Ben Bernanke

President Obama

What do President Obama’s speech this week about higher education and Federal Reserve Chairman Ben Bernanke’s speech about the economy last week have in common? Early education. The paths to increasing college graduation rates and strengthening the economy start with early education.

In a speech about higher education that he delivered at the University of Texas on Monday, the president lamented lagging college graduation rates and called for producing eight million more college graduates by 2020.

“The fact is we know what to do to offer our children the best education possible,” Obama said. “We know what works….   We can’t afford to let our young people waste their most formative years.  That’s why we need to set up an early learning fund to challenge our states and make sure our young people, our children, are entering kindergarten ready for success.  That’s something we’ve got to do.”

(A little background. The College Board, in a report released late last month, found that college completion rates for young adults has fallen dramatically and recommended early education as a key strategy to reverse the trend. See A Generation at Risk of Falling Behind Their Parents.  Meanwhile, a subcommittee of the U.S. Senate’s Committee on Appropriations included $300 million for an Early Learning Challenge Fund in its proposed spending plan for fiscal 2011. See New Life for the Early Learning Challenge Fund.)

On August 2, Federal Reserve Chairman Ben Bernanke returned to South Carolina, the state where he was raised, to deliver a speech — “Challenges for the Economy and State Governments” – at the annual meeting of the Southern Legislative Conference of the Council of State Governments. In it, he praised the South for improvements in education that propelled its economic growth – and he underscored the importance of high-quality early education.

“No economy can succeed without a high-quality workforce, particularly in an age of globalization and technical change. I think this is a lesson that the South, as a region, has learned quite well,” Bernanke said. “Doubtless, investment in education and training has been a key source of the remarkable economic gains that the South has achieved over the past 50 years or so. I am confident that, in light of this experience, your efforts to improve education and workforce skills will continue.

“As you do that, please keep in mind that formal K-12 and post-secondary education, as important as they are, do not alone build better workforces. Research increasingly has shown the importance for both individuals and the economy as a whole of both early childhood education as well as efforts to promote the lifelong acquisition of skills. The payoffs of early childhood programs can be especially high. For instance, investment in preschool programs for disadvantaged children has been shown to increase high school graduation rates. Because high school graduates have higher earnings, pay more taxes, and are less likely to need to use public health programs, such investments can pay off even from the narrow perspective of state budgets; of course, the returns to the overall economy and to the individuals themselves are much greater.”