Louisville, KY - Economic inequality is increasing; uncertainty has produced a divided society and a polarized electorate; growth in real wages has stagnated; those with college degrees, and especially advanced degrees, have gotten higher real wages; high school graduates have not seen good wage growth; and high school dropouts have seen their wages decrease from 40 years ago. These are the issues challenging today’s young parents, those who educate their children and educational and economic policy makers, according to James Heckman, a Nobel prize-winning economist and University of Chicago professor of economics. Dr. spoke October 24 at the Louisville Marriott Downtown about the issues impacting early childhood development.
Heckman cited demand for higher skills, better education and increasing economic inequality to make the point that very early work with children can position them for greater success in life, and that their gains benefit society as well.
He opened by noting that a lot of what he had to say was just common sense - and we need to think more deeply about our common sense.
“And so there really is a problem out there. Over a long stretch of the last 30 years we’ve had real problems,” he said.
Skills are the major source of productivity and have become increasingly important in determining social advantage or disadvantage, he said. Globally, there is a bias in favor of skilled workers.
“At the same time that the demand for skilled workers has accelerated as a worldwide phenomenon, the United States, our overall rate of growth in producing skills has slowed down. We have more college graduates than before, but we also have more high school dropouts than before. And it’s not just a question of migration,” Heckman said.
This stagnation and decline in graduation is among native-born Americans.
“So the blue collar, and the middle class, the high school graduate group has actually been shrinking. And so what we’ve seen, increasingly, is two Americas emerge. And society is polarized. And the inequality is very serious.”
Heckman suggested creating policies that recognize the skills most in demand, how to build them, and prioritizing a unified approach that avoids fragmented solutions such as promoting skills by building more schools or improving health by hiring more doctors. “I’m not saying any of these things don’t work. But what I am suggesting is there’s a better way, which is actually a way that is a policy of prevention rather than remediation.”
Cognitive skills matter, he said, and so do personality skills, such as perseverance, attention, motivation, self-confidence, character. He cited Thomas Edison’s observation that genius is 1 percent inspiration and 99 percent perspiration.
“Well, there are counterparts to that everywhere,” he said. “And that’s why I say this is all very obvious. Except public policy doesn’t recognize it. We don’t measure it. And we don’t even try to cultivate it.”
Skill gaps between the advantaged and the disadvantaged open early, long before children even enter school. Family and environment have important roles in skill development, and early interventions that build skills have a higher rate of return than later remediation, he said.
“So the longer we wait to intervene, the more costly it is to remediate.”
In discussing income inequality, Heckman argued for care in considering income distribution, citing the Great Society and its War on Poverty. Transfers of wealth helped reduce poverty – but didn’t help the next generation, he said. That led him to redefine child poverty not in terms of income but of parenting.
Skill begets skill, he said, and skills cross-fertilize each other. Children who are healthy, motivated and engaged learn more.
Heckman said parental stimulation is crucial. What children bring to school from home turns out to be more important, he argued, than what the schools themselves are doing. Families are under challenge, he said, and the subject at hand is family policy.
These matters, he said, are key to business. Heckman cited Springfield, Mass. for its high dropout rate. As a transportation hub, it also has a lot of bus and truck traffic.
Recruiters asking who can drive a truck are also asking who can be responsible at the controls of such potentially lethal and certainly costly equipment.
“We know that if a society helps early enough in the lives of children in a sustained way, supplements the family, works in a cooperative way, not replacing the family, you can actually promote the health of children, promote cognitive character skills, and promote the life of a larger society,” he said.
Heckman said he strongly encourages public-private investments.
“One of our main priorities is insuring that we have high-quality early childhood programs in Kentucky, precisely because of what you heard today,” said
Stu Silberman, executive director of the Prichard Committee for Academic Excellence.
Hosts for the program were the Governor’s Office of Early Childhood, the Kentucky Chamber of Commerce and the Prichard Committee’s Business Leaders for a Strong Start, with partnership from the United Way in Kentucky, Metro United Way and United Way of Greater Cincinnati/Northern Kentucky.