And you are right. BUT...the military is a targeted customer with a clearly defined need. Therefore the target for actual funding is easy to determine.
Society is much more complex. What measure will you apply to determine what fields are worth funding?
Before I went into engineering I was an astrophysicist. People used to argue that my type of research (supernovae) had no return on investment ever. And I had to (grudgingly) agree. Is a psychologist that researches ADD statistics in schools less valuable than a pharmaceutical engineer that produces Ritalin?
I think in the end it will be the market itself that forces the correction. Once you have an overabundance of B.A.s and there are no jobs except for McDonalds, the trend will go the other way. My area is currently the center of a housing boom and suddenly trades have been rediscovered by the local population. The same is true on a national and global scale.
posted on 07/17/2004 7:01:09 PM PDT
To: drtom; GSlob
LEt's take a look at Friedman's dilemma of investing in Human Capital in a non-slave state. After all, you can't buy a piece of a person.
I'll propose an idea, an original idea that I just dawned on me: Education Bonds! We'll call them "EduBonds".
How they will work is that government will issue bonds for investing in a certain educational field. The government will give a defined dividend (we'll say 3% annual) on each type (engineering, computer science, literature, psychology, etc.). If the market feels that a particular field is needed more than others, investors will bid up the value of that bond, thereby increasing it's value. This will accurately reflect the supply and demand of certain professions in the private sector. If a private-sector investor feels that a certain profession will be in strong demand in the future, he can "buy into it" before it goes up in the future. The only money the government would pay is the dividend. Since the dividend rate is the same across all professions (3% in this scenario), but the price of the bond is not (it fluctuates based on private-sector demand), the government will end up paying for education based directly on what the private-sector is demanding!!!
Under this scenario, the government is not distorting what the private sector needs, but merely following the market's needs.
I really think I'm on to something. Can you help me work on it?
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