Arnold Kling's Observations on Education

All these observations are good, but I will give you the first three:

1. The U.S. leads the world in health care spending per person, but not in health care outcomes. Many people look at that and say that health care costs too much in the U.S., and we should be able to get the same our better outcomes by sending less. Maybe that is correct, maybe not. That is not the point here. But–

2. the U.S. leads the world in K-12 education spending per student, but not in student outcomes. Yet nobody, says that education costs too much and that we should spend less. Except–

3. me. I believe that we spend way too much on K-12 educatio

  • him

    Just to be fair, while the argument that we should spend less on education is popular in Rightist circles (don't look at me like that, I agree completely), the vastly higher health care costs for subpar outcomes usually gets a response of "that's just because it's the best and other states don't pay the cost". Patently ridiculous but fitting the tribal identification of the two large parties. I'll make any Rightist a deal - I'd be happy to cheer for education cuts if they support healthcare cost cutting.

  • CC

    The argument about health care outcomes is skewed. Outcomes if you have cancer or a heart attack are better in the US. Overall mortality is biased in two ways. First, the US has more accidental (cars) and murder and drug overdose deaths, largely among the poorer segment. These are unrelated to health care quality but raise the death rate. Second, infant mortality is under-reported in many countries--if the infant doesn't survive the first few weeks it is counted as non-viable, rather than a mortality.
    Finally, in the US people can afford to spend money on things like artificial limbs, electric wheelchairs, physical therapy, cataract surgery, weightloss surgery, that in other countries people simply can't get. They just suffer. Of course if you have more money you will spend more on quality of life. That is not a "problem".

  • CC

    I am NOT saying health care costs aren't bloated by the way.

  • mogden

    In the case of education, the money would be spent by our wise elected overlords. In the case of health care, it would be squandered by greedy insurance companies.

  • Ike Evans

    The entire discussion on education reform is generally a rouse behind what's plaguing our youth: the breakdown of the nuclear family.

    The fundamental question we should all be asking is: are we doing what is necessary to help our youth grow up and become productive adults. I would argue that we have made significant strides in improving our education over the generations. We are quick to blame the failures of the system when we aren't getting the results we want, when we are looking the wrong direction from the get-go.

    First things first: let's stop turning single mothers into heroes.

  • DirtyJobsGuy

    I think you can break K-12 education into two segments, K-5 (or 6) and 7-12. Elementary school should be fairly inexpensive but the benefits of improved (or traditional) methods are large. Skills in writing, spelling, reading and the basic arithmetic needs are lagging from what my grandfather had in the 1920's. No one except child prodigies would suffer from a thorough grounding in all of these. Vouchers will lead most parents to these programs I suspect. For the middle/high schools costs of administrators are the biggest factor. Reducing the union caused bloat to make promotion paths is essential. Outsourcing is the key. When my daughter was in an upscale CT suburban school the elementary math was an awful constructivist mess. I got some books and classwork from the Calvert School to supplement the inadequate progressive stuff. Calvert is a private school that for a long time did packages for homeschooled kids overseas. I was astonished to find how cheaply you could buy a full curriculum along with books, supplies, tests, homework etc. It was only a fraction of what our district spent to implement "new" curriculums.

    Even special needs students could be better accommodated by vouchers.

  • GoneWithTheWind

    Those who think other countries have better health care outcomes are essentially referring to minor statistical anomalies that are not related to health care at all.

  • Mercury

    All true. Waiting forever for an artificial hip probably doesn't make it into the "outcome" stats either.

    That, and the US has a lot of fat people which exacerbates/causes a lot of health problems regardless of how much money is spent on medical care.

    I'd like to see the stats on public education employee/administrator outcomes in the US vs. the world. Take that you smarty-pants foreigners! U-S-A! U-S-A! U-S-A!

  • sailor116

    The increase in costs without an increase in benefits is known as "cost disease." Quite a bit has been written on it.

    See, e.g. https://www.bloomberg.com/view/articles/2017-01-18/this-economic-phenomenon-is-making-government-sick
    and
    http://slatestarcodex.com/2017/02/09/considerations-on-cost-disease/

    Anyway.

    Both probably suffer from the inefficiencies of serving the worst (and most expensive) cases.

    In education, we used to take less-able students and stick them in a back room. This was bad, but cheap. Now they may require $50,000 each of IEPs, administrators, and specialists. This is more equitable, and perhaps more ethical, and is certainly more expensive.

    In healthcare, folks used to die more often of preventable causes. And it was accepted that poor folks would get pretty bad (or no) care. This was also bad, but cheap. Now we claim to avoid "death panels" and we seek more constant care across multiple levels. This is more equitable, and perhaps more ethical, and is certainly more expensive.

  • kidmugsy

    Fair enough. Now tell us about the statistical artefacts that exaggerate the merits of American health care.

  • texasjimbo

    "that's just because it's the best and other states don't pay the cost".
    Its a little vague to me if "other states" is other states in the US or other countries. I suspect the later, since the first doesn't really make sense in context. There is actually a lot to that explanation: the US definitely subsidizes the rest of the world's pharmacy goods and other medical goods/services research. Our healthcare is better: we have unique health care challenges (mentioned in other comments) and we take care of them better than other countries take care of their challenges. We do consume more healthcare, mostly because we are wealthier (than all but a handful of small countries), and thus have more income to spend on luxury goods (and advanced healthcare is a luxury good, and the one that makes the most sense to spend on). So our healthcare spending really isn't that out of line.

  • mlhouse

    1. Claim 1 is false. THe U.S. does lead the world in health care outcomes. For example, the five year survival rate of breast or prostrate cancer is 95%. In Europe it is 75%. Two other factors are a) medical outcomes must also include the concept of wait time. In the U.S. your services will be delivered much quickly than in Europe and else where. You want a knee replacement? You will wait much longer outside the U.S., with that much more limited quality of life and pain. b) if the Europeans were not allowed to piggy back on U.S. pharmaceutical and technological progress they would be in 3rd world status medically. U.S. consumers pay the full costs of the development of these products. Other nations do not (which is why we can "reimport" drugs with significant discounts). If the Europeans or Canadiens had to pay full cost their systems would be bankrupt. If some did not pay full cost, also known as the Americans, then little advancement could be made.

    2. Claim 2 is very misleading. Two misleading facts. First, if you break down the U.S. results demographically you will see American Asians are at the top of the list (where you would expect). U.S. whites rank very high. What brings down U.S. results is the minority performance which ranks near the very bottom of the world. Second, the test penetration in these other countries does not go as deep as it does in the U.S. My guess is most of these nations, including Singapore and even European ones limit their testing to their more advanced students/schools biasing hte results.

    3. I agree that we spend too much on K-12 education and it does not give the results we should expect. I think our entire one size fits all "college prep" system needs to be changed. I believe that as early as 6th grade we need to start segmenting the students. Some students will be put into "university track". Others into "college tracks". A wide swath of the students should be put into vocational tracks. And, lastly, some students should be put into 10th grade drop out tracks and that is it for them. University prepares students for advanced degrees. College for white collar work. Vocational tracks would give you the vocational training students need to spent time and money AFTER K-12 that are then followed up with extensive apprenticeships. If you want to be a plumber, and the taxpayers are spengind $10,000/year on your education, why do you have to follow up more training/education on your own dime? Get two years of that in high school. Everyone gets the education they need.

  • mlhouse

    Here is the problem with cutting health care costs. How do you do it? The fact is, almost all of our health care costs are the allocation of fixed costs. The 250 bed hospital cost X million to build. It cost that much whether 250 of their beds are occupied or 0 of their beds are occupied. The equipment in the hospital cost the same whether they are being used or not. Emergency room treatment costs "more" than other treatment not because you necessarily get better treatment, but because it needs to be staffed and equipped to meet most every possible types of treatment and peak usage, even if nobody comes into the emergency room. And that is why your medical bills have ridiculous charges for cheap things like aspirin.

    To make major savings in health care costs, there would have to be a reduction in capacity. The amount of hospital beds, the level of equipment, the level of emergency services, and the levels of staffing would all have to be reduced. You would greatly expand the wait times and limit the medical treatment.

    Health care in some ways is no different than a soda. Time and place matter. In a convenience store you pay $1.79/bottle for the same exact bottle of soda you pay $0.40 if you buy it off the shelf at Wal-Mart. They are bottles of soda, but not the same commodity. In the U.S, we pay for the availability of medical treatment and demand the highest level of quality. Other places get their medical treatment wholesale at Wal-Mart. While I believe there are some savings that can be made in how we deliver health care services, particularly that not all of our medical treatment needs to be done at 7-11 and can be done at Wal-Mart instead, I don't think it is totally worth eliminating the level of care our system has.

  • Washington DC spends over $29,000 per pupil and is the second worst school system in the country in test scores, dropout rate and other criteria. They had a reformer making progress, but she was canned. The person running for mayor, Gray, worked a deal with the teachers union. They would provide all the money he needed to get elected and he would do the unions bidding. Result: union teachers won and the students lost.

  • jdgalt

    I'm sure it was luck that the post happened to chop off there, but I love the coined word "educatio" for what the NEA is doing to us. It fits.

  • jdgalt

    Simply remove a lot of the regulation we have now (so that falling to an average European standard of care is allowed if the patient wants the lower price), and especially remove the tax incentives for employers and other third parties to pay for most medical care (so consumers will have a reason to pay attention to its price), and the market will right itself.

    Reforming the legal system (loser-pays) would also help, since a LOT of doctors' overhead is malpractice insurance. And of course Medicare distorts the whole price structure that applies to everyone but its members.

    And finally, let's get the federal government totally out of regulating health care. Not only ObamaCare but HIPAA before it have driven huge numbers of doctors out of the field. We're screwed if most of them don't want to come back.

  • J_W_W

    You can reduce capacity or you could increase utilization. Manufacturing utilizes expensive equipment. Health care minimizes the use of things like MRIs, CAT scanners, X-rays, etc. The cost of using these machines comes down immensely if they're being constantly used. It paying for a minimum number of uses of expensive machinery that maximizes its cost.

    Manufacturing has spent 40 years annihilating excess cost. Medicine doesn't know one goddammed iota about how to even start....

  • Max Lybbert

    It's certainly an unpopular opinion, but there are people making the argument: http://johnhcochrane.blogspot.com/2017/02/economies-in-reverse.html .

  • alancc

    Claim #1 is pretty misleading, just as an FYI (I know its not the point). Two data points specifically from the "lies, damn lies, and statistics" category.

    If you look at things like life expectancy ... you find that the USA has the highest in the world (as of 2010 or so, I'm sure we've been dropping under Obama ever since) if you adjust for automobile and gun deaths. Why? Because they disproportionately kill young males, skewing life expectancy statistics and not reflective of the healthcare system (by the way, trauma care in the US is among the very best in the world). If you adjust for those, then we leapfrog all those poor pitiful countries where you pay $10 a gallon for gas and can't own a gun. Which is a truer measure of outcomes.

    If you look at infant mortality ... you find that every other country lies. If a child dies in the first week, then it wasn't viable, and its excluded from infant mortality statistics. Not in the US. We count every life. So infant mortality stats can't be compared - because most countries lie.

    The examples go on and on ... figure its worth having a couple handy even if the debate is never about facts and logic but emotion and swirling feelings and stuff ...

    Great post by the way, and a great framing of the issue.

  • kidmugsy

    "The U.S. does lead the world in health care outcomes. For example, the five year survival rate of breast or prostrate cancer is 95%."

    That is a misleading claim. There is no evidence that I've ever heard of that the US is more successful with those cancers. She spends a lot on diagnosing them early, with the inevitable consequence that people appear to survive longer because, even if their lifespan is unchanged, they were diagnosed earlier.

  • CapitalistRoader

    We pay the most to get the best. In comparison to most other developed countries the US is a higher risk/higher reward society. We drive more, we have more guns, we engage in riskier behavior, and we're much more racially diverse.

    http://b-i.forbesimg.com/theapothecary/files/2013/11/National-Life-Expectancy12.png

  • CC

    For education, we can clearly identify where the extra money is going. Mark Perry documented for his university that 30 yrs ago or so it was something like 3 faculty per 1 admin, and now is 2 admin per faculty. The salaries of upper admin are very very high. For lower grades, there are more assistants, aides, requirements for mainstreaming troubled or disabled children etc. For colleges there is also an arms race of amenities like nice dorms, beautiful buildings, entertainment, etc to attract the kiddies.

  • Mercury

    Quick, what other national characteristic do the top five countries on that list also share?

  • mlhouse

    Well, every study has demonstrated this fact and early diagnosis is a significant reason why the survival rate in the U.S. is significantly higher. This is most important for the more "survivable" cancers such as prostrate and breast cancer were early detection is critical.

  • kidmugsy

    If you diagnose a higher proportion of slow-growing cancers that don't pose much threat, you can make your numbers look better without actually having done much good. if you believe that cancer treatment is better in the US why not cite some figures that show it unambiguously, rather than the misleading figures of five year survival rates?

  • CapitalistRoader

    https://uploads.disquscdn.com/images/4a8373a631bdd377088598ea49c8b594e06d709710a4c21d44da36a5a7708861.jpg

    Unlike the US, almost everyone in those countries looks, talks, and pretty much thinks exactly the same?

  • Ward Chartier

    Please cite the source for Item 2 in the post. I'm interested in using these data along with the data in the chart you posted several days ago. Many thanks.

  • GoneWithTheWind

    The old riddle helps understand this issue: You are a race car driver and to qualify for a race you have to average 120 mph for two laps around a one mile track. On the first lap your car isn't running well and it takes two minutes for the lap. So how fast do you have to drive on the second lap to qualify.

    This is the problem with statistics without context. In the U.S. our average life span is a couple years below a cuntry like Japan. Some people like to claim that is because we have inferior health care. But the cause is much easier to explain and kind of nefarious in the way it affects stats. Last year 50,000 people, mostly young people, overdosed on drugs. Last year gang bangers and others killed about the same number of people. And there are other "freedom" and "cultural" related deaths in the U.S. that Japan never has to worry about. But when you are creating a statistic about life expectancy it matters if the person killed by a gang member is 12 or 72. Statistically is skews the data. And this is over and above the fact that just the death alone skews the statistics. The executive summary is that if Japan were to get our inner city minority populations their statistical lifespans would drop like a rock. Probably lower than the average for whites only in the U.S. There are lies, damned lies and statistics.

    By the way the answer is you cannot qualify if your first lap is 120 seconds because that is how long it would take to drive two laps at 120 mph. And the answer to the second riddle is you can't have statistically long life spans in a country where you have a minority population that kills themselves at record rates.

  • Ike Evans

    With the exception of Australia and New Zealand, that is true of every country above us on that list.

  • him

    Require upfront signed agreements with the full cost of treatment for any non-emergency care, signed by insurer, facility managing and providing care and the patient. Limit cost recovery from the consumer at this level.

    This will allow consumers to shop and avoids the "Oops, here's a 10k out of network bill you are in fact responsible for, too bad" issue.

    All emergency care should have a fixed price for consumers that is part of their insurance contract, with all variable cost up and beyond taken care of between the hospital and the insurer.

    Allow insurers and hospitals to compete nationwide.

    Done, market forces will do the rest.

  • him

    If a macbook costs me 3000 USD here or the equivalent of 300 USD in Hong Kong, I'll feel like mine's overpriced. Maybe Apple is using the profits from the US to subsidize the cost in Hong Kong, but regardless of the reason, the price difference is an indication that I am overpaying, and it's not the consumers in Hong Kong who cause my price to be higher, it's the vendor.

    An appendectomy with five days in the hospital costs 3000 USD in Germany (first world nation, great medical care). It costs more than 30000 in the US, typically for a shorter hospital stay.

  • texasjimbo

    You suggested the claim that "...other states don't pay the cost" wasn't a valid explanation for why our costs are higher. I'm simply saying it is a valid explanation, implicitly acknowledging the costs in the US are higher.
    As for the cost comparison you gave in the second paragraph, it simply is not valid. It is likely not an apple to apples comparison, and it likely reflects what hospitals initially bill, not what they collect. It is completely useless for this discussion.

  • marque2

    Some stats like to look at the life expectancy of people over 50 in first world countries, the druggies and murderers, and idiots have already killed themselves or have calmed down, so the people over 50 are less likely to die from accident or crime, and because of age, are most affected by healthcare services. Looking at the over 50 set and America has by far the highest life expectancy in the world.

    I don't know where to find these stats. I wouldn't be surprised if I saw them on this blog. But I am sure a bit of googling and you can find it.

  • marque2

    The fat thing is a bit of a canard, as people get older they gain weight until about the 60's and then the weight slowly drops, but not fast. The US population has been ageing, So it is now 10 years older than 30 years ago, that explains the extra 10 pounds per person.

    As for fat people, if you look hard enough you will find them, but go in any mall, are "most" of the people fat by any means, or do you see maybe one in the whole mall?

    Another issue, that BMI they switched to makes one deemed fat at a lower weight, then they used to. When you need a crisis change the yardstick.

  • Bonticou

    Let's not forget the costs of greater documentation for government agencies in higher education and the proliferation of "deans" for every imaginable subgroup and subject. The college I graduated from in 1958 had at that time two deans, one for men, one for women, and about 900 students. it now has about 2 dozen deans and assistants for about 1600 students.

  • him

    It is actually exactly what both hospitals initially bill. How is that not a valid comparison?

  • CC

    Colleges these days also have diversity centers, LBGQT centers, multiple student unions, special counseling, special safe spaces. All this costs money.

  • texasjimbo

    First, I'm doubtful of the trustworthiness of the numbers both because they a both round numbers and because they are unsourced. (Provide a link). Second, if the German hospital doesn't reduce the bill after request/negotiation and the American hospital does, then it is obviously *not* a valid comparison. Lastly, I seriously doubt the German price reflects the real cost of the care; it likely only reflects the patient's portion, while the bill from the American hospital more accurately reflects the cost. But, since there is no link, we can't really explore what the actual explanation is. But the numbers do not reflect a valid comparison of the cost difference between the two countries.

  • Steven Aldridge

    I've been making that point for years, falls on deaf ears.

  • him

    Fair points.

    30k was the cost I was billed for mine. Germany comes with predetermined and published maxima for procedures, and that's where the 3k came from. Source: http://www.focus.de/finanzen/news/tid-19140/lebenshaltung-wie-viel-kostet-ein-krankenhausaufenthalt_aid_530529.html

    German billing reflects the full cost billed to insurance; the patient portion typically is a fraction thereof. Just to put things into perspective, I'll point out that they make a profit at this level and that the full sum is considered expensive in Germany.

    The point I am making is exactly that American care providers tend to price procedure way beyond cost. It's very nice that in some cases they decide to allow customers to pay less, but quite frankly, this is not a sign that American prices make sense and the rest of the world is skirting their responsibilities, it's evidence that we have a severely distorted cost function for healthcare that could be corrected by applying free market principles.

  • cesium62

    You might want to look at spending on health care as a % of gdp, and also spending on education. You might also look at % of gdp spent on the military. Hint: The U.S. has the highest health care spending, but mediocre education spending.

    http://data.worldbank.org/indicator/SH.XPD.TOTL.ZS?year_high_desc=true

  • cesium62

    You should work on your googling skills.
    https://www.ncbi.nlm.nih.gov/books/NBK62587/ table 2.1 disagrees with you.

    Also: http://www.worldlifeexpectancy.com/your-life-expectancy-by-age disagrees with you.

  • cesium62