The fallacy that education drives economic success

One of the great fallacies of the last 30 years or so is that by educating the population economic success is guaranteed.

In Australia, Opposition leader Kevin Rudd has been pushing this wheelbarrow for all it's worth. In a recent speech he revisits the failed Labor Knowledge Nation policy:

Labor leader Kevin Rudd says his party has a "galvanising vision" to make Australia the best-educated nation in the world.

"For us education has always been the engine room of equity as well as being the engine room of the economy," he told the annual Mick Young Scholarship Trust race day at Royal Randwick in Sydney.

Here just a few nations over the last 50 years that had a strong focus on educating all of the population to a high standard.

Soviet Union
China
Cuba
North Korea

In spite of their undeniably high education levels, which saw the Soviet Union churn out heaps of talented engineers and scientists they were economic pygmies with an immiserised population. The fault, of course, was that socialism is not an economic system in which creativity and innovation have much room to flourish and so all of that good education is for nought.

Equally, in China the people's education generally went to waste until the economic shackles were released and its educated workforce was able to take advantage of the new opportunities presented to it. A very similar thing happened in India, which threw off the shackles of socialism, embraced free market economics and is now a global IT powerhouse.

Former prime ministers Gough Whitlam and Bob Hawke were among several Labor figures who attended the event, which is a major fundraiser for the trust.

Mr Hawke made a speech that criticised Prime Minister John Howard's government for failing to invest in education, saying is was the sole reason for the current skills shortage.

He said it was not industrial relations, but a lack of education funding that was standing in the way of economic growth.

And he said Mr Rudd understood that.

Australia has had its share of post-War economic ups and downs with the nadir being during the turbulent Whitlam period and again during the Keating era with the 'recession we had to have'.

In each of those periods the education levels of Australians didn't change from the prosperous years preceding the decline through to the recovery afterwards.

Clearly, if Australia is going to maintain its position in the top bracket of nations in the medium to long term then its population needs to be highly educated to deal with an increasingly knowledge based world economy. If education were all that mattered then wouldn't North Korea's future be assured?

"Let's take the talent and enthusiasm and the initiative of this great Australian people and turbocharge it into the future by making sure we are the best educated country and economy and society in the world," Mr Rudd said.

I don't know anybody who would disagree with the sentiment he expresses. Given that the education unions and bureaucracies have turned Australia's education system into an international embarrassment is Kevin Rudd saying that he intends to solve the issue by breaking the power of the education establishment and introduce, for example, school vouchers?

An educated workforce is like an engine in a motor car. If you don't have a sound chassis to run it in then you're not going to get the results you seek. It seems that many on the left are yet to grasp this concept.