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As a breeze and drizzle made way for the sun, there was not much special about a 70-degree day in Dallas Texas in late November. On that day nearly 61 years ago, President Kennedy was assassinated which turned that “nothing” day in Dallas into a very sad one, with parallels drawn to the attempt on former president Trump over a week ago. Following Kennedy’s death, Lyndon B Johnson was sworn in as president and went on to win the next election as well. It remains to be seen how history will play out this time, but we can hope for calmer heads to prevail and the safety of our leaders.
With the war in Vietnam raging on, Johnson aimed for aggressive domestic policies with what is coined the Great Society programs. With large federal spending on these programs and price controls on gold, large amounts of the yellow metal were leaving the US shores to be sold for higher prices on foreign markets. Longtime readers will know what happens next. Nixon removed convertibility with gold in 1971, officially ending any faint grip left on responsible government spending.
Today, America is known as the land of opportunity. Home to 4 of the top 10 universities in the world, the US has been at the top of higher education for a long time. With globalization has come more international students, which helps explain why the US still has top universities while its education quality as a whole continues to decline. Primary and secondary education is nearly universal, but scores for math, science, and literacy have been falling in the US compared to other countries. This is especially strange considering the wealth of the United States and the vast expenditures towards education.
Americans who went to school during the 1960s ranked a respectable 3rd; those schooled in the 1970s ranked 5th. But 16- to 25-year-olds, adults who were wandering America’s school hallways during the 1980s and 1990s, ranked 14th. In short, the literacy survey records a simple, steady progression downward. - Paul Peterson
The ‘60s have a few parallels to today, as the public zeitgeist is shifting towards domestic policy over foreign affairs. Trump is for import controls, re-shoring, immigration reforms, and his ideas for inflation/economy. Biden is also focused on domestic policies like inflation, student loans, import controls, re-shoring, and social programs. While the latter may put more effort into existential issues like foreign policy and climate change, there is growing emphasis on fixing things on the home front.
In the 60s, Johnson’s Great Society programs revolved around civil rights, education, medical care, urban problems, poverty, and transportation. You may remember during the Great Depression, Hoover and FDR expanded the federal government’s role in the economy dramatically. This kickstarted a change in the federal government of increasing social welfare programs that continue to this day. Unlike the Depression, the Great Society came amidst a roaring economy that more closely resembles today.
“Show me the incentive and I’ll show you the outcome”. - Charlie Munger
Several education reforms occurred during Johnson’s term. Before this, it was considered taboo for the federal government to provide aid for public education. Along with the social pressures, the launch of Sputnik in 1957 amidst the Cold War was another catalyst for education funding particularly in the areas of science and math.
Johnson immediately signed the Higher Education Facilities Act of 1963 which boosted federal aid to universities by several times. Then the Higher Education Act of 1965 was established to give scholarships and low-interest loans for students and established a teacher Corps that subsidized teachers in poverty-stricken areas. Further, the Elementary and Secondary Education Act of 1965 provided over a billion dollars (~1 trillion in today’s dollars) for states to provide programs and supplies, especially for low-income areas. It also established the Head Start program. Limits on loans for higher education were also increased substantially, allowing more debt and money to enter the space.
While extraordinary amounts of funding from the federal government are spent, it doesn’t show up in the data the same way as you’d expect. Much of the grants were for University debt or to state and local governments. Over time, some of the education expenditures for K-12 have shifted from local to state and federal.
I’ve discussed in the past how federal funding for college has not warranted positive results. The growth in science funding, PhDs awarded, and publications published has grown exponentially while the true breakthroughs in science have not matched or as I argue have gone down. For K-12, federal expenditures have also gone parabolic in real terms with the pace accelerating in the 60s/70s.
This is especially dramatic considering the number of students attending schools was also still rising, but nearing its peak.
The Department (office) of Education’s origin is in 1867 under Andrew Johnson. It was merely for data collection and had four employees and a $15,000 budget. By 1965, the Office of Education expanded to 2,100 employees and a $1.5 billion budget. In 1979 under President Carter, it officially became a cabinet-level department. Today, the bloat continues, with 2,100 employees and a $60 billion budget.
The United States is one of the top spenders of any country on K-12 education but does not have the test results to back it. It is constantly middle of the pack for math, science, and literacy proficiency meaning that money is not being used effectively. Over time, as the federal government has taken action to help promote education in the US, its standing has gone down. Increasing amounts of money that fail to yield positive results has not stopped education spending from slowing down. Instead, there are calls that even more funding is what is needed to help many of these programs be successful.
It is natural to support programs aimed at helping certain groups. Who wouldn’t want to help lower poverty, make more accessible healthcare, or help the education of our kids for example? Unfortunately, many times the government programs do not have the intended effects. Education is a clear example of this. It is not the good-intentioned people’s fault that these policies are a failure, but merely the incentives they put into place. The more the federal government spends on education, the worse it gets. Until next week,
-Grayson
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