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Human Capital over Infrastructure

Statistics Canada has recently released a report (http://www.statcan.ca/english/freepub/81-004-XIE/2004006/litearn.htm) that just backs up what I’ve been saying for a long time. Investing in human capital, that is, investing in improving the knowledge, skill-sets, and education of the populace, is far more beneficial for the economy as a whole than investing in physical capital, which is things like machinery and equipment. Or as I like to say it, building universities isn’t building an education.

In fact, the report says that an investment in human capital is “three times as important to economic growth over the long run as investment in physical capital,” and also says that it isn’t just the percentage of people with high literacy skills that matter. The report indicates that the average skill level is a far better indicator of future growth. Or in other words, we need to make sure to bring up the people who are at the bottom.

Of course, while Canada has a department of Infrastructure (http://www.infrastructure.gc.ca/), there’s no corresponding department for education. No, education falls under the department of Human Resources and Skills Development (http://www.hrsdc.gc.ca/). The same department that handles Employment Insurance, the Homelessness initiative, and Aboriginal relations.

Given the difficulties with Employment Insurance over the past few years, I think it’s safe to say that our education, and hence our economic growth, might not be in the best of hands.

Maybe it’s time concerned citizens started writing to the federal government about this to let them know what their own statistics department is saying with respect to education. It’s time the federal government created a department to just concentrate on education, the way they have one that concentrates on infrastructure. After all, if human capital is three times as important, it stands to reason that such a department is three times the investment.

Ontario Roasts Federal Government over Budget

In a bit of a strange twist, the harshest words (http://ogov.newswire.ca/ontario/GPOE/2005/02/23/c7872.html?lmatch=&lang=_e.html) for the recently released liberal federal budget come not from the conservative west, but rather from the liberal province of Ontario, the province most typically thought of as the home of the liberal party, at least out here in Alberta

The Ontario Finance Minister, Greg Sorbara, has taken the federal government to task for a budget that “does not address key Ontario priorities such as spending on post-secondary education …”

Before being too proud, however, it should be remembered that this is also the province where the government took the Rae report, and pulled from it the idea that universities should be given more lee-way in setting their own tuition, while completely ignoring the portion that specifically said tuition should not be allowed to rise until there had been a significant overhaul of student finance and grants for low income students put in place.

On the bright side, if enough pressure can be put on the federal government to make them change, it might make it easier for the provincial governments to do their part as well.

Alberta Takes another Look at Post-Secondary

Finally, after several years of surplus budgets, Premier Klein is looking at the idea of starting to help the post-secondary system back up from the brutal knee-capping he gave it several terms ago. The province has announced (http://www.gov.ab.ca/acn/200503/1765834EA1BA9-22D0-456C-AF16EF9EAD63C2F5.html) the creation of a three billion dollar endowment fund to support post-secondary education. When fully funded it will provide(http://www.gov.ab.ca/home/index.cfm?page=1016) 135 million per year, devoted strictly to post-secondary education. In addition to this, 1.5 billion will be used to expand current endowments and scholarships.

In the most recent throne speech, the government promised to “develop Canada’s most innovative, entrepreneurial and affordable tuition policy by the start of the 2006 school year.” I have to wonder what is meant by an “entrepreneurial” tuition policy, however. Is that another word for more of the same idea of people putting aside money for when they can to take education later? The same idea that ignores that the people who would most benefit from a post-secondary education are often those forced to live from pay-cheque to pay-cheque and who have no money to save?

Well, we can hope not.

In fact, for those at Athabasca University, the hope may be a little brighter even, as one of the ideas delivered in the throne speech is to “explore increased use of alternate delivery training mechanisms, such as distance learning and mobile delivery.” Finally, it seems AU’s model is becoming important enough to be explored for increased use. With luck, that might translate into more dollars to encourage that use by lowering tuition, or at the very least, keeping AU from raising it by the maximum legally allowable.

It’s not perfect, but it’s a start.

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