THE BLOG
01/15/2013 06:15 pm ET Updated Mar 17, 2013

Philosophy and Money

Philosophically, I agree with you...

Many frustrating conversations grind to an end with that phrase. The speaker expresses sympathy with whatever forward-thinking humanitarian scheme you have in mind. But -- there's always a but -- he or she says it can't be done because it costs too much. It's irresponsible to spend money we don't have.

Well, I’ve got an answer for that one, Dear Reader. Feel free to use it next time you find yourself in a frustrating conversation: Do you plan on sending your kids to college?

Ask him if he has the cash on hand to pay for college tuition. Unless you’re talking to a viscount, the answer is probably “no.” Middle class families manage college through a combination of borrowing, cutting back on expenses and maybe a bit of moonlighting. College is out of reach only in truly poor families, who have no credit and nothing to cut back on, and where parents are often unable to find work. Most of us stretch to pay for college because it’s worth it. Even after factoring in the costs of getting an education, a college graduate can expect more than half a million dollars in lifetime earnings over what someone without a degree will make.

That is just one example of how we go to the wall financially for our kids. Many families with young children decide it’s best for one parent to stay home or work part-time, even though it's a financial hardship. As our incomes go down, we spend heavily on our kids. It’s amazing how much equipment such a little person needs, from playpens to swings to the weekly boxes of diapers that inflate the grocery bill. As our kids grow, we keep finding money for piano lessons, soccer uniforms, braces, and on and on. These are not luxuries. They’re things that keep our kids safe and healthy or that give them the chance to socialize with other children and develop their talents. These expenditures put them on the road to a comfortable and fulfilling life, and so we parents find a way.

We need to think as a society in the way we think as a family. We need to invest in our children’s future. There are literally thousands of investments we could make as a society with similar payoff. Here are just a couple to illustrate:

The Nurse Family Partnership sends registered nurses into the homes of first-time, low-income mothers during their pregnancies and through their child’s second year. These kids are healthier than their peers, do better in school and are less likely to be arrested as adults. A Rand study found that the program produces $5.70 in benefits for every dollar spent.

A large study in North Carolina found that low-income kids who received high quality early childhood education: scored higher on cognitive tests, were more likely to attend a four-year college, and were older than their peers when their first child was born. The mothers of these children also had higher educational and career achievements than women in similar circumstances.

If we truly “philosophically” believe such things are important, then we will find a way to pay for them. For example, some states and municipalities are turning to social impact bonds, where the cost of a program to taxpayers is directly linked to whether it achieves its goals. Another interesting innovation matches alumni lenders with student borrowers to offer student loans at below market rates. Why not a similar arrangement to finance human services programs?

I’m not promoting any specific financing strategy to advance social good. I’m just pointing out that these strategies exist and that creative folks are coming up with new ones all the time. My point is that when we look at our failure to adequately support poor children, money is not a reason. It is an excuse.

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