Nicole M. Obongo
Northwest High School
3rd Place, Maryland
How Can the Country Readily and Realistically Tackle Growing Income Disparity?
If there was indeed an easy answer to the vexing question of growing income disparity in the United States (U.S.), the nation would probably not be facing the conundrum in the first place. Disparity gaps in earnings in America have manifested among various groups respectively: between the poor and the middle class; between White and Asian Americans on one hand, and Black and Hispanic Americans on another; between males and females; and more recently between the middle class and top earners. According to the Congressional Budget Office (CBO, 2011), while gaps between other groups have stagnated, it is the growing income disparity between America’s top earning one percent compared to the middle class that has particularly widened tremendously over the last four decades. A pragmatic approach to tackle this rising predicament is to adopt a comprehensive policy that places priority in education; geared towards fostering entrepreneurship in new technology and other emerging fields. In addition, America should protect its innovations and new technologies from illegal copyright violations.
Educating America’s future workforce in cutting edge sectors is likely to open millions of opportunities for well paying jobs. The silver lining in the cloud is that the U.S. remains the global leader in most areas of advanced technology ranging from; military, biotechnology, computer technology, finance, aeronautics, Web applications and more. While little opportunities currently exist for unskilled workers, each of these areas still offers huge openings for expert employment. One needs to understand the context of globalization and what opportunities it presents for America. As globalization and integration of world markets continues to take root, many U.S. corporations are sending most unskilled jobs to Third World countries where labor is cheap. The corporations are simultaneously investing huge portions of profits locally into their respective research and development departments in a bid to gain competitive edge in innovation and the creation of future products. It is the sound appreciation of this trend that should guide U.S. policymakers as they plan adjustments in employment creation strategies.
Most employment offered in corporate research and development usually requires highly skilled and qualified personnel. Hiring for such jobs is thus based on educational attainment and professional credentials of respective applicants. Upon recruitment and further training, these expert employees are often tasked with development of new product lines or improvement of existing ones. Such experts are the skilled human resource pool that America needs to build in order to create millions of employment opportunities in existing and emerging fields. Research and development should not necessarily be restricted to Information Technology (IT) where Silicon Valley has become globally renowned. With an educated and skilled workforce, America can take or maintain lead in many other fields including new ones.
According to the CBO (2011), the U.S. has a deficit in the proportion of its adult population holding advanced academic and professional degrees. The average income of these highly educated people has accelerated over those with lower levels of education in the last four decades (Snyder & Dillow, 2012). Scarcity of skilled experts in the occupational market is what has pushed their earnings disproportionately upwards.
This inclination can be alleviated through a national policy geared towards educating more people to attain similar high skills and expertise. Such effort would contribute towards reducing the growing income disparity between the middle class and top earners. As indicated earlier, another great benefit for the nation in creating a skilled workforce would be the amassing of future inventors, entrepreneurs and job creators.
Besides fostering advanced education, the U.S. government must concurrently help safeguard property and intellectual rights of American innovators. The nation must deal with global copyright violators - who illegally steal U.S. innovations - in international courts and at the World Trade Organization. Otherwise it would be futile training the next wave of creators only to lose the innovation and business advantage to unscrupulous counterfeiters based offshore. As a technology enthusiast, it is disheartening to realize for instance, how brazen some Chinese counterfeiters have lately become. One of the most incredible counterfeit products of all time was the recent release of a cheap Chinese version of the “iPhone 5” on sale before its American manufacturer Apple Inc., released the original version of this mobile phone. With such blatant copyright violations, the U.S. government has to aggressively defend American corporations like Apple Inc. to secure profits from their painstaking innovations – much of which is normally reinvested into research and employment. Without engaging in overt trade protectionism, America would be better served if it protects its discoveries while concurrently facilitating the uplifting of its citizenry to match the skills level of emerging technologies.
Achieving the goal of educating America’s population would require smart investments in education at all levels, from pre-school to post-graduate and professional training. The big question is – will this humongous responsibility be left to government? Any policy whose foundation is premised predominantly on government direction and funding would frankly be unrealistic. The same would apply to policies shunning any input from government. A balance must be sought which involves both the public and private sector in educating America’s population for the next century.
The more practical path would have to first give an objective assessment of the outcomes of the current grade school system dominated by public schools. A 2007 United Nations (UN) study found that grade school students in many countries in Asia and Europe outperformed those in the U.S. in mathematics and science with U.S. high school graduation rate also being lower than the rates in 33 countries in Europe and Asia (Snyder & Dillow, 2012). The same report showed that college enrollment increased at a much lower rate in the U.S. compared to several countries in Europe, Asia, Central and South America (OECD, 2011). It is quite clear from all these studies that outcomes from the current U.S. public-school-dominated system have relatively been unimpressive. CBO (2011) estimates that joining the U.S. labor market without a high school diploma translates to an unemployment rate four times the rate of those with a college degree. Even for those who find full-time work, they would most likely earn less than what college graduates make each year. No American child should currently aspire for low skilled jobs that are fast disappearing because of globalization.
It can be argued that revitalization of the U.S. education system is a national security issue. Policymakers should therefore view issues such as: poor outcomes from public-dominated grade schools; particularly weak performance in mathematics and science; low high school graduation rates; and reduced rates of access and affordability to college as national priority concerns. Bridging the growing income disparity gap in the U.S. hinges on building an education system where there should be no one-answer fits all solution. A mix of private schools, public schools, charter schools, academic centers of excellence, and subject-oriented schools would all have to be encouraged without necessarily cutting funds for public schools. When plenty of private academic, technical and professional institutions thrive liberally in America’s education sector, the cost of education would likely go downwards. Without privatization of existing public schools, a balanced approach should embrace granting of school vouchers to parents willing to send their children to charter or private schools of their choice. This would be a good start to encourage competition among schools, paving way for further growth of market based education. Both the government and private sector should also sensitize parents and students about the significance of mathematics, science, and technology during early schooling.
Privatization of education alone cannot be the magic bullet for redressing America’s income disparity. It has been shown that in most developed countries where public direct expenditures on education as a percentage of gross domestic product (GDP) exceeded the five percent expenditure in the U.S., student performance and graduation rates were both better than those in America (Snyder & Dillow, 2012). At the tertiary level, public support for research and teaching at institutions of higher learning would have to be expanded to nurture novelty. To boost college enrollment, government guarantees and subsidies would have to be considered for college education loans to students who cannot afford tuition and boarding. The financial cost of all these education programs should essentially be viewed from the context of anticipated reduction in income disparities and other economic benefits expected in the long run.
It is therefore through such mixed approach encompassing both private and public strategies that America would tackle its education demands of the future. This would likely bridge the growing income disparity gap. Protecting American innovations and nurturing interest in mathematics, science, and technology are also paramount to this effort.
Congressional Budget Office (CBO), Congress of the United States. (2011, October). Trends in the distribution of household income between 1979 and 2007 (Publication No. 42729). Washington, DC: CBO.
Organization for Economic Co-operation and Development (OECD), Center for Educational Research and Innovation (2011). Education at a Glance, 2011: OECD Indicators. Retrieved October 20, 2012, from http://www.oecd.org/edu/eag2011.
Snyder, T.D., and Dillow, S.A. (2012). Digest of Education Statistics 2011 (NCES 2012-001). National Center for Education Statistics, Institute of Education Sciences, U.S. Department of Education. Washington, DC: U.S. Government Printing Office.