Editorial: Richer Because We're Smarter

By Steve Tuttle

It was not some hype-happy local paper but the eminently respectable British magazine The Economist which concluded recently that the Southeast has been the “locomotive powering the American economy” during the nation's longest and strongest economic expansion in history. Such a conclusion, reached by eminent economists from the dispassionate distance of a few thousand miles, should have received more attention in the national media. But because this is the South, after all, it didn't.

Now the Southern Regional Education Board (SREB) has analyzed a host of statistics in the 16-state region and produced a report which demonstrates that The Economist, if anything, understated its conclusion. The SREB found, among other things, that between 1988 and 1998 about 9.4 million new jobs –– more than half of all the new jobs in the United States — were created in the Southeast. In North Carolina alone, 804,000 new jobs were created in that 10-year span, a 27 percent growth in employment.

A principle reason the Southeast has garnered all those jobs is because Southerners became better educated. From 1986 to 1996, the Southeast, which is home to barely a third of all American colleges, accounted for 55 percent of the nation's total increase in college enrollment, the SREB found. College enrollment grew 12 percent in the nation in that span, by 16 percent in North Carolina and by 24 percent in the region. North Carolina's population now has a greater percentage of college graduates than high school graduates in 1940.

But if it's now a given that the South is a far wealthier, more educated place than most people give it credit for, there are some warning signs, particularly in the affordability of higher education. In the region over the past decade, state tax funds supporting higher education, adjusted for inflation, have grown only by about $70 per student. And in North Carolina, as in most states, the percentage of state taxes going to higher education actually has declined — from 18.8 percent of the budget in 1986-87 to 14.6 percent in 1996-97.

Colleges are making up the difference by raising tuition and fees. Tuition accounted for 10 percent of colleges' income in North Carolina in 1985-86; it's 15 percent now and climbing. Twenty years ago, a year at a public four-year college cost the equivalent of 13 percent of an average family's income. It now takes 17 percent of that family's income.

Education is the goose that laid the Southeast's golden egg. We shouldn't be starving that goose.