February 01, 2011

Innovation or Implementation

Chrystia Freeland recently published an article on the changing face of the super-rich that should be required reading for anyone interested in politics. It's a sympathetic but not entirely uncritical portrait. I particularly like that it reflects its subjects' global view of a changing world economy rather than being entirely U.S.-focused.

From a global perspective, the impact of these developments has been overwhelmingly positive, particularly in the poorer parts of the world. Take India and China, for example: between 1820 and 1950, nearly a century and a half, per capita income in those two countries was basically flat. Between 1950 and 1973, it increased by 68 percent. Then, between 1973 and 2002, it grew by 245 percent, and continues to grow strongly despite the global financial crisis.

However, the article also suffers at some points for sharing the perspective of those it covers. It has certain blind spots that it shares with the innovators profiled. This is particularly the case when the article discusses the intersection of taxes, charity, and innovation.

The super-wealthy have long recognized that philanthropy, in addition to its moral rewards, can also serve as a pathway to social acceptance and even immortality: Andrew “The Man Who Dies Rich Dies Disgraced” Carnegie transformed himself from robber baron to secular saint with his hospitals, concert halls, libraries, and university; Alfred Nobel ensured that he would be remembered for something other than the invention of dynamite. What is notable about today’s plutocrats is that they tend to bestow their fortunes in much the same way they made them: entrepreneurially. Rather than merely donate to worthy charities or endow existing institutions (though they of course do this as well), they are using their wealth to test new ways to solve big problems. The journalists Matthew Bishop and Michael Green have dubbed the approach “philanthrocapitalism” in their book of the same name. “There is a connection between their ways of thinking as businesspeople and their ways of giving,” Bishop told me. “They are used to operating on a grand scale, and so they operate on a grand scale in their philanthropy as well. And they are doing it at a much earlier age.”

What this misses is, well, what we actually need. By insisting that the big answer to the problems of education is to be found in experimentation by those privy to the (often untested, or unfounded) visionaries of programs like TED, these ridiculously rich philanthropists ignore the fact that we often already have a pretty good grasp on what works.

Bill Gates, likewise, devotes most of his energy and intellect today to his foundation’s work on causes ranging from supporting charter schools to combating disease in Africa. Facebook’s Zuckerberg has yet to reach his 30th birthday, but last fall he donated $100 million to improving the public schools of Newark, New Jersey.

If you want to improve education in the U.S., fund it properly. Fund the education and salaries of teachers. Fund the building and maintenance of schools. Fund supplies. Fund libraries. Fund good textbooks and other materials. Fund early education. Fund student nutrition and health. Fund community social services that keep parents rooted in one place longer.

In short, fund those things it takes to produce small classes of students undistracted by other problems, taught by experienced teachers who aren't constantly overworked. Is it a sexy solution? Does it put somebody's name in lights? No, but it works.

Putting your name on some education initiative somewhere is grand. Nifty, even. The problem is that it really isn't all that innovative when it comes right down to it. There is plenty of history of experimentation in education. Much of it even produced promising results.

Then it fell by the wayside because the implementation cost money. All the promise in the world can't produce results if no one is willing to pay the cost. No, if someone really wants to do something new and different in the field of education, they need to implement those solutions that have already been proven.

Does that mean that these super-rich need to pay more taxes if they want to make their marks? Probably.

While the U.S. educational system already pays a high amount per student relative to the educational spending of other Western industrialized countries, not everything that needs to be funded is counted in comparisons across countries, and not everything is directly comparable. Social services and safety nets make a difference in student preparedness, but they aren't considered educational expenses unless directly provided by schools, as free and reduced-cost school lunches are in the U.S. Teacher salaries, like most salaries, don't have to be as high in countries where health care is provided out of a general pool.

One way or another, however, whether we pay these costs affects our educational outcomes. It makes more of a difference than a pilot here or there will ever make. It makes more difference than any single person's large check can ever make. And that's true for many of the world's problems.

These aren't problems that have single, magical causes or cures. They aren't problems we haven't made huge strides in understanding. This is even something that Freeland approaches in the article.

There is also the simple fact that someone will have to pay for the improved public education and social safety net the American middle class will need in order to navigate the wrenching transformations of the global economy. (That’s not to mention the small matter of the budget deficit.) Inevitably, a lot of that money will have to come from the wealthy—after all, as the bank robbers say, that’s where the money is.

It's close. It's very close. But it still misses, or won't quite come out to say, what these rich people are doing by focusing on personal innovation over implementation of the basic solutions is making a poor monetary decision. They're being bad stewards of the money they insist they should keep. They insist on keeping it because, they say, they've shown how to make money work. But that's not what business does. Business makes money move.

If you want to make money work, that's a job for government. It's a job that's too big for any individual, no matter how innovative, no matter how rich.

1 comment:

Richard said...

Love it. Excellent article.