The Cradle of Prosperity

Raising the New American Economy

Genetics does play a role in this process, but not necessarily a final role. “Brains come with blueprints—that’s our genetic inheritance. But life circumstances and personal experiences affect how a child’s brain architecture actually gets built,” explains Jack Shonkoff, a pediatrician and chair of the National Scientific Council on the Developing Child, which brings neuroscientists, developmental psychologists and economists together to analyze, integrate, and communicate research on how early development unfolds. “Genes establish the initial blueprint, but how those genes influence the ongoing development of individual competence is shaped by interactions with the environment—in the home, in the neighborhood, in the child’s full environment of relationships.”

If a child experiences persistent toxic stress (from continuous economic instability or poverty, recurrent abuse, chronic neglect, or the like), the developing architecture of his or her brain can be severely undermined by the release of harmful chemicals in the brain that make it more difficult for neurons to form connections with each other. Weakening of the brain’s architecture, in turn, weakens a child’s ability to respond adaptively to future stresses, including normal life obstacles. This can increase an individual’s vulnerability to later health problems, ranging from anxiety and depression to cardiovascular disease, hypertension, and diabetes. Also, the child’s ability to learn and interact positively with other children is diminished—along with his or her future contribution to the economic and civic health of the community.

Fortunately, however, the human brain has a marvelous plasticity, an ability to construct new neurological pathways to compensate for significant threats or missed opportunities. “Brain development is predisposed to make adaptive adjustments along the way. If problems arise, compensations will be made to get the process back on track, but the evolving architecture of the brain is strongest when it is built on a sturdy foundation,” says Shonkoff. This important neuroscientific principle makes economic sense to Heckman and Rolnick: in the brain, as in the economy, getting it right the first time is ultimately more effective and less costly, to society as well as to the individual, than trying to fix it later.

The second stream of research establishes early parameters for measuring the economic benefits of building brain architecture. These data include a set of longitudinal studies of children from low-income families, including the Perry Preschool Project in Ypsilanti, Michigan; the Abecedarian Project in Chapel Hill, North Carolina; the Chicago Child-Parent Centers; and New York’s Elmira Prenatal/Early Infancy Project. The long-term Perry Preschool Project, initiated in 1962, revealed that, by age 40, program participants were less likely to be placed in special education programs, more likely to have completed high school, more likely to hold a job, more likely to have higher earnings, and less likely to have committed crimes than those in the control group who did not attend preschool and whose parents did not receive home-based assistance. According to an analysis of the Perry Preschool findings by Rolnick and research associate Rob Grunewald, investment in high quality early education for disadvantaged preschoolers yielded a rate of return of 18 percent annually (inflation adjusted) over a 62-year period, with all but 2 percent returned to society as a whole.

Other researchers have calculated slightly different cost-benefit ratios, but the findings are consistent, indicating strong returns in greater economic productivity and less crime. A 2005 cost-benefit study for the Rand Corporation on preschool in California listed a range of economic gains, including stronger work-force performance, international competitiveness, and the distribution of wealth across generations. Solid brain architecture means a solid child who will grow into an adult who is more likely to give back positively to his or her community. Indeed, this is an investment that keeps on giving. “The economic case for why we should invest in early childhood development is closed,” says Rolnick.

Investing in Long-Term Prosperity

If investing in young children can be a powerful stimulant to job creation and long-term prosperity, how can we best make that investment? One approach is to educate business executives, legislators, and other influential citizens and organizations about the accumulating scientific evidence linking child development to economic development. Presumably, change would then take place on many independent fronts. Rolnick favors a market-oriented approach, but with an emphasis on public/private partnerships involving local businesses, government, and nonprofit organizations. He is pursuing that strategy through the Minnesota School Readiness Business Advisory Council, a 200-member organization of CEOs, senior executives and business leaders. A different approach is prescribed by Robert G. Lynch, chairman of the department of economics at Washington College, and author of “Exceptional Returns,” a report for the Economic Policy Council. Lynch calls for a national, government-supported early childhood development program for all children from low-income families. Such a program would cost billions of dollars, but Lynch calculates that the fiscal payoff would arrive just in time to save the Social Security trust fund from insolvency.

Whatever the size of the investment, and however it is paid for, Heckman calls for careful targeting and an awareness of the scientific research—which reveals a more complex challenge than recent education reform, including school readiness programs, have met. “American society puts its faith in public training programs to make up for 17 years of neglect. It’s nuts,” Heckman told The Region magazine, published by The Federal Reserve Bank of Minneapolis, in June 2005. Skill development depends on sturdy brain architecture and that architecture is built over time—not through a crash course. Moreover, a proper accounting of human capability recognizes both cognitive skills (the process of acquiring knowledge through reasoning and problem-solving) and noncognitive skills (such as motivation and self-control). “Noncognitive skills are powerfully predictive of a number of socioeconomic measures—crime, teenage pregnancy, educational achievement, and the like,” says Heckman. But in addition to preventing undesirable outcomes, such programs help children grow up to be healthier and more productive adults—more socially skilled and more motivated. The development of non-cognitive skills has not been a priority of the federally mandated Leave No Child Behind approach to education reform. Stimulated in part by the nation’s business community, recent reform has focused on school readiness, literacy, and standardized testing. Conventional concern also emphasizes school dropout rates, the number of years of education completed, and the degree obtained. But Heckman considers those only partial measures.

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