Tuesday, July 29, 2008

David Brooks Misses the Pink Elephant in the Room   posted by TangoMan @ 7/29/2008 03:51:00 PM

Brooks sets out to share his wisdom on the root causes of America's past success and why we're faltering of late. He writes:
As Claudia Goldin and Lawrence Katz describe in their book, "The Race Between Education and Technology," America's educational progress was amazingly steady over those decades, and the U.S. opened up a gigantic global lead. Educational levels were rising across the industrialized world, but the U.S. had at least a 35-year advantage on most of Europe. In 1950, no European country enrolled 30 percent of its older teens in full-time secondary school. In the U.S., 70 percent of older teens were in school.

America's edge boosted productivity and growth. But the happy era ended around 1970 when America's educational progress slowed to a crawl. Between 1975 and 1990, educational attainments stagnated completely. Since then, progress has been modest. America's lead over its economic rivals has been entirely forfeited, with many nations surging ahead in school attainment.

What could have happened in the 1960s that could, by 1970, lead to the cessation of the educational gains we had made over the 50 - 75 years?

Has anyone looked at Senator Ted Kennedy's handiwork? Well, Brooks certainly doesn't even entertain the notion that the demographic nature of the US today is different from what it was during most the century preceding the 1965 Immigration Reform Act. Moreover, during the sustained periods of immigration restriction the cultural focus was squarely on assimilation and unlike today, educational resources were not squandered on celebrating diversity, rather they were targeted towards moving all children along a common cultural vector.

Goldin and Katz describe a race between technology and education. The pace of technological change has been surprisingly steady. In periods when educational progress outpaces this change, inequality narrows. The market is flooded with skilled workers, so their wages rise modestly. In periods, like the current one, when educational progress lags behind technological change, inequality widens. The relatively few skilled workers command higher prices, while the many unskilled ones have little bargaining power.

Having an immigration policy which pulls in tens of millions of 6th grade educated, Spanish-speaking immigrants is a policy that creates inequality. Goldin and Katz would do well to control for immigrant status, legal and illegal, in the ranks of the low skilled.

The meticulous research of Goldin and Katz is complemented by a report from James Heckman of the University of Chicago. Using his own research, Heckman also concludes that high school graduation rates peaked in the U.S. in the late 1960s, at about 80 percent. Since then they have declined.

In "Schools, Skills and Synapses," Heckman probes the sources of that decline. It's not falling school quality, he argues. Nor is it primarily a shortage of funding or rising college tuition costs. Instead, Heckman directs attention at family environments, which have deteriorated over the past 40 years.

Heckman points out that big gaps in educational attainment are present at age 5. Some children are bathed in an atmosphere that promotes human capital development and, increasingly, more are not. By 5, it is possible to predict, with depressing accuracy, who will complete high school and college and who won't.

Again, demography matters. When we celebrate diversity and when we hold all cultures to be equal then we discount the importance that cultural practices, traditions and views have on real world factors, like education and economic productivity. Heckman notes that "some children" benefit from family practices that promote human capital development, but that many don't. I'm willing to wager that racial and cultural factors correlate to a good deal of this disparity.

It's not globalization or immigration or computers per se that widen inequality. It's the skills gap. Boosting educational attainment at the bottom is more promising than trying to reorganize the global economy.

It's fantasy to posit that the skills gap is independent of group measures of human capital stock. ParaPundit shows the dismal embrace of higher education by Hispanics even after 4 generations in the US.

America rose because it got more out of its own people than other nations. That stopped in 1970.

There are two things wrong with this claim. First, measuring what a country gets from it's people is simply another way of referencing the concept of productivity and US productivity increases didn't stop in 1970. In fact, from 1995-2005 the US experienced a 2.35% annual rate of productivity growth, which was only exceeded by the rates experienced in Iceland, Finland and Sweden. We're clearly able to "get more" out of our citizens. Brooks' conflates educational attainment in a nation with productivity growth. Clearly, some segments of our population excel at educational attainment while others groups stumble.

Secondly, it would help to disaggregate the data on educational attainment and productivity growth by demographic group. If we look at Canada, with it's massive surge of Asian immigrants, we see that these newcomers to Canada are not having the same dismal educational experience as America's Hispanic immigrants and Canada is managing to "get more" (36%+ of Chinese immigrants have some university, only 12% show no educational attainment) out of its new citizens than the US is managing with our new Hispanic residents. Even when we look beyond the immigrant generation and focus on their children, we see that Canada's policy of seeking to maximize human capital stocks when making immigration decisions results in these immigrants having children who exhibit better academic performance compared to our first generation Hispanic students despite the fact that Canada's public schools aren't financed as generously as ours (OECD Excel File) (Education Spending/Student 2000: Primary Level - Canada $6,120, US $7,980; Secondary Level - Canada = $5,947, US $8,855; Tertiary Level - Canada = $14,983, US = $20,358) and yet Canada isn't getting as "much out of" their citizens in terms of economic productivity as the US.

So, whatever the US is doing right in terms of productivity growth it still manages to surpass most developed countries even when handicapped by unique demographic challenges. If Brooks would like to see educational attainment increase over time then he should really begin advocating that we stop importing poverty, stop fostering cultural diversity and begin trying to assess human capital stocks in our immigrants.

Here's a hint for Brooks - you need to understand the parameters of a problem before you can hope to discuss it accurately - leaving out demographics when questioning national performance will forever lead you to misanalyze. Peoples and cultures matter. Don't take my word for it - here's what the official demographer of Texas has to say:
Texas is changing. It is growing older and browner, with the elderly and Hispanic populations growing at an unprecedented rate. And as the populations increase, so will the challenges.

If current trends continue, Texas' work force will be less educated and less skilled. State services, already burdened, may be strained to a point never experienced before. The numbers provided by Murdock support the dire warnings:

Hispanics may represent 53 percent of the population by 2030, compared to 30.3 percent for Anglos and 9.2 percent for blacks.

More than half of Hispanics 25 and older had failed to finish high school in 2000; fewer than 20 percent had completed some college, and only about 10 percent had a college degree.

Hispanics could occupy 38 percent to 52 percent of the Texas work force by 2030.

By 2030, 16 percent to 20 percent of the population will be 65 or older, an increase of about 10 percent over 2000. Most will be Anglos. Of Texans older than 65 in 2000, 72.6 percent were Anglo, 16.7 percent Hispanic.

The aging population - coupled with a segment that is less educated and, thus, earning less money - will strain social services, including those for the elderly.

"An educated work force raises income levels, which generates businesses activity and increases the market for goods and services," Murdock said. "It also increases investments for new businesses, which in turn increases tax revenues. Higher education equals higher incomes."

Sen. Pete Gallego, D-Alpine, said education is perhaps the most important issue facing the state.

"This is really a wake-up call," he said. "The conclusion is that by the year 2025, if we keep doing what we're doing now, Texas will have the economy of a Third Word country. I have a son who will be 21 in 2025, and that's just not the kind of Texas I want to turn over to him."