck, or Deloitte, or Accenture will only come down to:
1. Your personal relationships
2. Your company's policies on procurement
3. Your budget
in that order.
McK's "secret sauce" is that if you, the exec, don't like the powerpoint pages Mck put in front of you, 3 try-hard, insecure, ivy-league educated analysts will work 80 hours to make pages you do like. A sr. partner will take you to dinner. You'll get invited to conferences and summits and roundtables, and then next time you look for a job, it will be easier.
Analysis of what? What does that mean? What's something you conceivably would need a consulting firm to "analyze?" I don't understand why management consulting firms would hire software people in the first place, and then punish them for not being on a client-facing project. That seems a bit contradictory to me, but this is all way out of my wheelhouse
2. How is the industrial ceramic market structured, how do they perform
3. How does a changing environment impact life insurance
Strategy:
1. Should I build a datacenter
2. Should I invest in an industrial ceramics company
3. Should I divest my life insurance subsidiary
Specifically in the software world this would be "automate some esoteric ERP migration" or "build this data pipeline" vs. "how can we be more digital native" or "how do we integrate more AI into our company"
The executives who hire McKinsey are often not clueless, but they often lack the political power in the company to push through their plans. So they hire some well-regarded business consultancy to get an "objective" analysis what needs to be done.
How can it be that what you just wrote is such a widely known fact? I've been reading this and hearing this from consultancy people as well for many years now. If the guy lacks the political power, why don't his internal political opponents say, "nice try hiring the consultants, but we know this trick very well, you still don't get it your way".
It has to be some kind of higher level protection racket or something. Like if you hire the consultants there is some kind of kickbacks to the higherups or something with more steps involved where those who previously opposed it will now accept it if it's rubberstamped by the consultants.
Or perhaps those other players who are politically opposing this person are just dummies and don't know about this trick and actually trust the consultants. Or maybe it's a bit of a check, that you can't get anything and everything rubberstamped by the consultants, so it is some kind of sanity filter that the guy isn't proposing something that only benefits himself and screws everyone else.
And if it's the latter, then it is genuine value, a somewhat impartial second opinion. Basically there is a fog-of-war for all the execs regarding all the internal politics going on, it's not like they see through everything all the time and simply refuse to take the obviously correct decision for no reason.
There's a sort of prisoner's dilemma. If you make a fuss you'll get branded as anti-progress and sidelined. If you put your head down and just do what you're told you're a team player and will probably survive.
Aside, there's a lot of stuff online re McKinsey. I suggest searching HN plus also search "Confessions of a McKinsey Whistleblower" in your fave web search engine.
if you don't have sufficient political clout or influence, you seek sponsorship or backing from others with it to accrue more influence for your idea. You can pay consultants to agree with your idea and produce pretty charts and whitepapers for it.
The question is, why does anyone take the word of a company seriously which will agree with any idea if you pay them? After several iterations of this game (decades by now), someone would surely say "nah, we don't care about these charts and whitepapers, we know that the company who made them will agree with anything for money, so it's still a NO"
My hunch is that in fact they won't agree with just any idea. There is a limit to how extreme the idea can get, though probably the filter is indeed weak. Still, without this filter, people would propose even wilder ideas that maximize their own expected payoff at the expense of other players, so just the fact that it has to be signed off by an external party is still enough information for the powerful decision makers that they are willing to fund their services.
Nah. They're conflicted and goal seek backwards from your wacky vision.
Look at NEOM in Saudi.
McKinsey took 130M in a year to recommend a 500B investment in a 105 mile city in the desert. Sunk 50B and project was revised to take 50 years and 8 trillion.
It's impressive salesmanship how they were able to bilk such a large sum and support interim approvals for the regime to launder favors. I can see people wanting that "conflict."
In my experience, McKinsey often gets brought in from the very top - who should be able to push through more or less what they want. They just want a scapegoat in case things go wrong.
Equally annoying is when folks say “Asian” as an ethnicity. That’s glossing over a whole bunch of different countries that have relatively little to do with each other apart from being in the same general area on the planet.
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