OP-ED: The (Everett, WA) Herald, September 18, 2004

How Investing in Education Pays Off

By DICK STARTZ, UW Economics Professor

This November we vote on Initiative 884, which would raise the sales tax by a penny on the dollar to provide more funds for education. We'll be hearing many arguments pro and con as the election approaches. Most of the arguments center on helping kids versus overburdening taxpayers.

Too often we don't talk about ways that education has direct value to taxpayers (on top of what our children get.). One particular argument hasn't gotten nearly enough attention: schooling cuts crime. And the crime-cutting value of education is large enough that it deserves our attention.

* A one percentage point increase in high school graduation rates reduces murder and assaults by about 2 percent.

The idea that more education makes our community a nicer place to live approaches a cliché. What is less well articulated is what "nicer" means. Chopping back crime fits my definition. Perhaps it's not the most high-minded thought, but I'm willing to pay taxes to not get knocked over the head on a dark night.

* A one percentage point increase in high school graduation rates reduces car theft by about 1.3 percent.

Few of us will ever get closer to a murder case than reading about it in the newspaper. Car theft, especially in Washington, is much more likely to strike close to home. Better my money goes for education than for a steering wheel club.

* A one percentage point increase in high school graduation rates nationwide would save victims and state and federal governments as much as $1.4 billion a year.

Two economists, Lance Lochner and Enrico Moretti, put together the numbers I'm citing in a recent issue of the American Economic Review. The numbers are estimates—very careful estimates—based on data from across America.

You can probably think of a variety of reasons why people who choose to stay in school are already the kind of people who don't get involved in crime. This raises the question of whether the education/crime link is real or just a statistical coincidence. The researchers handled the potential coincidence issue very carefully. The evidence is that the link is real.

* Each extra high school graduate saves society $1,170-$2,100 per year in reduced costs of crime.

In putting together the dollar and cents benefits of increasing education to reduce crime, two factors were considered: the direct reduction in the cost to victims and the taxpayer savings from having to lock up fewer people. The bulk of the cost is the former, but incarceration isn't cheap. It costs more to lock up someone for a year than it does to pay a year's college tuition. When our legislators draw up a budget, they ought to remember that spending on education today cuts what we'll have to spend on public safety tomorrow.

* More education reduces black imprisonment rates even more than it reduces white imprisonment rates.

Education is particularly effective at reducing black crime, for reasons that are not understood. The gap between black and white education levels accounts for about one-fourth of the gap between black and white crime rates, without any consideration of the other societal factors that are typically different for blacks and whites. While the most important issue with crime is that there is too much of it, we also worry because the very high imprisonment rate of young black men is not good for society.

Should we be spending public money on education just in order to reduce crime? No, of course not. We spend money on education to benefit our kids and our neighbors' kids. But the dollar value of reduced crime is large, really large.

When we shortchange education, we really do all lose.

Dick Startz is Castor Professor of Economics and Davis Distinguished Scholar at the University of Washington.

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