The New York Times has a discussion.
Conservatives (especially from the hinterlands) love to claim that it’s all about government rent-seeking whether by special interests or defense contractors. Thankfully, the article has a more balanced view:
Still, Washington’s good times are not all — or even mostly — about rent-seeking. The region has two legitimate economic lessons to offer the rest of the country.
This is the key point:
Washington’s second lesson is arguably even more important. If you wanted to imagine what the economy might look like if the country were much better educated, you can look at Washington….
About 47 percent of the region’s adults have a bachelor’s degree, more than any other major metropolitan area in the country, according to the Census Bureau. In an economy ever more organized around knowledge, Washington’s employers — from biotechnology and Internet companies to retail and health care — have an easier time finding workers who fit their needs. Especially in bad times, employers can have more confidence they are hiring someone they will want to keep.
How do we know that education matters more than stimulus or rent-seeking? Other highly educated regions, like Boston and Minneapolis, join Washington near the bottom of the unemployment ranking and the top of the household-income ranking. “The more a person learns, the more a person earns,” Gov. Martin O’Malley of Maryland told me last week.
Know-nothingness is no solution to our problems. One of the chief questions of the day is how, as a society, we can educate our population effectively at a reasonable cost. It’s not all about job training, education for life and how to live a good one matters as well.
One of the ongoing trends I agree with is that there are certain “acceptable” cities to live in. A defining feature of these cities is the proportion of the population which is educated and works in knowledge jobs. This isn’t just about what work is most rewarding, there are social externalities as well. Cities where the population looks down on education and knowledge and mediocrity is celebrated won’t do well in the future. Cities where these pursuits are prized and excellence is expected, will.