Here's some from the piece I wrote following up the talk by Art Rolnick of the Federal reserve bank at a Rochester luncheon Tuesday.
I may have more – additional detail that I did not have space for in print - from this to put up soon.
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What is the best investment businesses and communities can make for the future with the greatest return?
That’s the question that Art Rolnick, a senior vice president and director of research at the Federal Reserve Bank set out to answer before a crowd of about 150 local leaders at a luncheon Tuesday sponsored by the Rochester Area Foundation’s First Steps early children development program.
Bidding or luring companies from other states or nearby cities to bring their jobs and money to your community is absolutely the wrong way to approach economic development, he said. That doesn’t create anything.“The right way to do it is to invest in human capital,” Rolnick said.
And that investment needs to start early, when people are young, from the womb to five years old.
An investment in quality early childhood education from the womb to five years old averages out an annual inflation-adjusted return of 16 percent, he said, pointing out that the only people promising returns like that lately have been involved with Ponzi scams.
“Most of that (16 percent) return is a public return,” Rolnick said.
Rolnick began looking at that issue “through an economic lens.”
What they saw was compelling. Studies show children in at-risk families who receive quality early childhood education to prepare for kindergarten are 50 percent less likely to commit a crime than their peers who did not receive that preparation. It also shows positive effects for the children’s health and for spurring their parents to better themselves with education.
While those benefits are documented through multiple studies, 50 percent of Minnesota children fail a kindergarten readiness assessment.
Rolnick’s analysis determined for an investment in children and families preparing for kindergarten to be effective it needs to accomplish these things:
• Start with at-risk families.• Engage parents.• Offer high quality services.• Start early.
• Make it measurable.
• Be able to bring it to scale.
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