This week, I read a report from the Economic Analysis and
Research Network titled “A
Well-Educated Workforce is Key to State Prosperity.” The report began by
asking the question – “What can state governments do to boost the economic
well-being of their people?” The report summarizes that incomes and wages
increase when productivity increases. There are several key policy levers to
increase productivity: investments in public infrastructure, in technological innovation
at public universities and in workers through the education and training systems.
Many states, including Kentucky, have been taking the
opposite approach to investment in the workforce. We have seen in the last four
years, major reductions to base funding for our K-12 and our higher education
systems. Recently, one state, Florida, took an approach of trying to lure
employers from Kentucky to the sunshine state. This strategy does not work in
the long run since there is very little investment in helping to make the
existing workforce more productive.
The report provides several key findings that our policy makers
in Kentucky need to review.
1. Overwhelmingly, high-wage states are states with
a well-educated workforce. There is a clear and strong correlation between the
educational attainment of a state’s workforce and median wages in the state;
2. States can build a strong foundation for
economic success and shared prosperity by investing in education;
3. Cutting taxes to capture private investment from
other states is a race-to-the-bottom strategy that undermines ability to invest
in education (I hope Gov. Scott in Florida reads this);
4. States can increase the strength of their
economies and their ability to grow and attract high-wage employers by
investing in education and increasing number of well-educated workers, and;
5. Investing in education is also good for state
budgets in the long run, since workers with higher incomes contribute more
through taxes over the course of their lifetimes.
As I reported to the Interim Joint Subcommittee for P-12 education this week, it is time to reinvest in Kentucky education.
For a number of years, Kentucky educators have done
significantly more with less. Kentucky education is one of the fastest
improving education systems in the nation. However, our educators have hit a
wall. Without significant reinvestment in P-12 education, we will begin losing
ground. When we lose ground as a state, we have a less well-educated workforce. When we have a less well-educated workforce
than our neighbors, we lose jobs and potential employers who pay living wages.
This conversation needs to happen in every community. Every
superintendent, teacher, parent and business leader needs to have this
conversation with their local school boards and state legislators. We are not
going to “cut” our way to prosperity in Kentucky. Investments in education
today will pay huge dividends in the short and long term.
Specifically, I am pushing for three major priorities.
1. Restore the basic SEEK funding per pupil to $3,866
(this will cost $60 million in FY15 and $90 million in FY16 (due to growth and
keeping former dropouts in school).
2. Restore funds for safe schools, extended school
services, textbooks and preschool. These funds were originally part of the KERA
in 1990. We need $60 million each year of the budget.
3. Restore funds to expand access to broadband and
network services to our school districts Also, provide a $50 million, 5-year
bond to replace aging technology equipment. ($20 million in FY 15 and $20
million in FY16).
As opposed to last week's post, I am in total agreement with this post. Basic Keynesian depression economics are simple and effective, if counter-intuitive. When the economy is in a slump (a slump which continues to plague job creation as evidenced by Bernanke's decision today to not slow down the bond-buying spree), government is supposed to engage in deficit spending, spending to invest in things like infrastructure, education, and new technologies to offset the contraction in private sector spending and investment. The federal government, at least at the beginning, did this. Most state governments, Kentucky included, did not. It is definitely time to restore and even improve Kentucky's education funding.
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