The Saeculum Decoded
A Blog by Neil Howe
May 072010

I have a lot of respect for Ronald Lee.  He’s a big-name demographer/economist.  But I just can’t fathom how he can arrive at his conclusions because the differences in the magnitude of spending are so large.  This year, all levels of government spent around $150 billion on higher ed—but around $1.2 trillion on transfers to the elderly.  Keep in mind too that all generations are taxed to support higher ed, and that higher ed has current benefits (discoveries, R&D) benefitting all generations, whereas the majority of the transfers to elderly go strictly from younger people’s payrolls and pay exclusively for the personal consumption of the elderly.  If he includes all levels of education, the quantitative comparison is less lopsided, of course, but then I find it harder to interpret his comment about the earliest generations who “did not receive public eduction.”  And I’d like to know how he deals with the interesting question of how to calculate the enormous implicit subsidy K-12 education received in the early decades when talented women had few other places to work, and thus could be hired by schools at very low salaries.  Up until the 1970s, you could say, adult women were collectively “taxed” for the collective benefit of children.

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