Georgia Council on Economic Education Annual Meeting
Chancellor Erroll B. Davis Jr.
Federal Reserve Bank of Atlanta
Friday, April 27, 2007
Thank you, Arlethia. I appreciate the invitation today.
Economic education is truly vital for this country's future. It is a serious issue -- and economics is serious business. This Council supports economic education in our schools -- a worthy and needed focus. But occasionally it's good to step back a bit.
Even a place as formal as the Wharton School understands that sometimes the best way to make a point is with a smile. So let me share a story about this serious topic that has made the rounds at Wharton many, many times.
A man was walking along a road in the countryside. He comes across a shepherd and a huge flock of sheep. He tells the shepard, "I will bet you $100 against one of your sheep that I can tell you the exact number in this flock." The shepherd thinks it over; it's a big flock so he takes the bet.
"973," says the man. The shepherd is astonished, because that is exactly right. He says "OK, I'm a man of my word, take a sheep." The man picks one up and begins to walk away.
"Wait," cries the shepherd, "Let me have a chance to get even. Double or nothing that I can guess your exact occupation." The man says sure.
"You are an economist for the Federal Reserve," says the shepherd.
"Amazing!" responds the man, "You are exactly right! But tell me, how did you deduce that?"
"Well," says the shepherd, "put down my dog and I'll tell you."
So, while it's important to know the numbers and the data, you also have to know the some basic realities! And one of the realities with which we have all become acquainted is this idea of a new world -- a flat world. A world where our global competitiveness is being increasingly challenged.
Tom Friedman noted in his book, "The World is Flat," that in India, Bill Gates is a rock star, an icon. In India, Bill Gates is Brittany Spears. In the United State, Brittany Spears is Brittany Spears -- and that is our problem.
When people aspire to be Brittany Spears or sports stars that is a limited field. But when people aspire to be Bill Gates, the chances of success -- if prepared by education -- are unlimited.
Our challenge is that we must shape a new perception of success for this new world -- one that helps our customers hold a self-image more attuned to Bill Gates than Brittany Spears or the latest football icon one injury away from a truncated career. And going further, we must help our customers connect the dots between being Bill Gates and higher education being the vehicle to get you to that point.
So, first, why connect those dots? And then, how to connect them?
We must connect the dots in the flat world because of the speed with which knowledge is created and shared by emerging technologies. While much has been made of the "virtual world," there is no question we are in a new world -- a world in which individuals must be educated -- highly educated.
The U.S. Department of Labor estimates that today's learners -- the very students we are teaching math, science, and economics in our schools -- today's learners will hold 10-14 jobs by the time they are 38 years old. Ten to 14 jobs -- some of which are here already and you can't understand them, and some of which have yet to be created.
Think about the importance of education, of understanding the economic forces at work, in helping these students -- our children -- compete. This is why the work of this Council is so important.
As I just suggested, the U.S. Department of Labor has estimated that in just a few years, many of the top demand jobs are in occupations that don't even exist today. And these jobs will use technologies that don't currently exist, to solve problems that we don't today even know are problems.
We are in a new world because the rest of the world is embracing knowledge and technology -- and is catching up. This has implications for us in terms of maintaining the nation's ability to be globally competitive.
While the U.S. has long enjoyed a well-deserved reputation for its higher education system, today other nations have taken note and are educating more of their citizens to more advanced levels. India and China are prime examples.
Here is a sobering thought! Twenty-five percent of the highest IQ's in China represents a population greater than that of North America. In India, that corresponding figure is 28 percent. That's competition. That is a lot of very smart people.
The translation for our teachers in K-12 -- and on down the road for our college faculty -- and eventually our employers is this: China and India have more honors kids than we have kids. And those kids are being pushed to a high level of education. In fact, China is well on the way to becoming the number one English-speaking nation in the world.
In short, the rest of the world in this flat earth is beginning to set a new standard for education. Our challenge here in the U.S. and in Georgia in higher education is to educate a much higher percentage of our population to a much higher level than in the past in order to meet that higher standard. This is the only way we will remain globally competitive.
We are no longer preparing just an educated elite. We are in the mass production business when it comes to education. But, we also must prepare more citizens in the right way. We must connect the dots in ways that make sense. We have to understand not just the data, but also the difference between a sheep and a dog!
Let me illustrate how the task before us is crucial in terms of getting our educational priorities correct. It comes from someone who worked for the very organization hosting today's event.
Last month the Wall Street Journal had an interesting article on free trade and globalization. In the article, I was struck by a comment made by Alan Blinder, a former Federal Reserve Board vice chairman and now a Princeton economist. Looking at the continued migration of jobs from the U.S. to overseas locations, Blinder notes that it is not enough for U.S. colleges to simply educate Americans.
He has issued a call to "retool America's education system so it prepares young people for jobs likely to remain in the U.S." I submit to you that economic education should be a central component of any such retooling. Blinder comes close to calling it negligent to simply tell students that they have to go to college to compete in the global economy.
And, he warns, the vaunted U.S. college diploma could lose its "silver bullet" status unless we work now to ensure that we have correctly identified the challenges ahead for the U.S. economy. So, when we today talk about educational reform and working together, it does have real urgency and the potential of profound impact.
The "why" is clear. So, let's talk now about the "how." Just how are we connecting the dots in ways that are relevant to this flat earth and relevant to the preparation of our children?
First, we must recommit ourselves to the concept of partnership and collaboration. We can no longer be successful working in our traditional silos. Education does not begin in college, or in high school -- it begins, formally, with Pre-K. And I do see very encouraging signs that we are breaking out of our silos and looking at students holistically.
Here in Georgia, there definitely is a student-centric focus that is uniting many groups. This Council is a great example of this focus -- one you have pursued for some time and with great results. It is a good partnership among both the public and private sector. I note that Arlethia and other University System leaders such as President Carl Patton and President Beheruz Sethna provide great support to this Council. And even though he just retired from the University System, I know Frank Butler has served the Council as well.
Another example of a new partnership approach to connect the dots is Governor Perdue's convening last year of all of the state agency heads involved in education -- yours truly included. Under the leadership of State School Superintendent Kathy Cox, this group has been working to develop a coordinated, unified strategy and action plan.
As an aside, of course, our first goal was to create yet another educational acronym: AEAH, the Alliance of Educational Agency Heads. Our primary goal is to increase Georgia's high school graduation rate and correspondingly decrease the dropout rate.
What that does for us at the university level is that it increases the size of our educational pipeline. Georgia actually does a good job of sending its high school graduates on to college. In 2004, 64 percent of public and private high school graduates in Georgia went directly to college. The average for the nation that year was 55.7 percent.
Our problem, of course, is that not enough of our kids graduate. And that assumes even more significance when you think about all those honors students in China and India! So, if we can increase the high school graduation rate, we will see larger numbers of graduates moving to postsecondary education. And that is the critical pipeline Georgia must have in order to remain competitive globally.
You do not have to look far to find examples of lost business opportunity because the educated workforce was just not available. Ensuring that an educated workforce is available is the joint responsibility of all involved in education -- and with a stake in education -- in Georgia. This certainly gives incentive to our work.
Beyond our current work with the AEAH, in the University System, we have been working closely with the State Department of Education and local schools for a number of years. We work together to connect the dots through efforts such as our African-American Male Initiative, which Arlethia heads up.
The University System STEM program -Science, Technology, Engineering and Math - is producing teachers in these disciplines to educate young Georgians in our elementary schools, high schools and beyond in these key fields. And we are involved in creating more interest in Science, Technology, Engineering and Math among K-12 students through our PRISM program, funded by the National Science Foundation.
In addition to these efforts, our work with the state's education heads, and this Council's program, we are engaged in many other areas to prepare our students well for the world ahead.
But you are correct to ask, what are we doing in the System once these students come to us to ensure they graduate and are ready for the workplace? We are focusing on improving our retention rates from the critical freshmen to sophomore year. For the University System, this is currently at just above 78 percent.
And, we are focusing on improving both graduation rates and shortening the time to degree. The current six-year graduation rate for the System is only 56 percent. The national average today is six years to earn a bachelor's degree. We want more of our students getting out in four. We are going to have 100,000 more students by 2020 and candidly, we need to make more room for those waiting to come in the door.
But, as I suggested earlier, we want them moving into the world truly prepared to contribute. That's why our new strategic plan, for example, will take a hard look at our core curriculum. We want to make sure that our curriculum is relevant to today's world and today's workplace. We want to ensure that we have prepared for those jobs that don't exist students who are intellectually capable of solving the problems of tomorrow.
Education is a serious endeavor and it requires partnerships and commitment of the type found in this Council. As I look around this room, I see a veritable "who's who" of business leaders, community partners, and educational leaders. Your actions to strengthen the economic education of K-12 students speak loudly. This is an important mission to achieve if our students are going to fully understand how to navigate through life.
And let me note with pleasure your selection of David Ratcliffe as the 2007 Commitment to Education Award recipient. David and the Southern Company understand how important this mission is. David is a good friend and colleague of long standing. He is very deserving of your recognition. His support and that of the Southern Company for the Council and for so many other important community efforts underscores the commitment of so many businesses and organizations throughout this state for education.
I guess it once again demonstrates the ability of the energy industry to "supply the power" for all kinds of ideas and programs! This type of support should be considered an investment. We all invest in our future when we work to ensure that our children learn, and learn well.
The University System is working alongside its many partners to ensure that our children are educated, and in turn, that Georgia's economy remains competitive and growing. We work with you to understand this new world -- to connect the dots for our children in ways that prepare them to not just know the facts -- but understand the difference between a sheep and a dog.
Long term, we are committed -- as is this Council and the many partners that support it -- to transforming lives. I thank you for the work you do to help create economic opportunity through that wonderfully transformative tool of education. And, thank you again for the opportunity to be with you today.