Federal economist says early childhood education makes sense
Citizens for Missouri’s Children held its 25th anniversary luncheon at the Chase Park Plaza today, and its keynote speaker was not a child advocate, but an economist with the Minnesota Federal Reserve.
Rob Grunewald and his upper Midwest colleagues have been doing ground-breaking analysis on the cost-benefit of providing quality early childhood education to poor children for about six years.
Grunewald said the research shows that investing in early childhood education promises, at minimum, a 12 percent financial return - far out-pacing the rates for more traditional economic development tools such as subsidies and tax credits to businesses.
In economics-speak it’s called “human capital development,” and Grunewald said there’s growing child development research indicating the optimal time to invest in people is far earlier than secondary school, college or graduate school.
Grunewald cited a Harvard child development study that showed, from birth to age 5, a child’s brain is developing 700 new synaptic connections per second - the most remarkable period of learning in a human lifetime. Cognitive development peaked at age 2 to 3, the target age for many early childhood programs.
Tapping into that developing hardwiring through quality early childhood education has already been shown to impact long-term outcomes of kids, he said. One 40-year study showed that poor children in Michigan given early childhood education in the early 1960s were, among other things, far more likely to graduate from high school on time, serve less jail time, earn more money, own a home and maintain a savings account than those who did not participate in such programs.
Grunewald and his colleagues took that study and others like it a step further by applying cost-benefit analysis to each of those outcomes, calculating how much each of those factors benefited or detracted from the overall economy.
In the case of the 40-year-study, the economists concluded that for every dollar spent on quality early childhood education, the economy gained $16. The annual rate of return (think of it like yearly interest earned on the initial investment) for the total economy was 18 percent, and about 16 percent of that return went to public coffers, he said.
Although the benefits of early childhood education have long been touted by child advocates and educators, the fact that federal economists are now backing that up with hard economic data, may prove a break-through for proponents who have had a hard time appealing to many conservatives.
“Business leaders and fiscal conservatives have warmed up to investments in early childhood,” Grunewald said prior to his presentation. “That has helped states and communities to move the ball forward on investment in early childhood.”
Nancy Cambria is the Children and Families reporter for the St. Louis Post-Dispatch. She writes on a wide variety of topics pertaining to the well-being of children and family issues. She posts on children and family policy in The Grade blog and on general family and parenting issues in the Parents Talk Back blog located in the lifestyle section. 
To be successful in recieving this funding, the Early Education field in California will become more coordinated and aligned with national standards. This will also eventually result in progress around other issues, such as workforce development, affordability and access as program standards assist with quality of programs.
Reaching kids at an early age is the key. For an in depth study of how reducing class sizes in the early elementary setting has long lasting impacts both socially and academically look up Project Star.
Missouri Department of Corrections head George Lombardi has endorsed this approach to say that the more we spend on early childhood education up front, the less we will pay to imprison people on the back end. It’s smart fiscal policy and makes common sense.
When interested parties do research and project economic benefits, I have little confidence in their results. At NASA, the billions spent going to space were said to produce seven times as much in economic benefit. It could be true, but the American economy was weaker in the 1970s (after the space race) than it was in the 1960s.
To pay for pre-school takes money from families, even though the tax system makes this invisible to most well-meaning advocates of more government spending. As a result many more women have to work to support their families — they are no longer are at home to give their children personal attention.
For those who love statistics, homeschooled children consistently outperform those produced by the government schools.