Philip Greenspun’s Weblog

If you live in Boston and/or are interested in commercial diving or big engineering projects, Trapped Under the Sea: One Engineering Marvel, Five Men, and a Disaster Ten Miles Into the Darkness is a great book.

Neil Swidey describes events from the late 1990s that were critical to completing the Boston Harbor clean-up project. Treated wastewater would travel from the Deer Island sewage plant through a 10-mile-long tunnel underneath the Massachusetts Bay and then rise up to be discharged at the seafloor, about 100 feet underwater. So that people building the tunnel wouldn’t be at risk of flooding, the riser tubes were plugged at the seafloor. These plugs could then be removed when the project was complete. What if a big ship dragged its anchor 10 miles out into the bay? The tubes were also plugged at the bottom, 10 miles into the tunnel. Kiewit, the contractor building the tunnel, wanted to pull the lower plugs while the tunnel was still lit and ventilated, then patrol the bay to keep ships clear while the lighting and ventilation were removed. They noted that it had been about 10 years since the top plugs were installed and no ship had dislodged one. The government authority managing the project disagreed, despite the fact that it would be a violation of OSHA regulations for workers to be in the tunnel without ventilation:

The irony is that each side claimed worker safety was its primary concern. Corkum, writing on behalf of Kaiser and the MWRA, said it would be unwise to endanger the lives of up to a hundred sandhogs by leaving the tunnel vulnerable to a possible flood during the long cleanup period. Kiewit, meanwhile, said it would be insane to put a small number of workers at extreme risk by sending them into a tunnel that had no air or light, all in the name of protecting a larger group of workers from an exceedingly small risk. By waiting until the end to pull the plugs, the Kiewit manager wrote, “the risk of catastrophe would be exponentially higher!” In frustration, Kiewit enlisted a former OSHA inspector named Fred Anderson as a consultant. In his report, Anderson stressed that the stakes were “enormous in terms of both money and political necessity.” By insisting on installing backup plugs without a clear understanding of how they would be removed, the parties involved in the project had painted themselves into a corner, he wrote. But the tunnel would not be viable if they couldn’t figure out a safe way to yank out the plugs. “They must come out!” After reading the contract closely, Anderson noted, it was clear that the people who wrote the specs intended for the plugs to be removed by a crew “dependent on self-contained breathing apparatus in an unknown and uncontrollable environment.” He stressed, “To me, this is a scary prospect.” He warned that the hazardous assignment could cost lives. And if workers died, regulatory agencies would likely shut down the tunnel, adding further delays. Anderson strongly advised Kiewit to stand firm and insist on pulling the plugs before removing the ventilation, lighting, and rail systems. Asking workers to venture nearly ten miles into a dark, unventilated tunnel hundreds of feet below the ocean, he said, would be sentencing them to “an operation somewhat akin to a spacewalk.

The technical explanations in the book are pretty good, e.g., why wouldn’t there be plenty of oxygen in a tunnel that was in fact open on one side?

Even though the ventilation line no longer extended past the four-mile mark, the divers found that oxygen levels were sufficient to sustain human life well beyond that point. But they knew that by the time the tunnel cleanup had been completed and the actual plug-removal mission had begun, those oxygen levels would be lower, for two reasons. First, the cleanup wouldn’t be considered complete until the entire bag line was yanked out. Second, the remaining oxygen at the end of the tunnel would essentially begin using itself up. In the dank, confined space of the tunnel, oxygen would be depleted by things like the growth of aerobic bacteria and the rusting of metals, such as bolts. There was also the very real possibility that oxygen would be displaced by highly toxic gases, such as carbon monoxide, methane, and hydrogen sulfide, which is produced when certain organisms decay.

The state government authority (MWRA) got its way and federal workers at OSHA blessed a plan to send commercial divers 10 miles into the tunnel with an experimental air supply based on mixing liquid gases. The government did not ask for any testing of the experimental air supply, but that doesn’t mean they waived other regulations:

The first day on the island was a blur of unloading and unpacking, after the divers went through the drug testing that the MWRA mandated of all workers on the job.

Predictably there were deaths, but few people cared.

[at a funeral] Hoss watched as Riggs stood to deliver a special reading. The reflection had actually been published as a letter to the editor in The Boston Globe two days after the accident. Written by a stranger named Parker Pettus, it contrasted the “lavish” wall-to-wall coverage of the death of John F. Kennedy, Jr., who had been granted a mariner’s funeral aboard a warship, with the “unadorned” news report about the deaths of Billy and Tim. These men were not rich or famous or privileged. Certainly they would have preferred not to have been in a dangerous tunnel hundreds of feet below the surface and miles from any help. They died while doing a hazardous, unheralded job, and their contribution to a clean, revived Boston Harbor will last for generations. They will not be immortalized in the media, they will not be buried at sea from the decks of a warship. These workers are the kind of heroes who are so often taken for granted. We would do well to think of Boston’s clear, blue, living harbor as a monument to the courage and sacrifice of the ordinary heroes who made it a reality.

More: Read the book

Next on my reading list: Bad Pharma: How Drug Companies Mislead Doctors and Harm Patients

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Perhaps you aren’t able to emigrate to Finland but you still want your children to get a good education. You aren’t willing to assume that a country (the U.S.) that has been running a mediocre public school system for 100 years is suddenly going to snap out of its football-induced stupor. Does Amanda Ripley’s The Smartest Kids in the World: And How They Got That Way offer any practical tips for what a conscientious parent might do? Yes.

How about joining the PTA?

PTA parents cared deeply about their children and went out of their way to participate in school functions. During the 1980s and 1990s, American parents and teachers had been bombarded by claims that children’s self-esteem needed to be protected from competition (and reality) in order for them to succeed. Despite a lack of evidence, the self-esteem movement took hold in the United States in a way that it did not in most of the world. So, it was understandable that PTA parents focused their energies on the nonacademic side of their children’s school. They dutifully sold cupcakes at the bake sales and helped coach the soccer teams. They doled out praise and trophies at a rate unmatched in other countries. They were their kids’ boosters, their number-one fans. These were the parents that Kim’s principal in Oklahoma praised as highly involved. And PTA parents certainly contributed to the school’s culture, budget, and sense of community. However, there was not much evidence that PTA parents helped their children become critical thinkers. In most of the countries where parents took the PISA survey, parents who participated in a PTA had teenagers who performed worse in reading.

By 2009, Schleicher and his colleagues had managed to convince thirteen countries and regions to include parents in the PISA. Five thousand of the students who took the PISA test brought home a special survey for their parents. The survey asked how they had raised their children and participated in their education, starting from when they were very young. Strange patterns emerged. For example, parents who volunteered in their kids’ extracurricular activities had children who performed worse in reading, on average, than parents who did not volunteer, even after controlling for other factors like socioeconomic background. Out of thirteen very different places, there were only two (Denmark and New Zealand) in which parental volunteering had any positive impact on scores at all, and it was small.

Giving your children lots of encouragement and praise?

In one Columbia University study, 85 percent of American parents surveyed said that they thought they needed to praise their children’s intelligence in order to assure them they were smart. However, the actual research on praise suggested the opposite was true. Praise that was vague, insincere, or excessive tended to discourage kids from working hard and trying new things. It had a toxic effect, the opposite of what parents intended. To work, praise had to be specific, authentic, and rare.

Knocking yourself out like Tiger Mom?

Korean parenting, by contrast, were coaches. Coach parents cared deeply about their children, too. Yet they spent less time attending school events and more time training their children at home: reading to them, quizzing them on their multiplication tables while they were cooking dinner, and pushing them to try harder. They saw education as one of their jobs. This kind of parenting was typical in much of Asia—and among Asian immigrant parents living in the United States. Contrary to the stereotype, it did not necessarily make children miserable. In fact, children raised in this way in the United States tended not only to do better in school but to actually enjoy reading and school more than their Caucasian peers enrolled in the same schools.

While American parents gave their kids placemats with numbers on them and called it a day, Asian parents taught their children to add before they could read. They did it systematically and directly, say, from six-thirty to seven each night, with a workbook—not organically, the way many American parents preferred their children to learn math. The coach parent did not necessarily have to earn a lot of money or be highly educated. Nor did a coach parent have to be Asian, needless to say. The research showed that European-American parents who acted more like coaches tended to raise smarter kids, too.

What if, due to a lifetime of living in America, you are too lazy to do that?

Parents who read to their children weekly or daily when they were young raised children who scored twenty-five points higher on PISA by the time they were fifteen years old. That was almost a full year of learning. More affluent parents were more likely to read to their children almost everywhere, but even among families within the same socioeconomic group, parents who read to their children tended to raise kids who scored fourteen points higher on PISA. By contrast, parents who regularly played with alphabet toys with their young children saw no such benefit.

And at least one high-impact form of parental involvement did not actually involve kids or schools at all: If parents simply read for pleasure at home on their own, their children were more likely to enjoy reading, too. That pattern held fast across very different countries and different levels of family income. Kids could see what parents valued, and it mattered more than what parents said.

By contrast, other parental efforts yielded big returns, the survey suggested. When children were young, parents who read to them every day or almost every day had kids who performed much better in reading, all around the world, by the time there were fifteen. It sounded like a public-service cliché: Read to your kids. Could it be that simple? Yes, it could, which was not to say that it was uninteresting. After all, what did reading to your kids mean? Done well, it meant teaching them about the world—sharing stories about faraway places, about smoking volcanoes and little boys who were sent to bed without dinner. It meant asking them questions about the book, questions that encouraged them to think for themselves. It meant sending a signal to kids about the importance of not just reading but of learning about all kinds of new things. As kids got older, the parental involvement that seemed to matter most was different but related. All over the world, parents who discussed movies, books, and current affairs with their kids had teenagers who performed better in reading. Here again, parents who engaged their kids in conversation about things larger than themselves were essentially teaching their kids to become thinking adults. Unlike volunteering in schools, those kinds of parental efforts delivered clear and convincing results, even across different countries and different income levels.

What if you’re too busy watching TV and playing Xbox to read? Can you be savvy about choosing your child’s school? Ripley has an entire appendix on the subject.

If you are trying to understand a school, you can ignore most of the information you are given. Open houses? Pretty much useless. Spending per student? Beyond a certain baseline level, money does not translate into quality in education anywhere. The smartest countries in the world spend less per pupil than the United States. Average class size? Not as important as most people think, except in the earliest years of schooling. In fact, the highest-performing countries typically have larger classes than the United States. The research shows that the quality of the teaching matters more than the size of the class. Test data? More helpful, but very hard to decipher in most places. How good is the test? How much value is the school adding beyond what kids are already learning at home? More and more U.S. school districts have this kind of information, but do not make it public. Instead, the best way to gauge the quality of a school is to spend time—even just twenty minutes—visiting classrooms while school is in session. When you get there, though, it’s important to know where to look. Parents tend to spend a lot of time staring at the bulletin boards in classrooms. Here is a better idea: Watch the students instead. Watch for signs that all the kids are paying attention, interested in what they are doing, and working hard. Don’t check for signs of order; sometimes learning happens in noisy places where the kids are working in groups without much input from the teacher. Some of the worst classrooms are quiet, tidy places that look, to adults, reassuringly calm. Remember that rigorous learning actually looks rigorous. If the kids are whizzing through a worksheet, that’s not learning. That’s filling out a form. Kids should be uncomfortable sometimes; that’s okay. They should not be frustrated or despairing; instead, they should be getting help when they need it, often from each other.

There should be a sense of urgency that you can feel.

I saw bored kids in every country. Boredom is the specter that haunts children from kindergarten to graduation on every continent. In American classrooms, I watched a girl draw a beautiful rose tattoo on her arm with a ballpoint pen; she did it slowly, meticulously, as though she were serving a life sentence.

In the best schools, though, boredom was the exception rather than the norm. You could walk into five classrooms and see just one or two students who had drifted away, mentally or physically, rather than eight or ten. That’s how you know that you are in a place of learning.

Don’t ask, “Do you like this teacher?” or “Do you like your school?”

The first thing I usually ask is straightforward: What are you doing right now? Why? You’d be amazed how many kids can answer the first question but not the second.

 

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Are you a rich American? Maybe you can buy your children a Finnish-style education by sending them to private school. Amanda Ripley explores this possibility in The Smartest Kids in the World: And How They Got That Way.

In 2011, I took a tour of a Washington, D.C., private school that was hard to get into and cost about $30,000 a year. Sunlight streamed through the skylights. As I walked down the hall, the sound of kids learning in different languages filtered out into the hallway. There were muffins in the principal’s office. It felt like a learning spa—a parent’s dream.

When the head of the school talked, nothing she said made sense to me. There was a lot of jargon about the curriculum and vague promises of wondrous field trips and holistic projects. All the visiting parents nodded;

Then a parent with three children at this school took us for a tour. We saw gleaming floors, bright, colorful walls, beautiful, framed art projects, and other seductive tokens. Finally, one visiting father asked a good question: “Every school has its weaknesses. What is this school’s weakness?” I lifted my head, straining to hear what our tour guide would say. “You know, I’d have to say the math program is weak.”

What did it mean if the math program was weak at a school that made small children take I.Q. tests before they were even accepted? That particular parent wrote a check each year for about $90,000 to this school to cover the tuition for her three children. Wouldn’t she demand decent math classes in exchange? But no one said anything.

Then the tour guide parent added one more thing: “Oh, and I wish the football program was stronger.” Suddenly, the parents perked up. “Really, what do you mean? Is there not a football team? What age does it start?”

Perhaps this explained why our most affluent kids scored eighteenth in math compared to affluent kids worldwide: Even wealthy American parents didn’t care about math as much as football.

Fortunately not every American private school has been ruined by football-crazed American parents:

At the Success Academy charter schools in New York City, students spend an hour and a half reading and discussing books each day. Then they spend another hour and a half writing. Kids start learning science every day in kindergarten. That’s what rigor looks like. In most New York City public schools, kids don’t learn science daily until middle school. That’s not all. Success Academy students also take music, art, and dance; they learn to play chess. They almost never skip recess, even in bad weather—a policy they share with Finland. They call their strategy “joyful rigor.” Does this work? All fourth graders at Success Academy schools are proficient in science, according to New York City’s test, and 95 percent perform at advanced levels. Success Academy Harlem I, where the mostly low-income students are randomly admitted by lottery, performs at the same level as gifted-and-talented schools across New York City.

At these schools, kindergarten teachers are forbidden from speaking to children in a singsong voice. It’s hard to respect children when you are talking down to them.

“It’s an insult to the scholars’ intelligence,” writes founder and CEO Eva Moskowitz and her co-author Arin Lavinia in their 2012 book, Mission Impossible. “What the teacher is saying should be so interesting that the kids are sitting on the edge of their seat, hanging on every word. It’s intellectual spark that holds and keeps their attention, not baby talk.” Parental involvement means something different at Success Academies; parents are not asked to bake cookies or sell gift wrap. Instead, they are asked to read to their kids six nights a week.

 

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Finland is the model for Amanda Ripley. In The Smartest Kids in the World: And How They Got That Way she celebrates the high performance of Korean schools, but notes that it comes at a terrible cost to parents and teenagers. We can learn a lot from Poland, but they are relatively new to the high-performance education world.

Ripley follows Kim, a student from Sallisaw, Oklahoma, to a small dark village in Finland.

During her three months in Finland, Kim had collected a small catalogue of differences between school here and in Oklahoma. The most obvious were the things that were missing. There were no high-tech, interactive white boards in her classroom. There was no police officer in the hallway. Over time, though, she had begun to notice more important distinctions—the kind that a visiting adult would not see. Take the stoner kid, as Kim had nicknamed him in her head. He’d walked into class that day looking hung over, with glassy eyes, as usual. He had short blonde hair, icy blue eyes, and a nose that was always a shade redder than the rest of his skin. He didn’t talk much in class, but when he was with his friends, smoking cigarettes outside, he was louder. Kim had seen plenty of kids like him in Sallisaw. Somehow, she hadn’t expected to see stoner kids in Finland. But there he was. Every country had its stoner kids, as it turned out. That was lesson one. There was only one major difference, as far as she could tell, and this was lesson two. The Finnish stoner kid was a model student. He showed up to class, and he was attentive. He took notes. When Stara assigned essays, which was often, he wrote them, just like everybody else. In Oklahoma, the stoner kids didn’t do much schoolwork, in Kim’s experience. They didn’t care. Here, all kids complained about school, too, and they had teachers they liked and disliked. Yet most of them seemed to have bought into the idea of education on some level.

After class, Kim had a free period—a full seventy minutes with nothing scheduled. This was the other big difference she’d noticed about Finland: the inexplicable stretches of luxurious freedom. She kept finding herself released into the ether, trusted to find her way through long stretches of time. She could even walk out of the school in the middle of the day and go to a coffee shop in the village until her next class began.

Parents in general seemed to trust their kids more. Kim routinely saw eight-year-olds walking to school alone, wearing reflective vests to keep them visible in the dark. At the high school, she rarely saw parents for any reason. Teenagers were treated more like adults. There were no regularly scheduled parent-teacher conferences. None. If teachers had a problem with the student, they usually just met with the student.

When Kim’s school day in Finland ended at three forty-five, it was already dark. Her classmates all headed off in different directions. A few boys in a garage band went off to practice; some of the girls went shopping. No one Kim knew went to afterschool tutoring academies. Finnish kids had more free time than American kids, and not just because they did less homework. They were also less likely to play sports or hold down jobs.

As one U.S. exchange student to Finland explained in the survey conducted for this book: “My Finnish school fostered a great deal of respect for the institution and faculty in the students. This can be partly explained by the academic rigors that teachers had to endure in their journeys to becoming educators. The students were well aware of how accomplished their teachers were.”

How does one get to be a teacher in Finland?

Finland’s landscape used to be littered with small teaching colleges of varying quality, just like in the United States. That helped explain why the first phase of reforms in Finland were painful, top-down, accountability-based measures. Finland, it turns out, had its own No Child Left Behind moment, one that today will sound familiar to teachers in the United States and many other countries. In the 1970s, Finnish teachers had to keep diaries recording what they taught each hour. National school inspectors made regular visits to make sure teachers were following an exhaustive, seven-hundred-page centralized curriculum. Central authorities approved textbooks. Teachers could not be trusted to make their own decisions. During the same time period, the Finnish government did something else, too—something that has never happened in the United States or most other countries. The Finns rebooted their teacher-training colleges, forcing them to become much more selective and rigorous. As part of a broader reform of higher education, the government shuttered the smaller schools and moved teacher preparation into the more respected universities. It was a bold reform, and not without controversy. Opponents argued that the new system was elitist and would, as one editorial warned, “block the road to our rural youth when their inner calling beckons them to a [teaching] career.” Some university leaders objected, too, fearing that the inclusion of such preprofessional, practical training might dilute academic standards for the rest of the departments and lower their institutions’ prestige. Interestingly, these same arguments were also made in the United States whenever anyone tried to make teacher training more selective.

When Kim was starting kindergarten in 2000, ten out of ten new Finnish teachers had graduated in the top third of their high school classes; only two out of ten American teachers had done so. Incredibly, at some U.S. colleges, students had to meet higher academic standards to play football than to become teachers.

Like Kim’s math teacher back in Oklahoma, Stara was a veteran teacher, approaching two decades in the profession. Both teachers had jobs that were protected by powerful unions, and neither could easily be dismissed. This pattern held true in most developed countries around the world: Teachers’ unions held a lot of power, and teachers rarely got fired anywhere. The similarities ended there. From the moment she had decided to study education in college, Stara had entered a profession completely different from that of Kim’s Oklahoma teacher. To become a teacher in Finland, Stara had had to first get accepted into one of only eight prestigious teacher-training universities. She had high test scores and good grades, but she knew the odds were still against her. She’d wanted to teach Finnish, so she’d applied to the Finnish department at the University of Jyväskylä. In addition to sending them her graduation-exam scores, she’d had to read four books selected by the university, then sit for a special Finnish literature exam. Then she’d waited: Only 20 percent of applicants were accepted.

At that time, all of Finland’s teacher-training colleges had similarly high standards, making them about as selective as Georgetown or the University of California, Berkeley in the United States. Today, Finland’s education programs are even more selective, on the order of MIT. It was hard to overstate the implications that cascaded from this one fact. Just one out of every twenty education schools was located at a highly selective institution in the United States. Far more than that had no admission standards at all. In other words, to educate our children, we invited anyone—no matter how poorly educated they were—to give it a try. The irony was revealing, a bit like recruiting flight instructors who had never successfully landed a plane, then wondering why so many planes were crashing. [emphasis added]

In Finland, all education schools were selective. Getting into a teacher-training program there was as prestigious as getting into medical school in the United States. The rigor started in the beginning, where it belonged, not years into a teacher’s career with complex evaluation schemes designed to weed out the worst performers, and destined to demoralize everyone else.

Is there something magic about Scandinavia? Apparently not.

Norway, for example, shares a border with Finland and spends more on education. But Norway is not choosy about who gets to become a teacher, and the quality of preparation varies wildly, just as it does in the United States. Norwegians have fretted about the quality of their teacher-training colleges for decades, and the government routinely interferes in the training to try to make it better. As in many countries, teachers are made to attain ever more amounts of training and education, without much regard for quality. Partly as a result, Norwegian fifteen-year-olds perform at about the same middling levels as teenagers in the United States on PISA, and even the most privileged among them perform poorly in math, compared to advantaged teenagers worldwide.

After you stock the schools with teachers who were good at school, do you need brilliant management techniques?

The Finns decided that the only way to get serious about education was to select highly educated teachers, the best and brightest of each generation, and train them rigorously. So, that’s what they did. It was a radically obvious strategy that few countries have attempted. Then, in the 1980s and 1990s, something magnificent happened. Finland evolved to an entirely new state, unrealized in almost any country in the world. It happened slowly, and partly by accident, but it explained more about Finland’s success than almost anything else. With the new, higher standards and more rigorous teacher training in place, Finland’s top-down, No-Child-Left-Behind-style mandates became unnecessary. More than that, they were a burden, preventing teachers and schools from reaching a higher level of excellence. So Finland began dismantling its most oppressive regulations, piece by piece, as if removing the scaffolding from a fine sculpture.

The government abolished school inspections. It didn’t need them anymore. Now that teachers had been carefully chosen and trained, they were trusted to help develop a national core curriculum, to run their own classrooms, and to choose their own textbooks. They were trained the way teachers should be trained and treated the way teachers should be treated.

By the time Kim got to Finland, teachers, principals, union leaders, and politicians routinely worked together to continually improve the education system. They sometimes disagreed, but collaboration was normal, and trust was high. The government conducted standardized testing of targeted samples of students—to make sure schools were performing. But there was no need to test all students, year after year.

Do you need cultural and economic homogeneity to achieve good results? (repeat of some of the same quotes from earlier posting on U.S. schools)

To find out how diversity changed the culture of rigor, I went to the Tiistilä school, just outside Helsinki, where a third of the kids were immigrants, many of them refugees. The school enrolled children aged six to thirteen. It was surrounded by concrete block apartment buildings that looked more communist than Nordic. In a second-floor classroom, Heikki Vuorinen stood before his sixth graders. Four were African; two wore headscarves. An Albanian boy from Kosovo sat near a Chinese boy. There was a smattering of white kids born in Finland. Vuorinen gave the class an assignment and stepped out to talk to me. Wearing a purple T-shirt, jeans, and small, rectangular glasses, Vuorinen proudly reported that he had kids from nine different countries that year, including China, Somalia, Russia, and Kosovo. Most had single parents. Beyond that, he was reluctant to speculate. “I don’t want to think about their backgrounds too much,” he said,

When pressed, he told me about one of his students in particular. She had six brothers and sisters; her father was a janitor and her mother took care of other people’s children. Money was very tight. But she was, he said, the top student in his class. Vuorinen was visibly uncomfortable labeling his students. “I don’t want to have too much empathy for them,” he explained, “because I have to teach. If I thought about all of this too much, I would give better marks to them for worse work. I’d think, ‘Oh, you poor kid. Oh, well,

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Part of The Smartest Kids in the World: And How They Got That Way by Amanda Ripley concerns big changes to the Polish schools.

And there he was, in Poland at last. Everything was more or less going according to his plan. The thing is: When Tom walked to the front of that classroom in Poland that day, he was carrying an American burden no one could see. Despite his Yo La Tengo T-shirt and his winter of Chekhov, Tom was in at least one way a prototypical American teenager. Tom was not good at math. He’d started to lose his way in middle school, as so many American kids did. It had happened gradually; first he hadn’t understood one lesson, and then another and another. He was too embarrassed to ask for help. He hadn’t wanted to admit that he wasn’t as smart as other kids. Then he’d gotten a zero on a pre-algebra quiz in eighth grade. In other classes, a bad grade could be overcome. But, in math, each lesson built on what happened before. No matter how hard he tried, he couldn’t seem to catch up. It felt like he was getting dumber, and it was humiliating. The next year, he got an F in math.

Note that this reminds me of the frustration expressed by a friend who quit a wonderfully well-paid job as a public school teacher to become a flight instructor and then commercial pilot of a $5 million aircraft (total compensation about half of a senior schoolteacher’s). He said that classes should be organized like a Latin American Spanish-language school for gringos in which people took a placement test every month and might move ahead or behind so as to ensure that they were always in an appropriate level.

Is this guy Tom from the lavishly funded Gettysburg, Pennsylvania high school an exception?

America’s math handicap afflicted even its most privileged kids, who were more privileged than the most advantaged kids in most other countries, including Poland. Our richest kids attended some of the most well-funded, high-tech schools in the world. Yet these kids, including the ones who went to private school, still ranked eighteenth in math compared to the richest kids in other countries. They scored lower than affluent kids in Slovenia and Hungary and tied with the most privileged kids in Portugal.

Our poorest kids did even worse, relatively speaking, coming in twenty-seventh compared to the poorest kids in other developed countries, far below the most disadvantaged kids in Estonia, Finland, Korea, Canada, and Poland, among many other nations.

How does math class work in Poland?

Back in America, Tom and all his classmates had used calculators. In his Polish math class, calculators were not allowed.

In Poland, the lowest grade was always one, and the highest was five. After each test, he waited to see if anyone would get a five; no one ever did. No one seemed surprised or shattered, either. They shouldered their book bags and moved on to the next class. Kids in Poland were used to failing, it seemed. The logic made sense. If the work was hard, routine failure was the only way to learn. “Success,” as Winston Churchill once said, “is going from failure to failure without losing your enthusiasm.”

There were no sports at Tom’s school in Poland. Sports simply did not figure into the school day; why would they? Plenty of kids played pick-up soccer or basketball games on their own after school, but there was no confusion about what school was for—or what mattered to kids’ life chances.

Did Poland have a deep tradition of pedagogical excellence? A Danish-style harmonious society with low poverty?

The defenders of America’s mediocre education system, the ones who blamed poverty and dysfunction for our problems, talked as if America had a monopoly on trouble. Perhaps they had never been to Poland. It is difficult to summarize the tumult that occurred in Poland in the space of a half century. After the fall of communism in 1989, hyperinflation took hold; grocery store shelves were empty, and mothers could not find milk for their children. The country seemed on the verge of chaos, if not civil war. Yet Poland tumbled through yet another transformation, throwing open its institutions to emerge as a free-market democracy. The citizens of Wrocław renamed their streets for a third time.

By 2010, when Tom arrived from Gettysburg, Pennsylvania, Poland had joined the European Union. The country still struggled with deprivation, crime, and pathology of all kinds, however. While Tom was there, the local soccer teams started playing in empty stadiums, silent but for the sounds of their feet kicking the ball. There’d been so much violence among the fans that they’d been banned from their own teams’ games. Nearly one in six Polish children lived in poverty, a rate approaching that of the United States, where one in five kids are poor. It is hard to compare relative levels of sadness, but the data suggested that poor children in Poland led jagged lives. In a United Nations comparison of children’s material well-being, Poland ranked dead last in the developed world. Like the United States, Poland was a big country where people distrusted the centralized government. Yet something remarkable had happened in Poland. It had managed to do what other countries could not. From 2000 to 2006, the average reading score of Polish fifteen-year-olds shot up twenty-nine points on the PISA exam. It was as if Polish kids had somehow packed almost three-quarters of a school year of extra learning into their brains. In less than a decade, they had gone from below average for the developed world to above. Over the same period, U.S. scores had remained flat.

Poland still had not joined the top tier of education superpowers. But, unlike the United States, it had dramatically improved its results in just a few years—despite crime, poverty, and a thousand good reasons for why it should fail.

Just a few weeks before, a friend of Tom’s had been mugged at knifepoint there, in broad daylight, as he’d walked home from the school. The Triangle kids did not have easy lives. Some had fathers in prison; others had mothers who drank too much vodka. On some days, kids came to school tired and hungry. To an outsider, it didn’t look all that different from an American ghetto.

So how have they done so well?

In 1997, when Mirosław Handke became Poland’s minister of education, he was an outsider. A chemist with a white mustache and dramatic, black-slash eyebrows, he looked like an Eastern Bloc version of Sean Connery. Handke was accomplished in his own world at AGH University of Science and Technology in Kraków. He’d published more than eighty papers on the obscure properties of minerals and become the head of the university, one of Poland’s best. However, he knew next to nothing about education policy or politics. His cluelessness would serve him well, at least for a little while.

In the spring of 1998, he and his boss, the new prime minister, Jerzy Buzek (another chemistry professor), announced a series of reforms the likes of which they might never have contemplated if they’d had more experience with the political sensitivities of education. “We have to move the entire system—push it out of its equilibrium so that it will achieve a new equilibrium,” Handke said. He was still teaching chemistry, this time to thirty-eight million people. To get to the new equilibrium, the country would enter what scientists called a transition phase. This phase would, as Handke put it, “give students a chance.” It had four main parts, laid out in a 225-page orange book that was distributed to schools all over the country. First, the reforms would inject rigor into the system. A new core curriculum would replace the old, dumbed-down mandates that had forced teachers to cover too many topics too briefly. The new program would lay out fundamental goals, but leave the details to the schools. At the same time, the government would require a quarter of teachers to go back to school to improve their own education.

Along with rigor came accountability. To make sure students were learning, they would start taking standardized tests at regular intervals throughout their schooling—not as often as American kids, but at the end of elementary, junior high, and high school.

For younger kids, the tests would help identify which students—and teachers and schools—needed more help. For older students, the tests would also have consequences, determining which high schools and then universities they could attend.

The Poles couldn’t know it yet, but this kind of targeted standardized testing would prove to be critical in any country with significant poverty, according to a PISA analysis that would come out years later. Around the world, school systems that used regular standardized tests tended to be fairer places, with smaller gaps between what rich and poor kids knew. Even in the United States, where tests have historically lacked rigor and purpose, African-American and Hispanic students’ reading and math scores have gone up during the era of widespread standardized testing.

autonomy was the fourth reform. Teachers would be free to choose their own textbooks and their own specific curriculum from over one hundred approved options, along with their own professional development. They would start earning bonuses based in part on how much professional development they did. In a booming country where people were judged by how much money they made, the cash infusion would telegraph to everyone that teachers were no longer menial laborers. The principal, meanwhile, would have full responsibility for hiring teachers.

the new system would demand more accountability for results, while granting more autonomy for methods. That dynamic could be found in all countries that had dramatically improved their results, including Finland and, for that matter, in every high-performing organization, from the U.S. Coast Guard to Apple Inc. All this change would happen, Handke declared, in one year.

Did the people who’d been getting paychecks from the old system welcome the change?

the Union of Polish Teachers came out against the reforms, accusing Handke of trying to change too much too quickly with too little funding. In another article in the same newspaper, one principal prophesied disaster: “We can look forward to a deterioration in the standard of education for most young people, a deepening of illiteracy and a widespread reluctance to pursue further education.”

And the results?

in 2000, Polish fifteen-year-olds took the PISA. No one realized it then, but the timing was perfect. PISA captured, entirely by coincidence, a snapshot of Poland before and after the reforms. The Polish kids who took the first PISA in 2000 had grown up under the old system. Half had already been tracked to vocational schools, half to academic schools. They were the control group, so to speak. No one in Poland had expected to lead the world, but the results were disheartening all the same. Polish fifteen-year-olds ranked twenty-first in reading and twentieth in math, below the United States and below average for the developed world. Once again, Poland had found itself on the outside looking in. If the vocational students were evaluated separately, the inequities were startling. Over two-thirds scored in the rock-bottom lowest literacy level.

Three years later, in 2003, a new group of Polish fifteen-year-olds took PISA. They had spent their elementary years in the old system but were by then attending the new gymnasia schools. Unlike their predecessors, they had not yet been tracked. They were the experimental group. The results were shocking—again. Poland, the punch line for so many jokes around the world, ranked thirteenth in reading and eighteenth in math, just above the United States in both subjects. In the space of three years, Poland had caught up with the developed world. How could this be? Typically, it takes many years for reforms to have any impact, and most never do. But the results held. By 2009, Poland was

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Part of The Smartest Kids in the World: And How They Got That Way concerns American schools. Unfortunately it is mostly to contrast them with effective schools elsewhere.

Amanda Ripley identifies the following major problems with American schools:

• people who are poorly educated are hired as schoolteachers
• teachers have limited autonomy (partly as a result of their low level of knowledge and ability)
• schools have multiple missions, only one of which is education, which leads to a loss of focus
• teachers and administrators dwell on student and family backgrounds so as to build up a catalog of excuses for poor educational outcomes
• parents are complacent regarding the low expectations set for their children

Here are some excerpts from this interesting book:

Scott Farmer had just been appointed the town’s first new superintendent in twenty years. He had short brown hair and a boyish face. The state of Oklahoma had 530 superintendents like him, each with their own fiefdom. There were about as many superintendents in Oklahoma as there were members of Congress for the entire country.

This tradition of hyperlocal control, hard-wired for inefficiency, hinted at one reason that the United States spent so much more than other countries on education. Farmer made about $100,000 per year, which made him one of the top earners in Sallisaw. He had an assistant superintendent, too, along with eight director-level managers and a school board. It was quite an operation for a district that included just four schools. But it was hardly unusual. Compared to the rest of the state, in fact, Sallisaw was one of the more efficient school districts in Oklahoma.

That, too, was a common refrain among educators all over the United States. Whatever the problem, it was, it seemed, largely outside their control.

Sallisaw had plenty of good students, too. Other than the destitute and the dropouts, Sallisaw High School had its success stories, like every town. About half the kids who graduated from Sallisaw enrolled in public colleges and universities in Oklahoma. Others went to out-of-state colleges or looked for jobs. What happened to these success stories after they left? Their colleges tested their basic skills and found them wanting. More than half these students were promptly placed into remedial classes at Oklahoma public colleges. That meant that some of Sallisaw’s best students were paying good money for college, often in the form of student loans, but they weren’t getting college credit.

I asked Principal Martens about all the Sallisaw alumni who were retaking math or English. “That really doesn’t bother me,” he said, “because at least they are trying.” The main goal was to go to college. Whether his graduates succeeded there was out of his control, or so it seemed. The fact that those kids had spent four years in his school preparing to get to college—and that he’d given them a diploma that was supposed to mean they were ready—did not seem relevant.

American teachers taught with textbooks that were written to appease thousands of districts and many states all at once, as education researcher William Schmidt has documented in detail. That meant that American textbooks tended to be far too long—covering (and repeating) way too many topics in too little depth. Internationally, the average eighth grade math textbook was 225 pages long; in the United States, eighth grade math texts averaged 800 pages. That was about 300 pages longer than all thirteen volumes of Euclid’s Elements.

The end result was that American students ended up learning about, say, fractions every single year, from first to eighth grade, while their peers in smarter countries covered fractions in grades three through six.

By eighth grade, seven out of ten kids went to schools that did not even offer algebra courses with the kind of content that was standard in most other countries. It was only logical that American kids were behind their peers in the smart-kid countries; they were essentially taking remedial math, whether they needed it or not.

Aside from the high cash compensation, three months of summer vacation, and secure pension, what motivates Americans to work in an environment where failure is almost guaranteed?

… consider Kim’s math teacher back home, Scott Bethel. He’d decided to become a teacher mostly so that he could become a football coach. In America, this made sense. As a student at Sallisaw High School, he was an all-state quarterback in 1989. “My dad taught at a school about ten miles from here,” Bethel told me. “He was also a football coach, and I was always good at sports, and I thought, ‘You know what, I’d like to become a coach.’ ”

If you too wanted to be a high school sports coach/math teacher, what would you have to do?

Although Bethel hadn’t taken calculus in high school, he’d always been pretty good at math. So, he figured the best way to become a coach was to become a math teacher. Bethel was one of several coaches that Kim had as teachers over the years, a hybrid job that would be considered bizarre in Finland and many countries, where sports lay beyond the central mission of schools. In Oklahoma alone, Bethel could choose from nearly two dozen teacher-training programs—almost three times as many as in all of Finland, a much bigger place. Oklahoma, like most states, educated far more teachers than it needed. At most U.S. colleges, education was known as one of the easiest majors. Education departments usually welcomed almost anyone who claimed to like children. Once students got there, they were rewarded with high grades and relatively easy work. Instead of taking the more rigorous mathematics classes offered to other students, for example, education majors tended to take special math classes designed for students who did not like math. Bethel did his training at Northeastern State University, like the Sallisaw superintendent and many Oklahoma teachers, including Kim’s mom. The university prepares more teachers than any other institution in the state and has a good reputation. However, it also has a 75 percent acceptance rate, which means that it admits, on average, students with much weaker math, reading, and science skills than Finnish education schools.

During his sophomore year at Northeastern State University, Bethel had applied to the university’s education college. Here was another chance for the university to select its best and brightest to become teachers. But to be admitted, Bethel had to have a grade-point average of just 2.5 or higher (out of 4). He would have needed a higher GPA to become an optometrist at the same university today. To be a teacher, he also had to have at least a C grade in freshman English and a C in speech or a class called the fundamentals of oral communication. He also needed a score of 19 or higher on the ACT, a standardized test like the SAT. The national average for the ACT back then was 20.6. Let’s consider what this meant: It was acceptable to perform below average for the country on a test of what you had learned throughout your educational career if you aspired to dedicate your career to education.

At the education college, Bethel discovered that he didn’t have to major in math to become a high-school math teacher. So he didn’t. Nationwide, less than half of American high-school math teachers majored in math. Almost a third did not even minor in math.

Bethel liked math, but his primary goal was to become a coach, so he majored in physical education and minored in math. When he took the required test for high school math teachers in Oklahoma, he passed easily. Most of the material was at a tenth or eleventh grade level, and he didn’t find it difficult. However, if he had, he would have been allowed to retake the test until he passed.

When researchers tested thousands of aspiring teachers in sixteen countries, they found that future middle-school math teachers in the United States knew about as much math as their peers in Thailand and Oman. They had nowhere near the math competence of teachers-in-training in Taiwan, Singapore, or Poland.

Maybe American teachers get more practical training to compensate for their weak college experience?

In Oklahoma, Bethel’s student teaching experience helped him learn to plan lessons and manage a classroom. But it lasted just twelve weeks, compared to the year-long residency typical in Finland. Nationwide, U.S. teacher-training colleges only require an average of twelve to fifteen weeks of student teaching,

Has any state ever tried to “pull a Finland” and restrict teacher education and hiring to those who were reasonably good students?

Why hadn’t that evolution ever happened in the United States—or in most other countries? Had anyone even tried? The examples were few but revealing. As the new education commissioner in Rhode Island, one of Deborah Gist’s first acts was to raise the minimum test scores for teachers-to-be in 2009. At the time, Rhode Island allowed lower scores than almost any state in the nation. She had the power to change this unilaterally, and she did, taking one small step in the direction of Finland by requiring new teachers to score significantly higher on the SAT, ACT, and the Praxis, a teacher certification test. Immediately, critics called her elitist, lobbing the same accusations critics had used against reformers in Finland in the 1970s. Some argued that a teacher who struggled in school was actually a better teacher, because that teacher could relate to students who were failing.

Others worried that higher standards would lead to a teacher shortage. Yet Rhode Island’s teacher colleges already churned out 1,000 teachers a year, about 800 more than the school system needed to hire.

Because this was America, a diverse country with a long history of racism in colleges, public schools, and every other institution, Gist’s efforts were also attacked as discriminatory. Higher education leaders warned that the new standards would prevent minority students, who tended to score lower on tests, from becoming teachers.

It was interesting to note that higher standards were seen not as an investment in students; they were seen, first and foremost, as a threat to teachers. Rhode Island’s teacher-preparation programs produced five times more teachers than Rhode Island’s public schools actually hired each year. The only institution benefiting from this system seemed to be the colleges themselves, but college leaders still complained that they would lose too many students if the standards were higher. They voiced this concern to newspaper reporters, and reporters quoted them without irony.

Under the new, higher standards, about 85 percent of Rhode Island College’s education students would not make the cut, the dean threatened. Coming from the college that produced more Rhode Island teachers than any other, this was an astounding statistic, one that should have been a source of deep shame, but was not. Gist did not back down, however. “I have the utmost confidence that Rhode Island’s future teachers are capable of this kind of performance,” she said. She did agree to phase in the higher cut score gradually over two years and to allow colleges to ask for waivers for highly promising candidates who did not make the cut score. Three years later, she had not received any waiver requests. At Rhode Island College, the percentage of minority students studying to be teachers went from 8.8 percent to 9.24 percent, remaining essentially unchanged despite all predictions to the contrary.

What does a good American high school look like to a Finnish teenager?

Elina discovered one important difference about America. Back home, she’d been a good student. In Colon, she was exceptional. She took Algebra II, the most advanced math class offered at Colon High. On her first test, she got 105 percent. Until then, Elina had thought it was mathematically impossible to get 105 percent on anything. She thought she might have more trouble in U.S. history class, since she was not, after all, American. Luckily, her teacher gave the class a study guide that contained all the

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The New York Times has a story about how colleges might switch from admitting students based on race to admitting students based on income. But what would stop a traditional married couple from getting divorced prior to their children applying to schools? In The Smartest Kids in the World: And How They Got That Way, Amanda Ripley reported on Korean parents getting legal (but not practical) divorces in order to improve their children’s chances of admission to elite universities that had established preferences for children of single parents.

If two parents of a Harvard aspirant got a sham divorce, and only one of them had an income, the applicant could claim to be estranged from the high-earning parent and therefore be the child of a destitute family (this article says that the non-custodial parent’s income is not considered for calculating Federal and state financial aid).

A stay-at-home mother friend of mine often jokes about how if she and her husband would get legally divorced she could then obtain an array of valuable assistance from taxpayers, notably free health insurance and food (via SNAP or “food stamps”). Could the possibility of otherwise-impossible admission to the Ivy League for her children push her over the edge into implementation?

[Separately, The Smartest Kids in the World: And How They Got That Way notes that in the countries with high-performance education systems, there is only one way to get into a top college: score well on a national exam (a 50-hour essay-heavy test in Finland). Family background and wealth are not considered.]

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Biotech remains strong in Massachusetts, but we’ve faded into obscurity when it comes to software. The City of Cambridge, however, has come up with one way to level the playing field: make it illegal to be a customer of a Silicon Valley success story. Here’s a posting from Uber about how the Cambridge city government is proposing effectively to shut Uber down within Cambridge. (There is a public hearing tonight.)

California may be ahead of us in grape production, but they are sour grapes and we do not want them.

[Separately, this relates to the Piketty postings. By definition taxi medallions tend to be owned by millionaires (since one medallion costs close to $1 million and in fact most medallions are owned by people who own multiple medallions). Uber drivers are trying to catch up to these rich folks, but government regulation can prevent them from earning any kind of living in this industry (other than, perhaps, the minimum wage job of working for a taxi medallion owner).]

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I’ve written a few posts about the trees inside Thomas Piketty’s verbose tome, Capital in the Twenty-First Century:

• tax people who don’t live in France
• economics and morality
• banks are rich and they don’t get high returns automatically
• can rich people actually get richer past a certain point, or just have more dollars?
• tax and spend to halt climate change
• Piketty, Democracy, and Hugo Chavez
• sample bias leads to Piketty’s conclusion that rich people earn high returns
• better to take money from rich people than to work
• why U.S. GDP is so high
• why Europeans love Socialism
• is income inequality actually higher than 200 years ago?
• can anything be learned from the U.S. housing craze of the 2000s?

Now it is time to look at the forest.

One reason that Piketty’s book deserves attention is that it is a book, not a paper. When a field is pre-paradigmatic, The Structure of Scientific Revolutions (Kuhn) says that progress is made with books, not with journal papers. Is Economics a paradigmatic science like chemistry, biology, or physics? Due to its lack of predictive power, as evidenced by the fact that economists did not predict the Collapse of 2008 nor predict which countries would emerge from that event in the best shape, Econ is pretty plainly pre-paradigmatic (otherwise economists would be as rich as John Paulson). Piketty throws some rocks at his colleagues:

To put it bluntly, the discipline of economics has yet to get over its childish passion for mathematics and for purely theoretical and often highly ideological speculation, at the expense of historical research and collaboration with the other social sciences. Economists are all too often preoccupied with petty mathematical problems of interest only to themselves. This obsession with mathematics is an easy way of acquiring the appearance of scientificity without having to answer the far more complex questions posed by the world we live in. There is one great advantage to being an academic economist in France: here, economists are not highly respected in the academic and intellectual world or by political and financial elites. Hence they must set aside their contempt for other disciplines and their absurd claim to greater scientific legitimacy, despite the fact that they know almost nothing about anything.

Piketty reminds us continuously that much of the economic growth for which politicians take credit is simply population growth. And also that national borders are substantial barriers to efficient deployment of capital:

If the rich countries are so flush with savings and capital that there is little reason to build new housing or add new machinery (in which case economists say that the “marginal productivity of capital,” that is, the additional output due to adding one new unit of capital “at the margin,” is very low), it can be collectively efficient to invest some part of domestic savings in poorer countries abroad.

the income of Africans is roughly 5 percent less than the continent’s output (and as high as 10 percent lower in some individual countries). With capital’s share of income at about 30 percent, this means that nearly 20 percent of African capital is owned by foreigners:

According to classical economic theory, this mechanism, based on the free flow of capital and equalization of the marginal productivity of capital at the global level, should lead to convergence of rich and poor countries and an eventual reduction of inequalities through market forces and competition. This optimistic theory has two major defects, however. First, from a strictly logical point of view, the equalization mechanism does not guarantee global convergence of per capita income. At best it can give rise to convergence of per capita output, provided we assume perfect capital mobility and, even more important, total equality of skill levels and human capital across countries—no small assumption. In any case, the possible convergence of output per head does not imply convergence of income per head. After the wealthy countries have invested in their poorer neighbors, they may continue to own them indefinitely, and indeed their share of ownership may grow to massive proportions, so that the per capita national income of the wealthy countries remains permanently greater than that of the poorer countries, which must continue to pay to foreigners a substantial share of what their citizens produce (as African countries have done for decades).

if we look at the historical record, it does not appear that capital mobility has been the primary factor promoting convergence of rich and poor nations. None of the Asian countries that have moved closer to the developed countries of the West in recent years has benefited from large foreign investments, whether it be Japan, South Korea, or Taiwan and more recently China. In essence, all of these countries themselves financed the necessary investments in physical capital and, even more, in human capital, which the latest research holds to be the key to long-term growth.35 Conversely, countries owned by other countries, whether in the colonial period or in Africa today, have been less successful, most notably because they have tended to specialize in areas without much prospect of future development and because they have been subject to chronic political instability.

When a country is largely owned by foreigners, there is a recurrent and almost irrepressible social demand for expropriation. Other political actors respond that investment and development are possible only if existing property rights are unconditionally protected. The country is thus caught in an endless alternation between revolutionary governments (whose success in improving actual living conditions for their citizens is often limited) and governments dedicated to the protection of existing property owners, thereby laying the groundwork for the next revolution or coup. Inequality of capital ownership is already difficult to accept and peacefully maintain within a single national community. Internationally, it is almost impossible to sustain without a colonial type of political domination.

historical experience suggests that the principal mechanism for convergence at the international as well as the domestic level is the diffusion of knowledge. In other words, the poor catch up with the rich to the extent that they achieve the same level of technological know-how, skill, and education, not by becoming the property of the wealthy.

In other words, a rich country will continue to invest in its industries, schools, and transportation network even though a much better return on investment is available from investing in a poor country (building a new road to a growing city in Brazil should have more value than repaving an existing road in the U.S.; building high-speed rail in China at a low cost per mile is a much better investment than building high-speed rail in California).

Piketty also notes that the more capital is accumulated the lower the return on capital tends to be, in the same sense that the availability of 1 billion skilled workers in China will tend to lower wages elsewhere or the discovery of natural gas fields will tend to lower the cost of natural gas.

After explaining these factors, however, Piketty pretty much ignores them and posits that returns on capital going forward will be just as good as they have been in the past. And then adds that rich people and organizations will get an even higher return than average schmoes invested in the S&P 500 and other public equities.

Piketty has collected copious data that he says shows that wealth inequality is high right now, comparable to conditions prior to World War I. Critics have said that he is misinterpreting, misquoting, and mistranscribing the data. But let’s suppose that he is right. Piketty argues that this means we are about to enter an era of soaring wealth inequality, the likes of which the world has never seen, in which the rich run away with it all. The top 0.1 percent will taxi their Gulfstream G-650s down Main Street whenever they want to buy a quart of milk. But perhaps Piketty, like Karl Marx, will prove to be a better historian than prophet. The same data could also be interpreted as evidence that capitalism is inherently self-correcting and wealth inequality over 200 or so years has swung between limits despite radically changed circumstances, governments, and technology.

As noted in a previous posting, Piketty’s call to action/arms is based on his prediction that wealth inequality is a runaway process that will lead to a handful of people owning virtually everything on the planet within 100 or 200 years. This prediction rests on the following assumptions:

1. rich people get a better return on their investments than regular investors
2. governments will stop taxing dividend and capital gain income
3. the world economy will grow at best slowly for the next 50-100 years
4. the return on capital will be high
5. rich people won’t consume too much (which means most of their income gets plowed into additional investment)

All of these assumptions are questionable. Regression toward the mean has been one of the safest bets in finance, calling into question Assumption 1. Piketty doesn’t cite any examples of governments that have willingly given up a rich vein of tax revenue. When rates are cut it is typically by politicians seeking to increase actual collections, not in an attempt to shrink revenue. Piketty’s book came out right about the same time that the U.S. added the 3.8% Obamacare tax to investment income, roughly a 25% increase in the tax on capital-based income (depending on one’s tax bracket and whether dividends were “qualified”). Finally, the U.S. actually already has a wealth tax. It is called the capital gains tax not adjusted for inflation. For example, suppose that you bought a stock for $1 million in 2000. The market hasn’t moved much since then, so let’s say that the stock has appreciated only at the official inflation rate. Now it is worth $1.38 million. If you sell it to rebalance your portfolio, you’ll pay federal, state, and Obamacare taxes of about 30%, depending on the state where you live. That’s a $111,400 tax on a non-existent gain, i.e., an 11.4% tax on the wealth that you had in 2000. If we use an inflation rate closer to reality for rich people, instead of the government’s CPI that is based on a lifestyle of consuming Chinese-made DVD players and Costco hot dogs, the stock might have gone up to $1.6 million and the tax would be $180,000 on what is, from the perspective of someone who is buying fancy houses, restaurant meals, hotel rooms, etc., a non-existent gain. That’s an 18% wealth tax.

World economic growth in the 20th century was led by the U.S., a country with poorly educated people according to the PISA test. Since human capital is an important driver of growth, maybe the 21st century will be as strong or stronger now that countries with high PISA scores have market-oriented governments. Thus Assumption 3 may be wrong. If Piketty is right about Assumption 4, i.e., that the return on capital will remain high, he needn’t have wasted his time scribbling out a 700-page book. He could be making literally infinite money in the swap market (since the rest of the folks in finance think that the return on capital going forward will be low).

Assumption 5, that rich people won’t spend, seems questionable as I sit here at the Teterboro airport looking out at a forest of Gulfstreams. It may be hard to imagine that the owner of an Embraer Phenom 300 craves a Gulfstream G-450 or that the owner of a Gulfstream G-450 craves a Gulfstream G-650, but somebody is always buying those fancier planes. As business jets, luxury houses, luxury cars, etc., all depreciate over time, this is spending, not investment. And when rich people bid up the price of houses and/or build new mansions, they end up paying out huge property taxes. Rich people may spend money involuntarily. Most of them will try to live the middle class dream of marriage and children, but this paper by Brinig and Allen predicts that they will be targeted

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Matt Guthmiller has made it across the Atlantic in a single-engine Bonanza (tracker). Inspired by his daring, I made it to Teterboro today, flying right seat in a friend’s Embraer Phenom 100 business jet. My favorite part of the flight was measuring 76 dBA of interior noise at 220 knots indicated and 16,500′.

The ramp looks as though the 2 and 20 crowd robbed a Gulfstream store…

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