Great Risk Transfer: Education

Posted: June 11, 2011 in Uncategorized

To recap, last time I wrote about how the U.S. has seen an unprecedented transfer of risk from institutions, governments and corporations to individuals. This has occurred in many aspects of our daily lives, including retirement, healthcare, employment, homeownership, the legal system and natural and man-made disasters. Add another to the list: education.

This is a rough one, because it impacts children who are young and vulnerable as well as young adults, robbing them of the opportunity to receive a good education unless they are fortunate enough to be in the correct socio-economic class or in the right place at the right time. Let’s look at what’s going on:

  • Daycare: Not only is there a generally scarcity of high-quality day care options, but high quality day care is incredibly expensive. Like every other type of education, the lower the child-teacher ratio, the better the quality of the education. Most people who work, unless they are wealthy, are limited in their daycare options and have to take what they can get when they can it, regardless of the quality of the situation. Research shows that one of the biggest predictors of future educational success is early exposure to a solid preschool environment, so when children and their parents are forced to compromise with daycare options that are little more than TV-based babysitters, children suffer for the rest of their educational experience.
  • Elementary schools: Ah, school choice. Another bait and switch term for a concept that benefits for profit educational companies, billionaire business owners and children of upper class families at the expense of the poor and needy. The hard truth is that the parents and guardians of children who make less money and struggle financially are less likely to have the time, energy and knowledge to navigate a system allegedly based on “choice.” Charter schools, vouchers and other “choices” drain money and resources from a system that isn’t flush in the first place. Do I think that the public school system is perfect? By no means! But depriving children of resources and punishing hard-working teachers isn’t going to help; in fact, it makes the system even less able to function than it already is. Instead of focusing on choice, put that money to work to fighting poverty, and many of the issues that dog the poorest performing schools will improve.
  • High schools: Ditto on school choice. Add high stakes testing (ditto for elementary schools) that drills students in concepts most likely to be tested rather than learning concepts that are actually used to educate, and you’ve got a recipe for limited testing success but no true educational success. Students that have the background and resources to succeed are bored to death in school, and those that don’t are likely to fall further behind and drag the rest of the school down with them due to rules in No Child Left Behind. Most high schools don’t prepare children well for college OR the workforce because of this insane emphasis on high-stake testing. And the most vulnerable, those in special ed, are being squeezed by high-stakes testing that they can’t possibly master and being deprived by the resources being drained out of the system by school choice.
  • Trade schools: The best trade schools are institutions where Americans get hands-on training that directly translates to the job market. The worst — and all too many fall into this category — take advantage of vulnerable students by saddling them with student debt that will be virtually impossible to pay off for training that either doesn’t translate into a job or translates into a job far lower paying than what was advertised. There’s a disconnect between what employers need and the training that many of these schools offer and students all too frequently come out on the short end. Tuition is outrageously high, leading to an unacceptably high student loan burden. Is it any surprise that the highest rate of student loan default is among trade school grads?
  • Universities: To say that higher education has gotten obscenely expensive is an understatement. When it’s difficult for even the middle class or upper middle class to afford to send their kids to college, let alone the working class, it’s a problem. Hey, it’s a problem that anyone can’t afford to access institutions that provide a gateway into higher earning occupations. By pricing college education outside of the reach of many, and transforming much of the student aid available from grants to loans, generations of young people are either shut out entirely from the college education system, overloaded with debt or forced to quit mid-stream due to lack of resources. Or all of the above. The student debt crisis is a huge story that is flying under the radar for all too many, and the student loan companies have made it practically impossible to get out from under this debt burden. So many students are stuck, forever.
What’s the result of all these changes to the educational system? Parents, and students, are bearing more of the risk than ever in terms of education. The responsibility is on the parent and the child (and the teacher), those who have the least power in the current system. There are so many pitfalls in this system that it is much more likely that these three groups, who are the heart of the educational system, will fail instead of succeed. And the price for failure is high — unemployment or underemployment at the very least, lower lifetime earnings, lack of benefits and other issues. Even the relatively well off struggle with navigating a Byzantine system that makes no sense.
But the wealthy, and super wealthy, can take comfort in their 529 plans, by which they can transfer wealth to future generations without ever actually having to spend it on college. All during a period of time in history when a college education is less affordable than it’s ever been. And this passes for fairness. What a shame.
  1. Sysparatem says:

    Yes and Shame is exactly the right word. Shame on those who portray this as an example of American entrepreneurial spirit.. Shame on those who heap shame on the poor, the young, the sick and the disadvantaged. This is not the American social spirit that saw thousands volunteering help, food and blankets during terrible flooding. But then those were ordinary folks right? and what they gave was probably not from surplus in many cases. These policies and actions don’t represent what most of in the world respect as the American spirit. I t represents the very worst sociopathic behaviour. Evil hiding behind the fig-leaf of Darwinsim


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