Action Area 2: Increase the Size and Effectiveness of Learning Investment

Expenditure on health has grown dramatically in recent decades. Education has, by comparison, barely grown. (And as more education is well known to contribute to better health, an increase in educational investment might reduce health costs below what they would otherwise be.) Yet more and better education is vital to a number of areas of great social significance, including the growth of earnings, reduction of public criminal justice system costs, reduction of Medicaid and public welfare costs, and more generally improvement in the quality of life.

If it is to be the transformative influence that it can and should be, more needs to be invested in education and the investment needs to be more effective.

The public case for more investment in education also needs to be grounded in an economic logic that moves beyond the confines of the annual tax take and fiscal responsibility measured in financial years, and towards a longer term logic of borrowing and investment with longer term measures of return and frames of risk. One narrow calculus might be: what do we have to invest now, for what tax-take later? The more basic overall question is ‘are the social rates of return properly calculated to include the total social benefits and total institutional costs?’ If such a calculation were made, the results would be significantly higher than the alternative returns that could be earned by pre tax funds, usually taken to be about 10% in real terms (e.g. on S&P mutual fund investments).

These are extraordinary economic times, requiring an enormous economic stimulus to avert recession sliding into depression. These times provide cause for public investment in education on an unprecedented scale. Historically, many government-created economic stimulae have left little to show. Tax cuts or tax rebates feed into increased personal consumption, but this is not like investment in human capital or in physical capital which also have a supply-side effect and increase productivity and output later. Wars provide a boost to industry and employment, but also leave no manifest legacy of increased productive capacity. Expanding roads may mean increasing private transport infrastructure which aggravates energy costs and dependencies—and in any event, they may not be needed with the rise in telecommuting, cheaper person-to-person telecommunications, digital delivery of formerly physical content, and better public transportation. By comparison, there are few public infrastructure investments as evenly distributed and with as high a total return and tangible public value than investment in human capital formation through basic and higher education.

Education, however, also needs to use resources more effectively. Schools, it is estimated, are used for 13% of the hours in the year. In fact, the length of the school day, and the number of days in school per calendar year, are quite low in the US in relation to most of the other OECD nations—one reason perhaps for the underachievement of students in the US as measured in international tests. Instead, schools need to become a 7 days per week, 7-11 resource, a focal point of community life in a knowledge society. This is to just to consider the way we use the physical resources of the school. Similar observations, however, could be made of the school’s human resources. Teaching to the middle of the class, where some learners are bored and others lost, is hardly efficient—customized learning is more efficient. And why does the ratio of learners to teachers need to be so consistent, when today’s learning environments could span a broader range, as needed, from one teacher to one learner, to one teacher to a great many learners? Peers or more advanced learners can perhaps do a lot of the work of teachers, to the benefit of both amateur teacher and learner. However, this requires a reconfiguration of the physical plant of the school, into new and more flexible spaces reflecting a wider range of person-to-person learning relationships. The question of resource use goes to the very heart of the business of education. Higher productivity in producing desirable education outcomes might mean we can pay teachers much better and get better value for that pay.

The ‘more investment’ argument can also rest on a personal case. The personal case is this: invest now and you will reap the rewards later. But for this personal case to work, it has to be more directly personalized. At the moment, there is a less than perfect alignment between learning investors (parents under financial pressure from multiple sources or aging local tax communities) and learning dividend recipients (children and future generations of productive workers). Onerous loans create a personal disincentive. Government grants can produce distorted effects by favoring the already-privileged and elite institutions.

The evidence shows individuals benefit directly from education in the form of receiving a higher income. If and when you benefit, you should be directly responsible to return a portion of that benefit for the public good. One solution would be to replace loans with a income taxation surcharge in which people repay the cost of their post-compulsory education if and when they reach the average income. Low paid professionals will never pay; those not working will not pay so long as they are not working. There will be additional benefits whether an individual repays the cost of their education or not, and that is the external benefit to the society and future generations, a benefit that would otherwise not be obtained because private families will invest too little.

It may be possible to add additional incentives that come from non-monetary private benefits to the individual and broader systems of reward for generating external social benefits. Considerable thought has been given in recent years to the economics of what is called ‘social production’, or non-market production that benefits others in the society, such as the unpaid contributions to open source software, to the authorship of Wikipedia, to the enormous community volunteer sector. This has sometimes been called a ‘reputational economy’, where people work to gain the non-monetary recognition of others.

— Mary Kalantzis and Bill Cope

Action Items

Action Item 2.1: Repair Old Schools and Build New Schools

Old schools need to remodeled and new ones built—Knowledge Community Schools—which support new relationships of learning and new connections with communities. Knowledge Community Schools would be 7 x 7-11 schools. They would be the focal point for knowledge communities. They would be central points community services and community development. They would support students and communities in social-play relationships. They would be living laboratories of sustainable-green practice. They would support a wider variety of person-person learning configurations, beyond the conventional one teacher to a class of students.

To achieve some or all of these objectives, infrastructure development work needs to be based on minimum, average and optimal standards, in which all schools need to show progress in relation to infrastructure standards required of fully-fledged Knowledge Community Schools. Public audit and progress reports would be based on the standards of a Knowledge Community School.

To extend community buy-in, matching, tax deductible advancement funds would be established to which local businesses, service agencies, benefactors and parents may be motivated to contribute.

Action Item 2.2: Workforce Development

We propose a variety of significant changes in the way people are educated for the knowledge economy jobs and demands of today’s complex workplace—the Work to Learn Program. The changes we are recommending cannot occur within current educational policies and academic research environments. From a policy perspective, several immediate federal actions are needed that are aimed at strengthening the education system in the United States and creating needed workforce changes in a time horizon as short as 3-4 years.

  1. We must create greater access to workforce programs targeted to community needs, job openings, and forecasted types of job openings. Community colleges are in close communication with local community job force needs. These can include federal initiatives, such as green technologies and health care. Educational and financial policies must be in place to ensure that unemployed and displaced workers are provided access to educational opportunities that will develop the knowledge and skills needed for employment in knowledge economy jobs. Mechanisms are also needed to ensure that returning veterans have immediate access to educational programs and in forms that accommodate their unique personal, financial, and educational needs. These educational programs need to provide worker retraining and reintegration of returning military personnel into the world of work and their community.

In weak economic times, the underemployed, unemployed, and soon-to-enter workforce turns to the community college for skilling and re-skilling, or to supplement an existing skill set with more competitive certifications. Businesses, too, seek the services of community colleges to provide business- or sector-specific support. Community colleges are uniquely capable of meeting these needs quickly and efficiently to streamlined career and technical curricular approval processes, noncredit and contract-training capabilities and established connections to business and industry through advisory committees and funding formulas that promote local responsiveness.

A forward-thinking, proactive higher education policy could take advantage of these capabilities in key three areas: alternative energy, health care, and efforts to promote equity in higher education, as well as broadening access and affordability.

  1. Federal resources should be aimed at regional and state-focused consortia of education, business, government, and non-profit agencies with goals of creating local investment and growth in highly technical, highly creative industries—those that can continue to compete globally.

  2. Re-vision education, not as developmental “modules” (K-8, HS, higher education, workforce), but as a strategic driver of U.S. labor, U.S. industry, and U.S. domestic and foreign policy; and as a key component to individual attainment. As such, federal policy should be aimed at reducing transition gaps, crediting learning—wherever learned—and enabling individual efforts to change as employment opportunities and requisite skills change. Education has the opportunity to develop the public (communities and families) beyond a narrow focus on economic resources (labor/workforce). Our education system must be restructured to extend and enhance the high-interaction pedagogies that develop metacognitive skills, critical thinking skills, ethics, and evidence-based decision making skills. This will demand active engagement and responsibility among multiple publics (community, family, education, industry, government), including international engagement and responsibility with the world community. Industry support and collaboration will also be needed to build a citizenry and serve the common good (informed, ethical governance, community orientation, build social cohesion).

  3. Develop greater capacity to reach underserved populations (blue collar, poor, youth), primarily through new forms of ubiquitous technologies for learning. This can be accomplished by efforts to reduce high school dropout rates, including but not limited to expanding our use of media and ubiquitous technologies to address the learning needs of local communities and families for educational purposes.

  4. Develop and foster enhanced individual knowledge and skill attainment through the creation of learning communities both inside and outside traditional educational institutions.

  5. Develop stronger capacity for critical research initiatives that:

    • provide stricter accountability and evaluation of outcomes and effectiveness of public and private workforce education initiatives.

    • analyze policies and policy development for local, regional, state-level, national, and international workforce development.

    • improve professional qualifications and continuing professional development of workforce educators in public and private settings.

    • redesign the curriculum for the global workforce.

    • broaden the reach of workforce education to the professions and professional schools.

    • analyze the tension between social, organizational, and individual goals related to workforce education and learning at work.

    • improve models of program evaluation of work based learning initiatives.

    • break down of psychological contract between workers and organizations and the opportunities and liabilities of individually focused career models (so-called protean careers).

Adequate resourcing is obviously a prerequisite to these efforts, but the real change in policy is a return to the idea that work and education are intertwined and that the knowledge economy demands workers who are not only smart and skilled, but also capable of reskilling, of being creative, and of being engaged. This means elevating education policy to a cornerstone of governance, focusing beyond funding and performance towards strategy, and ensuring that education expertise is drawn upon in a variety of contexts.

Action Item 2.3: Personalizing Educational Investment

Amongst the alternatives for personalizing educational investment, one is a system of deferred taxation—The Personal Educational Investment Fund. Long term personalization can occur by aligning current educational costs of post-compulsory education with borrowings against future tax payments. If and when you earn an above average income, you would return the costs of your non-compulsory education over a period of time via an income tax surcharge.58

Action Item 2.4: Credit Unpaid Educational Contributions

There are many things peer or higher level learners, or community supporters of education, might do outside of the formal educational finance system. They might get involved in tutoring and assessment; they might work as a teacher’s aide, in class or online; they might do action-research learning as learners or with learners in businesses or community organizations; they might take unpaid or minimally paid microwork placements. This could perhaps be supplemented (a ‘reputational economy’, plus) with transferable credits—build up a certain number of Open Learning Contribution Credits.

Or you could trade their value against the financial costs of education. Or you might can donate them to a child, relative, friend, neighbor or child in a poor neighborhood. In other words, it may be possible to supplement the financial economy of educational investment a substantial and energetic barter economy based on open learning contributions. This informal or semi-formal economy might also become a place for people to work who are in traditionally unproductive parts of their lives—from the young who become recognized educational workers in their moments of peer teaching, to the old who can trade learning credits against updates to their skills and knowledge, or donate to younger family members. This could be a way of expanding the economy by blurring the conventional boundaries of working life, at the same time as reducing unemployment or mitigating the effects of unemployment.

Supporting Evidence

Supporting Evidence 2.1: The External Social Benefits of Education

The external social benefits of education are the public benefits of education that spill-over to benefit others in the society, including others in future generations. The term social benefits is often used to refer to these external benefits, but total social benefits normally also includes the private benefits. The external benefits of education must be sharply distinguished from these private market benefits to earnings, as well as from the private non-market benefits beyond earnings (such as to own-health or happiness). Private families and individuals have no incentives to invest in these external benefits because these benefits spill over to others in the society and future generations.

The external benefits of education include education’s direct benefits to the development of civic institutions that contribute slowly over long periods of time to the rule of law, democracy, human rights, and political stability. Externalities also include the social benefits from greater longevity avoiding losses to the workforce from early death, to reduced poverty, to lower crime rates, to lower public welfare and prison costs, to cleaner air, water, and environmental sustainability, to social capital, and to the dissemination and adaptation of new knowledge and technology.

External benefits of education also include the indirect effects of education that are over and above these direct benefits. Indirect effects operate through other variables and feed back over time to increase the private market and non-market benefits. Examples include the contribution of education to better governance, to political stability, and to trade, all of which are known to directly increase growth as well.59 Education thereby indirectly contributes in significant ways to pure economic growth. More generally, indirect effects from education on measures of development set the stage for new rounds of growth in the future.60 This benefits others and future generations. The reverse side of the coin is that earnings and well-being today are larger due to external social benefits of education from prior generations.

Major efforts have been made more recently to estimate not just the size of these external social benefits but also their value. There are four methods of estimating the monetary value, the Haveman-Wolfe61 income-equivalent method, The McMahon62 dynamic simulation method, the Breton63 type aggregate externalities method, and the Eisner64 ‘Total’ Social Accounts method. Each of these has their strengths and their weaknesses. But it is useful to use a mix to allow for cross-checking.

Based primarily on the Haveman-Wolfe method, McMahon has estimated the economic value of each of the separate external social benefits listed above, and added up the value expressed in 2007 dollars. On this basis, a first approximation of the external social benefits above and beyond earnings generated by graduates each year who are currently receiving a bachelor’s degree is about $27,726. The value of the external social benefits generated annually by each two year Associate Degree would be about half that. The estimates of value made based on the other methods are reviewed, compared, and discussed, some of which are lower, some larger, and some are not strictly comparable.65 But based on this first approximation, the social benefits of education have a value that is almost equal to the value of the earnings benefits.

Given that the above estimates of earnings and external social benefits do not include the value of the many non-market private benefits, it would appear that there is a very significant failure in higher education markets due to poor information about the nature and value of these non-market education outcomes. To the extent that this is true it contributes to under-investment by families and by governments in access to and affordability of post secondary education. This market failure could be a very major source of the current tragedy facing the middle class.

— Walter W. McMahon

Supporting Evidence 2.2: An Immediate Question of Infrastructure

In his radio address on the economy (Saturday, December 6, 2008) President-elect Barack Obama said “to help our children compete in a 21st century economy, we need to send them to 21st century schools.” Further, he stated, “my economic recovery plan will launch the most sweeping effort to modernize and upgrade school buildings that this country has ever seen. We will repair broken schools, make them energy-efficient, and put new computers in our classrooms.” No part of economic recovery plan is more important than rebuilding the infrastructure of American education. Too many of America’s children go to school in overcrowded buildings with leaky roofs, faulty electrical systems, and outdated technology, all of which compromise their ability to achieve, succeed, and develop the educational skills necessary to compete in the knowledge economy of the 21st century. A well developed economic stimulus plan that places education at the core of rebuilding America’s infrastructure is necessary for the nation to achieve the kind of high quality learning environment appropriate for the 21st century.

We have known for over a decade that the nation’s education infrastructure is fundamentally inadequate to prepare our children to compete in the knowledge economy of the 21st century. At the end of the 20th century several studies reported that America’s school infrastructure was in poor condition and lacked the capacity to create an environment where children could be properly educated and prepared for the 21st Century. Recognizing that the studies in general relied too heavily on anecdotal evidence and also presented different methodological problems, the General Accountability Office (GAO) in 1995 conducted a study that could used as a basis for determining the condition of the nation’s education infrastructure. The GAO disseminated its study to House and Senate committees and to all members of Congress. Congress passed the Education Infrastructure Act of 1994,8 in which it stated, “Improving the quality of public elementary and secondary schools will help our Nation meet the National Education Goals.”66 Despite these efforts, through good times (the budget surplus of 2000) and bad times (the current market crisis) the infrastructure of American schooling has remained almost a state and local responsibility, with virtually no help from the federal level. Given the current budget deficits among the vast majority of the States, local governments will continue to defer vital infrastructure needs from year to year due to lack of funds. A high-quality learning environment is essential to educating the nation’s children for the 21st century and the nation’s only option for a modern infrastructure in through a federal infrastructure recovery plan.

In 1995, the GAO concluded that rebuilding the physical infrastructure of American schools is critical for sustaining a high quality-learning environment for all students. In short, millions of students are in need of decent facilities, especially in urban areas. Decent school structures are generally defined as those that are structurally safe, contain fire safety measures, safe water supply, sufficient sanitary toilet and plumbing facilities, adequate light, and free from asbestos. The GAO found that too many public schools are in substandard condition and need major repairs due to leaking roofs, asbestos dust and fibers, plumbing problems, inadequate heating and lighting systems, poor ventilation or other system failures, including the poor state of technology. This means, among other necessary reforms, school construction, equipping classrooms to connect to the Internet, and increasing the physical capacity for distance education. Too many of U.S. schools, many built over 50 years ago, are increasingly run-down, overcrowded and technologically ill equipped. According to reports by the GAO in 1995 and 19967, one-third of U.S. schools needed major repair or outright repair or replacement; 60 percent needed work on major building structures such as a sagging roof, or a cracked foundation; and 46 percent lacked even the basic electrical wiring to support computers, modems, and modern communications technology. Projected record increases in student enrollments over the next ten years, 1995-2005, necessitated 6,000 new schools. In 1995, the GAO estimated that the federal government would need to invest $112 billion to provide decent school facilities for all children. In response to such concerns, President Clinton introduced new school construction legislation that authorized $5 billion of federal funds to stimulate over $20 billion in school construction, as a starting point. However, Congress did not approve the proposed legislation. Meanwhile, conditions have deteriorated further over the past decade, especially in inner-city areas.

Rebuilding the education infrastructure fits perfectly into the economic recovery plan. New school construction and repair will stimulate the creation of thousands of new jobs in construction-related services, jobs that can’t be moved off shore. New or newly repaired schools will be part and parcel of the green economy, energy-efficient school buildings that over time could save the nation millions from the reduced cost of utilities.

It is important to emphasize the fact that a modern school infrastructure is not just about buildings, repair and equipment. More important, the fundamental question is “How can we transform schools into genuine learning organizations that develop students who are ready for successful participation in a 21st century knowledge economy?” Hence, the call for a modern infrastructure is critical primarily as the foundation for a new learning environment that enables our students to acquire a competitive advantage for living and learning in the 21st century.

— James Anderson

Supporting Evidence 2.3: Short Term Impacts of Education Spending on Job Creation

Investment in human capital formation through, for example, Pell Grants not only has an enormous long run payoff, but it has a huge immediate job creation effect for small businesses that is several times the size of the initial expenditure.

The ‘Longer Run’ Payoff. Investment in Pell Grants is a long term investment in human capital that is vital to the individuals’ and to America’s future to be sure. This expenditure is not government “spending”, it is an investment in human capital that pays for itself over and over again. It pays for itself at the current social rates of return that it currently earns every six years during the 45 years or so each student is in the labor force, which is 7 1/2 times over, in the form of returns to the individual and economic growth in the society. If not just earnings but also the value of the non-market private benefits to the student and the and non-market external social benefits beyond earnings are considered, it pays for itself over and over again every three to four years after graduation. Beyond this it generates very significant additional state and Federal income tax and sales tax revenues, and reduces state Medicaid and welfare costs.

The Short Term Stimulus. The most obvious impact on reducing unemployment is that, as additional young people and adult lifelong learners are enrolled in community colleges or four year institutions as the result of new public support, this has an immediate effect in reducing the number potentially unemployed. This immediacy was one of the major motivations for the GI Bill following World War II, although it had an enormous long run payoff along the lines discussed above.

Beyond this however government spending in support of schools, colleges, and Pell Grants is money that is respent immediately by the recipients. This increases the demand for the products that small businesses and other businesses produce, which is what allows these businesses to retain workers and to hire, thereby creating new jobs. Small businesses and other reasonable businessman cannot and will not create jobs or invest in physical capital when there is low and even falling demand for their product and excess store or plant capacity. Investment tax credits are a fine thing, but in this situation of low demand they will not work. Only government expenditure such as that for teachers or students who then increase the private demand for products will work. It is a tragedy that some cannot see this. They therefore are opposing the very programs that create the most jobs and do the most to rescue small businesses.

But this is not the end of the process. After this first round of re-spending by the recipients of the government expenditure there are more rounds. A multiplier effect occurs as the recipient of the government expenditure spends, but perhaps saves some, and then the recipient of this new private expenditure respends again, going through a second, third, fourth, and fifth round, each smaller than the last. The result is that a multiple of 2.2 to 2.7 times the initial government investment in education (or ‘spending’) in the form of increases in the demand is created for the products of small businesses and for increases in the jobs they create before the impact of the initial government spending wears itself out.68

In the 2008-2009 recession, the same multiplier is working in a downward direction. As people are laid off or hours cut back, their spending is reduced, the recipients of this reduced demand is in turn cut back, leading to still further cutbacks that are a multiple of the initial shock coming from the housing sector, and businesses far beyond the housing sector are rapidly failing. The process plunges the economy downward, an environment in which most do not want to borrow, quite apart from the banks who, seeing the risk, do not want to lend. Monetary policy that has lowered interest rates about as far as is possible is ineffective. Only increased public spending, and at the Federal level because this is where there is the capacity to borrow, will work and can come in as the heavy artillery. This is true for government spending on education, just as much as it is true for government spending on defense as we got into World War II (which after all was a fiscal stimulus because it was government spending financed by borrowing).

If this fiscal stimulus is too short run, and is cut back, the multiplier will work in the reverse direction and the economy will plunge backward into recession. This happened in 1936-37 in the US, and in Japan in the 1990’s. So the package must contain not just major short term stimulus (e.g. Pell Grants, state spending on education or Medicaid, shovel-ready projects) but also some longer term stimulus elements (e.g. construction that is only effective as a stimulus when work is put in place and money is spent over the life of the construction project). Otherwise the US experience of 1936-7 and of Japan of falling back into prolonged recession will merely be repeated.

This is not the time to worry about inflation. Deflation is the problem. And temporary bounces in gasoline prices due to refineries restricting their output to below capacity for example, should more or less be ignored. As the fiscal stimulus package slows the decline and turns the economy around at the bottom in late Fall 2009, if by 2010 or 11 there is rising and then high demand and some inflation, then the fiscal stimulus will be removed, and the budget balanced, which will eliminate that inflation. Paul Volker, Obama’s key adviser on this matter, is very experienced in using Federal Reserve Monetary policy which is also extremely effective in doing this even though there is a continuing fiscal stimulus as there was in the Reagan years. A doctor prescribing medicine for inflation as the economy is plunging downward or later before it fully recovers is going to kill the patient.

Households and businesses have piled up a mountain of consumer credit debt and mortgage debt. They also have a huge stock of relatively new cars and new houses, and there is excess office space, too many unoccupied shopping malls, and excess plant capacity. The initial first waves of the stimulus, especially the tax cuts, will be used in fair part to pay this debt off, let the cars and other household durables age, and work off the excess capacity in businesses. So the multiplier effects on new demand and new jobs created especially from tax cuts must be expected to be smaller at first. But these excess debts must be paid down, and the excess capacity worked off, before full recovery is possible. Also the bank balance sheets must be rid of toxic assets in order to get out of the recession. But these are first steps in the very familiar process, reducing the size of the multiplier at first in a predictable way. However, the multiplier effects from education spending should be in the neighborhood of 2.5 to 2.7 times the size of the initial expenditure in creating the demand that first saves and then creates jobs.

As these multiplier effects from education spending kick in, there are short term benefits to the increases in GDP and income and sales tax revenues. These short term impacts are in addition to the even larger long run benefits from investment in human capital formation discussed above.

— Walter W. McMahon

Supporting Evidence 2.4: The Trend to a Declining Skilled Workforce

According to many accounts, industry is facing a growing shortage of a qualified technical workforce.69 The National Science Board’s (NSB) Task Force on National Workforce Policies for Science and Engineering raised concerns about declining numbers of students pursuing engineering and scientific careers in the US.70 Likewise, an analysis of ACT data found that the percentage of high school seniors who took the ACT test and reported plans to major in engineering in college declined from 8.6% in 1992 to 5.6% in 2002.71 The declining percentage of high school students who reported that they plan to major in engineering in college exacerbates the workforce situation noted by the NSB.

Employers also complain that it is difficult to recruit qualified technicians and identify trainable individuals who have a career interest in technical fields. This problem is compounded by the fact that the Bureau of Labor Statistics (BLS) projects significant employment growth for technicians in a wide range of technical areas. For example, the heavy equipment industry, which employed about 393,000 service technicians and diesel engine mechanics in 2002, will need 50,000 more technicians by the year 2012, a 12.7% increase in employment.72 The need is even greater for the automotive field, which employed about 818,000 service technicians and mechanics in 2002. The Bureau of Labor Statistics projects that the employment need will increase by 101,000, or 12.4% by the year 2010.73 Although these data reveal a growing need for qualified technicians, the problem, however, is likely to become worse as the aging baby boomers start to retire in the next two decades.74 Comprehensive actions will be required to reverse these trends.

In addition to the dwindling numbers of new engineers and technicians, there is a growing recognition that those graduating with engineering and technical degrees lack many of the competencies required of the 21st century. The assessment of the Engineer of 2020 Project states that it is no longer sufficient for education to react to changes in technology and society, rather is it increasingly necessary for education to lead technological and societal changes75. Other sectors of the workforce also recognize the need to lead, as well as the need to broaden the definition of skilled workers beyond the traditional competencies of the past industrial era76. Recognizing the rising pluralism and complexity inherent in rapidly changing, globally based industries, as well as societies77, authors in the scholarly and popular press alike proclaim the need for workers to become more proactively creative, analytic, and critical in the work they do.

There are many factors that contribute to the current shortage in the technical workforce. One reason is that students are less likely to be introduced to technical occupations in their high school career than in the past. This is due to the increased emphasis on academic requirements coupled with a reduction or elimination of high school career and technical programs. Another factor that explains the shortage of people choosing technical careers is the negative perception within society on the value of blue-collar occupations.78 Changes in the family structure over the years also limit children’s exposure to technical work in the home. For example, single-mother families increased from 3 million in 1970 to 10 million in 2003. This equates to a growth rate of 12% to 26% single-mother family groups between 1970 and 2003.79 The lack of parental role models for children to observe and gain hands-on technical experience at home may further contribute to the shortage of individuals interested in pursuing technical careers.

A survey of the directors and instructors of technology programs in more than 120 post-secondary trade and technical schools generated a list of reasons that explain the difficulty of recruiting adequate numbers of students into technician preparation programs. These reasons included:

— Russ Korte

Supporting Evidence 2.5: Workforce Development for the 21st Century

The road to economic recovery depends heavily on job creation and the availability of a well-trained workforce. The role of education in meeting the needs of employers has never been more important. The shift to global competition, the movement toward a knowledge economy, the complexity of technology and technical systems, and the interdependence of work performance and social connections within the workplace place new demands on education at all levels81.

The workplace is facing rapid changes in technologies and processes and the rate of change is accelerating. This demands increased knowledge and skill of employees at all levels as the half-life of workplace knowledge continues to shorten82. At the same time there are increasing competitive pressures on the U.S. workforce due to the availability of equivalent technical skill at lower costs in the international/global marketplace. Beyond the need to enhance technical competences, this new workplace requires greater social competency, including teamwork, leadership, change management, interpersonal relations with international colleagues, customers, and suppliers. These rapid changes in the workplace have also promoted an equally rapid change in the career paths available with large employers and a move to a ‘protean’ career model that requires different levels of self-direction, flexibility, and career resilience.

Several troubling features of the U.S. education system deserve revisiting in light of emerging structural features shaping the workforce, such as globalization, technological innovation, and increased interdependence between the public and private sectors. Thus, at the same time that China and India, among many other nations, are gaining technical and creative expertise in their workforce, the United States is allowing technical capability to deteriorate by deemphasizing career and technical education at both K-12 and higher education levels83. Demographic shifts indicate that workforce numbers in emergent economies will outstrip the U.S. domestic workforce in such sectors as manufacturing, technology, and even engineering and science. Technological innovations in health care, hospitality, automotive repair, and other service industries demand a workforce skilled in both the job tasks of the industry and backroom technology applications that create efficiencies and competitiveness84. Finally, while multinational firms’ revenues and expenditures rival state economies, growing networks of public and private entities -- profit, non-profit, and government – are driving local and regional economic growth.

The new workplace demands that we change our view of workforce education so that it becomes education for work, at work, through work, and about work. We currently have a highly fragmented ‘system’ of workforce education and training in public and private sector. This is a legacy of 1960s expansion of vocational education, which provided basic workforce education as a second-rate option for those who were not college bound. With little attention to occupational and workforce issues in public schools, students entered workforce development programs in community colleges and technical institutes with little prior preparation for technical work and the associate degree and certificate programs are unable to provide the depth of training needed to raise the quality of our technical and scientific workforce. According to ASTD, the private sector has assumed a larger role in providing basic skills and literacy training as well as the more specific technical training that is needed for successful and productive employment in today’s knowledge oriented workplace. The investment in workforce development by the private sector exceeds $65 billion per year in direct costs and approximately $220 billion in total expenditures85. In effect, the burden of workforce development has been transferred to the private sector, which has made a huge investment in workforce training and development86.

The structural shifts in work and the economy call for an engaged education system, working with government and industry to meet workforce needs, at precisely the same time that the education system attempts to strengthen proficiencies in the “basics” at the expense of technical training. Engagement goes beyond offering programs for emergent industries, although this is clearly important. Matriculation gaps must be narrowed. A strength of the United States education system has been its adherence to multiple paths of entry and exit, ability to demonstrate proficiency, wherever earned, and efforts to remediate where necessary87. This requires greater attention to what students/workers are doing in transitions, whether these are between high school and higher education, between higher education and work, or from work into higher education. Students need to be able to utilize technical credits toward the completion of B.S. and M.S. degrees, whether earned at a local community college, in military or industry training, or in community-based experiences. Critical work is needed to develop quality indicators across sectors, to scaffold programs based on combinations of credentials, degrees, prior learning assessment, and to enhance work-based skills development.

Workforce education needs to focus on individuals in all career paths and throughout the life span, early childhood to retirement. The modalities for this new perspective on workforce education will promote both formal and informal learning, structured and non-structured education, short-term and long-term perspectives, self-directed and prescribed learning, and in person and technology mediated delivery systems88.

Despite its importance to the nation and world, workforce education is under-theorized, under-researched, and lacks the academic and intellectual identity and rigor needed to make a difference in our global competitiveness and our economic growth. Workforce education is rarely seen as a central mission in most colleges of education and seldom is it a valued priority for institutions of higher education.

However, higher education has an important and significant role to play in the reinvention of workforce development that provides education for the common good. Rather than pursue a narrow definition of workforce development based on industry, economic, and market issues, we now need to pursue a broader definition of individual and community development based on systems thinking and social and political process issues, in addition to industry, economic, and market needs. We need to develop an expanded notion of education that fosters the intellectual development of individuals and communities.

By making workforce development a responsibility of higher education, and recognizing at the same time the many additional non-market private and social benefits from extending higher education to more in the population, we can help preserve and strengthen education’s charter for promoting a humanistic, democratic, community-oriented agenda. This avoids devolving into the marketization and commoditization of education that serves only employment and industry. The current and narrow economic focus on serving the needs of the market precludes a more holistic and systemic view of an informed, engaged citizenry. What is needed is an expanded focus on public and social issues to balance the growing focus on market and economic issues. We can help expand the notion of workforce as more than labor, it is the community of people making up our society.

— Scott Johnson, Russ Korte, Peter Kuchinke, Tod Treat

Supporting Evidence 2.6: Youth Transition to College

Reviewing college participation trends, transition to college has been rising in the United States, but some student population groups participate more than others. The percentage of high school completers who enroll in two- and four-year college in the fall immediately after high school increased nearly 20 percentage points between 1972 and 1997, from 49 to 67 percent, then dropped to 62 percent between 1997 and 2001 before rising to 69 percent in 2005, the most recent year statistics were computed by the National Center for Education Statistics.89 However, this promising trend masks the differential transition rate by racial/ethnic group. Whereas White students show an all-time high in the immediate high school-to-college transition rate of 73 percent, the immediate enrollment rates of African Americans and Hispanics have fallen between 2002 and 2005. Continuing a trend observed for several previous years, the immediate enrollment rate of female high school completers exceeds male high school completers, with much of the growth of females occurring at the 4-year level. Differences in immediate enrollment rates by family income and parental education have persisted for over 20 years, showing immediate college enrollment is higher for high school completers from high-income families than from low-income. Likewise, compared with completers whose parents had a bachelor’s or higher degree, high school completers whose parents had less education had lower rates of immediate college enrollment in each year between 1992 and 2005. These enrollment trends point to a widening gap in college access for underserved students by race/ethnicity, income, parental education as well as gender.

Not surprisingly K-12 achievement patterns parallel the college access gap. Of the approximate 2.5 million public high school graduates in the United States each year, over half of these students aspire to a bachelor’s degree despite their lack of engagement in high school-level course work that prepares them for collegiate studies. Over 50% of new college entrants take remedial courses, many in multiple subjects.90 Referencing national statistics that show college completion has reached an all-time low for several consecutive years, Venezia argued the disconnect between student aspirations and academic preparedness contributes to large percentages of students leaving college before their second year.91 The historical gap between K-12 and higher education, and the subsequent lack of communication, connection and accountability between the two educational sectors, exacerbates problems with college transition as well as completion.

Combined with changes in the labor market that deem at least a two-year college education vital to family-wage employment, the need for equitable transition to college for underserved groups highlights the criticality of better aligning secondary and postsecondary education.92 Misaligned policies and practices are confusing to students, particularly those who are unfamiliar and inexperienced with college. Many struggle with determining what they need to know and be able to do to enter and succeed. Given the necessity for more youths to participate in college, some states have begun to recognize the importance of transition through the educational pipeline, emphasizing the transition from high school to college.93 Despite this recognition, state and local responses often take different forms in attempting to connect disparate levels of the P-16 educational system.

Hodgkinson contends an ideal P-16 education system is a single integrated entity that promotes student achievement and educational attainment from the primary grades through college.94 A P-16 framework is a way to enhance education system efficiency and effectiveness and stem criticism that education fails to prepare students for advancing to the next level of the system and finding employment linked to personal and financial success.xcv Ewell reported as many as 30 states implement P-16 state policy mechanisms to raise K-12 standards and enhance the academic preparation of students who desire to enroll in college and enter the workforce.96 Alignment of curriculum, standards, and assessments represents an important means of linking K-12 with postsecondary education and creating increased opportunities for youths to transition to college ready to learn, but serious attempts at alignment are sporadic or lacking in evidence of effectiveness.97

Transition programs for youth show promise when academic and career preparation are combined. Bragg et al. and Lekes et al. report positive postsecondary outcomes when youths combine rigorous college prep studies with a sequence of three or more career-technical education (CTE) courses.98 Students who balance a college preparatory course load with CTE courses exhibit outcomes superior to other students. Studies of youth transition also show promising results for student participation in dual credit, suggesting curriculum alignment and student outcomes are enhanced by dual credit.xcix Karp et al., Kim and Lekes et al. found dual credit contributed to participants’ accelerated progress and success in college enrollment and progress to degree.100 If youth transition programs are to flourish, it is crucial that they be supported with adequate financial resources. Along with governmental support, more needs to be done to encourage the public and private sectors to work collaboratively to support student transition from high school to college.

— Debra D. Bragg

Supporting Evidence 2.7: Transition of Low-Skilled Adults to College

Despite the growth in adults participating in education and training during the 1990s, a large segment of the adult population does not engage in formal education beyond high school. National studies find more than half of working adults do not participate in postsecondary education and training of any kind, which poses a problem for the individual as well as the economy.101 The financial well-being of the individual and his or her dependents as well as the well-being of the economy depend on a workforce that possesses knowledge and skills beyond the high school level.102 Increasingly, employment that provides family-sustaining wages requires postsecondary education of one, two or more years’ duration. Adults who do not complete high school and who lack fundamental literacy and workplace skills are at much higher risk of living in poverty than individuals who participate in postsecondary education and training.103

In widely cited research referred to as the “tipping point” study, Prince and Jenkins used student record data from the Washington State Community College and Technical Education System to report that low-skilled adults experience serious barriers to program and degree completion in community and technical colleges.104 Only 13% of non-native English speaking, low-skilled adults who start English Language Learning (ELL) programs persist to earn college credits; less than 30% of adult basic education (ABE) students make the transition to college-level courses. Prince and Jenkins found adult learners who attend at least one year of college (equivalent to at least 30 credit hours) and earn a postsecondary professional-technical education105 (PTE) credential over as much as a five-year period experience a substantive boost in labor market outcomes, both employment and earnings. Taking basic skills courses concurrently with college courses produces significant improvements in average rates of employment and quarterly earnings. Despite the potential benefits, these types of programs are relatively rare.

Increasingly, community colleges are exploring an array of programs and services to address the needs of low-skilled adults106, including non-credit ABE, GED, ELL, developmental (or remedial) education, and credit-bearing college-level instruction. Bailey and Morest contend that, despite their modest funding and competing multiple missions, community colleges are the most likely of all types of higher education institutions to meet the needs of underserved students.107 Community colleges have a historical orientation to offering low cost and locally accessible options for underserved populations, including low-skilled adults. Already, they are a primary provider of education and training to meet adult workforce needs by aligning disconnected programs and implementing new programs, practices and services.108

Economic, cultural, social or other factors often mitigate completion of high school, let alone continuation to college. Moreover, postsecondary institutional and curricular policies and procedures, albeit unintended, marginalize low-skilled adults and magnify their hardships. Academic preparation is especially problematic for low-skilled adults, resulting in large proportions of incoming adults needing to participate in multiple remedial courses for which many never advance beyond the most rudimentary levels.109 The completion of postsecondary programs is exacerbated by inadequate student services to address the wide ranging challenges low-skilled adults experience in life.110 The presence of a professional who guides and supports adult learners has been shown by numerous studies to be an indicator of retention and success for vulnerable student populations, including low-skilled adults.111

Beyond the challenges of college attendance, employer skepticism about low-skilled adults’ ability to fulfill employment obligations creates hurdles at the hiring stage and limits opportunities for training in the workplace. With rising workforce skill requirements, technology innovations, and global competition, low-skilled adults are likely to continue to be marginalized.112 By 2014, more than 63% of all U.S. job openings will require at least some postsecondary certification or associate, baccalaureate, or graduate degrees.113 The current economic crisis looms as a further complicating factor in the employment picture for low-skilled adults. The magnitude of the population currently in need of adult literacy coupled with the growing demand for increased literacy and the uncertainty of the economy presents a challenge to educators and policy makers alike.114

Short-term programs designed to help adults acquire foundational skills and knowledge and transition into college, often called “bridge programs”, are increasing in number.115 These programs integrate GED or developmental education with workforce training and PTE, drawing on funding from the federal Workforce Investment Act (WIA) and the Carl D. Perkins IV legislation. Alssid et al., Henle, Jenkin, and Smith; Jenkins and Spence, and others have called for “career pathways” that offer curriculum that extends beyond bridge programs, calling for a sequential and sustained educational experience that extends beyond a bridge and leads to postsecondary credentials.116 Bragg et al. studied career pathways that link adult education to college, particularly community and technical colleges, identifying the importance of program components such as career development, contextual curriculum, and student support to retaining low-skilled, low-income adults.117 Fully implemented, career pathways offer a means of enhancing the economic and personal circumstances of adult learners while improving the workforce and economy.118

— Debra D. Bragg

Supporting Evidence 2.8: Employer-based Education and Training

The education and training of adults in so-called non-traditional settings, such as the workplace, the community, or religious organization have long played an important role in the system of education in the United States.119 University departments of workforce and human resource education have a distinguished history of providing leadership through academic research, teaching, and service, including policy recommendations, program development and evaluation, and training and professional development of workforce and human resource educators working in a variety of settings including for-profit organizations, the not-for profit sector, government, and the military.120 With rapidly increasing knowledge and skill requirements and the critique of the pedagogical model of the professional schools,121 the importance of workforce development, for initial placement and in the context of continuing professional development has been recognized as key to individuals’ career success and well-being,122 to organizational success and competitiveness,123 and to economic development at the local, regional, state, national, and international levels.124

With Copa, workforce development addresses education for work (such as career and technical education in high schools and community colleges), education at work (such as continuing professional development or retraining), education through work (such as service learning and apprenticeships), and the increasingly important area of education after work (that is after formal employment and in retirement).125 The size and importance of employer-based workforce education was recognized over 20 years by two influential reports sponsored by the Carnegie Foundation for the Advancement of Teaching that concluded that business and industry had, in fact, created a third system of education and training on par in terms of importance and expenditure with the public and private systems.126 Today, the annual survey by the American Society of Training and Development indicates an investment of $134.39B in 2008 in direct costs for employee learning and development equal to about 2.15 percent of payroll.127 The corporate curriculum includes a wide range of subject matter, including remedial academic skills, computer literacy, social competencies, leadership development, technical training and re-training, health and safety, and compliance-oriented training.128

According to the US Department of Labor’s Occupational Outlook Handbook survey, specialists in human resource education and training are employed in virtually every industry, with the private sector accounting for over 80 percent of the jobs.129 Total employment in the United States is estimated to be about 424,000 with some 17,000 education and training specialists being self-employed. Job growth is expected to be higher than average with an estimated increase of 16 percent between 2006 and 2016.

As the DOL report states: “…employers are expected to devote greater resources to job-specific training programs in response to the increasing complexity of many jobs and technological advances that can leave employees with obsolete skills. Additionally, as highly trained and skilled baby boomers retire, there should be strong demand for training and development specialists to impart needed skills to their replacements.130

With the funding constraints of public secondary and post-secondary education and the mandate for life-long education and training for the benefit of individuals, organizations, and the nation, a further shift of the responsibility for workforce development and training towards employers can be predicted. Unlike the public education system, however, there is little systematic research or accountability, and the need exists for rigorous academic research, innovation and reform of workforce educator preparation and professional development, and service to improve the systems of employer-based training and education. A further critical need exists in creating a link between the systems of public and private workforce education to ensure a seamless transition and synergy between the levels and to maximize the resources available to each sector.131

— K. Peter Kuchinke

Supporting Evidence 2.9: Returns on Investment in a System of Early Care and Education

Every day, families in every neighborhood in every community in the United States rely on early childhood programs so that they can work and so that their children can receive educational experiences vital for optimal development and school readiness. In fact, the early care and education industry is a vital contributor to each state’s economy. In Illinois, for example, programs are offered at over 16,000 sites and employ more than 100,000 staff. The early care and education workforce is central to the quality and expansion of care and education for children from birth to formal school entry at age 5.132

Most importantly, research on cost benefit analysis for early care and education clearly demonstrates that investments in the quality of care for young children, ages 3 to 5 pay off in substantial savings with an estimate of $16.00 saved for every dollar spent.133 A review of research and meta analyses demonstrate that participation in high quality early care and education programs promote gains in cognitive and emotional development for the child and improved parent-child relationships. The findings support improvements in the educational outcomes for children as well as future entry into the workforce with higher incomes and decreased probability of delinquency or crime.134

Illinois has engaged in extensive planning and the development of an infrastructure to support current systems of care and professional development as well as to expand services to provide universal preschool for three and four year olds.135 The key elements of this infrastructure are found in a few other progressive states and provide the necessary ingredients to promote systemic change within a state’s design and delivery of early care and education, and in particular universal prekindergarten.136 They include: 1) the establishment of a state level coordinating council; 2) creation of a Professional Development Advisory Council to identify a core body of knowledge—with content and competencies—which then are aligned to state and national standards; 3) development of a career lattice and credentialing system for early care and education teachers; 4) establishment and expansion of a competitive grants program to increase high quality early care and education programs within existing community child cares as well as through local public schools, and 5) the development of a Quality Rating System to encourage families to choose high quality care provided by teachers with credentials.137

These components in combination will enable an expansion of high quality early care and education to serve the needs of all working families. The current system of child care in most states remains fragmented and uncoordinated. Effective use of Child Care Block Grant Funds and Education dollars, however, can bring together diverse agencies, regulatory and oversight systems, and promote a standard of care and the preparation of professionals who can deliver early childhood education that can impact the lives of all children and provide them with the trajectory to succeed in school and life.

— Susan Fowler

Supporting Evidence 2.10: K-12 and Higher Education Funding in International Perspective

In comparison to the eight leading industrialized countries, the United States spends more per student at both the K-12 and higher education levels. In 2003, the U.S. spent 16-37% more per primary and secondary student than the other G8 countries. In higher education, this gap is even larger, with the U.S. spending 102-174% more per student in 2003138. Moreover, from 1995 to 2003, the U.S. increased educational spending at a rate higher than the OECD average139. The U.S. also spends a greater percentage of its GDP on education than the other G8 countries, 4.1% on primary and secondary education and another 2.9% on higher education. However, a larger portion of this spending comes from private citizens in the U.S. than in most industrialized countries. In 2003, private education expenditures across all levels were equivalent to 2.1% of the U.S. GDP, and 57% of all U.S. spending in higher education came from private sources140. Also, it is important to note that international comparisons of educational spending are complicated by differences in the scope, categorization, and measurement of particular expenditures across countries141.

The relatively high levels of aggregate funding in the U.S. mask the considerable funding inequities at state and local levels in K-12 education. The average school in a wealthy district receives about 24% more funding than an average school in a lower income district, despite the considerably greater needs of low income students142. Funding targeted to poor districts, higher state shares of total funding, and local tax efforts in poor communities were all major factors affecting these gaps. After weighting for students’ socioeconomic needs, only three states provide more funding for low income districts143. These inequities occur despite the greater tax effort expended by citizens in poor districts in most states.

The U.S. higher education system is even more severely stratified. Elite institutions provide heavily subsidized education to their students, while lower tier institutions rely more heavily on tuition funds for operation. The top decile of institutions stand in stark contrast to the lower 90%, providing twice the subsidy of the second decile and more than 10 times the subsidy of the lowest decile144. The differences in wealth among tiers of institutions are so severe that even significant improvements in management may have only marginal benefits for institutions in lower tiers.cxlv

— Peter Weitzel

Supporting Evidence 2.11: Restructuring Federal Policy for the Funding of Higher Education

Current federal policy unfortunately provides incentive for state legislatures to increase tuition while correspondingly encourages the state houses to reduce appropriations to higher education. Strangely, federal funding policy for higher education, unlike for public elementary and secondary education, has no prohibition against supplanting of state dollars with federal dollars. Only in 2008 did this issue arise in the halls of Congress resulting in a minor and wholly inadequate “maintenance of effort” requirement touching state appropriations.

To explain: The current federal policy rewards institutions of higher education, both public and private, that have higher sticker prices. The higher the tuition that is charged by an institution, the greater the amounts of money for which student qualifies. The subsidy that flows from the federal government is largely through subsidization of loans to students. Students attending higher-priced institutions qualify for greater subsidies.

Private institutions that have autonomy in setting their own tuition policy consistently raise their sticker prices reaping federal fiscal rewards. Federal policy also gives incentives to state legislatures to provide state tuition vouchers, modeled after federal Pell grants, which further incentivize private institutions to raise tuitions.

In a different, but equally problematic way, federal policy encourages state universities to raise tuition in order to obtain federal largesse, and in so doing, encourages legislatures to reduce funding for public institutions. As a result, in virtually all states the relationship between tuition and state appropriations has become distorted, with students bearing the increasing financial burdens that are shifted from the state appropriations.

Thoughtful commentators who understand this problem have called for a complete overhaul of federal financial funding policy for higher education. Ronstadt recently called for the killing of federal student aid policy.146 Ehrenberg has repeatedly called attention to this major policy flaw,147 and Alexander has pointedly addressed this issue and called for revision of federal policy.148

The present system of higher education funding has not been seriously examined for 40 years. The direction of current funding was predicated on economic assumptions fostered in 1969 that convinced Congress that access to higher education149 would be enhanced if left to market forces.150 As we are all now painfully aware, the solution to all public policy and economic issues cannot be left to the unfettered choice and the economic markets. The experiences have, thus, shown that access to quality higher education has not materially increased and the price of higher education has skyrocketed.

Solutions to this problem are not easy to obtain, as vested interests of the various types of institutions, public, private nonprofit and private for-profit institutions, have grown and multiplied over four decades. However, in spite of the obvious difficulty of the undertaking, solutions and alternatives must be explored that will result in a new direction of federal policy.

— Kern Alexander

Supporting Evidence 2.12: Theories and Practices of Social Production

The terms ‘open knowledge’ and ‘open knowledge production’ are now well accepted in the literature to refer to a range of related models of ‘peer production’ and ‘peer governance’ that provide an emerging alternative to traditional proprietary models of knowledge production. The concept of ‘open’ and ‘openness’ deserves special attention because it has come to christen a range of related activities concerned with the advantages of decentralized distributed networks that characterize what Benkler151 calls ‘commons-based peer production’ and increasingly defines the political economy of the digital networked environment. The concept of ‘openness’, for example, has been applied to: open government; open source; open access; open content; open courseware; open communication; open archives; open science; open learning; and open education. These changes and insights have been the basis for a series of major reports by the U.S. Committee for Economic Development with its most recent report on Open Standards, Open Source, and Open Innovation: Harnessing the Benefits of Openness152 that focuses on new collaborative models of ‘open innovation,’ originating outside the firm, that results in an ‘architecture of participation.’ Three major reports were published in 2007: Giving Knowledge for Free: The Emergence of Open Educational Resources153; Open Educational Practices and Resources; A Review of the Open Educational Resources (OER) Movement: Achievements, Challenges, and New Opportunities.154 Open access and open knowledge production, sometimes also referred to A2K and P2P (peer to peer), now customarily refers to knowledge creation and sharing as well a range of other topics such as framing human rights and development, political economy of trade treaties and intellectual property, peer production and education, digital rights management, and open archives publishing and libraries, among others.

The role of nonmarket and nonproprietary production promotes the emergence of a new information environment and networked economy that both depends upon and encourages great individual freedom, democratic participation, collaboration and interactivity enabling social production and exchange to play a much larger role than ever before. Peer production of information, knowledge, and culture enabled by the emergence of free and open-source software permits the expansion of the social model production beyond software platform into every domain of information and cultural production. Open knowledge production is based upon an incremental, decentralized (and asynchronous), and collaborative a development process that transcends the traditional proprietary market model. Commons-based peer production is based on free cooperation, not on the selling of one's labor in exchange of a wage, nor motivated primarily by profit or for the exchange value of the resulting product; it is managed through new modes of peer governance rather than traditional organizational hierarchies and it is an innovative application of copyright which creates an information commons and transcends the limitations attached to both the private (for-profit) and public (state-based) property forms.

Social media production serves to create new public domains and knowledge commons, which should be protected and extended. At a crucial time in the history of the U.S., facing the 2008-09 economic recession, open source models reconnect with the older community traditions and attempts for a more cooperative social order offering youth a vision of renewal and hope. There is no doubt that there exist relationships between these different sets of ideas and the emerging information environment is based upon a new form of open knowledge production that has strong implications for a kind of open informational democracy, open science, and open knowledge economy in which participation, inclusion and collaboration are the key ideas.155

— Michael Peters