The current economy resembles the Whac-A-Mole game I played at
arcades as a kid. As economic pain cascades throughout all sectors of
the economy, the highest remaining mole gets whacked. The managers,
professionals, financial experts, lawyers, and doctors of the Bay Area
are now taking their turns as the mole.
For this group, the beginning of this century seemed like the “end
of history.” As they grew financially comfortable, many thought they
had reached a pinnacle where they had enough money to live large. Many
were able to forsake the public schools for expensive private schools.
But a “new normal” is setting in. Housing prices of the moderately
wealthy are now taking the hits that mirror or exceed those in the
poorer areas of the East Bay. They have lost more money in the
financial markets than their fellow citizens below them on the economic
ladder. And they are not well-connected enough to benefit from Treasury
Secretary Timothy Geithner’s largesse to his Wall Street cronies.
This is one of the unintended consequences of the current recession.
It is tending to push those who didn’t need to pay daily attention to
their finances back down with the masses — not to the level of
the “masses yearning to be free,” to be sure, but to the level of
financial stress experienced by most. Hello, checkbook balancing.
Unemployment is hitting this group hard, with rates for college
graduates doubling in the last year. While the distressed economy hurts
the poor disproportionally, this recession has a greater white-collar
flavor than most.
But this process does have a silver lining, reminding everyone that
just because you rose a little, you are not that different from people
with fewer financial resources. The result could boost California’s
educational system. Parents who could afford private schools will be
forced to return to public schools. California’s kids may be better off
for it.
As we all know, California’s school system is a mess. Surveys now
rank California’s schools at or below the level of those in the
southern states. Proposition 13 has destroyed the educational
infrastructure of what had been one of the country’s best state school
systems, if not the best. With pink slips recently handed out to 27,000
California educators, things are certainly going to get worse, no
matter how voters handle the propositions on the May 19 ballot.
One of the reasons California let its schools go into disrepair is
because more and more people could afford to send their kids to private
schools. The children of managers, lawyers, accountants, doctors, and
others did not have to worry about California’s deteriorating schools.
While many of these folks, especially in the East Bay, continued to
support public schools, this was not their problem. There were no evil
motives to their actions. (And, a disclaimer here, my kids spent their
high school years in private schools.) But when your kids go to private
schools, the public schools don’t feel like your concern, right or
wrong. Without this focus, our wealthier citizens have been able to
direct their energies elsewhere.
The cost of secular private school education is stratospheric. In
the East Bay, consider Head-Royce School, where kids can get a great
education in a diverse atmosphere. Current tuition is $19,500 a year
for kindergarten through 5th grade, $21,600 for 6th through 8th grade,
and $27,000 for 9th through 12th. Assuming your kid is lucky enough to
get in, you will pay more than $270,000 — just for tuition
— to get him or her through the 12th grade. Head-Royce does offer
scholarships, and its web site boasts that one quarter of its students
receive some form of aid. But what if you have more than one kid? For
the average upper-middle-class East Bay resident, these concerns
matter.
Slowly but surely, this group may conclude that they have to send
their kids to public schools. What was once a doable investment is
going to become impossible. The New York Times recently
described this phenomenon in a story entitled “The Sudden Charm of
Public Schools.” Panicked parents, many of whom are underwater in their
real estate, now realize that the economics of private school simply
don’t work for them.
Of course, when talking about schools, there are exceptions to every
rule. In many communities, parents do get involved, such as in Fremont
during the fight over high-school boundaries. (And the small schools
movement in Berkeley certainly has folks aroused.) Fights over schools
are sure to grow, no matter what happens in Sacramento. We will likely
see more efforts to enact parcel taxes, which will not be easy to pass
these days, since they require a two-thirds majority of the voters. To
be successful you must get nearly everyone on board — other than
those who vote against any tax, anywhere. Orinda passed a parcel tax
last month, but the measure passed in Alameda last year remains
entangled in litigation.
The ramifications of this leavening process are more important than
they may at first appear. A recent study in Science magazine,
highlighted by Peter Singer in his book The Life You Can Save,
found that people become less altruistic when money is involved. In
their study, the authors wrote, “money enhanced individualism but
diminished communal motivations, an effect that is still apparent in
people’s responses today.” Certainly that has been the case when
wealthy parents can buy their way out of public schools.
When thinking about education, we are all in this together —
like it or not. Those who thought they had risen to a place where they
no longer had a personal stake in the state of society are being
brought to Earth. The Whac-A-Mole economy is seeing to that.
