Worthwhile early investment

When it comes to allocating scarce government resources, the voices of young children are often the hardest to hear. The problem is not that public officials don't care. It is that they treat early childhood education and health care as a social issue rather than as an economic imperative. And the policymakers believe spending on young children is equivalent to other government spending. I view it differently.

Simply put, prevention is less costly and more effective than remediation. University of Chicago Nobel laureate economist James Heckman repeatedly stresses, "Policies that seek to remedy deficits incurred in early years are much more costly than early investments wisely made."

As a businessman and investor, my response is, "Amen."

Let's look at the facts.

Research by the Minneapolis Federal Reserve Bank's Arthur J. Rolnick has shown that taxpayers reap a 16 percent return on their investment in early childhood programs. His work evaluated results of a landmark four-decade study of the Perry Preschool Program in Ypsilanti, Mich., focused on a group of similarly situated children from preschool age to midlife. Half went to preschool, the others did not.

The positive effects of preschool were compelling. More than 65 percent of those who attended preschool graduated from high school, compared with 45 percent from the non-preschool group. The early-educated kids were also four times more likely to become earners of at least $24,000 annually. Perhaps most stunning, children who did not attend preschool were five times as likely to have spent time in jail.

It is clear that long-term taxpayer returns are substantial. Data presented at a 2004 Massachusetts Institute of Technology early education financing conference estimated the costs of providing early childhood education to all 3- and 4-year-olds in the U.S. at $50 billion, or roughly the appropriation for eight months of the Iraq war. And yet for that relatively modest investment, it was projected that more than $213 billion in value would be created over the next 40 years. That's a net gain of $163 billion. In short, the social savings, productivity and wage gains that come from early education are as close as one comes to a guaranteed investment.

Perhaps just as important as the cost savings and return on public investment, early education significantly enhances our nation's competitiveness in a global economy.

Early childhood education and health-care programs dramatically increase the lifetime earning potential of low-income children. Long-term, this means more productive workers and a growing, internationally competitive economy.

It is increasingly common for employers to lose good people because the cost of quality day care offsets the workers' earnings. Twenty years from now, we could be facing a very different workforce scenario, one in which these employees' now-grown children are neither healthy, nor motivated nor educated enough to meet the demands of the workplace.

This is not mere speculation. Groundbreaking research, funded in large part by the late Chicago philanthropist Irving Harris, quantified socio-emotional costs and opportunities for at-risk children. This work, together with the socio-economic research of experts such as Heckman, Rolnick and others worldwide, demands a rethinking of how we as a society view investments in early education.

In 1990, this country adopted its first National Education Goal declaring that by the year 2000, all children would start school ready to learn. All kids were to have access to high quality, developmentally appropriate preschool programs and the nutrition, health care and physical activity necessary to foster healthy minds and bodies. While strides have been made, it is clear that as a nation we have fallen woefully short of the goal.

Here in Illinois, Gov. Rod Blagojevich and the state legislature recently made an important decision to make early childhood education and health care a priority. By investing in broadening preschool access and children's health care, our state can become a national model, while laying the foundation for increased economic success. On a close vote, both "All Kids" and "Preschool for All Children" were funded for the coming year. Moving forward, these programs need to become our first priority, not our last. While some may not accept it, history has shown that government is the only entity with sufficient reach to meet this challenge.

We owe it to ourselves and our nation to make this a priority now.

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J.B. Pritzker, managing partner of the Pritzker Group, recently launched the Pritzker Consortium on Early Childhood Development at the Harris School of Public Policy Studies at the University of Chicago to identify when and how child intervention programs can be most influential.