Executive Summary

A Sick Society Cannot Compete

Dr. James J. Renier
Chairman & CEO of Honeywell Inc.

March 1993

The condition of Minnesota education has direct implications for Minnesota business. Our export business puts Minnesotans in direct competition with the highly educated workers of Asia and Europe--and given current trends--that's pretty scary. Our Minnesota students rank high in the United States. But that's cold comfort indeed because Americans are consistently near the bottom globally.

Minnesota education is no longer living up to its own record of excellence. Our rate of dropouts has been creeping upward for a decade. It has improved somewhat for American Indian and Black students, but worsened for White, Hispanic, and Asian students, resulting in a loss overall.

And academic performance has deteriorated as well. From 1969 to 1989, Minnesota's ACT scores trended lower, dropping more than the national average. Also, our Scholastic Aptitude Test scores have fallen--not precipitously but steadily-since 1974. While we are still above the national average, our scores have eroded faster.

In the preliminary Scholastic Aptitude Tests, Minnesota scores dropped more than twice as much as the U.S. average. Three years ago, verbal skills fell below the national average, and students' performance is nearly down to the national average in Advanced Placement Tests. These are not encouraging reports for a state that depends on brainpower for economic power. We need good education for the creative, motivated, and productive workers our knowledge industries must have.

But education does much more than build our industrial base. Healthy companies need healthy home towns. Business can thrive best where communities offer good civic and social services, a safe and clean environment, honest and efficient government. All of these also require an educated population.

So there are sound, hard-headed business reasons for working to better the lot of our people, improve education, and garner the benefits of successful communities. But business people are also moved by the same humanitarian motives that affect the rest of the world. Most of them recognize that too many Americans do not share equally in the fruits of production. Nearly half of all the jobs created in the last decade pay wages at or near the poverty level. Through the 1980s, the wealthiest one-fifth of American families had sharply rising incomes, after taxes, while incomes dropped for the lowest fifth.

The costs of social failure--crime, drugs, violence, broken homes and broken lives--are borne by production. These costs are packaged in the prices of what we make and sell; if social costs go up, our products become less competitive. So it is imperative, for the sake of our economy--and the well-being of all our people--to build a healthy, drug-free, low-crime society of educated and productive citizens. We must strengthen our competitive power and we must correct our social dislocations. The two go hand in hand. We cannot accomplish one and ignore the other.

Adapted from remarks at the Mondale Policy Forum, February 5, 1993.

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