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The U.S. education system is not as internationally competitive as it used to be; in fact, the United States has slipped ten spots in both high school and college graduation rates over the past three decades, according to a new report and scorecard from the Council on Foreign Relations’ Renewing America initiative, which examines the domestic foundations of U.S. power. U.S. national security is directly linked to issues such as education because shortcomings among American workers threaten the country’s ability to compete with other countries and set a compelling example internationally.
"The real scourge of the U.S. education system—and its greatest competitive weakness—is the deep and growing achievement gap between socioeconomic groups that begins early and lasts through a student’s academic career," writes Rebecca Strauss, associate director for CFR’s Renewing America publications. Wealthy students are achieving more, and the influence of parental wealth is stronger in the United States than anywhere else in the developed world.
Although the United States spends the fourth most in the world on per-student primary and secondary education and by far the most on college education, those funds are not distributed equitably. The majority of developed countries invest more resources per pupil in lower-income school districts than in higher-income ones. It is the reverse in the United States, in large part because local property taxes provide most revenues for K-12 public schools. The investment gap continues in college and has increased significantly over time. In 1967, the gap in real annual per-pupil spending between the most and least selective colleges was $13,500. In 2006, the most recent year for which data is available, it was nearly six times larger, at $80,000.
"Human capital is perhaps the single most important long-term driver of an economy," Strauss writes. "Smarter workers are more productive and innovative. It is an economist’s rule that an increase of one year in a country’s average schooling level corresponds to an increase of 3 to 4 percent in long-term economic growth. Most of the value added in the modern global economy is now knowledge based."
Holding a college degree matters for landing a good job. In 2011, according to the U.S. Census Bureau and the Bureau of Labor Statistics, thirty- to thirty-four-year-olds who had only a high school diploma earned $638 per week, and their peers with bachelor’s degrees earned $1,053. Yet while more Americans understand that a college education is necessary for success, fewer say they can afford to pay for one.
The Obama administration’s record for taking on education inequality is mixed, writes Strauss. It has set an ambitious agenda for education policy that pushes for more accountability, especially for schools that serve low-income students, along with more innovative ways to measure and evaluate quality. Yet funding decisions have taken federal policy in the wrong direction. The major federal programs for disadvantaged students are set to be cut back as part of sequestration, while several budgetary changes, particularly in higher education student aid, disproportionately favor the wealthy.
"The United States is in an era of austerity," the report concludes. "The challenge will be to expand higher-quality education for all Americans, rich and poor, in a time of tight budgets."
This scorecard is part of CFR’s Renewing America initiative, which generates innovative policy recommendations on revitalizing the U.S. economy and replenishing the sources of American power abroad. Scorecards provide analysis and infographics assessing policy developments and U.S. performance in such areas as infrastructure, education, international trade, and government deficits. The initiative is supported in part by a generous grant from the Bernard and Irene Schwartz Foundation.