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Fed economic analyst urges investment in kids
By JODIE TWEED

An investment in early childhood education programs yields, over time, a wealth of cost savings for society, a federal economic analyst said Thursday at Central Lakes College in Brainerd.

Rob Grunewald, an economic analyst with the Federal Reserve Bank in Minneapolis, said the investment also improves the chances for future success for a child.

The cost savings result from reduced crime, fewer tax dollars spent on special education, higher individual earnings, fewer welfare recipients and an improved quality of the work force.

Grunewald was the featured speaker at Thursday's Early Childhood Investment forum sponsored by the Rosenmeier Center for State and Local Government. Panelists were Brainerd Superintendent Jerry Walseth; Beth Swenson, district trainer for the Literacy Collaborative; and Brainerd Police Sgt. Troy Schreifels.

Grunewald said most early childhood programs appear at the bottom of economic development lists for state and local governments, which is a mistake. He said studies have found early childhood programs, including part-time preschools and full-time early child-care and education programs run by private and public organizations, are vital to a
community's economic development.

He said there is research that has shown the importance of brain development in young children and the impact of early childhood education on future academic success. Children living in poverty often enter kindergarten lacking fundamental reading or language skills and never catch up to their peers, ending up in lower-paying jobs or experiencing trouble with the law later in life.

An early childhood development program "can help close that gap," Grunewald said, referring to the gap between the advantaged and disadvantaged.

Grunewald cited four longitudinal studies that found there is an economic benefit to early childhood programs. The Perry Preschool study followed 123 low-income young children in Ypsilanti, Mich., to age 40. The children were given access to well-trained teachers in a quality preschool program while a control group was not enrolled in the program. The study found higher achievement scores, graduation rates and a reduction in needs for special education in the children who attended the preschool when compared to the control group, said Grunewald. By the time the group reached age 40, the former Perry preschoolers had higher rates of home ownership and their arrests/crime rates were half of those in the control group.

Grunewald said the $10,000 investment per child in the Perry Preschool study yielded a $17 to $1 benefit-to-cost ratio with an annual rate of return at about 18 percent. The public rate of return was 16 percent. In other words, for every dollar invested in early childhood education, It yielded a $16 return on the public's investment. Other studies found similar economic benefits in the case for an investment in early childhood education. One study found young children enrolled in an early childhood program were three times more likely to attend college compared to children who didn't attend a program

A program that provided home visits by registered nurses for at-risk mothers and their babies found it helped reduce the number of emergency room visits, the need for welfare and a decline in child arrests as those children grew up. This study found a $5 to $1 rate of return for society in the investment in the program.

Grunewald advocated the development of a government scholarship fund that would allow low-income families to afford quality early childhood development programs. A pilot study on such an endowment fund is being developed in the Twin Cities, he said.

Audience members asked panel members and Grunewald several questions relating to the importance of early childhood education. Walseth said an old saying goes, "It costs less to send people to Penn State than to the state pen."

For more information on early childhood research conducted by Grunewald and Art Rolnick, senior vice president and director of research for the Federal Reserve Bank, visit the Web site, www.minneapolisfed.org.