Here’s a fact that may not surprise you: the children of the rich perform better in school, on average, than children from middle-class or poor families. Students growing up in richer families have better grades and higher standardized test scores, on average, than poorer students; they also have higher rates of participation in extracurricular activities and school leadership positions, higher graduation rates and higher rates of college enrollment and completion.
Whether you think it deeply unjust, lamentable but inevitable, or obvious and unproblematic, this is hardly news. It is true in most societies and has been true in the United States for at least as long as we have thought to ask the question and had sufficient data to verify the answer.
What is news is that in the United States over the last few decades these differences in educational success between high- and lower-income students have grown substantially.
One way to see this is to look at the scores of rich and poor students on standardized math and reading tests over the last 50 years. When I did this using information from a dozen large national studies conducted between 1960 and 2010, I found that the rich-poor gap in test scores is about 40 percent larger now than it was 30 years ago.
To make this trend concrete, consider two children, one from a family with income of $165,000 and one from a family with income of $15,000. These incomes are at the 90th and 10th percentiles of the income distribution nationally, meaning that 10 percent of children today grow up in families with incomes below $15,000 and 10 percent grow up in families with incomes above $165,000.
In the 1980s, on an 800-point SAT-type test scale, the average difference in test scores between two such children would have been about 90 points; today it is 125 points. This is almost twice as large as the 70-point test score gap between white and black children. Family income is now a better predictor of children’s success in school than race.
The same pattern is evident in other, more tangible, measures of educational success, like college completion. In a study similar to mine, Martha J. Bailey and Susan M. Dynarski, economists at the University of Michigan, found that the proportion of students from upper-income families who earn a bachelor’s degree has increased by 18 percentage points over a 20-year period, while the completion rate of poor students has grown by only 4 points.
In a more recent study, my graduate students and I found that 15 percent of high-income students from the high school class of 2004 enrolled in a highly selective college or university, while fewer than 5 percent of middle-income and 2 percent of low-income students did.
These widening disparities are not confined to academic outcomes: new research by the Harvard political scientist Robert D. Putnam and his colleagues shows that the rich-poor gaps in student participation in sports, extracurricular activities, volunteer work and church attendance have grown sharply as well.
In San Francisco this week, more than 14,000 educators and education scholars have gathered for the annual meeting of the American Educational Research Association. The theme this year is familiar: Can schools provide children a way out of poverty?
We are still talking about this despite decades of clucking about the crisis in American education and wave after wave of school reform.Whatever we’ve been doing in our schools, it hasn’t reduced educational inequality between children from upper- and lower-income families.
Part of knowing what we should do about this is understanding how and why these educational disparities are growing. For the past few years, alongside other scholars, I have been digging into historical data to understand just that. The results of this research don’t always match received wisdom or playground folklore.
The most potent development over the past three decades is that the test scores of children from high-income families have increased very rapidly. Before 1980, affluent students had little advantage over middle-class students in academic performance; most of the socioeconomic disparity in academics was between the middle class and the poor. But the rich now outperform the middle class by as much as the middle class outperform the poor. Just as the incomes of the affluent have grown much more rapidly than those of the middle class over the last few decades, so, too, have most of the gains in educational success accrued to the children of the rich.
Before we can figure out what’s happening here, let’s dispel a few myths.
The income gap in academic achievement is not growing because the test scores of poor students are dropping or because our schools are in decline. In fact, average test scores on the National Assessment of Educational Progress, the so-called Nation’s Report Card, have been rising — substantially in math and very slowly in reading — since the 1970s. The average 9-year-old today has math skills equal to those her parents had at age 11, a two-year improvement in a single generation. The gains are not as large in reading and they are not as large for older students, but there is no evidence that average test scores have declined over the last three decades for any age or economic group.
The widening income disparity in academic achievement is not a result of widening racial gaps in achievement, either. The achievement gaps between blacks and whites, and Hispanic and non-Hispanic whites have been narrowing slowly over the last two decades, trends that actually keep the yawning gap between higher- and lower-income students from getting even wider. If we look at the test scores of white students only, we find the same growing gap between high- and low-income children as we see in the population as a whole.
It may seem counterintuitive, but schools don’t seem to produce much of the disparity in test scores between high- and low-income students. We know this because children from rich and poor families score very differently on school readiness tests when they enter kindergarten, and this gap grows by less than 10 percent between kindergarten and high school. There is some evidence that achievement gaps between high- and low-income students actually narrow during the nine-month school year, but they widen again in the summer months.
That isn’t to say that there aren’t important differences in quality between schools serving low- and high-income students — there certainly are — but they appear to do less to reinforce the trends than conventional wisdom would have us believe.
If not the usual suspects, what’s going on? It boils down to this: The academic gap is widening because rich students are increasingly entering kindergarten much better prepared to succeed in school than middle-class students. This difference in preparation persists through elementary and high school.
My research suggests that one part of the explanation for this is rising income inequality. As you may have heard, the incomes of the rich have grown faster over the last 30 years than the incomes of the middle class and the poor. Money helps families provide cognitively stimulating experiences for their young children because it provides more stable home environments, more time for parents to read to their children, access to higher-quality child care and preschool and — in places like New York City, where 4-year-old children take tests to determine entry into gifted and talented programs — access to preschool test preparation tutors or the time to serve as tutors themselves.
But rising income inequality explains, at best, half of the increase in the rich-poor academic achievement gap. It’s not just that the rich have more money than they used to, it’s that they are using it differently. This is where things get really interesting.
High-income families are increasingly focusing their resources — their money, time and knowledge of what it takes to be successful in school — on their children’s cognitive development and educational success. They are doing this because educational success is much more important than it used to be, even for the rich.
With a college degree insufficient to ensure a high-income job, or even a job as a barista, parents are now investing more time and money in their children’s cognitive development from the earliest ages. It may seem self-evident that parents with more resources are able to invest more — more of both money and of what Mr. Putnam calls “‘Goodnight Moon’ time” — in their children’s development. But even though middle-class and poor families are also increasing the time and money they invest in their children, they are not doing so as quickly or as deeply as the rich.
The economists Richard J. Murnane and Greg J. Duncan report that from 1972 to 2006 high-income families increased the amount they spent on enrichment activities for their children by 150 percent, while the spending of low-income families grew by 57 percent over the same time period. Likewise, the amount of time parents spend with their children has grown twice as fast since 1975 among college-educated parents as it has among less-educated parents. The economists Garey Ramey and Valerie A. Ramey of the University of California, San Diego, call this escalation of early childhood investment “the rug rat race,” a phrase that nicely captures the growing perception that early childhood experiences are central to winning a lifelong educational and economic competition.
It’s not clear what we should do about all this. Partly that’s because much of our public conversation about education is focused on the wrong culprits: we blame failing schools and the behavior of the poor for trends that are really the result of deepening income inequality and the behavior of the rich.
We’re also slow to understand what’s happening, I think, because the nature of the problem — a growing educational gap between the rich and the middle class — is unfamiliar. After all, for much of the last 50 years our national conversation about educational inequality has focused almost exclusively on strategies for reducing inequalities between the educational successes of the poor and the middle class, and it has relied on programs aimed at the poor, like Head Start and Title I.
We’ve barely given a thought to what the rich were doing. With the exception of our continuing discussion about whether the rising costs of higher education are pricing the middle class out of college, we don’t have much practice talking about what economists call “upper-tail inequality” in education, much less success at reducing it.
Meanwhile, not only are the children of the rich doing better in school than even the children of the middle class, but the changing economy means that school success is increasingly necessary to future economic success, a worrisome mutual reinforcement of trends that is making our society more socially and economically immobile.
We need to start talking about this. Strangely, the rapid growth in the rich-poor educational gap provides a ray of hope: if the relationship between family income and educational success can change this rapidly, then it is not an immutable, inevitable pattern. What changed once can change again. Policy choices matter more than we have recently been taught to think.
So how can we move toward a society in which educational success is not so strongly linked to family background? Maybe we should take a lesson from the rich and invest much more heavily as a society in our children’s educational opportunities from the day they are born. Investments in early-childhood education pay very high societal dividends. That means investing in developing high-quality child care and preschool that is available to poor and middle-class children. It also means recruiting and training a cadre of skilled preschool teachers and child care providers. These are not new ideas, but we have to stop talking about how expensive and difficult they are to implement and just get on with it.
But we need to do much more than expand and improve preschool and child care. There is a lot of discussion these days about investing in teachers and “improving teacher quality,” but improving the quality of our parenting and of our children’s earliest environments may be even more important. Let’s invest in parents so they can better invest in their children.
This means finding ways of helping parents become better teachers themselves. This might include strategies to support working families so that they can read to their children more often.. It also means expanding programs like the Nurse-Family Partnership that have proved to be effective at helping single parents educate their children; but we also need to pay for research to develop new resources for single parents.
It might also mean greater business and government support for maternity and paternity leave and day care so that the middle class and the poor can get some of the educational benefits that the early academic intervention of the rich provides their children. Fundamentally, it means rethinking our still-persistent notion that educational problems should be solved by schools alone.
The more we do to ensure that all children have similar cognitively stimulating early childhood experiences, the less we will have to worry about failing schools. This in turn will enable us to let our schools focus on teaching the skills — how to solve complex problems, how to think critically and how to collaborate — essential to a growing economy and a lively democracy.
By: Sean F. Reardon, Professor of Education and Sociology, Stanford University; Published in The New York Times, Opinion Pages, April 27, 2013
The Middle Class is in a funk, its view of the future growing dim as fear rolls in like a storm.
An Allstate/National Journal Heartland Monitor poll released Thursday found that while most Americans (56 percent) hold out hope that they‘ll be in a higher class at some point, even more Americans (59 percent) are worried about falling out of their current class over the next few years. In fact, more than eight in 10 Americans believe that more people have fallen out of the middle class than moved into it in the past few years.
The poll paints a picture of a group that is scared to death about its station in life.
By the way, 58 percent of respondents in the poll viewed themselves as either middle class (46 percent) or upper middle class (12 percent).
According to the poll, Americans see a middle class with less opportunity to get ahead, less job security and less disposable income than the middle class of previous generations.
Respondents were most likely (52 percent) to say that losing a job would put them at the greatest risk of falling out of their current class, followed by an unexpected illness or injury in the family.
Most of those polled believe that higher education is the key to staying in the middle class, but many worry about its prohibitive cost and inaccessibility.
And who did most of them say is responsible for making it worse for the middle class? Congress, chief executives of major corporations and big financial institutions.
Of those who blame politicians, there is some evidence that Republicans get more of the blame than Democrats. A CNN/ORC poll released last month found that 32 percent of respondents thought that Democrats favor the middle class compared with 27 percent who believed the same of Republicans. Sixty-eight percent of those polled believed that Republicans favor the wealthy, compared with 24 percent who believed that Democrats do.
This anxiety about a shrinking middle class is understandable.
A Pew Research Center study, “The Lost Decade of the Middle Class,” released in August, found that “since 2000, the middle class has shrunk in size, fallen backward in income and wealth, and shed some — but by no means all — of its characteristic faith in the future.”
According to the report, “Fully 85 percent of self-described middle-class adults say it is more difficult now than it was a decade ago for middle-class people to maintain their standard of living.”
The report continued:
“Their downbeat take on their economic situation comes at the end of a decade in which, for the first time since the end of World War II, mean family incomes declined for Americans in all income tiers. But the middle-income tier — defined in this Pew Research analysis as all adults whose annual household income is two-thirds to double the national median — is the only one that also shrunk in size, a trend that has continued over the past four decades.”
It’s important to note that many of the people who describe themselves as middle class would not be placed under that rubric by most objective observers. For instance, the Pew study found that 35 percent of people making $30,000 and under and 46 percent of those making $100,000 and over self-identified as middle class. (Meantime, six percent of those making $30,000 and under self-identified as upper class, and six percent of those making $100,000 and over self-identified as lower class. Go figure.)
As Pew pointed out, over the last decade, “middle-tier median household income” fell and median net worth plummeted, and people in the middle class said it was becoming harder to maintain their lifestyles.
To add insult to injury, another Pew report, released this week, found that “during the first two years of the nation’s economic recovery, the mean net worth of households in the upper 7 percent of the wealth distribution rose by an estimated 28 percent, while the mean net worth of households in the lower 93 percent dropped by 4 percent.”
As The Washington Post reported in September after the release of a frightening Census report: “The vise on the middle class tightened last year, driving down its share of the income pie as the number of Americans in poverty leveled off and the most affluent households saw their portion grow.”
The wealthy have come surging back, riding record stock market highs, but many in the middle class are at best treading water and at worst sinking.
In his State of the Union speech in February, President Obama said that the “true engine of America’s economic growth” is “a rising, thriving middle class.”
It certainly looks as if that engine has stalled.
By: Charles M. Blow, Op-Ed Columnist, The New York Times, April 27, 2013
“Affirmative Action”: An Imperfect But Essential Way To Deal With A Persistently Unfair And Unequal Landscape
In all the well-justified furor over the Supreme Court’s review of voting rights and marriage equality issues, it’s easy to forget that when this term’s opinion roll out, the odds are high that the Court will strike a major blow against affirmative action programs for college admissions.
We are all familiar with the ideological dimensions of the affirmative action issues. But we have an original piece up on the website today, from Elias Vlanton, a distinguished public-school teacher in Maryland, that cuts through the hype and compellingly addresses the human element of affirmative action, and why it is an imperfect but essential way to deal with a persistently unfair and unequal landscape for college admissions. Here’s a sample:
Tramon, Morganne, Arnetta, and Anngie were all students of mine in Advanced Placement classes at Maryland’s Bladensburg High School . Bladensburg is neither a private school, nor a “we skim the cream of the crop” magnet public school. It is in one of Washington, DCs poorest suburbs, where family income ranks in the bottom quarter of the state, and a school where less than ten percent of any graduating class makes it through college.
This semester, while Morganne proudly posts videos of her next dissection and Anngie writes another long essay in French, the Supreme Court, in deciding Fisher v. University of Texas at Austin, will determine whether my students deserve to attend the colleges where they are being so successful. In addition to attending a low-performing high school, my kids are all African American and Latino. They were accepted into their elite colleges as part of those schools’ commitment to the mission of promoting diversity in higher education, the very diversity that affirmative action attempts to encourage—and that Fisher seeks to declare unconstitutional….
My four freshmen—my odds-beaters—had SAT scores hundreds of points below the average of the students admitted to their colleges. They took far fewer AP courses, and participated in fewer extra-curricular activities (since our school offers few activities other than sports). What set them apart was their class rank: they were all in the top two percent of the senior class, a function of their love of learning, their desire to do well, and their hard work to rise to the top. Despite the claim that, on the merits of their applications, they were “unqualified” for admission to the schools where they are getting As and Bs, all will graduate with honors from schools that are among the best in the country—joining my former students who graduated from Bowdoin College, Johns Hopkins University, Georgetown University, and Stanford University .
So Chief Justice Roberts, in the end, we agree: Discrimination is discriminatory. That is why colleges must be allowed to consider the social and economic circumstances of my students when making admissions decisions—as Bryn Mawr, Cornell, Dartmouth, and Middlebury have done. My kids don’t want a leg up; but neither do they deserve a kick in the chest.
Vlanton’s passionate essay is a reminder that while so many agonize over the “injustice” of affirmative action, our country is doing a terrible job (as Kevin Carey documented in his article in the January/February issue of the Washington Monthly) of providing anything like equal opportunity in higher education.
Yes, affirmative action programs are flawed, but not half a flawed as the “color-blind” system that will be left in place if affirmative action is discarded and something more systemic is not put in its place.
By: Ed Kilgore, Contributing Writer, Washington Monthly Political Animal, March 29, 2013
Five years after Wall Street crashed the economy by irresponsibly securitizing and peddling mortgage debt, the financial industry is coming under growing scrutiny for its shady involvement in student loan debt.
For a host of reasons, including a major decline in public dollars for higher education, going to college today means borrowing—and all that borrowing has resulted in a growing and heavy hand for Wall Street in the lending, packaging, buying, servicing, and collection of student loans. Now, with $1 trillion of student loans currently outstanding, it’s becoming increasingly clear that many of the same problems found in the subprime mortgage market—rapacious and predatory lending practices, sloppy and inefficient customer service and aggressive debt collection practices—are also cropping up in the student loan industrial complex.
This similarity is especially striking in the market for private student loans—which currently make up $150 billion of the $1 trillion of existing student loans.
As detailed in a July 2012 report by the Consumer Financial Protection Bureau and Department of Education, private student loans mushroomed over the last decade, fueled by the very same forces that drove subprime mortgages through the roof: Wall Street’s seemingly endless appetite for new ways to make profit. In this case, investor demand for student loan asset backed securities (SLABS) resulted in private student lenders—primarily Sallie Mae, Citi, Wells Fargo, and the other big banks—to relax lending standards and aggressively begin marketing these loans directly to students.
Unlike federal student loans, private loans have higher and fluctuating interest rates and come without any flexibility for tailoring payments based on income. Before the SLABS binge, most private student loans were actually made in connection with the college financial aid office, which helped ensure students weren’t taken for a ride, or weren’t borrowing more than they needed to. Between 2005 and 2007, the percentage of loans to students made without any school involvement grew from 40 percent to over 70 percent. And the volume of private student loans mushroomed from less than $5 billion in 2001 to over $20 billion in 2008. The market shrunk back to $6 billion after the financial crisis as lenders tightened standards.
And just like the subprime mortgage market, not all students were aggressively targeted by these rapacious lenders. The largest percentage of private loans taken out in 2008 were by students at for-profit colleges. In 2008, just 14 percent of all undergrads took out a private loan while 42 percent of students at for-profit colleges took them out. And as we now know, these loans are sinking borrowers—with absolutely no ability to discharge these loans by filing bankruptcy.
The latest student loan default rates issued by the Department of Education show that the three-year default rates for those who started repayment between October 2008 and September 2009 was 13 percent nationally—an average masking sharp differences depending on the type of school the borrower attended. For-profit institutions had the highest average with nearly 1 out of 4 borrowers in default, compared with 11 percent from public institutions and 7.5 percent at private, non-profit institutions.
All these statistics mean that close to 6 million borrowers are in default (almost 1 in 6 borrowers) to the tune of a combined $76 billion, more than the combined annual tuition for all students attending public two- and four-year colleges.
And for the borrower who can’t make payments, the student loan industrial complex is not a good place to be. And it’s costly for taxpayers: the Department of Education paid $1.4 billion last year to debt collectors and guaranty agencies to chase down borrowers who weren’t paying their loans. And here’s where Wall Street grabs another slice of the debt-for-diploma system pie. As reported in The New York Times, of the $1.4 billion paid out last year, about $355 million went to 23 private debt collectors. The remaining $1.06 billion was paid to the guarantee agencies to collect on defaulted loans made under the old federal loan system, which they in turn often outsource to private collectors.
But wait, there’s more! It turns out that two of the nation’s biggest banks own debt collection agencies that have contracts with the Department of Education to collect on federal student debt that’s gone bad: NCO Group, owned by One Equity Partners, the private equity arm of JP Morgan Chase and Allied Interstate, owned by Citi Venture Capital International, the private equity arm of Citigroup. Both of these debt collection agencies are distinctive in that according to a comprehensive report by the National Consumer Law Center, they have received the most complaints filed with the Better Business Bureau in a three-year period. At the same time, NCOs performance in recovering past-due loans has made it one of the top performers for the DOE.
The new cop on the beat—the Consumer Financial Protection Bureau—is now going to be providing federal oversight of the nation’s largest debt collectors, which is welcome news. The Department of Education could also play an important role in rewarding good behavior by their debt collectors. As NCLC recommends in its report, they could incentivize humane treatment of debtors by penalizing agencies for large numbers of complaints filed against them and reward agencies with few complaints.
Over the last two decades, our nation—in a major shift from its historical roots—slowly privatized and financialized the responsibility of paying for college. The result is a system in which the entire pipeline of student loans—now the largest source of “aid” for most students—is fueled, serviced, and collected by Wall Street.
The student loan industrial complex invites a more profound question: given the billions in profit generated by federal and private student loans, along with the billions in administrative costs absorbed by tax payers, is debt the most efficient and equitable way to provide access to higher education?
By: Tamara Draut, The American Prospect, November 16, 2012
“Romney’s Higher Education Plan”: A Giveaway To Wall Street Banks And Predatory Schools That Fund His Campaign
2012 presumptive presidential nominee Mitt Romney released his higher education plan Wednesday, decrying the nation’s “education crisis.” During a speechbefore the U.S. Chamber of Commerce, Romney blamed President Obama for rising tuition prices and increasing student debt.
Of course, tuition increases and growing debt are a phenomenon several decades in the making. And Romney’s plan would make the problem decidedly worse in two important ways, giving federal money away to Wall Street banks and predatory for-profit colleges, two industries to which Romney has extensive ties.
First, as he’s promised before, Romney intends to divert money away from student aid — instead giving it away to banks — by repealing Obama’s student loan reforms:
Reverse President Obama’s nationalization of the student loan market and welcome private sector participation in providing information, financing, and the education itself.
President Obama did not nationalize the student loan market. (Plenty of banks still make private sector student loans.) Instead, Obama and the Democrats cut private banks out of the federal student loan program, ending billions in subsidies that were needlessly going to banks for acting as loan middlemen. The money saved went into the Pell Grant program. Romney’s plan would entail taking away Pell money in order to pay Wall Street to service federal loans.
Second, Romney would remove regulations meant to protect students from predatory for-profit colleges:
Ill-advised regulation imposed by the Obama administration, such as the so-called “Gainful Employment” rule, has made it even harder for some providers to operate, while distorting their incentives.
This rule simply states that colleges leaving too many students crippled with debt and without good jobs lose their access to federal dollars. Many for-profit schools make nearly all of their revenue from the federal government — in the form of the various streams of aid used by their students — yet have much higher rates of student loan default than public schools. Only 11 percent of higher education students in the country attend for-profit schools, but they account for 26 percent of federal student loans and 44 percent of student loan defaults.
Romney is already intimately tied to the for-profit college industry. Inside Higher Ed noted that two of his advisers “have lobbied on behalf of the Apollo Group, the parent company of the University of Phoenix.” On the campaign trail, Romney has effusively praised Full Sail University, a for-profit institution. And it seems that his policy platform would be a boon to this industry which is, in many instances, extremely predatory.
By: Pat Garofalo, Think Progress, May 24, 2012