In his most recent op-ed in the Washington Post Nobel Prize-winning economist Joseph Stiglitz presents his prescription for reducing income inequality in the U. S.. Imagine my disappointment but, uinfortunately, not surprise when I found that, like most analysts, he is much longer on diagnosis than on prescription:
If we want recovery, there is no choice but to rely on fiscal policy. Fortunately, well-designed spending can lead simultaneously to more employment, growth and equality. Further investments in education, especially aimed at the poor and middle, from preschool to Pell Grants, would stimulate the economy, improve opportunity and increase growth. Spending a fraction of the money the federal government gave to the banks to help underwater homeowners — or extending unemployment benefits for those who have long searched but failed to find a job — would simultaneously ease the burden of those suffering from the recession and help bring the recession to an end. This higher growth would, in turn, lead to higher tax revenue, improving our fiscal position. Plenty of investments would pay for themselves.
The emphasis is mine.
Now, I agree with his third prescription—I think more attention should have been devoted to address the problems of borrowers and the steps taken to aid lenders should have had many, many more strings attached. And, despite Robert Barro’s findings that continuing unemployment insurance is a substantial contributing factor to the ongoing high level of unemployment, I’m not sure we have any other alternative but to extend unemployment benefits. But I want to examine his second prescription more closely.
The United States:
- Spends the most overall and per capita on education of any major country while having the greatest income inequality of any major country.
- Has increased real per student spending by several multiples even as income inequality has increased.
- Has seen the on-time high school graduation rates for many urban school systems remain stubbornly at less than 50% over the period of the last half century.
- Is already among the countries with the highest rates of post-secondary education.
- Has more than 50% of recent college graduates unemployed or underemployed.
Under the circumstances I think it appropriate to ask Dr. Stiglitz exactly how more education will reduce income inequality? Quite to the contrary I think that he has the causality almost exactly backwards. It is reasonable to believe that people with professional degrees and doctorates have higher incomes because they’re receiving subsidies from governments at various different levels. If that’s the case and the solution why not just eliminate the educational middleman and extend the subsidies?
In a famous episode of the prime time cartoon program South Park tiny gnomes have come up with an ingenious business plan:
- Collect underpants.
- ???
- Profit!
To my eye Dr. Stiglitz’s plan seems to be:
- Spend more on education.
- ???
- Income equality.
This seems to be what we get from most economists these days, a solution exceedingly vague on the details. I happen to agree that education INVESTMENT would pay very good dividends, but we don’t make investments; we just throw money at schools with no strings attached and no negotiation on costs. It isn’t a problem with the students, it’s a failure of the system as a whole that massive debt is a pre-requisite of getting an education. My vague policy solution?
1) Any American can and will be required to receive a four-year liberal arts education at state expense before moving to the graduate level.
2) Dispense with the loan system entirely for state schools and move to a grant-based system where the federal government negotiates prices with institutions.
3) Require several years of maturation between the undergraduate and graduate level. I cannot emphasize how important I think it for people to go out, work and think about their lives and what their goals are before locking themselves into a career path. This is where a national jobs program would be worthwhile: graduating students can go work doing community or public service for a year or two if there are no jobs in the private sector and repay some of the generosity their society has shown.
4) Require a renewed emphasis on teaching relative to research. Currently these two goals are seriously out of whack, with universities regarding education of students as secondary to bringing in research grants.
5) Mandatory retirement age at state schools so the young can move up. I think stagnancy is becoming an ever-growing problem because we can’t get rid of our intellectual dinosaurs and can’t get new blood into institutions to drive change.
Have you noticed how much really incisive political commentary comes from comedians? Jon Stewart, Colbert, South Park have gone beyond the easy political joke (Hey, how about that President Obama, what’s with those ears?) to develop a very smart sort of political comedy. Jon Stewart’s truth squad is far superior to anything in the mainstream press.
Ben, what do you mean by a liberal arts education? It sounds like to me you are suggesting that portion of college education that tends to be less practical, such as literature, history, music, politics, and foreign languages, as opposed to courses in more practical-oriented fields such as business or engineering. Is this what you mean, and why would you emphasize that portion of higher education with the lesser potential for return on investment?
@PD Shaw
For the same reasons the ancients emphasized history, philosophy, art, culture and politics; breadth of understanding to become a better person rather than narrow hyper-specialization of “career”. The idea that education should be pragmatic is a scourge on our society and is leading to a dysfunctional political system.
I’m skeptical that anything useful can be achieved by trying to accomplish universal post-secondary education. The countries with the highest rates in the world are Russia and Canada at around 50%. I think that educating more than half of the people beyond secondary education is probably just spinning your wheels.
Additionally, in our big cities half of the kids aren’t even graduating from high school. How you’ll compel them to go to college and learn anything when you can’t keep them in high school and many aren’t even learning to read is a puzzler.
I don’t think that “one size fits all” is going to do it. I think we should make post-secondary education much more rigorous. Create apprenticeships and practical training for people who just aren’t interested in book l’arnin’.
“I’m skeptical that anything useful can be achieved by trying to accomplish universal post-secondary education. ”
I didn’t mean to imply we need compulsory secondary education, only that anyone who wants to go can go and must initially study to develop a broad knowledge base and the dreaded “W” word, wisdom. After that you study what and how you want, but I completely agree with Jefferson that maintaining a democracy requires enlightenment, not career or trade skills.
@ Anyone
Is anyone else concerned that “wisdom” is a word that has virtually disappeared from our language? Can anyone remember the last time it came up in a conversation or in writings, or that it was discussed as a worthy and important goal to obtain?
Ben:
I agree with you. I recall the moment I realized we were moving from education as broadening to education as narrowing, or at least when I noticed it. I was briefly in college at SF State around 1973. Then briefly attended San Jose State in 1975. Somewhere in there I realized other people had a different view of education, that they saw even a university as a sort of trade school.
I remember thinking it was bizarre to be 18 or 19 and studying business. Not only to have a specific major, but a major that announced your lack of interest in anything other than making money. I had up to that point thought of making money as secondary to whatever you happened to be doing.
I still think it’s ridiculous to be a teenager, just out of high school and therefore knowing essentially nothing, and already deciding the course of your life that way. I thought it was sad, and I still do.
And I agree that wisdom has become this outmoded, slightly ridiculous goal. As though it was obviously sensible to chase a dollar your whole life and just as obviously self-indulgent to chase knowledge for its own sake. I think the result has been a narrowing of our culture, a reduction of every single aspect of life to a financial equation.
At the point when people started talking about the stock market and stopped talking about philosophy, culture, morality, history, the world became a duller place. And look at how we’ve lived the last few decades. We shuffled a lot of money from one pocket to the other, inflated some bubbles, fooled ourselves into thinking we were terribly clever and far richer than we were, and now we sit in the debris of all that, still obsessing over money.
I chase a dollar, too, and do it enthusiastically. But, man, if that’s what you think life is about you’re not going to have much of a life.
“Is anyone else concerned that “wisdom†is a word that has virtually disappeared from our language? Can anyone remember the last time it came up in a conversation or in writings, or that it was discussed as a worthy and important goal to obtain?”
The owl of Athena, they say, only flies at dusk. Perhaps there’s some solace in that. But your complaint is, unfortunately, an old one. Here’s someone writing in the wake of political disaster wrought by another people also drunk on liberty and wealth:
Socrates and Thessalian businessman:
And, despite Robert Barro’s findings that continuing unemployment insurance is a substantial contributing factor to the ongoing high level of unemployment….
Do people suddenly get jobs because they end their 99 weeks of UEI?
Require several years of maturation between the undergraduate and graduate level.
That would destroy what was left of native American talent in Physics and Mathematics, and probably some other hard sciences. Best to do that stuff when young. In fact, if anything people with talent in those areas should be getting to college and then graduate school faster.
For the same reasons the ancients emphasized history, philosophy, art, culture and politics; breadth of understanding to become a better person rather than narrow hyper-specialization of “careerâ€.
Perhaps it was because the educated class was already at top of the heap, and thanks to their slaves and land holdings (depending on the era and locale) didn’t need to worry about making a living so much as they needed to worry about keeping the plebes (and other lowly creatures) in their place.
Not to mention that they didn’t really have much in the way of physics and chemistry and biology and micro-economics and such, so that would have saved time for more poetry. Not to mention they had to write out everything on scrolls (for the true ancients) so it wasn’t like they could mass produce the basics needed for educating more than the few favored by the Gods anyway.
@ Icepick
I’m pretty sure Socrates qualifies as an ancient, and he occupied no privileged position. Quite the contrary. He was considered dangerous by the powerful because of his inqusitive mind, broad knowledge and encouragment of skepticism among the you of Athens. A well informed and enlightened citizenry is a check against elites, a narrowly educated citizenry an enabler.
you = young
I think that contradicts your proposal. If elites are against an enlightened citizenry, then why would they institute and properly administer an educational program for that purpose? To me that’s like expecting good bank regulation from a treasury department staffed from the revolving door to the banking industry.
@Andy
I don’t expect them to allow a good educational system. At best the populace would drag them kicking and screaming into it, unless they themselves are enlightened as well. But Plato argued that the wise and enlightened will shun power, only accepting it to avoid being ruled by unsavory types. The end result is that elites are generally unenlightened seekers of privilege and self-aggrandizement, not philosophers.
I’m pretty sure Socrates qualifies as an ancient, and he occupied no privileged position.
He was a citizen instead of a slave.
Also, how much did all that wisdom work out for Socrates?
Let me elaborate a little. For argument’s sake let’s assume Socrates had great wisdom. Socrates was even a teacher, and he passed that knowledge on to Plato, Xenophon and others. Plato even passed some of that wisdom, as well as some of his own presumably, to his great student Aristotle. Aristotle in his turn passed along that wisdom to the son of Philip II of Macedon.
All of that wisdom led to the rapid creation of a great empire that fell apart almost as quickly as it was built. Where was the wisdom in all of this? Alexander was certainly a capable student, and a brilliant individual. He was taught within the greatest lineage of ancient teacher’s. And did any of that lead to anything better? Did that Athenian wisdom even help Athens?
I’m not seeing where Socrates shows the great power of the wisdom of the ancients. The philosopies led to the stultification of science for centuries and failed to promolgate decent government. (Any government that relies on the brilliance of one individual can’t be very robust.)