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Education spending that isn't smart

| Saturday, Feb. 9, 2013, 9:00 p.m.

Not long after President Obama proclaimed in his second inaugural that “an economic recovery has begun,” we learned that the U.S. economy actually shrank in the last quarter. Many economists believe this is a temporary setback. This recovery might be the weakest in American history, but the economy isn't cratering either.

Still, you can bet that if the economy continues to contract, Obama will propose the same remedy he always has — more “investments” in education, infrastructure and various industries of the future. It seems that whatever the ailment, Dr. Obama always writes the same faulty prescription.

This is hardly shocking: Building roads and schools is a big reason why God created Democrats in the first place. And identifying the Next Big Thing — and taking credit for it — is something of a vocation for many liberal policymakers.

But are these really the drivers of economic growth?

Higher education in particular is almost universally championed as the key to “winning the future” — a buzz phrase the president borrowed from Newt Gingrich a while back. New York Times economics columnist David Leonhardt calls education the “lifeblood of economic growth.”

Often channeling such writers as Thomas Friedman, whose fondness for the Chinese economic model borders on the perverse, Obama routinely elevates education to a national security issue.

Now, obviously, education is important and necessary for a host of reasons (and nobody is calling for “disarmament,” whatever that means). But there's little evidence it drives growth.

Growing economies spend a lot on education, but that doesn't necessarily mean that spending makes them grow. During the so-called Gilded Age, the U.S. economy roared faster and longer than ever before or since, while the illiteracy rate went down. But the rising literacy didn't cause the growth. Similarly, in the 20th century, in places like China, South Korea and India, the economic boom — and the policies that create it — always come first while the investments in education come later.

There are similar problems with claims that infrastructure spending will pay off. When I was in college, prominent experts and journalists — Lester Thurow, Robert Reich, James Fallows, Kevin Phillips et al. — were insisting Japan would be the next world economic superpower. In the late 1980s, Jacques Attali, the first head of the European Bank for Reconstruction and Development, claimed that “America has become Japan's granary, like Poland was for Flanders in the 17th century.”

Japan is now well into its third “lost decade.” Over the years, it has poured money into “stimulative” infrastructure projects that have yet to stimulate and protected industries that have steadily lost their competitive edge. Economic growth has averaged less than 1 percent since 2000, while government debt is now more than twice its GDP. If a highly educated workforce, support for allegedly cutting-edge industries and lavish spending on infrastructure were the recipe for economic growth (and if debt didn't matter), Japan would be doing great.

Obama surely wants to see some real economic growth. Perhaps the problem is that he thinks investing in a much bigger cart to put before the horse will get him where he wants to go.

Jonah Goldberg, editor at large of National Review Online, is the author of “The Tyranny of Clichés.”

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