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Education disparity fuels economic inequality

From school funding to student loans, low-income youth face disproportionately high barriers

The United States has the 17th best education system in the world, according to a recent study conducted by the Economist Intelligence Unit. A variety of metrics were used to quantify success, including international test scores, graduation rates between 2006 and 2010, and percentage of students seeking higher education. The studies preface notes that, “simply pouring resources into a system is not enough: far more important are the processes which use these resources.” Despite downplaying the link between wealth and education quality it is no coincidence that all forty of the nations included in the report are industrialized and relatively prosperous.

Education is widely considered a primary method for eradicating poverty— personally, nationally, and globally. In 2000 the United Nations adopted it’s “Millennium Development Goals,” the second of which was to ensure every child worldwide is able to access primary education by 2015. Currently we are still some 57.2 million children away from reaching that goal. Of these, 29.8 million live in Sub-Saharan Africa, falling from 40.6 million in 2000. The region with the second most children out of school is Southwest Asia, with 12.4 million, down from 37.8 million thirteen years ago. In South West Asia primary education is available to 67% more students than it was in 2000, compared to just a 26% increase for Sub-Saharan Africa over the same period. According to the Millennial Development Goals Report of 2012, the percentage of people living in poverty in Southwest Asia has fallen 17%, from 51% to 34%, between 1990 and 2008, while it’s fallen only 9%, from 56% to 47%, in Sub-Saharan Africa. These statistics illustrate that Southwest Asia’s rate of poverty has reduced about twice as quickly as the poverty rates in Sub-Saharan Africa during a period that overlaps primary education, becoming available to twice as many kids in South West Asia as it did in Sub-Saharan Africa. This demonstrates a strong correlation between education and economic opportunity.

If education equals economic access, why is it that the world’s wealthiest nation would only have the 17th best education system? Paul Peterson, a Harvard Government Professor, and director of the Program on Education Policy and Governance, stresses the importance of having a “powerful educational system that is producing a highly proficient workforce” in order to out-compete the rest of the world. Yet the two countries with the top education systems, Finland and South Korea, are well off, but hardly international economic juggernauts. However, both nations have significantly less economic inequality than the United States. The Gini coefficient is a formula created in 1912 by Italian statistician Corrado Gini that measures a nations wealth inequality among values of frequent economic distribution, such as income. A Gini score of 0 represents absolute economic equality, while 100 is complete inequality. According to the World Bank’s current Gini index, Finland holds a score of 26.9, South Korea clocks in at 31.3, while the US comes in at a cold 45.

America’s educational inequality reflects and perpetuates its economic inequality. Our federal government funds roughly 13% of the public school system, with the additional costs split between state and local governments. Of this remainder, an average of 43% comes from the state and 44% from the local community, primarily through property taxes. These percentages fluctuate widely throughout the country, yet the trend leads to more affluent communities and states winding up with a better-educated populace than their impoverished neighbors. In Finland, schools are federally funded based on the number of students, resulting in socioeconomic circumstances playing a less crucial role in a child’s outcome. This cuts down the plight of intergenerational poverty. Furthermore, the Finnish government covers the costs of college and vocational school, both of which are available to all. Teachers are required to have a master’s degree and receive substantial salaries. Teaching is a highly competitive field with only about 10% of applicants getting positions. This is in stark contrast to America’s system of criminally underpaid, undertrained educators.

The nonpartisan “Equity and Excellence Commission,” created by Congress to advise the Department of Education on addressing economic inequality in education, found that “No other developed nation has inequities nearly as deep or systemic (as the United States); no other developed nation has, despite some efforts to the contrary, so thoroughly stacked the odds against so many of its children.” Ten million low-income American children are subject to run-down schools with underpaid, often underperforming teachers. According to Stanford Law Professor and commission member Mariano-Florentino Cuéllar, “The achievement gap between children from high and low-income families is 30 to 40 percent larger among children born in 2001 than among those born 25 years earlier.” Children born 25 years earlier would have begun school in 1980, and since the early 1980’s, wealth inequality in America has been accelerating at a staggering rate. In 2005 the top 1% of earners took away 21.8% of total national income, nearly double their 1980 levels.

Brutal budget cuts butchering our education system have helped accelerate this economic disparity at an exponentially increasing rate. Between 2010 and 2012, 19 states cut education funding by five percent or more, causing class sizes to swell as teachers dwindle. Low-income districts were particularly hard hit, relying on Title 1 funding, which is federally distributed amongst schools with higher percentages of low-income youth, to help ease the shortfall. Unfortunately that funding is evaporating at a rapid pace. As a result of the recent sequester congress has cut $725 million from the Title 1 program.

Instead of directly addressing the economic disparity, political solutions to the broken school system have a tendency to focus on testing and common standards. No Child Left Behind put the cost burden on individual school districts to meet funding requirements for the program and nurtured a system of measuring a school’s academic success through standardized test scores. Obama’s Race to the Top program strengthens the tie between test-scores and funding, offering federal grants to districts and schools that turn around low-performances. This has naturally caused a shift in American classrooms towards teaching to the test, emphasizing reading and mathematics at the expense of everything else—a disservice to our youth.

Oftentimes, institutionalized prejudice is perpetuated by standardized testing through “test bias,” a form of social discrimination imbedded in the text of many tests. In 2003 Jay Rosner, Executive Director of the Princeton Review Foundation, which creates SAT prep programs, revealed that the makers of the SAT often reject potential questions that are answered correctly by a higher percentage of black people than whites, in order to ensure that test results are “consistent” from year to year. Another egregious example, from the 2006 New York State Regents exam on world history, asks students to describe how Africa benefited from imperialism. More prominent than blatant racism is latent “differential item functioning,” a phenomena where minority and/or economically disadvantaged students with the same educational background will consistently score lower on certain questions than their middle and upper class white counterparts. Many of these questions rely on knowledge of bourgeois vocabulary and cultural motifs that children from wealthier families are more likely to have been exposed to. One such question asked which of a list of items did not belong on a porch, the correct answer being a sofa. Sofas are common porch staples for those who do not have access to or interest in patio furniture. According to Stanford Sociology Professor Sean F. Reardon, the average difference in test scores between a family who makes at least $165,000 and one who makes $15,000 would have been roughly 90 points in 1980. Today that has increased to a 125-point divide; almost double the average 70-point difference between Caucasian and African American test-takers.

With so many other barriers barring low-income youth from a quality education, it is no surprise that resources to help them attend college are dwindling alongside the quality of primary education. Tuition rates at public colleges have gone up an average of 27% since the 2007-2008 school year. Congruently, states have been spending an average of 28% less on each student. In extreme examples, such as California and Arizona, tuition rates have increased 70%. All the while, financial aid opportunities have decreased and federal student loan rates have shot up. Couple this with the $51 million being cut from the work-study student employment program and you have crippled economic access for high-performing, low-income students to continue their education. College enrollment increased 46% between 1996 and 2010; over the last twenty years there has been an 18% increase in children from upper-income families earning bachelors degrees, with only a 4% gain in low-income students earning degrees over the same period.
The US Bureau of Labor Statistics reports that as of May 2013 the unemployment rate for college graduates is half that of high school graduates—3.8 versus 7.4 percent. Employed graduates make an annual income average of $17,000 more than their high-school-educated counterparts. These numbers reflect mostly those above the age of 25, many of whom received their education and entry-level jobs before the 2008 recession. The 3.8% unemployment rate for graduates is twice the pre-recession level, and many of those adding to the statistic are recent graduates. Of those under 25 who received their degree up to one year before October 2011, an estimated 73% were employed, either fulltime or part-time, with over 11% still searching for work. A March 2013 Wall Street Journal article reports that there are a total of 284,000 college graduates working for minimum wage or less, roughly twice the pre-recession levels.  The Center for College Affordability and Productivity released a study, which reveals, “Barely half of college graduates are in occupations requiring bachelor’s degrees or more.”

Graduates who land jobs that require their degree are often unprepared for the work force. The New York Times explored this phenomenon in detail in their June 28 article, “What It Takes to Make New College Graduates Employable.” They cited a study by The Chronicle of Higher Education and American Public Media’s Marketplace, finding that half of 704 sampled employers were dissatisfied with the skill level of their recent graduate hires. The consensus was that the graduates lack written communication and problem solving skills. According to HR Policy Association Vice President Jaime S Fall, “(Young employees) are very good at finding information, but not as good at putting that information into context… They’re really good at technology, but not at how to take those skills and resolve specific business problems.” This demonstrates a lack in abstract thinking skills perpetuated by an education system increasingly focused on quantifying success through standardized testing.

Secretary of Education, Arne Duncan, quite accurately stated in TIME magazine that, “Budgets are never just numbers. They reveal our values. They reveal our value choices.” Let us then reflect on what our education budget says about our values as a society. Do we value widening the economic gulf between rich and poor by extending decreasing opportunities to one group while kicking dirt in the face of the other? Or do we recognize education’s power to foster economic and social equality and use it as an agent of transformation that reflects the egalitarian values we claim to hold so dear? This dichotomy is a symptom of the increasing disconnect between the masses and controlling elite. Both groups have a vested interest in finding a solution, albeit for different reasons. Harvard’s Program On Education Policy and Governance released a recent report, “Globally Challenged: Are US Students Ready to Compete?,” which emphasizes that the US ranking behind 31 countries in math proficiency could cost the government trillions in GDP over the coming decades. The threat of intellectual stagnation stopping economic growth dead in its tracks is terrifying to plutocrats interested in the continued acquisition of capital. They see more egalitarian access to economic opportunity as equally horrifying. Stuck between a rock and a hard place, politicians desperately scramble for ways to raise test scores as they seek shelter from addressing funding disparities.

Fortunately a slew of popular protest is addressing a variety of issues related to education class discrimination. In Chicago, fifty-four schools are facing closure due to a $1 billion funding deficit, about 20% of the school district’s operating budget. The closure will cause massive teacher layoffs and further the ballooning of class sizes. Low-income minority students will be the most affected.  In recent months the Chicago Teachers Union has led massive demonstrations against these cuts, mobilizing educators, parents, and students alike. The protests have only increased as the cuts have been formalized, and are expected to continue through the summer and heighten at the start of the school year. Chicago provides a seedling of mass support for education equality that I hope to see grow into an organized national movement over the coming months.

Elsewhere, in Seattle, teachers have opted to boycott the standardized Measures of Academic Progress (MAP) tests, which they argue is an inaccurate measure of academic progress. Test bias and an overabundance of class time being used to prepare for a test that is unconducive to long-term educational goals are amongst their main motives. The protest started out at one school, Garfield High, and quickly gained traction across the district. The school board has caved to the teacher’s demands and next year high schools can opt out of testing, however they need to find other ways to evaluate and demonstrate student progress. This sort of leeway allows teachers to tailor their curriculum directly to their students’ needs, which is an essential element in the art of educating.

The coming months are set to make or break the movement for education equality. After Congress failed to reach a compromise, student loan rates doubled from 3.4 to 6.8% on July 1.  House Republicans refused to budge from a plan that ties student loan rates to the well-being of financial markets. Backed into a corner after a month of inaction, with no deal in sight, the Senate decided to gamble on the next generation’s future by subjecting it to the whims of Wall Street. With an 81-18 vote the Senate made this unholy union official on July 2, much to the delight of President Obama. This provides a burst of instant gratification for everyone involved, particularly Senate and House Republicans, who are going to milk their victory for short-term political points. Student loan rates for the upcoming year are going to be 3.9% for undergraduates, 5.4% percent for graduate students and 6.4% for PLUS loans. The caveat is the newly-created caps on student loan rates are 1.5% higher than the rates enacted July 1: 8.25% for undergraduates, 9.5% for graduate students and 10.5% for PLUS recipients. Tying student loan rates to free-market capitalism will make loans unmanageable for low-income students during future recessions, creating self-perpetuating cycles of economic hardship. During a recession, the sudden spike in interest rates is very likely to impact the retention and graduation rates of students reliant on low-interest loans to complete their education. The spike in dropouts could, in turn, lead to future economic turmoil caused by a shortage of educated professionals.

Senator Elizabeth Warren recently proposed her first bill, which would lower student loan interest rates to 0.75%, the same rates the Fed charges banks. She would also like the Fed to cover the debt reduction as it did for the Wall Street bailouts. If the US government is willing to make that sort of investments in its financial institutions, is it not worth making the same investments in educating our next generation? Each year Washington makes a $51 billion surplus in student loans that trickles into bank coffers. Preventing disenfranchised youth from opportunities to build a life outside of poverty while the rich get richer does not reflect our values as a people, nation, or species. For alternative models we can look to the likes of Senator Warren, the Chicago Teachers Union, the Finnish school system, and basic human decency. Whatever models we look to, may they guide us in a swift call to action. A more egalitarian approach to public education is clearly crucial for creating economic equality.

Jordan Beaudry has a pen in his pocket and a passion for social justice.


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