Pass the Books. Hold
the Oil. By THOMAS L. FRIEDMAN
EVERY so often
someone asks me: What’s your favorite country, other than your own? I’ve always
had the same answer: Taiwan. Taiwan? Why Taiwan? People ask. Very simple:
Because Taiwan is a barren rock in a typhoon-laden sea with no natural
resources to live off of ”it even has to
import sand and gravel from China for construction ”yet it has the
fourth-largest financial reserves in the world. Because rather than digging in
the ground and mining whatever comes up, Taiwan has mined its 23 million people,
their talent, energy and intelligence men and women. I always tell my friends
in Taiwan: You’re the luckiest people in the world. How did you get so lucky?
You have no oil, no iron ore, no forests, no diamonds, no gold, just a few small
deposits of coal and natural gas and because of that you developed the habits
and culture of honing your people’s skills, which turns out to be the most
valuable and only truly renewable resource in the world today. How did you get
so lucky? That, at least, was my gut instinct.
But now we have
proof. A team from the Organization for Economic Cooperation and Development,
or O.E.C.D., has just come out with a fascinating little study mapping the
correlation between performance on the Program for International Student Assessment,
or PISA, exam which every two years tests math, science and reading
comprehension skills of 15-year-olds in 65 countries and the total earnings on natural
resources as a percentage of G.D.P. for each participating country. In short,
how well do your high school kids do on math compared with how much oil you
pump or how many diamonds you dig? The results indicated that there was a
significant negative relationship between the money countries extract from
national resources and the knowledge and skills of their high school population,
said Andreas Schleicher, who oversees the PISA exams for the O.E.C.D. This is a
global pattern that holds across 65 countries that took part in the latest PISA
assessment. Oil and PISA don’t mix. (See the data map at:http://www.oecd.org/dataoecd/43/9/49881940.pdf)
As the Bible notes,
added Schleicher, Moses arduously led the Jews for 40 years through the desert
just to bring them to the only country in the Middle East that had no oil. But Moses
may have gotten it right, after all. Today, Israel has one of the most innovative
economies, and its population enjoys a standard of living most of the oil-rich
countries in the region are not able to offer. So hold the oil, and pass the
books.
According to
Schleicher, in the latest PISA results, students in Singapore, Finland, South
Korea, Hong Kong and Japan stand out as having high PISA scores and few natural
resources, while Qatar and Kazakhstan stand out as having the highest oil rents
and the lowest PISA scores. (Saudi Arabia, Kuwait, Oman, Algeria, Bahrain, Iran
and Syria stood out the same way in a similar 2007 Trends in International
Mathematics and Science Study, or Times, test, while, interestingly, students
from Lebanon, Jordan and Turkey also
Middle East states
with few natural resources scored better.)
Also lagging in
recent PISA scores, though, were students in many of
the resource-rich
countries of Latin America, like Brazil, Mexico and Argentina. Africa was not
tested. Canada, Australia and Norway, also countries with high levels of
natural resources, still score well on PISA, in large part, argues Schleicher, because
all three countries have established deliberate policies of saving and
investing these resource rents, and not just consuming them. Add it all up and
the numbers say that if you really want to know how a
country is going to
do in the 21st century, don’t count its oil reserves or gold mines,
count its highly effective teachers, involved parents and committed students. Today’s
learning outcomes at school, says Schleicher, are a powerful predictor for the
wealth and social outcomes that countries will reap in the long run. Economists
have long known about Dutch disease, which happens when a country becomes so dependent
on exporting natural resources that its currency soars in value and, as a
result, its domestic manufacturing gets crushed as cheap imports flood in and
exports become too expensive. What the PISA team is revealing is a related
disease: societies that get addicted to their natural resources seem to develop
parents and young people who lose some of the instincts, habits and incentives
for doing homework and honing kills. By,
contrast, says Schleicher, in countries with little in the way of
natural resources —
Finland, Singapore or Japan” education has strong outcomes and a high status, at
least in part because the public at large has understood that the country must
live by its knowledge and skills and that these depend on the quality of
education. ... Every parent and child in these countries knows that skills will
decide the life chances of the child and nothing else is going to rescue them,
so they build a whole culture and education system around it. Or as my
Indian-American friend K. R. Sridhar, the founder of the Silicon Valley
fuel-cell company Bloom
Energy, likes to say,
when you don’t have resources, you become resourceful. That’s why the foreign
countries with the most companies listed on the Nasdaq are Israel, China/Hong Kong,
Taiwan, India, South Korea and Singapore none of which can live off natural resources.
But there is an important message for the industrialized world in this study,
too. In these difficult economic times, it is tempting to buttress our own
standards of living today by incurring even greater financial liabilities for
the future. To be sure, there is a role for stimulus in a prolonged recession,
but the only sustainable way is to grow our way out by giving more people the knowledge
and skills to compete, collaborate and connect in a way that drives our
countries forward, argues Schleicher.
In sum, says
Schleicher, knowledge and skills have become the global currency of
21st-century economies, but there is no central bank that prints this currency.
Everyone has to decide on their own how much they will print. Sure, it’s great
to have oil, gas and diamonds; they can buy jobs. But they’ll weaken your
society in the long run unless they’re used to build schools and a culture of Lifelong
learning. The thing that will keep you moving forward, says
Schleicher, is always
what you bring to the table yourself.
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