by Alan Greenspan

We are in a period—especially in this country—of rapid innovation that is yielding dramatic changes in the way goods and services are produced and in the ways that they are delivered to final users. These innovations are markedly elevating the skill levels that will be needed if our increasingly sophisticated capital stock is to function effectively in the years ahead. Such considerations are an important element in the ongoing dialogue that our nation's leaders in business, labor, education, and public policy must have if we, together, are to be successful in meeting the rising demand for skilled workers. Success in this area will, in turn, allow us to realize the potential that advances in science and technology have made to enhance living standards for a large majority of Americans.

The pressures we face today are not unlike those of a century ago, when our education system successfully responded to the multiplying needs brought about by a marked acceleration in technological innovation. As those advances put new demands on workers interacting with an increasingly more complex stock of productive capital, high-school education proliferated—enabling students to read manuals, manipulate numbers, and understand formulae.

Students were thus accorded the skills necessary to staff the newly developing assembly lines in factories and the rapidly expanding transportation systems whose mechanical and automotive jobs required a widening array of cognitive skills. For those who sought education beyond high school, land-grant colleges sprang up, as states reacted to the increased skills required by industry and especially agriculture.

By today's standard, the required share of “intellectual workers” in our labor force was then still small. But the technological innovations of the latter part of the nineteenth century began to bring an increasing conceptualization of our gross domestic product—that is, a greater emphasis on value added stemming from new ideas and concepts as distinct from material inputs and demanding physical labor. The proportion of our workforce that created value through intellectual endeavors, began a century-long climb.

If we are to improve the scientific reasoning skills of young people today, we need to encourage a deeper interaction with numbers and their manipulation to a point at which students are confident and proud of their level of skills—in many instances an outcome they may not have anticipated. One is led to wonder whether the early sharpening of intellectual rigor that occurs when young students struggle to negotiate the complexities of doing multiplication and division the old-fashioned way is not without enduring value. A superficial understanding that does not stretch a child's intellectual capacity, in my experience, cannot galvanize an enhanced reality-based sense of self-esteem.

In this regard, it is discouraging that so many students who clearly demonstrate impressive verbal or other conceptual skills find mathematical procedures intimidating. According to a recent survey of student attitudes toward math conducted by the Department of Education, fewer than half of the high-school seniors surveyed said that they like mathematics, a proportion similar to the proportion who felt that they were good at it. Even more disturbing, these proportions were lower than those in the surveys conducted in 1990.

Some research indicates that such “math anxiety” has a negative effect on mathematics performance and that strategies for increasing students' confidence in their mathematical abilities are likely to have additional benefits in terms of achievement. If we can enhance their self-esteem and provide them with a strong curriculum and effective teaching, students may well find themselves rising to a level of analytic capability beyond their previous vision.

Addressing this issue is crucial for the future of our nation. It is obviously just a matter of time before the bulk of our workforce will require a much higher level of problem-solving skills than is currently evident. And while we have been fortunate to attract so many skilled young people to our shores, we must nonetheless strive to increase math and science achievement so that our students can take advantage of the considerable opportunities that will exist in tomorrow's labor market.

As a final point, I would stress that, even with the increasing intellectual specialization so necessary if we are to move to an ever higher degree of specialization in our overall economy, we also need to ensure that all students have a broad knowledge of the world at large. Major technological advances are becoming increasingly interdisciplinary. Many academics argue, I believe rightly, that significant exposure to a liberal education—music, literature, and the arts—broadens intellectual awareness, enhancing the ability to reach across disciplines to forge new ideas. Thus, while we must strengthen math and science education to address the requirements of the newer technologies we see on the horizon, we should not lose sight of the advantages of a liberal education.

I do not doubt that many of our most innovative and successful dot-com entrepreneurs are exceptionally, but narrowly, technically focused and educated. But if technology is to fit into a broader society of complex democratic institutions such as ours, it is important that all participants have an adequate awareness of society, its structure and values. For it is the latter that we as a people endeavor to achieve. Our technologies are only a means to that end.

Excerpted by Prism from testimony given by Federal Reserve Chairman Alan Greenspan before the Committee on Education and the Workforce, U.S. House of Representatives, September 21, 2000.