Inequality and education

Should we care about inequality? We might say, for example, that both the poor and rich have always been with us, and that we somehow upset the natural order by even drawing attention to the wealth differences let alone trying to reduce them via government strategies. Should we be more concerned with absolute levels of income and wealth rather than comparisons? In a Rawlsian sense, we could even justify the Haves getting more provided that the Have-nots are not made worse off.

Or is it possible that significant disparities between the rich and poor are good for neither? British researcher Richard Wilkinson believes as much, and has written about the ill-effects of inequality, first in his book Unhealthy Societies: The Afflictions of Inequality, and more recently with his partner Kate Pickett in The Spirit Level: Why Greater Equality Makes Societies Stronger. (I’ve written previously on Wilkinson’s work here and here.) Nobel laureate Joseph Stiglitz just published a book with the title The Price of Inequality.

We are familiar with the numbers, or at least should be. Since even before the Great Recession the United States experienced the greatest levels of inequality in 80 years. The rich have indeed become richer while the Rest of Us have seen our wages either stagnate or decline. Moreover, there are nearly 25 million Americans who are either without a job or underemployed, working part-time or in positions paying substantially less than before they were laid off following the collapse of the housing bubble and Wall Street’s near implosion. We can see what’s happened to our national Gini index over the last several decades in this chart:

 

I’ve been reading a book about education—Finnish Lessons: What can the world learn from educational change in Finland? The author, Pasi Sahlberg has this to say about inequality:

It seems understandable that income inequality, child poverty and lack of appropriate pupil welfare in schools play an important part in improving teaching and learning in national education systems. This has been well understood in Finland during the last half a century.

He goes on to say that Finland’s remarkable educational turnaround must be viewed within the context of a Finnish cultural legacy (e.g., resoluteness, focused problem-solving, and a strong sense of national community) and, most especially, the country’s elaborate social welfare system. Just a few ingredients:

  • free education, from pre-school through graduate school
  • free meals for all students regardless of socioeconomic status
  • universal health care
  • a pervasive sense of egalitarianism
  • an extraordinary commitment to improving the wellbeing of all citizens, particularly with an emphasis on enhancing human capital via education

The evidence is clear: Finland’s educational system is now the best in the world, with its students routinely scoring at or near the top in international tests. Ironically so, since Finnish students take very few tests during the course of their comprehensive education.

As to inequality and learning, Sahlberg includes this chart:

 

Note the sharp contrast between Finland and the United States. Finnish students score higher on the OECD-administered PISA than American students, and Finland is one of the most equal societies on the planet.

However, as Sahlberg discusses, Finland’s inequality is rising along with those of other western industrial democracies. He believes that the country’s leaders and citizens need to reaffirm their commitment to social justice and egalitarianism, traits, in Sahlberg’s judgment, that have allowed the Finnish reform movement to succeed where other countries have fail, the U.S. being the obvious example.

Of course, the above scatter-plot chart illustrates correlation and not causation. Moreover, some American students do quite well on the international tests, at least as well as Finnish students as a whole. And this gets to our point. Poor American students perform lousy on these tests just as they consistently do on high-stakes exams like the SAT. Sahlberg suggests that effective educational reform, one dedicated to improving learning among all citizens, requires that social-political context mentioned above.

But that’s a problem in the U.S. Finnish society and its political system are as different from ours as a goat is to an elephant. Based on Sahlberg’s description, Finland has achieved a “kinder, gentler nation,” whereas we can only dream about one. There is absolutely no way that today’s Republicans could even recognize the Finnish experience; they certainly couldn’t embrace it—even if in so doing America would dramatically boost educational performance, and thereby human capital, at considerably less cost that the status quo. It’s enough for the GOP to utter the word ‘socialism’ to send woefully ignorant Americans shrieking to the hills.

That said, whenever you hear a politician or any educational leader for that matter talk about reform, listen for references to the Finnish societal ingredients I listed above. Well, you’ll listen in vain. More likely you’ll be treated to the usual pabulum about “accountability” and “tests” and “competition”—all anathema to Finns. You have my permission, then, to simply ignore the blather, for it amounts to nothing.

Europe vs. the U.S. on inequality

As I mentioned before, I was surprised to learn from Prof. Galbraith that Europe now boasts (?) a higher Gini index than the U.S., when taking into account both in-country inequality and inter-country inequality.

I questioned whether or not Prof. Galbraith consistently applied his criteria and analysis when making the comparisons between Europe and the U.S. The professor says that he did, as you’ll note below. (By the way, I readily confess amazement upon seeing his comment in my mailbox this morning. I always wonder if anyone reads my stuff, let alone a noted academic and son of a legend.) Here is an excerpt:

What we did was to add the within-country inequalities to a measure of inequality between countries, in a mathematically-consistent way, so as to develop a measure of inequality across Europe as a whole.  Comparing this measure to the US, you find that the inequalities in Europe are greater.

Nevertheless, I dashed off an email to Prof. Emmanuel Saez at my alma mater. He’s the foremost expert on U.S. inequality. I’ve asked him to weigh in on the issue. I hope that he has the time and inclination to do so.

Wikipedia lists the Gini index of the 50 states. I quote from the entry:

U.S. income inequality was at its highest level since the United States Census Bureau began tracking household income in 1967. The U.S. also has the greatest disparity among Western industrialized nations

To be sure, the quality of Wikipedia’s information depends on its contributors, who may or may not be conversant with the latest data and analyses. That said, here’s a chart showing the Gini indexes of the states (click on the chart for a larger view).

 

Utah, as it turns out, has the lowest Index. New York has the highest. Washington state (red, at .441) is below the mean, which is 0.469 for the country as a whole.

I’ll have more on this topic in subsequent posts.

Outrage? Meh.

Charles Blow, writing for the New York Times, argues that this is a bad time for Democrats to go limp. But polls show that the enthusiasts for Obama in 2008 may sit on the sidelines in November, whereas Republicans are angry as hell, hate Obama and everything he stands for and is (did you know that he’s black?). Moreover, there’s lots of money being stuffed into their mouths.

Blow references remarks made by Vermont senator Bernie Sanders before the Judiciary Committee [hyperlinks in the original]:

Another witness at the hearing, Vermont Sen. Bernard Sanders, an independent, said the democratic foundations of the nation are currently enduring their most severe attack in history on both economic and political fronts.

“We are well on our way to see our country move to an oligarchy, where power rests in the hands of a few families,” he said.

Senator Sanders said inequality in the US is worse than it has been at any time since the 1920s. He noted that 23 billionaire families have contributed at lease $250,000 each so far in this year’s campaigns.

He added that the wealthiest 400 individuals own more wealth than the bottom 150 million Americans – roughly half the country.

“What the Supreme Court did in Citizens United is to say to these same billionaires and the corporations they control: ‘You own and control the economy, you own Wall Street, you own the coal companies, you own the oil companies. Now, for a very small percentage of your wealth, we’re going to give you the opportunity to own the United States government,’ ” Sanders said.

“This is the essence of what Citizens United is all about – and that’s why it must be overturned,” he said.

This should make the Rest of Us, well, outraged. But we’re not.

What Sanders said is as true as it is disturbing. However, the lack of enthusiasm in this electoral go-around may be easily explained: we get the message, which makes us realize that there’s really not a damn thing we can do about it. Besides, Obama has almost completely betrayed his pre-president principles—or, more likely, he never had any to begin with.

Mountain Lion: initial, very brief impressions

One can readily find comprehensive reviews of Apple’s new OS elsewhere (e.g., here and here). As an extreme early adopter, I downloaded my copy of Mountain Lion at the break of dawn Wednesday then installed it on my Mac Pro (the oldest version compatible with the new operating system—whew).

Unlike Microsoft’s Windows 8 or Metro or whatever Redmond is calling its latest OS, Mountain Lion’s improvements are mostly under the hood. The interface looks very much like its predecessor, Lion. This is a good thing and allowed me to load the OS onto my wife’s MacBook Air—she is my technological antithesis. It also helps that one purchase of $20 is good for multiple devices.

What I noticed first off, other than the appearance, was speed. This puppy is much more responsive than Lion, and the updated Safari shows the speed boost most of all. Web pages flash onto the screen—almost instantaneously with a mouse click.

That’s it for now. Like I said, very brief.

A bit more on inequality

In my previous post I discussed the notion of inequality, typically measured by the Gini index, or coefficient. James Galbraith believes that when taken as a whole Europe is more unequal than the U.S. However, I wonder if that’s true if you apply the same assumptions—treat the separate states as Galbraith does the European countries.

So, here’s a chart showing the real income per capita of two U.S. states, Connecticut and Mississippi, rich and poor (FRED data).

 

Yes, I, too, was surprised that people living in post-war Mississippi were richer than their counterparts in Connecticut. That metric reversed as part of the Great Divergence, beginning in Reagan’s first term. Today the average person in the Nutmeg State is twice as wealthy as a Mississippian. Using those two states as proxies for the U.S. as a whole, America’s Gini index is quite high, indeed, perhaps as high as, if not higher than, Europe’s.

Europe’s inequality

I was taken aback by a post from Matthew Yglesias. The caption read:

Europe Has Even More Inequality Than The United States

So I looked at some data from OECD. Here is what I found.

What I don’t see in this picture is higher inequality in Europe than in the United States. To be sure, if you subtract out the Nordic countries, which have much lower Gini indexes than the U.S.’s, you’ll encounter greater inequality. But it does not seem to be the case that Europe as a whole is more unequal than the U.S.

Yglesias is basing his judgment on that of economist James Galbraith. I’ll quote Yglesias:

One very interesting point that James Galbraith makes in his newish book Inequality and Instability is that if instead of looking at Finland then Spain then Germany then Greece all as separate countries but instead look at “Europe” as an integrated marketplace with perfect capital mobility and legal labor mobility then it’s even more unequal than the United States:

And when you do that, when you take what had been isolated labor market situations and bring them into direct interaction with each other, you have to measure the inequality on the new basis, on the new foundation. And nobody had done that. And what we found was that in fact when you do that, European inequality, taking into account the differences that exist between, let’s say, Germany and Poland or between Norway and Portugal, is actually larger in wages than it is in the United States.

I presume, then, that the OECD data do not reflect the adjustments made by Galbraith. Moreover, I do not have figures newer than 2008. On further reflection, I would not be surprised if the Great Recession took a nasty hit on Europe’s Gini index, especially given the huge problems in the peripheral countries. The economic declines in those countries have been quite dramatic, as we know, with very high unemployment rates (about fifty percent of Spanish youth, for example) and falling wages.

Galbraith’s point, though I haven’t read his book, is that when one looks at Europe as a whole, the peripheral countries’ wages are considerably lower than those of the core nations’, especially Germany’s. But guess what? If you were to take the same look at the United States, viewing it as “an integrated marketplace with perfect capital mobility and legal labor mobility,” though I question the “perfect” part, then the U.S. would have to have even greater inequality than it does when considered in the aggregate. Think of Mississippi and Alabama and the other southern states as Europe’s periphery. Compared with the coastal states our peripheral states are poor indeed, with much lower wages.

None of this should surprise us. But it’s important, I believe, to be consistent when attempting such comparisons.

A follow-up on geographical determinism

Yesterday I reprised my angst and bewilderment over America’s redness. One reader expressed his opinion on why so many of our fellow citizens choose to align with the Republican Party when it’s quite obvious that the GOP has nothing to offer them. He wrote:

I wonder how much the views of rural areas I [are] influenced by the inundation of conservative radio which in many places is the only programming you can receive out there.

Otherwise, perhaps the leanings to the right have to do with this kind of “individualism” many in the mid-west and rural areas have about themselves. Their perceptions are rooted in that and the line sold by the GOP runs right in line with that. Unfortunately, given the relatively lower income levels many in those areas live within, they are persuaded by the GOP that the Democrats are the antithesis of that perception so they vote conservative. I’d say it also has to do a lot with the religion. So many of the smaller communities’s centers are focused on the church.

Religion clearly demarcates red from blue, since those in the Midwest and South are far more religious than their coastal counterparts. And religion has a tendency to blind its adherents to what’s going on around them. Besides, it drives them to Fox News, which exhibits no regard for the truth.

So, why do people who live amongst cropland go to church while Seattleites drink coffee at the nearest Starbuck’s? Is church the physical hub of social networking, whereas urban-dwellers prefer pubs and cafés and restaurants and theaters and cinemas and city parks? I mean, what does one do in a corn field?

But back to the misalignment of interests. The New York Times editors remind us that the Republican-controlled House will surely vote down the recently passed Senate bill to extend the Bush-era tax cuts, except for the top two percent of households. The editors:

The vote, however, exposes the true priorities of the Republicans. No Senate Republican agreed to support the middle-class tax cut by itself because they insisted that the rich get one, too. (Actually, the rich would have gotten a tax cut on their first quarter-million of income, but, apparently, that wasn’t enough.) Forty-four Republicans (and one Democrat) voted for an alternative bill that would give wildly generous estate tax breaks to a few of the richest American heirs at a cost of $119 billion to the deficit.

And those 44 Republicans also voted to raise taxes on 13 million low- and moderate-income working families. Though it seems unbelievable on a day when Republicans tried to be so generous to their wealthiest contributors, they voted for a bill that would end the child tax credit for nine million families that make less than $13,300, costing some of the nation’s most struggling households $854 a year. Another four million families would be affected by the Republican vote to reduce both the earned income tax credit and the middle-class credit for college tuition.

How many citizens who call corn “neighbor” benefit from the Republican alternative, one that fleeces the poor and further coddles the rich?

Only in America.