Federal policy

In his first State of the Union Address, President Obama boldly asked for every American to commit to obtaining an additional year of higher education or training. He also set a goal that by 2020, “America will once again have the highest proportion of college graduates in the world.” There are two problems with this education plan. First, we have already achieved it. Second, even if we were not already the world leader in higher education attainment, it is far from clear that we would want to be.

OECD data seem to indicate that the U.S. no longer is the world leader in the share of its population obtaining a college degree (trailing Canada and Japan). However, at 29.4 percent, the percentage of Americans aged 25 or older with a college degree has never been higher (this trend holds for blacks and Hispanics, albeit at lower levels). Twenty years ago the share was below 20 percent – so our increase during that time has been nearly 50 percent. The U.S. is making substantial progress in educating its population at the postsecondary level. What is the problem?

Apparently, other countries are making progress at an even faster rate. U.S. improvement was only 15th best among 22 advanced countries whose group average increase was 75 percent since 1985, including Portugal, Austria, Spain, Korea, Italy, and Ireland – which have each doubled their college attainment rates. For a variety of reasons the OECD data report higher educational attainment than data from other sources. Economists Robert Barro and Jong-Wha Lee have extensively studied cross-country data, made adjustments for attainment by age and differences in the higher education systems across countries, and have found that the college attainment rate in the United States was over 50 percent larger than in the next most educated country, Korea. One reason for such dramatic differences is that the over-65 population in the U.S. is far more accomplished than their counterparts across the world – the OECD data look only at the 25-64 year old cohort.

Education in a Vacuum

Discussions about attainment statistics typically proceed under the inauspicious assumption that they are relevant. Rarely mentioned are reasons why such goals are important, and whether securing more higher education in particular is the best way (or even a good way) to achieve certain goals.

Is the president’s goal to increase the output and productivity of the American economy beyond what it would otherwise be? If so, then expanding the pool of graduates might do the trick if the number of Americans receiving a college diploma was the sole causal factor in determining economic growth. Alas, it is not. Education is but one of many ingredients in a mysterious growth recipe. Producing valuable goods and services requires the “right” mix of physical capital, labor skills, technological advances, institutions (such as secure property rights, the rule of law, customs and mores that promote trust, and so forth) and more than a sprinkle of luck. This mix differs across countries and over time and the recipe is wholly unknowable to any individual or group of individuals – in fact there is no recipe to follow. Every professional and lay social scientist to ever walk the face of the earth has gone to his grave trying to solve the mystery of growth – I do not expect any in our generation to enjoy a better fate.

More education has to be a good thing. After all, receiving more schooling can’t make you less productive, right? Education is like exercise, reading, spending time with one’s children, and sleeping – each of these is good for you. It is obvious that dedicating more attention to each of these is good. It is obvious … and wrong – for both individuals and societies as a whole.

While investing in each of these likely generates enormous benefits when starting from scratch, at some point each additional unit invested generates fewer benefits than the one before it – just as eating that fourth doughnut brings you less satisfaction than did the second. What if these so-called “diminishing returns” never set in for education? In a world of scarce time and resources, they must, albeit indirectly. Dedicating more resources to the production of educated workers must come at the expense of resources dedicated to creating other important capital goods, institutions, or consumption goods. An individual cannot dedicate 24 hours in a day to everything, nor can society dedicate all of its resources to everything. Put another way, if merely leading the world in educational attainment is desirable, why not aim to have every American receive a college degree? Better yet, why not aim to have every American earn a Ph.D.?

Is Education Necessary?

Leaving aside the possibility that higher education serves only a signaling function there is still room to ask the question: is education a necessary condition for economic achievement? A good deal of economic evidence points to a strong positive relationship across countries between educational attainment and economic growth. Given the small sample sizes involved in these studies and the difficulty of controlling all the factors influencing growth I would not stake much money defending these findings. To illustrate just one difficulty, were you to collect data on the time people spent on Facebook I am sure it would show up as a strong positive in growth estimations.

There are notable exceptions to the received wisdom. Several African countries made commitments to education since 1970 that were comparable to the countries with successful growth stories from that time, with no considerable economic growth to speak of. Hong Kong became one of the wealthiest regions in the world before it began any substantial investments in education. Within the United States there is a surprisingly small correlation between “economically dynamic states” and the level of educational attainment. In fact, the rank order correlation between how dynamic the state’s economy is and its share of bachelors degrees is only 0.34. While clearly some of the most dynamic states such as Massachusetts and California have terrific educational systems, other dynamic states such as Oklahoma, while short on college graduates, use some of the other “ingredients” mentioned above to promote their development. To be clear, I am not arguing that education is not important. What this does show is that neither is it a guarantee of success, nor lack of it a guarantee of failure.

Education and Human Capital

Education qua education is not a bad thing. It is nonetheless a mistake to conflate formal education with accumulating relevant human capital – the bundle of skills, experience, discipline, etc. required for an individual to produce things of value (broadly considered).

Colleges indeed develop social skills, help individuals identify with peers, and inculcate productive behavior – particularly important for students that did not grow up in an environment conducive to these habits. However, college also contains a considerable consumption component (this is no longer the exclusive domain of elite four-year colleges), and as information technology continues to advance at a breathtaking pace, so too does the opportunity for individuals to acquire important human capital outside of the academy. Despite the dizzying array of colleges, the forgoing factors might give one pause before urging the masses of Americans to attend college as the best way for them to accumulate human capital. These same factors are making it increasingly likely that the super-talented will eschew such formal training in favor of more customized real-life education.

Suppose that education is synonymous with human capital accumulation. Focusing on average educational attainment still makes the erroneous assumption that a year of additional education to every citizen increases the stock of human capital the same for each citizen, and also overlooks the possibility that changes in the quality of different levels of educational attainment may be more or less valuable investments than sending more people to college. For example, improving the stock of useful knowledge might be better accomplished by encouraging existing college graduates to obtain advanced degrees, with no change in high school graduate behavior. Alternatively, it might mean the same aggregate level of college completions, but changing who goes to college and who does not. It would be a wondrous coincidence if having lots of Americans complete four years of formal higher education was the appropriate way to increase the stock of human capital in America.

Where the Rubber Meets the Road

There are practical obstacles to reaching the president’s goal. Despite the measured and well publicized benefits of going to college, one-third of high-school graduates never attend, and roughly 50 percent of those that do attend actually remain until completion. To those of us who have taught large introductory courses (even in highly ranked universities) these figures are unsurprising. Aside from the considerable difficulty many of my students have writing, a number of them have basic vocabulary difficulties – as words such as scrutiny, anomaly, ascertain, isolate and mitigate continue to vex them.

It is a mathematical fact that as we expand college enrollments beyond what they are today, the average quality of students will go down. And while evidence is very strong that the current returns to receiving a college degree are quite large, increasing the supply of college-educated labor (everything else constant) puts downward pressure on these returns. Are political leaders and the educational establishment prepared for this, particularly if these trends -- by significantly increasing the enrollment of poorly prepared students at non-elite colleges -- increase the advantages of attending a prestigious college?

As enrollments increase, so too will financial pressures at most colleges. Student demand has recently surged in the U.S. and despite the fact that real state expenditures have been increasing at healthy clips over that time, per student expenditures have not kept pace. Proposals on the table to expand educational attainment include refundable tax credits and an expansion of Pell Grants – but these present a problem for many state colleges and universities in the form of an unfunded type of mandate. While they may help students afford college attendance, tuition and fees reflect only a small portion of the total cost of educating students at even the lowest cost colleges. Institutions with little excess capacity may find themselves in an increasingly difficult financial position particularly if they face political pressure to keep tuition low. Such supply issues are commonly overlooked in proposals that focus on expanding access on the demand side.

Skinning the Cat

The U.S. is already the world leader in its financial commitment to higher education – dedicating almost three percent of GDP to the sector (a share that has been rising, not falling, over time). Spending more might make sense, but rarely in these discussions does one encounter the question, “At what cost?” Does it make sense to sacrifice more and better carpenters or professional baseball players just to lead the world in college completions? Perhaps I am overplaying that hand. But there are many ways for individuals and societies to improve their human capital and productivity without relying on political forces to put more people through college.

Migration is one of the most powerful ways for an individual to augment human capital. International immigration vividly demonstrates this – a poor person living on $2 per day who migrates to the United States to accept a minimum wage job would experience a 20-fold increase in living standards just by moving here. Migration within the United States from areas with low-capital and low-productivity toward areas with more capital and higher productivity will have a similar effect. If the U.S. wishes to raise its average education levels, it would be far cheaper to simply encourage more immigration of educated workers from abroad. While such a move would undoubtedly alleviate some of America’s Social Security and Medicare problems, its low savings “problem” and its inner-city problems, it is a political non-starter.

Incidentally, that the rest of the world is “catching up” to the U.S. in educational attainment is cause for celebration, not alarm. For American consumers (we are all among them) this will mean access to innumerable new medicines, literature, advanced materials, etc. no less than if Americans were creating them. As the world grows wealthier and more connected, the market for American sourced goods and services is dramatically extended, as is the number of ideas for Americans to capitalize on – expanding opportunities for Americans without a formal education. Japanese auto-maker Toyota, for example, plans on producing its hybrid Prius here in the United States. Is this reason to worry about Japanese educational attainment surpassing ours?

An unintended consequence of making access to college an entitlement readily available to all high school graduates is that serious study in high school has become optional, even for those intending to go to college. Without an incentive to study diligently, many students are disengaged in high school and, as a result, underprepared for college. Some freshmen arrive at college thinking that having fun is the main reason they are at college and that the pursuit of knowledge should be available for when they have nothing better to do.

This situation came about relatively recently, partly the result of a change in the meaning of financial aid. Until World War II, financial aid referred to traditional scholarships that were awarded to academically meritorious students who mostly also were needy. The G.I. Bill, which financed college for discharged veterans of World War II, foreshadowed broader programs of federal grants and loans -- 20 at present from the federal government, 17 from the Department of Education and 3 more from other federal agencies -- that essentially universalized "financial aid." Few of them require better than mediocre previous or current academic achievement. As a consequence, about 30 percent of incoming freshmen at four-year colleges and over half the freshmen at two-year colleges are assigned to remedial courses in writing, mathematics, or other courses.

Nevertheless, federal grant programs, though supplemented by state and private grant programs, were never able to cover the financial needs of the millions of college students whose families could not afford the rising costs of attending college. So Congress established several loan programs, some indirect loans whose federal subsidies made attractive to banks, credit unions, and other financial institutions, and some financed directly by the Department of Education. Unlike Pell Grants and other federal grant programs for college students such as work-study programs for needy college students, which do not have to be repaid, loans must be repaid with interest after graduating from or leaving college.

Repayment is a problem for student borrowers. Many of these loans are subprime -- toxic in the same sense that some mortgages were toxic. They are even more likely to be subprime than mortgages are; the only collateral is usually the student’s future earning prospects after graduating, presumably enhanced by what he or she has learned at college. Student borrowers who do not learn enough from their educations to get jobs that permit then to repay what they have borrowed are likely to default on their loans, leaving taxpayers liable for them.

The student financial aid system was created by Congress not as an integrated system but in pieces: to do a variety of things for a variety of reasons. One major objective was to help youngsters from low-income families gain access to higher education. In the light of our egalitarian ideals, limiting educational preparation for good careers to children fortunate enough to have educated, affluent parents seemed immoral. A second reason for promoting college access for youngsters from low-income families is that, as Jefferson argued, persons of extraordinary talent may be born in humble circumstances, and giving them educational opportunities might enable the American economy to be more productive. The knowledge explosion during the 20th century demonstrated that ideas are extremely important to the "creative destruction" that a market system needs in order for the economy to grow. Institutions of higher education are where many new ideas are developed by adults through research and transmitted to youngsters through teaching. Politicians are referring to this economic growth function when they speak euphorically about student grants and loans as "investments." Realistically speaking, however, only a few federal grant programs -- and none of the loan programs -- seek out top-notch students who will presumably contribute most to the productivity of the American economy; others aim only to make accessible the college experience for children of lower-income families. The existing system is an uneasy compromise between these two objectives.

It is an uneasy compromise partly because promoting access for youngsters from low-income families sometimes conflicts with the meritocratic ideal of educating youngsters most capable of making great intellectual contributions to knowledge. A better compromise could be made to realize these two objectives by targeting the grants and loans devised by the federal financial aid program to needy students studying diligently in order to prepare to go to college. Instead they were set up mainly as incentives simply to go to college, prepared or not. Congress apparently assumed that the colleges would screen admissions appropriately or perhaps Congress was afraid to appear elitist by imposing meritocratic conditions. Thus, federal aid to college students removed most financial barriers to attending college. Applications increased as high school students heard the message that college attendance led to well-paid, interesting careers, and was now affordable. Many colleges expanded facilities and lowered academic standards for admission; virtually any high school graduate could get into some college. Students might have had an incentive to work harder in high school if they had had to demonstrate academic achievement both to gain admission to college and to obtain financial aid to cover expenses while enrolled. The unintended consequence of failing to set this requirement is students graduating from college without good job prospects, a problem made worse in an economy where the unemployment rate has now risen above 10 percent. The predictable result is a growing rate of student loan defaults.

I am about to propose to change federal loan programs to college students but not to change federal educational grants to college students. Why the difference? Both suffer from the same drawback; they entitle mediocre as well as able students to obtain federal financial aid. A different approach is justifiable because federal loans have much worse consequences for both students and taxpayers than federal grants.

Consider grants first. As gifts from American taxpayers that students do not have to repay, it is true that grants are a complete loss to taxpayers if students do not make contributions to American society as a result of going to college. On the other hand, grants involve less than half as much money as loans in the aggregate as loans. And even individual cases of defaulted loans, accompanied as they are by interest and penalties, can be very large burdens both to American taxpayers and to individual student borrowers. In a November 2009 case decided by a panel of five New York State judges who ruled against admitting a student borrower to the New York bar, the panel said, “His application demonstrates a course of action amounting to neglect of financial responsibilities with respect to the student loans he has accumulated since 1983.” The student owed nearly half a million dollars. This admittedly unusual case shows the advantage to both students and taxpayers of grants over loans. Because there are strict limits to the annual grants that students can receive from the Department of Education in any academic year, students cannot attend college whose costs are way beyond their means.

With the help of Pell and other grants, students can afford a community college even if they cannot get loans rather than an expensive private college, especially if they live at home and commute. Students who start at community colleges and are successful academically can transfer to four-year colleges for their junior and senior years. In other words, student grants ignore academic merit even though everyone knows that students who have not done well in high school are unlikely to do better in college. These grants are an expression of American society’s willingness to make higher education available even to students who are poor risks. Giving Pell Grants is a societal bet -- though a long shot -- that mediocre students are late bloomers and can do better scholastically in the future, not that mediocrity is acceptable in itself.

This bet is riskier for loans, and consequently I recommend that loans be treated differently. Congress and the President should start to require the Department of Education to make student loans contingent on the best available evidence of the student’s prospects for repaying them, such as good job prospects based on high school and college grades, curriculum in which they enrolled, and their credit ratings. Defaults would still occur. Predicting the earning potential of college students is chancy. However, many young people would almost certainly be saved from financial ruin, and American taxpayers would almost certainly not have to bail out as many subprime student loans.

As theologians have said, we mean well and do ill and justify our ill-doing by our well-meaning. The unintended consequences of good intentions apply to our system of financial aid to American college students, as it did to our providing mortgage money to borrowers who could by no stretch of the imagination have kept up payments on their mortgages.

To sum up: Federal grants give mediocre students a chance to become late bloomers. Loans, however, are expected to be repaid, and mediocre high school students with bad credit ratings are likely to default on their loans, causing serious financial problems for themselves and financial complications for the American economy. Targeting loans to students with good prospects for repaying them is more prudent financially and makes more sense educationally. Some illiterate high school graduates have already sued their high schools for educational malpractice; disappointed college graduates may follow suit. Some diplomas are "tickets to nowhere."

America, once the world’s most educated nation, is fast losing ground. Although we are still second in overall education levels, we are much weaker -- 11th -- in the proportion of younger people with a college degree. In a world where knowledge increasingly drives economic competitiveness, this is a very serious problem. The issue is more than abstract economics, it’s also a moral concern: Since 1970, the benefits of higher education have been very unequally apportioned, with the top income quartile profiting hugely and the bottom hardly moving at all (despite starting from a very low level).

America’s education problem has been apparent for 30 years or so, and there have been a lot of suggestions for making us competitive again. Ideas on the K-12 side include: better trained and motivated teachers, more and better early childhood programs, better prepared school leaders, improved curriculums, higher standards, financial incentives, better data systems, and more rigorous and frequent assessments. On the higher education side, proposals include: motivating professors and administrators with formulas that reward success rather than enrollment, more use of technology, more data, improved administration, and (at least for general education) more testing. And, of course, better funding is relentlessly advocated for the entire educational spectrum.

All of these approaches have at least some potential to foster improvement. Some have already demonstrated benefits while some are being seriously oversold (more on that in a separate essay).

My fundamental belief, though, is that even if one takes a very optimistic view of the achievable potential of each of these strategies and adds them together, the net result will be significant but insufficient improvement to allow us to catch up in educational levels. If our scope of action is limited to the ideas advanced so far, we will actually continue to fall behind.

What makes it so difficult for us to catch up in education? Our lack of a pervasive education culture.

A large part of American society understands and appreciates the importance of education. But a large part doesn’t really see the value proposition. I can illustrate this lack of a pervasive education culture with personal experience. I taught undergraduates for 17 years at Ohio State, mostly at the introductory level. The university at the time was open admissions. My practice was to interview students individually at the beginning of each quarter, using 15-20 minutes to learn about their preparation; my goal was to gauge their experience with essay examinations and, if they had little or none, to help them prepare. But I also inquired about their interests.

One question I always asked was, “Why are you at the university?” The most frequent answer was, “Because my parents wanted me to go,” followed closely by statements like, “Because my girlfriend is here.” Most of these unmotivated students were first generation, although I recall that similar expressions of indifference came from a significant percentage of those with parents who had gone to college. Over all, at best a very small proportion of the young people I talked to in my various roles at the university were convinced from their own beliefs that graduation was really important. My experiment would yield different results today at Ohio State, which has become selective, but I believe you would find the same pervasively weak indicators of motivation at most public access universities.

You might think that young people are typically uncertain about goals and that these examples aren’t shocking. But if that’s what you think you are almost certainly an American. If we consider the nations that rank ahead of the U.S. in science and math test scores and in graduation rates -- e.g., Korea, Japan, Norway, Finland -- you’ll find very different attitudes about graduation in both young and old. I’ve lived and worked abroad, and I’m confident that, if you went into a classroom equivalent to our sixth grade in any of these countries and asked the students if they thought a higher education credential was essential to economic success, you would get a consistent "yes" answer of around 100 percent. By contrast, the percent answering "yes" in American schools would vary considerably, with many ranging much lower that our Asian and European competitors.

An alert reader will note that so far I’ve cited only anecdotal information laced with speculation, and point out that in the U.S. today the percentages even of low-SES and historically disadvantaged minority Americans telling pollsters that college is important are quite high and rising. They are right; students (and parents) do reply positively when asked about college. But do they believe it? Agreeing that you want to go to college or want your child to attend has become the socially correct answer (a good thing, of course).

But there are many reasons to suspect that the percentages are artificially high. First, there are the hard numbers, especially the poor rates of high school completion and the low proportion of those going on to college. Nationally, only about 42 percent of 9th graders enter college by age 19. Although the stated goals are slightly different, this is a significant mismatch with the 91 percent saying they expect to get some post-high school credential. Second, a single question on a topic such as this isn’t likely statistically valid, a point reinforced by a study that showed the percentage of African-Americans who thought people needed to go to college to prosper in the workforce was the same as whites, but in a follow-up question the proportion that thought it actually feasible was dramatically lower, with only 16 percent of black parents saying the opportunity was there vs. 43 percent of white parents.

I’ve not been able to find good comparative data on the U.S. vs. other nations on attitudes toward the value of education. But what I’ve been able to find for the U.S. reinforces the point made by the study just cited: when asked if higher education is important, the answers are very positive. But follow-up questions reveal significant worries (or lack of conviction).

American Perceptions of Educated People

To better understand America’s lack of a pervasive education culture, consider the fact that as a nation we generally don’t greatly value educated people and don’t seem to believe that being educated contributes to quality of life beyond that offered by greater economic success. If you asked the 6th grade students described above a second question, something like, “Do you think it’s important to be an educated person in order to have a satisfying life?” I think the "yes" answers in Europe and Asia would be very high, and in the U.S. very low.

Our view of education is different from most of the rest of the world and certainly from those nations that rank ahead of us in education levels. A Nobel laureate in science visiting a school in Korea or Japan would occasion a high level of genuine student excitement. But in the U.S., even at our better schools, you’d have to invite an athlete or entertainer to get the kids turned on.

There are many examples of Americans rating education poorly. One is certainly the low status of teachers here by contrast with the rest of the world. Another is popular culture.

By far the longest-running television show in America, “The Simpsons,” features a boy who is a dreadful student and hostile to education but highly popular with his classmates, together with a girl who is smart and interested in learning but very unpopular. A fascinating episode is one where the father, the doltish Homer, has an operation that makes him smart -- and the result is a disaster for the family and even the community. Yes, I know that the Simpsons is satire. But the fact is Americans are very comfortable with these stereotypes. And, if you look across the entertainment landscape, you’ll see smart, educated people consistently played as seriously flawed, while those with “emotional intelligence” are the heroes.

Why is America Different?

Why is America so different in attitudes toward education? It’s an issue that deserves more thorough research than I’ve been able to give it at this point, but my study of history suggests several reasons.

One issue is that America was a leader in making education free and widely available. The objective was to support our revolutionary experiment in democracy. The experiment was a success and the diffusion of education obviously had an important role. But, apart from the civic aspect, schooling appeared to many as sort of a frill, since there was a very small market for educated people in the first century and a half or so of U.S. history (an important exception is agriculture, where the role of higher education has transformed productivity).

Another difference between the U.S. and Europe (and I think also much of Asia) is that many countries in these regions conflated education and nationalism: Schooling meant learning the national language and literature, and being highly educated meant being a standard bearer for your people. The U.S. experience with nationalism has been very different from most other nations (too complicated to discuss here), with the result that we’ve not made the education/nationalism connection in the same way (the U.S. response to Sputnik would be an exception, though a short-lived one).

But the most important factor in my view is that, unlike Europe and Asia, much of the U.S. long had plenty of reasonably stable and well-paying jobs in industry (and before that in agriculture). With good jobs to be had for all (with the notable exception of slaves and many of their descendants), most Americans believed that the key to success in life was simply a willingness to work hard, and that’s what our culture valued. The American situation was in sharp contrast to that in most European and Asian countries. Compensation in those nations’ labor-intensive jobs was comparatively much lower, as was the status of these occupations. People in other parts of the world worked as hard as Americans, but their effort was at best sufficient to keep them out of poverty rather than move them into a new kind of middle class, as happened in the U.S.

American workers’ good fortune in securing a high standard of living -- especially evident in the manufacturing areas -- seems to have resulted in education having a very different role in our national culture. The advent of compulsory schooling around the world was closely associated with the effort to end child labor. In most of Europe and Asia the newly added years of school were principally devoted to vocational study; only a small minority of students moved through the highly competitive system that prepared them for the kind of jobs where high levels of knowledge and associated intellectual skills were needed.

In the U.S., by contrast, study in the additional years was usually “general” in the sense that the traditional subjects of mathematics, science, literature, composition, and history were required. This curriculum wasn’t intended to prepare students for factory or similar work (mostly because no preparation was needed). It could prepare young people for college, but in many areas that was the goal of only a handful of students -- a group small enough to be ignored and often derided. The result? In many communities school became primarily a social place, a holding tank for the years before work. Students went through the motions of education -- doing enough to get to the next grade -- but the expectations for real learning were minimal. In many parts of the U.S., we effectively separated the concepts of school and learning.

The U.S. approach in curriculum did have benefits in the sense that it allowed more students to move on to college. But we shouldn’t give ourselves too much credit for this. Our success in sending students to college appears to have been more of an unintended consequence than a deliberate objective. For example, consider the surging college participation rates of the baby boom generation: As the children of factory workers started to join others in going to college, the U.S. was entering a period of sustained surplus of unskilled labor. Many of the young people I talked to at Ohio State in the 1970s were there not because they thought education was important but because neither they nor their parents could think of anything else for them to do (Vietnam was a factor also). Equally damning, one of our greatest achievements, the G.I. Bill, had as a clearly stated purpose keeping returning veterans out of the work force, while improving education levels was secondary.

Manufacturing and the Two Cultures Problem

The United States doesn’t have social classes in the same way as many other nations, but we are of two cultures when it comes to education. Our first culture, smaller but growing swiftly since the end of World War II, understands the importance of education and imparts at least some level of learning-related values to its young. The second culture, shrinking but still very large, has begun to hear the message of education but is slow to assimilate it, not surprising because economic change has occurred in fits and starts. There was no single, unambiguous day in history when everyone should have realized that good-paying jobs at mills and factories for unskilled labor weren’t coming back. Here and there, a few good jobs did resurface, so it’s hardly surprising that many communities are still waiting for some company, nowadays probably foreign, to take over one of their excellent vacant sites and flood the region with jobs.

The problem for the second culture is greater because it requires two new ways of thinking. The first is understanding the economy’s shift to knowledge. The second, viewing school in a new way, is perhaps a more difficult change. It is extremely hard for parents who thought of high school in social terms to act on a radically different set of expectations for their children. Unfortunately, Americans’ high level of mobility has exacerbated the cultural schism because parents who recognize the value of education can physically move and put their children in different schools; those who remain are in an homogenous culture, never to hear the leavers’ voices pushing for change.

As it became important to have a more educated workforce, other countries gradually opened the control gates and allowed more students to move forward in higher education. Since school had always had a purpose in these countries, and since educational success had always held high cultural value, the speedup has been faster than in the U.S. This, I believe, is why others are catching up and even moving ahead in overall education levels, not to mention in mathematics and science learning.

Recent studies have pointed out a growing spread in salary among those in the U.S. with college degrees. It shouldn’t be surprising, though, that some college graduates are earning a lot more than others: it’s a consequence of our separation of school and learning. Once, you came in with a business degree and the company re-educated you. Now, they expect you to be an effective analyst and critical thinker from day one. The folks who sleepwalked through college in the same way they did high school are suddenly experiencing turbulence; the fact is, the value of a simple credential is slipping in comparison to the actual knowledge it is supposed to represent.

Are There Solutions to the Education Culture Problem?

The answer in my view is an unqualified “yes.” We know that culture can change because we’ve seen it happen in perceptions of education for a large part of our society; there’s no basis for saying progress is impossible and walking away from the problem. Certainly, though, making this change pervasive is a difficult task and won’t be accomplished quickly (which is perhaps why so many prefer to focus on things like formulas, longitudinal tracking systems, and attacking college and university management). That’s the bad news.

The good news is that much significant change can be accomplished with modest increases in funding. I’m a strenuous advocate of stronger support for both K-12 and higher education, but I don’t think money alone will get us where we need to be.

Here are seven ideas for changing culture.

First, we need to improve the aspirational focus of our schools. One good way to do this is to help students understand that education really matters, that it’s needed for jobs that are there and that they will want to have. South Carolina’s Personal Pathways to Success is an excellent new effort in this area. Beginning in the eighth grade, students create Individual Graduation Plans that focus on their chosen career cluster (for example, “Information Technology”). Some of their curriculum is then geared toward the cluster area and they have the opportunity of work experiences and the like.

Second, we must modify the biggest barrier to student success in K-12: mathematics. We teach math as an abstract exercise that excites only a few, and, especially in schools lacking an education culture, math forces a disastrously large proportion to drop out or fall behind. Pairing math with science, or better yet replacing it as a separate subject with computational science, could change kids’ perception of its value and make them far more interested in learning. Widespread anguish over mathematics is a major problem in building a positive education culture.

Third, we should support locally-led college access programs that emphasize total community educational change -- not just implementing a few programs or raising spending -- creating total community educational change. The reality is that, even if an economically disadvantaged community were to have well-prepared teachers, perfect curriculums, and state-of-the-art facilities, it wouldn’t get much return on investment if the kids went home to an environment of parents and other adults who believed that education doesn’t really matter.

The best example of community change I’ve seen is Kingsport, Tennessee. In 2001 leaders there created “Educate and Grow,” which offered financial assistance to help ensure that all students in local schools could complete at least two years of college. The public investment was modest but the impact was profound. I’m most struck by the 23% increase in high school graduation rates -- something that was accomplished with no new funding. What mattered, from my understanding of the process, was that business leaders got involved, persistently going into the schools and other locales to tell students, parents, and others that education was really important and that it couldn’t end with high school. As a result, in homes throughout the community, conversations about the future began to have a different goal, one that had an immediate effect on the schools. To follow an earlier analogy, changing culture is like decreasing a vehicle’s weight; it makes the existing engine more powerful.

A key point about community change is that it can’t be imposed. Outsiders can help with advice and some funding, but local people have to be convinced and then take the initiative on their own if real progress is to be made -- it’s the difference between what you believe and what someone else tells you to believe. The good news here is that, as more communities embrace education and demonstrate success, others will perceive the competitive disadvantage and have even greater incentive to undertake their own structural improvement as well.

Fourth, higher education should shift its approach in some areas of instruction -- particularly developmental education -- away from competing against time and toward academic assistance. Instead of a high-stakes (to these students) “pass in a given amount of time or be labeled a failure” approach to developmental math and English, we should offer self-paced, competency-based, and (at least at the module level) no-fail options. Especially for returning adults, a more positive strategy can offset a pervasive lack of confidence in their ability to learn and thereby make them more optimistic about the value of education in their lives.

Fifth, consistent with the principles noted above with respect to developmental education, we need to design a “New Front Door” for adults to enter higher education. If we want them to have an opportunity to change their lives, higher education will have to change how it operates. Because so many of these adults are also parents, bringing them back into the educational stream with positive experiences will encourage them to set better goals for their children. This process of creating a “New Front Door” is well underway in South Carolina.

Sixth, and surprisingly, we can help create an education culture by improving general education. The goals of general education are superb, but the way we teach now doesn’t get us there. Serious change is needed. One idea is to use technology to thread instruction throughout all four years, allowing for a reinforcement of skills and abilities not possible now. For example, business majors would complete second, third, and fourth year online modules on environmental issues that draw on and reinforce knowledge and skills gained from their first year biology course.

Challenging faculty -- instead of threatening them with budget penalties -- is the only way to make such a major revision happen. And how does improved general education foster an education culture? Simple. Students who have a better experience outside their major will have a stronger appreciation of education’s ability to expand the mind, something that should pay dividends in many ways and at many levels. Making general education more positive will also be of enormous value with opinion leaders -- after more than thirty years of talking with business and political leaders on a regular basis, I can tell you that a distressingly high proportion has a negative view of general education.

Seventh, and finally, we should build a serious R&D effort on education culture. One idea is to create carefully structured community-based pilots to find out what works best in changing attitudes about the value of being highly educated -- effectively R&D on the total community change idea described above. We’re implementing pilots of this kind in South Carolina and will very much welcome partners. We also hope to look hard at success: some students excel even in the worst schools in the most disadvantaged communities. Why? Anecdotal evidence suggests that the motivators are parents or relatives. But this begs the question of why and how those people are different. Through careful study, we hope to learn how to replicate their supportive and motivating behaviors. There are many other possible research topics of this kind that would be a great project for teams of educators and social scientists. And it needn’t be hugely expensive. We could ask that existing publicly-funded time (“departmental research”) as well as the topics of doctoral dissertations be directed to this task. Grant monies could then be used for coordination and summary analysis.

Concluding Thoughts

As we pursue the kinds of specific actions described above, I believe Americans need to remember three things.

First, we should avoid complacency about the competitiveness of our entire educational structure. Tom Friedman’s The World is Flat gave us a much-needed slap in the face for our overall educational competitiveness, and there’s been a great deal of angst about K-12 for some time now. But few among our political leaders appear to be thinking about education as a K to graduate system, and far too few appreciate the changing levels of knowledge needed to function effectively in today’s society. Once, Americans thought everyone should have around a fourth grade education, then the line gradually moved up to the eighth grade and finally to the end of high school. But the line of minimum necessity has long since crossed into higher education; now, if all you have is a high school diploma, you’re a knowledge economy dropout.

Second, if we want to think of our problems in management terms -- a very American thing to do -- we have to dispense with our enthusiasm for the hard, mechanical side of the concept and engage in the soft side. The U.S. automobile industry provides an excellent example of failure and success in the two dimensions of management.

Confronted by popular, higher quality vehicles from Japan, the Big Three responded with workforce quality campaigns that mixed threats and exhortation, then followed with a massive investment in technology (mainly robotics), all the while mixing in the inevitable reorganizations and incentives to executives. When all these failed to make a sufficient difference, the companies finally gave up and resorted to the complicated, messy, and slow business of creating positive relationships with their workers. After about thirty years, J.D. Power reports that Ford is on a par with its Japanese competitors and G.M. is closing in as well. That’s encouraging, but it’s hard to avoid the conclusion that the gap could have been closed much faster if Detroit’s titans had been willing at the outset to think more holistically about the management challenge they faced.

In a recent essay on the origins of the Great Recession, the columnist David Brooks observes that economists’ practice has been to create elaborate mathematical models that make simple-minded assumptions about the manner in which people function in a complex economy. The utter failure of these formulas, he observes, is that they are “based on a stick figure view of humanity.” The lesson here is simple: the technical side of management is seductive (and has a role) but data and formula-focused approaches are at the periphery of the problem.

Finally, we -- especially those of us with a more positive view of higher education’s current effectiveness -- should be aware that significant additional investment in our public systems is unlikely. That isn’t to say that we should stop calling for appropriate funding levels -- as the economist Paul Romer points out, “Support for higher education is the lever by which the government can move the entire economy.” Rather it means we should acknowledge and accept the simple fact that there will never be sufficient resources to allow schools, colleges, and universities to take a great leap in effectiveness on their own. Instead, we’ll have to change the way an important proportion of our citizens think about the value of education. Having a much higher share of students fully understand and appreciate the importance of education will greatly enhance the productivity of our existing K-12 and higher education investment and help offset the size of future funding increases.

Culture change is the only real path to competitiveness for our nation, and time is short. I have some ideas; others will have better ones. Let’s get moving.

Our nation has a long history of creating problem-solving partnerships between government and our research and development enterprise. Indeed, greater support for innovation is an important part of President Obama's strategy for economic growth and international competitiveness.

The largest and most prolific research and development partnerships have often involved our national security, with foundations in the military. In recent decades, this kind of collaboration has grown in support of emerging fields, like alternative energy and biomedical science. But as the threats to our nation evolve, partnerships between government, academe and industry need to move beyond areas where collaboration already is strong. A deeper, broader partnership on homeland security must be one of these areas.

The United States is no longer isolated by two oceans. And a technological revolution has made societies more interconnected than anyone thought possible. At the same time, small groups of people can exploit technology to injure and kill on a much broader scale than ever before. Indeed, the creation of the Department of Homeland Security was a response to these new-generation challenges – ones made so painfully clear on September 11th, 2001.

Today, our nation is more secure than it was before DHS was founded. And in the last two years, we have made considerable progress strengthening our defenses against terrorism, and forging new partnerships at home and overseas to protect our shared systems of trade, travel, and communication. We have improved our emergency preparedness and response capabilities, and enhanced the resilience of our communities and critical infrastructure.

Despite this progress, however, we have a ways to go to thoroughly integrate our nation’s homeland security functions and capabilities. And to do that, we need the best that science can offer. Here are three areas, in particular, that stand out:

Greater Aviation Security and Awareness

The United States has the largest aviation industry in the world, processing some 2 million passengers through 450 airports every day. We know that terrorists have repeatedly sought to use airplanes as a means to take innocent lives, and we know they continue to alter their tactics.

We therefore need to both address the current threats, and also employ technology and innovation to help us leap ahead of future threats. Better explosives detection is important, but, in fact, is just one layer of security in a multi-layered system that includes multiple tactics, both seen and unseen.

The heart of the challenge is to use technology to make travel and trade as secure and smooth as possible for passengers and for cargo. Technologies therefore have to be effective, but also fast, complementary to one another, and as non-intrusive as possible. And, of course, they must support our commitment to protect the privacy, civil rights, and civil liberties of our citizens.

Our goal is to create "the airport checkpoint of tomorrow" that reduces the need for physical searches and maximizes the likelihood that we will prevent another attack on aviation. But to imagine, design, test, procure, and – eventually – deploy this, we need new kinds of managerial, operational, and engineering expertise.

The 'Big Data' Challenge

A second homeland security challenge is likely familiar to many academics: research brings in reams of data, but what is essential is the ability to glean insight, and discern patterns and trends, from a mass of information. How, for example, can we improve our ability to identify the anomalies that could point to illicit or terrorist activity from millions – billions – of data points?

To the airline passengers we screen, add the data on more than 50,000 cargo containers arriving each day through hundreds of air, land, and sea ports. And add to this sea of "Big Data" the terabytes of information pouring in to the intelligence community about threats from abroad – more data each day than the entire text holdings of the Library of Congress.

Pulling actionable intelligence from this data requires the constant evolution of our information gathering, learning, and analytic capabilities. It requires software engineers, information systems designers, and communications and data security experts working together. It requires getting this right so that we can ensure that analysts, agents, screeners, and officers anywhere in the world can get the information they need securely, and in real time.

Securing Our Cyber Networks and Critical Infrastructure

Protecting our shared cyber networks and critical infrastructure also requires strong scientific and engineering partnerships. In the past couple years, we have hardened critical facilities, such as chemical plants and transportation hubs, and greatly improved our ability to detect and respond to a large-scale cyber attack. But we know there's more to be done.

For instance, making sure the industrial control systems that run our water treatment and power plants are safe from attack. Or finding ways to ensure that the distributed nature of cyberspace becomes a contributor to the resilience of the system, not a liability. Indeed, the multiplicity of disasters that recently hit Japan – an earthquake, a tsunami, and a nuclear crisis – illustrates vividly why resilience is so very basic, and so important.

Ninety percent of Americans live in an area where there is a moderate or high risk of natural disaster. We know we can do more to make homes and buildings more secure and resilient. We can speed the commercialization of innovations in the field of nanotechnology that can help put more resilient building materials on the market. Our scientific community can play a direct role in developing security solutions in these and other areas.

How Scientists Can Serve the Public at DHS

Since I became homeland security secretary, we have taken several significant steps. We recently issued a solicitation for research through our Science and Technology Directorate that creates incentives for academe and the private sector to propose novel ideas and approaches.

We are supporting the president’s commitment to strengthen education in the STEM fields by granting nearly 100 fellowships, scholarships, and internships to students in science, technology, engineering, and math every year. We just announced a new Loaned Executive program to bring private sector expertise into our leadership ranks on 6- to 12-month rotations, and we’re launching a new Cyber Workforce Initiative to help attract and then retain the very top cyber professionals available in the country.

I believe there are many scientists and engineers interested in working on scientific issues for the public benefit who, perhaps, have never considered the idea of government service. Maybe their impression is that technical career paths in government are not as appealing as they are in academe or the private sector.

Yet it’s not unusual for a lawyer, economist, or political scientist to spend some time working on a particular policy issue at a government agency. We therefore need to do a better job at making a similarly worthwhile and workable path for top scientists to serve the public interest, and to help make our nation more secure. In essence, we need a model where there is more scientific knowledge across government, and more knowledge of government and public policy in science and engineering communities.

We have tremendous scientific resources in this country. We lead the world in scientific and technological innovation. We must, therefore, engage our best scientific talent in support of our common security. By doing so, we can build on past success, amplify our current efforts, and greatly accelerate our future progress toward a more secure and resilient America.