TKW Consulting

ECONOMIST Arthur Rolnick has a tip for states: Forget spending public money on sports stadiums or incentives to attract companies. "I can get you a better return," he said.

The hot tip from this vice president at the Federal Reserve Bank of Minneapolis: preschool. Spend wisely, he argues, and the annual return on investment should be 16 percent, in part because preschool can help cut spending on remedial education and jail.

But states don't have to take Rolnick's word. They can judge by watching a preschool experiment being run by Rolnick and the Minnesota Early Learning Foundation.

Using public and private resources, the project's goal is to "empower Mom," in Rolnick's words, by providing mentors and money. Public health nurses will provide support and information to low-income pregnant women, with the goal of creating parent-consumers who will demand rich educational choices for their children. These families will also get scholarship money to spend on such programs. Rolnick argues that these choosy mothers with money will stimulate the marketplace to create more high-quality preschool programs.

Some 1,200 families will be part of the pilot program.

Such experiments are valuable because they provide evidence of how or how not to gird poor children for success. Children in the initiative will take that state's school readiness test. The entire program, which will start next year, will be independently assessed.

The effort could also produce innovations in how states pay for preschool. Once Minnesota sees what preschool can do, Rolnick says, the state should create a $1.5 billion endow ment using state, federal, and private money, so that programs for poor children will have a dedicated stream of funding. Benefits could include declines in infant mortality and low birth weights, as well as increases in children's cognitive and social skills.

States may not rush to set up billion-dollar preschool trust funds. But pieces of this experiment could be borrowed or adapted.

If the mentoring program works, its terms might be expanded to include help with careers, financial literacy, homeownership, or other issues that promote economic stability. And the scholarships proposal should offer insights into whether a free market driven by parental choices is enough to expand high-quality preschool, or if public-policy nudges are also needed. Judgments will be made over decades as states measure long-term outcomes.

But it pays to act now. Grooming infants and young children for success is a better investment than helping adolescents and adults compensate for weaknesses.

// posted by Tammy Wachter @ 4:01 PM