US must invest in education to break cycle of poverty

Even wealthy countries such as the United States fall short on the challenges of providing education for all. Jessica Rinaldi / Reuters

A country's economic success depends on the education, skills, and health of its population. When its young people are healthy and well educated, they can find gainful employment, achieve dignity and succeed in adjusting to the fluctuations of the global labour market. Businesses invest more, knowing that their workers will be productive. Yet many societies around the world do not meet the challenge of ensuring basic health and a decent education for each generation of children.

Why is the challenge of education unmet in so many countries? Some are simply too poor to provide decent schools. Parents themselves may lack adequate education, leaving them unable to help their own children beyond the first year or two of school, so that illiteracy and innumeracy are transmitted from one generation to the next. The situation is most difficult in large families (say, six or seven children), because parents invest little in the health, nutrition and education of each child.

Yet rich countries also fail. The United States, for example, cruelly allows its poorest children to suffer. Poor people live in poor neighbourhoods with poor schools. Parents are often unemployed, ill, divorced or even incarcerated. Children become trapped in a persistent generational cycle of poverty, despite the society's general affluence. Too often, children growing up in poverty end up as poor adults.

Governments have a unique role to play to ensure that all young members of a generation - poor children as well as rich ones - have a chance. A poor kid is unlikely to break free of his or her parents' poverty without strong and effective government programmes that support high-quality education, health care, and decent nutrition.

This is the genius of "social democracy", the philosophy pioneered in Scandinavia, but also deployed in many developing countries, such as Costa Rica. The idea is simple and powerful: all people deserve a chance and society needs to help everybody secure that chance. Most important, families need help to raise healthy, well-nourished and educated children. Social investments are large, financed by high taxes, which rich people actually pay, rather than evade.

This is the basic method to break the intergenerational transmission of poverty. A poor child in Sweden has benefits from the start. The child's parents have guaranteed maternity/paternity leave to help them nurture the infant. The government then provides high-quality day care, enabling the mother - knowing that the child is in a safe environment - to return to work. The government ensures that all children have a place in preschool, so that they are ready for formal schooling by the age of 6. And health care is universal, so the child can grow up healthy.

A comparison of the US and Sweden is therefore revealing. Using comparable data and definitions provided by the Organisation for Economic Cooperation and Development, the US has a poverty rate of 17.3 per cent, roughly twice Sweden's poverty rate of 8.4 per cent. And America's incarceration rate is 10 times Sweden's rate of 70 people per 100,000. The US is richer on average than Sweden, but the income gap between America's richest and poorest is vastly wider than it is in Sweden, and the US treats its poor punitively, rather than supportively.

One of the shocking realities in recent years is that America now has almost the lowest degree of social mobility of the high-income countries. Children born poor are likely to remain poor; children born into affluence are likely to be affluent adults.

This inter-generational tracking amounts to a profound waste of human talents. America will pay the price in the long term unless it changes course. Investing in its children and young people provides the very highest return that any society can earn, in both economic and human terms.

Jeffrey Sachs is professor of economics and director of the Earth Institute at Columbia University. He is also special adviser to the United Nations secretary-general on the Millennium Development Goals