Your Economic Lesson of the Day

The solution is obvious. We desperately need another world war to straighten out the system.

Wow. Looks like this graph has almost a 1 to 1 correlation with collective bargaining rights.

All that education revenue loaded into the pockets of the uneducated and the union grifters.

I've seen better, but here is a timeline from Ohio that tells a similar story to the other stats I have seen in the past.

http://www.changinggears.info/wp-content/uploads/2011/03/timeline-3.jpg

Oh, I forgot to mention effing lawyers didn't I?

http://i188.photobucket.com/albums/z167/liberalamerican/unfairlaborpractices.jpg

Cap'n Capital, the proper title 'round these parts is "It's Probably Nothing".

My apologies. Duly noted.

Doubling the money spent on education would have minimal effect on quality of output, single digit percentage change at best. Halving the funding would probably have the same but opposite minimal effect. Would the world be a poorer place if the functionally illiterate high school grads suddenly became functionally illiterate grade 8 grads?

Cappy, I don't think that chart really does much to demonstrate a relationship between education spending and GDP at all. Correlation does not imply causation.

I'd suggest that it is better representation of the structural change in the economy, with the huge decline in manufacturing jobs, for which the education system did, at least to some extent, prepare young people to take.

I'm pretty much in agreement with the rest of your rant, but I question whether this chart really supports it.

Seems like the graph accurately charts the conversion of public education into public indoctrination.

gordinkneehill - nope, I look at it the opposite way. The percentage of 18-25 year olds who are available for things like post-secondary drops sharply when large numbers are overseas fighting a war. The more people that get into post-secondary (or, more accurately, that don't want to leave school and earn a living yet) the less effect they have.

Point taken about a changing economy, but I dismiss that argument because it's not like services aren't accounted for in GDP. Education should result in increased efficiency, innovation and therefore increased GDP.

Additionally, another thing I just thought of, is how you have to spend more time in school before the labor force will accept you. This means more money for school, less time working, and thus the decreased ratio.

i appear to have graduated at the all time low , I figure I have held up more than my end and must have come out of school in a time of mega interpretive dance types. yes , I are an engineer

@ Cpt. Capitalism at June 1, 2012 12:57 PM
"Education should result in increased efficiency, innovation and therefore increased GDP."

It does in many countries where schooling is actually competetive. Where not every student is number 1/special and braiwashed on global warming, political correctness and the evils of actually working for a living. Where learning subjects are relevant rather than useless.
I know this is a subject you have taken to task on your own site but it's always worth repeating. By the time common sense comes back into our system it will probably be too late, but at least we tried to warn them.

If there were a world war, the cost of labor would defeat us before our enemies fire a shot.

In my view we do have the education required to increase production and efficiency, and we have done so. Despite this, we have not been able to offset the increasing cost of labor which increases production cost and therefore market price. As demand is inversely proportional with price the only logical solution is off-shore production. GNP is higher than GDP, but just slightly. Notice foreign companies build cars here in right to work states while design and financial offices reside in others.

Since we can't manufacture things here our labor force has continually shifted to service industries since WWII.
http://i242.photobucket.com/albums/ff90/AvaBrendan/mfgvsservicejobs.png

Presently a service call to repair a cheaply built over-priced heat pump (made in USA)starts with a $100.00 for showing up and the recommendation for replacement. (I researched the problem and replaced a capacitor)

We're doomed.

@ Posted by: ∞ ≠ ø at June 2, 2012 1:20 AM
"If there were a world war, the cost of labor would defeat us before our enemies fire a shot."

Under the war measures act, the government can suspend all union contracts and impose whatever wages it sees fit. It can also ration whatever necessary for the greater good, impose working days/hours and suspend democratic freedoms to some degree. Total control. (Bloomberg would love it).

@ peterj
Very interesting. I had not considered that regarding your original comment.

One thing to consider is that an inability to engage in sustained conventional war, on many fronts, leads to a heightened probability of nuclear conflict, a similarly sobering thought.

Population reduction, or a fascist America, may well be closer than I had anticipated. Dangerous times indeed.

@ ∞ ≠ ø

Absolutely right. History shows almost all major recessions are followed by war.