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Surrounded By Insurmountable Opportunities


David Pearce Snyder

Consulting Futurist


In more than a decade and a half since the 1983 publication of A Nation At Risk by the National Commission on Excellence in Education, no major national reforms were adopted by U.S. public schools, and there has been no significant improvement in overall student achievement. In the December, 1999, issue of The School Administrator (Snyder, 1999), I argue that this dismal track record should not be looked upon as a failure of leadership, but rather as a triumph of the pragmatic, pluralistic American democratic process.

Basically, the years in question were – for most Americans and for most of our public and private enterprises – pre-occupied with unpleasant short-term economic realities that preempted the devotion of more than nominal time, attention or resources to educational reform. Between the early 1970’s and the mid-1990’s, average U.S. wages fell 15%. Family income drifted downward, as well, in spite of a doubling in the number of 2-income households. At the same time, the declining productivity improvement that depressed U.S. wages also reduced corporate profits, in response to which, employers sought to cut costs by nearly tripling annual layoffs from 1.2 million p.a. in 1979 to 3.5 million p.a. in 1992.

America’s "Age of Anxiety"

By the late 1980’s, a majority of job terminations were hitting middle-income, middle management employees. As a consequence of managerial downsizing, the U.S. found itself producing hundreds of thousands of surplus college graduates, and America’s over-educated, under-employed sons and daughters became primary targets for sit-coms and stand-up comics. The last of the Baby Boomers – those born between 1960 and 1965 – were confronted with such poor career prospects upon graduation from college that most of them moved back in with their parents, where demographers designated them the "Baby Boom-erang!"

A Nation At Risk appeared exactly half-way through this quarter-century of economic decline. The message promoted by the Report – that America’s schools were being engulfed by a "rising tide of mediocrity" – was intended to be a "wake-up call;" a warning that, in order for us to prosper in the incipient high-tech economy, the quality of our public schools and the rigor of their curriculum would have to be substantially enhanced. Today, this view seems prescient – even self-evident. But back in 1983, the degradation of U.S. public education described in A Nation At Risk was seen by many observers as the natural concomitant of industrial America’s decline and transition to a service-based economy. In this widely held view, there was no point to investing in education; millions of us were already over-educated! The mass-prosperity of the industrial era was behind us; ahead of us lay the mass-mediocrity of service economics, and no amount of educational reform could change that.

This dystopian view of our post-industrial future, fueled by alarmist books like The Jobless Future (Aronowitz and DiFazio - 1995) and The End of Work (Rifkin - 1994), has gained considerable currency over the past decade, and was at the heart of the protest demonstrations at the World Trade Organization in Seattle last December. And, in truth, for most of the past 20 years, the average wage of all newly-created jobs has been lower than the average wage of the jobs that have been eliminated. What’s more, the resulting diminution in national prosperity provoked a taxpayers’ revolt that curtailed the flow of revenue to the public sector in general, and to education in particular, at the very moment when new technology, aging facilities, and swelling numbers of immigrant children and Baby Boomer offspring began to place growing fiscal demands upon public schools.

Former Labor Secretary Robert Reich has observed that this period of economic retrenchment gave rise to an American "age of anxiety." As income fell and both public and private debt soared, we became much less hopeful about the future. By 1990, public optimism in the U.S. had fallen to 20-year lows; three-fourths of American adults surveyed said they believed that their children would lead less prosperous lives than they (the parents) had. National opinion polls during the late 1980’s and the early 1990’s showed that top public concerns included: the economy, job security, crime, health care costs, taxes, AIDS, drugs, Social Security and immigration, but "education" seldom appeared in the top five .... until the mid-1990’s.

A Rising Tide Lifts Our Hopes

In 1996, almost overnight, "education" became the number one concern of U.S. voters for the first time in over thirty years. It remains so today. This rapid re-ordering of public priorities coincided with dramatic rises in average U.S. wages, plus concurrent declines in unemployment, poverty and inflation. All of this good news, not surprisingly, has boosted public morale; consumer optimism today is at its highest in 30-plus years, and three-fourths of Americans believe today’s children will be more prosperous than their parents. More importantly, the U.S. electorate once again believes that education is the key to future economic success – both for individuals and for the nation as a whole.

The principal source of our renewed bounty and optimism is our rapidly-maturing information technology. Economic historian Joseph Schumpeter once described technologic revolutions as two-stage processes, in which the performance of existing economic institutions initially degrades as resources are shifted from proven mature technologies to powerful-but-costly, unreliable, and counter-productive immature technologies. Historically, this largely "destructive" initial period of a technologic revolution is followed by a "creative" period, during which the superior processes and products made possible by the newly-matured technology generate a rising tide of general prosperity that lifts almost everybody’s proverbial "boat."

Both Labor Department and Commerce Department measures of recent U.S. socio-economic performance present compelling testimony that America passed from the "destructive" to the "creative phase" of the "Information Revolution" over a 30-month period between late 1992 and early 1995, as productivity, profits and pay all began to rise at rates not seen in 25 years, while inflation fell.

At current rates of productivity improvement – which are roughly the same as those that America sustained throughout the 1950’s and 1960’s – the Labor Department projects that average U.S. household income will rise from $42,500 p.a. in 1997 to over $70,000 p.a. by 2020. But economic history – and current electronics industry forecasts – strongly suggest that, as our principal institutions assimilate the next generation of info-com technologies into their mainstream operations, national productivity improvement rates are likely to double again over the next 5 to 7 years, with further corresponding increases in general prosperity....and potentially rapacious impacts on existing production and distribution systems.

New Formulae for Success.....

Historically, seven-eighths of a new technology’s productive impact occur only as the technology becomes cheap, facile, robust and ubiquitous. The good news is that information technology (IT) will solidly achieve those benchmarks over the next five years. The somewhat more problematic news is that a matured technology’s principal benefits arise not from improving the performance of existing systems, but from making possible distinctly superior alternative means for performing essential social and economic functions. Corporate America has now begun to comprehend this truth as a result of twenty years of marketplace experimentation with information technology. Research conducted by Ernst & Young for the U.S. Labor Department has shown that company performances benefit most when employers "successfully integrate innovations in management and technology with appropriate employee training and ‘empowerment’programs."

The basic elements of these synergistic technical, managerial and structural initiatives are increasingly well-understood in most U.S. professions and trades. They are publicized and promoted by trade associations and professional societies. The U.S. Labor Department’s annual sectoral surveys of industrial productivity now finds that these innovations have become formulaic – even paradigmatic – and are expected by managers across many industries to sustain increased productivity improvement rates for years to come.

If we have, in fact, entered the "creative" phase of Schumpeter’s "wave of creative destruction," then we have also arrived at the transformational moment of the Information Revolution. This suggests that the turbulating innovations and expedient adaptations of the past 5 years have merely been the overture to a 20-year opera of organizational re-invention, marketplace realignment and paradigmatic change for every public and private institution, including education. But, at this critical moment of institutional re-invention, educators are at two serious disadvantages to almost every other major component of the American national enterprise.

.....vs., No Formulae for Success

To begin with, the U.S. industries and institutions that have forged new models of management and organization were subjected to powerful marketplace pressures to innovate, plus political incentives – e.g. supply-side tax policies – and legislative intervention – e.g. deregulation – over the past twenty years. By comparison, education has – by its circumstances – been largely insulated from the necessity to innovate, and largely deprived – by resource constraints – of the capacity to innovate. While this means that teachers, students, school administrators and communities throughout the country have been spared billions of dollars and hours wasted on immature, dead end instructional technologies and faddish re-engineering/restructuring schemes over the past two decades, it also means that, as America enters the transformational moment of the Information Revolution, there are few successful role models or consensus scenarios for how the nation’s industrial-era educational institutions may transform themselves to make productive use of mature information technologies.

Moreover, not only do the leaders of educational reform not have a widely accepted repertoire of successful reforms – and reformers – to turn to at this revolutionary moment, there is not yet a consensus among educators that truly transformational change is necessary. Currently, in both K-12 and in the graduate schools of education, the dominant reform activity involves mandating stringent tests of student achievement and teacher competency. Educational testing first emerged as a tool of public policy as a part of the meritocracy movement of the 1940’s. It’s current resurgence, however, can be traced to the Goals 2000 initiative, and the common belief, expressed by U.S. presidents, governors and business leaders, that rigorous benchmark tests of student achievement are necessary in order to demonstrate that educators have enabled their students to meet the higher academic standards that have been adopted by thirty-one states since the early 1990’s.

These new standards, largely derived from the U.S. Secretary of Labor’s Commission on Achieving Necessary Skills (SCANS, 1990-1992), envision a 21st Century workplace in which a mastery of formal information-handling skills – e.g. literacy, numeracy, reasoning and articulation, etc. – will be required to participate in essentially any economic or social enterprise. And, while the anticipation of just such a future has shaped the rhetoric of national education reform from A Nation at Risk and Goals 2000 to the Success for Every Student movement of the 1990’s, actual reform initiatives have consistently failed to directly address the institutional and professional implications of actually delivering on those rhetorical objectives.

Specifically, while a growing body of pedagogical research tells us that at least one-half of all students do not learn effectively in a traditional classroom setting, almost all major reform efforts have focused on improving the performance of classroom-based schools. The current "standards and accountability" movement is the culmination of this twenty year sequence of largely ineffective initiatives, including the "back to basics" movement of the early 1980’s, through dress codes and school uniforms, site-based management, gender separation, reduced class size, and the restoration of corporal punishment, etc. Each of these "reforms," including the new "standards of learning," are attempts to enhance the performance of existing institutions by means of a single, system-wide intervention.

New Performance Specs for Public Schools

The student tests being adopted under the banner of the "standards" movement are generally tied to stringent consequences. Poor performance by individual students denies promotion in a growing number of states; collectively poor test scores can directly impact teacher and administrator pay and job security, and in extreme cases, has led to state seizure and operation of local schools and entire school systems. Conversely, most states also offer financial rewards for superior student performance, including substantial bloc grants to districts, schools, teachers and even individual students.

An expressed purpose of these standards-based systems of rewards and punishments is to promote student achievement by placing educators under some of the performance pressures of marketplace economics. The standards movement does not prescribe the means by which superior – and rewarding – performance is to be achieved other than by traditional classroom methods. Rather, proponents argue (recalling Aristotle), that since "necessity is the mother of invention," mandating higher test scores will ultimately serve as the "mother of re-invention" for America’s public schools.

This reasoning is not entirely disingenuous. Some teachers and administrators have reported that, to meet stringent new standards, they have adopted classroom practices and school-wide motivational programs that they would otherwise have been unlikely to undertake. But critics – including many educators who have successfully mobilized their students and teachers to meet the new benchmark standards – question the retained intellectual value of the kind of rote memorization encouraged by test-driven instruction. And parents of economically disadvantaged students complain that the new tests are simply one more barrier to educational success which money – e.g. tutoring, instructional software, parental time and attention, etc. – can overcome.

The foregoing issues are already fueling a national back-lash against benchmark testing. But the crucial flaw in the new standards – as a means of transforming existing schools – is that they establish minimum levels of academic achievement that most existing school systems – as currently structured and staffed – cannot plausibly hope to impart to one-third or more of their students. As any structural, electrical or bio-engineer will quickly caution, increasing the performance specifications for any system without enhancing its operational specifications will inevitably produce stress in individual system components, and ultimately increase rates of failure. Mounting test-related stress among pupils, parents and teachers has provoked spontaneous student boycotts around the nation, along with protest campaigns led by parents, students and academics that have successfully lobbied jurisdictions (Wisconsin, New York City, etc.) to defund, cancel or delay new benchmark testing programs.

In summary, the final nation-wide movement to reform America’s public schools has now engendered a counter-reformation that will predictably constrain the use of benchmark examinations and thus dissipate the power of rigorous standards of achievement, by themselves, to provoke transformational innovations in public education. But the fact remains that such innovations are needed, and not for the future, but right now! And now that the shortcomings of our educational performance are immediate and palpable instead of distant and rhetorical, the dynamic forces determining the speed and character of innovation will rapidly shift from the closed and grid-locked political arena of public monopolies that has governed U.S. education during the 20th Century to the open, free-market economic arena of supply and demand.

A Predatory Challenge

About a year ago, Arthur Levine, President of Columbia University’s Teachers College, met with Michael Milken, the once fallen junk bond king, who has recently turned education entrepreneur. "The message was, ‘You guys are in trouble, and we’re going to eat your lunch," Dr. Levine said in a New York Times article, recalling what he considered to be "not a direct threat, but a kind of predatory challenge."

Mr. Milken’s Knowledge Universe, an education conglomerate whose products and services are targeted at learners from pre-schoolers to high-tech corporate trainees, isn’t the only entrepreneur hoping to carve lucrative markets out of the $700 billion per annum that America spends on education and training. Christopher Whittle’s Edison Schools (which lost $50 million on revenues of $132 million last year, while running seventy-nine elementary or secondary schools in sixteen states) remain committed to using investors’ funds to manage the waste and inefficiency out of our public schools – which were originally created from the public largess and non-profit benevolence of our industrial era prosperity. In a November 4, 1999, interview in the New York Times, the President of EduVentures, a Boston investment firm, estimated that "roughly $6 billion has been invested in private education companies by venture capital firms and other investors."

Although $6 billion represents a great deal of money to the average Dean or School Superintendent, it’s less than 1% of America’s total annual expenditure on education. Last spring, Michael T. Moe, Director of global growth research at Merrill Lynch, drew the investment world’s attention to the remarkably small proportion of the nation’s second-largest industry that earns money for private investors. In The Book of Knowledge, Mr. Moe points out that, while education and training generate 10% of the U.S. gross domestic product, they account for less than two-tenths of one percent of the value of the domestic stock market. By comparison, the nation’s largest industry, healthcare, generates 14% of our GDP and accounts for a similar percentage of the value of our stock market.

In the eyes of investment capitalists, education and training represent "an enormous amount of untapped market value," although most do not relish the idea of directly taking on the actual operations of elementary and secondary schools as Whittle has done. Instead, investors expect to reap their initial rewards from providing contract services to public schools, and from providing – to both employers and employees – the skills required to stay employed and upwardly mobile. Corporate America has already learned how to cut costs and improve performance by retaining and mastering their core competitive competencies while outsourcing to specialists and experts those logistic, administrative and technical services at which others are more competent. This shift has now begun to occur at all levels of education, and will, over the next decade, move tens of billions of dollars of public school funds out of the grants economy of the public sector and into the commercial marketplace.

On the other hand, in the markets for post-secondary, adult and continuing career education, however, the venture capitalists envision that substantial profits will be derived by competing head-to-head with established educational institutions. Part of this optimism arises from predictable ongoing changes in the nation’s demographic make-up. Nearly half of all students in higher education today are over twenty-five years old, up from only 28% in 1970. Because the low birth rates of the 1980’s will keep the numbers of new, traditional (18- to 24-year old) students relatively flat for the next ten years, the share of older students will soar. Many of these will be seeking skills to permit career changes or re-employment. Many more will have their tuition paid by their employers, who, as Ernst and Young have found, no longer view worker training as a cost to be minimized, but as a means of maximizing return on their human resources.

Entrepreneurs believe that they will be able to use information technology and modern techniques of product design, marketing and management to reduce costs, accelerate learning, and deliver superior value for money in the adult education marketplace. Initial successes by the Apollo Group (parent of the University of Phoenix) and by DeVry Inc., ITT Education Services, Sylvan Learning Systems, General Physics and others, have produced handsome returns for investors and have created a "momentum on Wall Street," according to financial analysts.

Of course, the same technologies and instructional innovations that are being employed by upstart entrepreneurs are also available to educators within public schools and universities. The full array of truly productive K-12 educational innovations of the past twenty years have been compiled and reported in such synoptic publications as What Works in Education (published in 1998 by the Cambridge Center for Behavioral Studies) and A Handbook for Creating Smart Schools (published in 1996 by the National Center to Improve the Tools of Education at the University of Oregon). And, as has already been observed, the U.S. public once again has discretionary money to spend, and believes in the future value of education. If there were such a thing as an "ideal" moment for a major public institution to invent itself, now would be that moment for education in America.

Certainly, a number of teachers and professors will prosper hugely in the transformational decade ahead as designers and producers of virtual instructional programs and personas. Some established institutions – like Harcourt Publishing’s Harcourt University, which is scheduled to apply for accreditation from the New England Association of Schools and Colleges in February, 2000 – will prosper in the cyber marketplace as producer-distributors of branded educational tools and services. But most traditional educational institutions – and their faculties – do not yet appear to fully comprehend the enormity of the moment at hand.

In March, 1999, the North Central Association Commission on Institutions of Higher Education awarded accreditation to Jones International University, the first degree-granting institution devoted to entirely on-line learning. This immediately drew a letter of protest from the American Association of University Professors, expressing the Association’s "shock and dismay" at the Commission’s accreditation of an institution that employs mostly part-time faculty, who teach programmed curricula, and who put little emphasis on research or scholarship.

In her reply to the AAUP, the Chair of the North Central Commission, Margaret Lee, wrote that, "Jones is providing as high a quality of education as a lot of other places." Later, in a The New York Times article, Lee said, "To think you can limit learning to that old model – it’s just impossible," Lee said in an interview in, noting that it was "absolutely unlikely" that the fifteen-person Commission – which voted unanimously to certify Jones International – would reconsider its decision.

At the close of his November 4, 1999, interview with Edward Wyatt, also in The New York Times, Columbia University’s Dr. Levine offered this observation: "I don’t know whether these companies can do a better job of educating people, but they are the most aggressive and creative actors in higher education today. Some of them have show that they can make a profit. And that means that much of this industry is up for grabs."

Welcome to the revolution, everybody.



 ©2000 • David Pearce Snyder

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