A correspondent has kindly drawn my attention to President Obama's accreditation reforms for higher education, as outlined in his State of the Union address. There is much that seems of merit to me in these reforms, but these reforms have encouraged me to think more broadly about education.
My premise is that policymakers should target, above all, social and environmental outcomes. As with other variables, like
income say or, more to the point, literacy, at the basic level there
is a strong correlation between something measurable and human
wellbeing. So, for instance, we can measure functional literacy
quite well, and the outcome of 100 percent literacy is a worthwhile
one to target. In this vein, I was pleased to see that President Obama proposed programs to provide early
education for four-year olds from lower-income households. There are also measures to encourage higher graduation rates from high school. At these levels there is a strong correlation between attendance at an
educational facility and real,
But things are much more complicated at higher
levels of education. We really need to think about what sort of
outcomes we want. Some social outcomes result only indirectly from education and, under a Social Policy Bond regime, we'd do better to target those outcomes themselves. For example, it would be more efficient to target unemployment directly rather than indirectly through the educational system.
Under a Social Policy Bond regime we could do that explicitly, and
investors in Unemployment Reduction Bonds (or Employment
Maximisation Bonds) might well decide that the school system needs
some sort of overhaul to meet the targeted goal.
This indicates how I think about targeting the supposed means toward
achieving an employment target via such things as "graduation rates, costs, average
amount borrowed etc" that are the focus of President Obama's reforms. These are less ends in
themselves than supposed means to an end (or various ends).
All our experience tells us that such narrow, short-term, top-down, goals can - and
will - easily be gamed or manipulated or will just not end up doing
what they are supposed to. Obama's reforms concentrate heavily on strengthening the regulation of institutions. This might be praiseworthy, but I'd much prefer to see fewer administrative fixes and more targeting of specific broad outcomes, which, under a bond regime, would motivate investors in to make their own decisions
about how best to achieve them. We need diverse, adaptive solutions
of the sort that government just cannot manage. Government, under a bond regime
scheme, would still ultimately subsidise or pay for the achievement
of these goals, and raise the revenue for their achievement, but it
would contract out the actual achievement to investors.
As happens so often with government everywhere, President Obama's
proposals take the existing institutions as a given. They take the
existing institutional framework as a given too. (I suspect Obama's healthcare proposals suffer from the same problem.) In the long run I think we'd do
better to think carefully about our real goals and
target those specifically. I think these would include high
employment, universal literacy, lower crime rates, better physical
and mental health and a few
others. Education is, in my view, a means to those ends - and
others, less easily specified which perhaps should not be a
government remit at all.
So...Obama's proposals for higher education reform are undoubtedly well meaning, and arguably positive, given the existing framework. But the existing framework should be challenged. Giving existing institutions more
targets might well do some
good, but I see them as
entrenching the existing, and increasingly questionable,
institutional structure at a time of rapid social and technological
change. Instead of micro-managing the current system we need to clarify exactly what outcomes we, as a society, want to see, and which ones we think government can legitimately and usefully target, and which it can't.