24.6.09

MAKE HIGHER EDUCATION HIGHER. Two officials of the state-supported higher education trade association make their case for expanding the industry.
The bottom line is that education affects economics. The more educated a work force is the more value it adds to society. We can chart this by looking at the way income levels vary with educational degrees. Since 1980, the gap between the earnings of those with bachelor's degrees and those with just high-school diplomas has widened. The ratio between the median earnings of men with the former and men with the latter grew to 1.99 in 2007 from 1.43 in 1980.
I wish it were that easy. There's ceteris paribus, which in empirical work is honored minimally by the expression "controlling for" (it often isn't really creating a ceteris paribus comparison, and the act of "controlling" can lose more precision by rounding error than it gains in precision of the point estimates) but which is completely missing from that comparison. Short form: the comparison could be revealing high schools that get worse faster than higher education has. That's this Laura Vanderkam assertion in USA Today.

McKinsey & Co., a management consulting company, recently ran the numbers, and found that if U.S. children did as well as students from nations such as Finland, our economy would be 9%-16% larger. This means our schools are costing us $1.3 trillion to $2.3 trillion every year. Just for comparison's sake, as of late May, economists thought the recession would shave 3.7% from our economy.

Even more interesting? This international gap is larger than America's black-white achievement gap. According to McKinsey, closing the racial gap would boost the economy by up to $525 billion. While that's a lot, as the report says, "lagging achievement in the United States is not merely an issue for poor children attending schools in poor neighborhoods; instead, it affects most children in most schools." The failure of schools to push even rich white kids to achieve their potential is inflicting the ongoing equivalent of the worst downturn since the Great Depression.

I'm not sure about all the assertions in Ms Vanderkam's column. I endorse the idea of requiring the high schools to do their job properly, rather than turn a first and sometimes second year of college into a second- or sometimes first-encounter with high school that too often turns out badly.

That's not what the trade association has in mind.

Given the impact education has on the economy, the U.S should set a goal of college degrees for at least 55% of its young adults by 2025. This is in line with President Barack Obama's statement that "by 2020, America will once again have the highest proportion of college graduates in the world." This goal would require graduating an additional 875,000 students per year -- a 42% increase of people with at least an associate's or bachelor's degree.

History suggests higher education can meet this goal within the next 15 years. In the 15 years following World War II, post-secondary enrollment expanded by 82%. And in the baby-boomer period of 1962-76, enrollment expanded by a whopping 174%.

The path we foresee resembles what happened during the baby-boomer period. Then, in the heat of the Cold War, the imperative to make technological progress led the nation's universities to expand. As the nation's youth came to understand that they needed more education, the government made education a priority. The sobering lessons from the current economic situation could contribute to a similar pattern of thought and action.

We propose to: 1) enroll a higher percentage of high-school graduates, now 64%; 2) increase the number of adults returning to college; and 3) increase college graduation rates while maintaining educational quality.

To realize these goals, the historic partnership between higher education and the state and the federal government should be re-established. It is the only way that this country will increase its number of degree holders by 42%, a task that will obviously require more resources than public universities and colleges currently have.

Working backwards: sometimes maintaining educational quality means reducing graduation rates, that is, unless the trade association intends to ask admissions directors to stop apologizing for being selective, or to start a serious conversation on the tradeoff of student preparation for student diversity that nobody wants to talk about. Part of that increase in enrollment the columnists point to is a secular increase in matriculations from high school: that was less than 50% as recently as 1970. The call for resources is understandable (that's what trade associations do), but the column gives reason to be skeptical about whether those resources will be productive. Consider that Sputnik-era fillip to enrollments. Perhaps that line about "imperative to make technological progress" followed by "youth came to understand that they needed more education" generalizes excessively from the columnists' experiences. I was subject to that Sputnik era science-and-math push, and I harvested some benefits from it (not the ones the government intended, but I digress) although that same program fostered cynicism among others (yeah, right, the kid of a Milwaukee machinist is going to the moon) and the proliferation of branch state universities (the current third and fourth tier and unranked in the league tables) gave the social set of many a late-sixties high school class new options for continuing the party scene past adolescence. Whether that led to any human capital formation, let alone formation with a positive benefit-cost ratio, isn't obvious. Whether the Vietnam War protests were a consequence of a higher consciousness or of unease commingled with guilt about being temporarily exempt from participation in a misconceived public policy I leave for another day.

Shorter form:
Instead of thinking that America has a crisis of not having enough college graduates, a far better argument can be made that we have a problem in luring too many young people with weak academic skills into college in the first place.
That's treatable in part: require the high schools to do their job, although that might lead to lower high school completion rates.

There's also skepticism about sending the state universities more money.
The public colleges point to the spending cuts they've made, and that's a good start. But they have to become more accountable for their costs to students and for producing graduates.
That from the Detroit News (motto: read about it on Wednesday) with local knowledge.
At Wayne State University, for example, students' six-year graduation rate is 36 percent. Wayne State officials contend their poor performance is due to their students' below-average K-12 preparation. But other urban colleges with a similar student body fare better. St. John's University in New York City and Queens College of the City University of New York have graduation rates of 59.3 percent and 52.6 percent, respectively.
"Similar student body" is not the same as "similar mission". Wayne State may still be an R1 (it has colleges of medicine and law) and one of the great challenges to faculty there has always been to simultaneously stay sharp enough to compete for space in the major journals and understandable enough to work with students whose preparation and background aren't mainstream academic. I got frustrated with that more than once. St. Johns is a private university, and Queens is neither South Bronx nor Hunters Point.

A Wall Street Journal editorial notes that educational spending in your neighborhood doesn't necessarily translate into economic development.

Until very recently, the auto industry offered those with low educational attainment high-wage jobs. One legacy is that too many Michiganders do not aim for college. And too many of those who do get a college degree end up moving to cities like Chicago, where opportunities are more attractive.

The result is that a state that once laid claim to creating the middle class is fast losing it. As recently as 2000, Michigan ranked 16th in terms of per capita income. Today Michigan ranks 33rd, with its per capita income 11% below the national average -- the lowest it's been since the federal government started keeping figures. Over those same years, Michigan has steadily hemorrhaged jobs.

I'm surprised the Detroit News editors didn't gripe (perhaps they did, on a Wednesday when you could read it) about the state money going to make up Illinois's deficiencies in its human capital formation: other states have seen the export of graduates as something undesirable.

I'll endorse these propositions: higher education ought to be higher, and high schools ought do their work properly in order that colleges and universities don't have to redo it. I'm not persuaded that attrition rates by themselves are evidence of institutional failure.

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