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ALP: education matters « Previous | |Next »
January 24, 2007

Kevin Rudd's education speech at Melbourne University needs to be read in the context of the discussion paper. This explores the critical link between long term prosperity, productivity growth and human capital investment, and frames education as an economic reform issue. Andrew Norton makes some comments on universities, whilst Andrew Leigh has some comments on schools.

Education has been a simmering burn under the Howard Government, due to the consequences of neo-liberal mode of goverance: low investment in skills and training, laying waste to the humanities in public universities, reduced public funding of public universities and high priced degrees. Education has been seen in term of a private rather than a public good.

The Beazley-led ALP failed to cut through on education and it was not able to build on the rhetoric about knowledge nation to put the Howard Government on the ropes. The opportunities were there with the Howard/Costello reliance on Quarry Australia to ensure prosperity and address the balance of payments of deficit. The ALP had consistently argued that Australia can do better on education, and that education is crucial to improving Australia’s productivity performance and to ensure its international competitiveness. One strand of the argument was about Australia's growing productivity gap, namely:

The economic reforms of the 1980s and 1990s, and more intense use of technological innovations gave a onceoff boost to the size of the economy, but now further productivity drivers are required if Australia is to recover its productivity momentum...A significant constraint on Australia’s productivity growth in recent years has been under-investment in education.

This argument never really cut through because it was not part of a larger economic narrative that persuaded us that reform was necessary, or indicated what kind of reform was need to boost education.

The New Directions Paper states the issue clearly enough:

The challenge that Australia now faces is that the platform for economic prosperity in recent years has changed from high productivity growth, to the short term, boom-time prices for minerals and energy. In the second decade of the twenty-first century, Australia is likely to face moderating conditions in global resources markets. In the absence of the resources boom, Australia’s economic fortunes will be determined by our underlying performance – i.e. productivity growth rates, which have been weak in recent years, and growing challenges to workforce participation arising from long term demographic change... It is important for Australia to reconsider the long term foundations of economic prosperity... economic research indicates that the most important enduring determinant of living standards is a nation’s productivity. Understanding the nature and foundations of productivity is central to the challenge of sustaining prosperity into the future.

The paper's argument is clear. Lifting productivity further in the next decade of twenty first century is the key challenge facing economic policy makers. It says that there is a broad consensus in the official and academic literature that two important determinants of long term productivity growth and prosperity are the degree of openness of the economy (that is, to both internal and external competition) and the level and quality of human capital investment.With repect to the latter it says that:
The more educated economies are wealthier economies. Countries that invest in education do better in achieving their potential economic growth rate.Beyond economic goals, educational analysts also highlight that education creates other social benefits. It helps build social capital – societies with a strong commitment to education can also enjoy higher levels of civic participation in community and religious groups, greater social cohesion and integration, lower levels of crime and social disadvantage, and a more trusting, equitable and just society.

The basic policy argument is that Australia’s current investment in human capital is inefficiently low, and
in the long run Australia’s productivity growth will fall behind those of other countries that are making greater
investments. Australia must lift its productivity growth to sustain its economic prosperity and this is best achieved
by improving our economic resources through investments in human capital.

So education needs more money. The human capital argument is that whereas in most OCED countries increasing private spending on tertiary education tends to complement, rather than replace, public investment, this is not so in. Australia. Here the shift towards private expenditure at tertiary level has been accompanied both by a fall in the level of public expenditure in real terms and by a significant decrease of public subsidies provided to tertiary students.

| Posted by Gary Sauer-Thompson at 4:04 AM | | Comments (1)


Interesting how the document targets the very young, aiming obviously to politically ally these kiddies from an early age (Political peadophilia?). By the time they have reached some maturity, the only thing these kids will recognise politically across the country is Labors supposed divine right to govern; and the ‘urgent’ need to vote for the Labor cult.

The document sites the Labor party 9 times, the Coalition 4 times. And it simply divides the decline in education at 1997. It implies no other correlation between ‘skill shortage’ and other factors or periods. The argument simply benchmarks the problem. And offers a new benchmark for ‘revolution’, the 2007 election. From whence all education effort will be refocused upon the very young, leaving all others to pass on by, unnoticed and dumbed down -apparently. It will be a sort of Hawke time warp (some of which we are still paying for).The effects of this off course wont hit home across the nation for another twenty years from Labors 2007 election. Clearly, they intend to reshuffle education to more reflect the Marxist ‘building’ of things, and the two tiered socialist system which they are itching to bring in. Hence the Marxist age division in the document.