What I'd like to talk about tonight is the pretty intense period of change we're in the midst of and what it potentially means for our schools. It's pretty hard to miss the big changes that are impacting American society. There are three substantial, and related, trends I want to touch on here in terms of what they mean for American education: demographic changes, political changes, and changes in the availability of information and how people access it.

We're in the midst of enormous demographic changes. Some of what's happening is common knowledge. A recent report from The Pew Hispanic Center described the tremendous predicted growth in the Hispanic population from 14 percent of the U.S. population in 2005 to 29 percent in 2050. That will account for 60 percent of our total population growth over that period. Amazingly, in our field, we still don’t have a national strategy for educating these youngsters even though they will account for more than one-in-three children in 40 years.

Even less discussed in terms of education is a second change: The graying of the country and what that means. The Census Bureau reports that between 2000 and 2050 the percent of Americans aged 0–19 will decline from 28 percent to 26 percent. But the percent aged 65 or older will increase from about 12.5 percent to slightly more than 20 percent. That's an enormous issue for schools. For starters, while government was able to focus resources on young people over the past generation, these aging trends portend a substantial shift in the country’s demographic burden. Health care costs, entitlements, as well as pensions and other obligations will strain public finance. That will in turn pressure school finance and other public obligations.

Meanwhile, we don't know how older Americans will think about financing schools. A few researchers have examined whether there is a "gray peril" facing schools, and the evidence is inconclusive. But it is worth thinking about whether an older population with less direct attachment to the public schools in their community and perhaps feeling some economic insecurity will support school bonds and school spending.

At the same time our politics are changing. The Democratic and Republican primary races illustrated that, but it's a much broader issue. The old coalitions are starting to fray, and although we've seen an uptick in people identifying themselves by party, it's clear that there is a hunger among voters for a more post-partisan politics and new alignments around issues, and coalitions that can actually get things done. And, at the same time, our politics are taking on an unmistakable global focus. It's not just the war; issues like trade, warming, economic policy, and increasingly the conversation about education have a global aspect that speaks to the greater interconnectedness of the world today. Some of the debate about globalization and competitiveness is hype in terms of education and in some ways the same debate we've had for a half century—now it's the Chinese and Indians, where it used to be the Russians or Japanese. But it's a mistake to ignore those issues altogether as some in our field counsel us to do.

Within education, persistent underperformance by urban schools and chronic achievement gaps are starting to splinter the traditional coalition of minorities and teachers unions. Why? Well, consider the National Assessment of Educational Progress, a national no-stakes test given to a representative sample of students. On the NAEP African-American high school students perform at the 20th percentile of the white performance distribution. Put another way, students of color trail white students by about four grade levels when they're in high school. And meanwhile the Harvard Civil Rights Project reports that only about half of the nation's black and Hispanic young people finish high school on time.

Against that backdrop it's not surprising that minority parents in more than a few cities are saying, "enough." And when you think about those demographic trends, the stark reality is that the only major group of students who are reasonably well-served by the public schools will decline in market share over the next 40 years.

Third, we have more information available than ever before and many new ways to consume it. What's happened in the media space in a relatively short period of time is pretty remarkable. At the elite level, it was not that long ago that the news cycle more or less began and ended with a few major newspapers and networks. Now Internet news sites, blogs, and new niche publications, for instance the Huffington Post or Politico, matter a lot, too. In a recent interview in the University of Virginia alumni magazine Brit Hume discussed the challenge of producing an evening news broadcast these days as opposed to in the past. Today, by the evening, people have generally learned the news of the day through cable news or the Internet. That's a real change from when a few media outlets set the tone and agenda.

For schools, this portends a real challenge. For parents and other educational consumers, a real opportunity. Not that long ago, it was hard to get much information about schools except from school officials, teachers, and the news media—who also often struggled to get it. Now you have elaborate Web sites about schools, Greatschools.net or Schoolmatters.com, that provide all kinds of information about schools and even interactive ways that parents can communicate with each other about different schools. The federal No Child Left Behind Act has hastened the data revolution in education. Just a few years ago hardly any states tracked a full panoply of data. That's one reason the law's accountability requirements work the way they do. Many of the ideas that are tossed around to improve the law sound commonsensical, and often are, but they were not options in 2001 because states had so little capacity to gather and use data. But today the Data Quality Campaign reports that more than half the states have more than half of what they define as the essential elements of a data system in place. And just about every state is making progress on data.

But with that information comes power and a new understanding of our educational challenges. The education reform battle from 1954 until into the 1980s was mostly about access to school, in particular, access for minority students and students with special needs. Today, the debate is fundamentally about what happens inside schools. In other words, the unit of analysis is shifting from schools to students. That's important because we know that even under the same roof—and even within the same classroom—students can have profoundly different experiences. And as more parents, and again especially minority parents, become more aware of some of the inequities in schooling, it is changing the conversation and politics around our schools.

So what's the impact on schools and education policy?

Well for starters, education has changed, too. Today we know a lot more about education from an empirical standpoint than we did not too long ago. That means that at the elite level the debate has shifted from whether or not schools matter relative to the demographic backgrounds of students to the question of how and why they matter and what elements matter most. That's led to big debates about teacher quality, school effectiveness, school choice, and so forth.

But those are the right debates to have because while we know that teachers and schools matter, and that especially effective ones can make substantial progress toward tackling the achievement gap, our public policies are still organized in a way that reflects a basic assumption that schools and teachers don’t matter. That assumption guided education policy for a long time. In fact, education policy, as an undertaking distinct from more general social policies or welfare state policies is a relatively new field.

Today, however, policy and governance are still not organized around the idea that schools can perform at high levels and the underlying idea, perhaps the most important in education policy today, that different schools and teachers have different effects on similar students.

Ignoring performance is a problem because there are three primary trends that are buffeting schools today and all three carry real risks and real opportunities. The most pronounced of the three is the demand for greater performance.

Today, schools are under intense pressure to improve performance. That takes two forms: pressure to improve the performance of underserved populations and address the achievement gaps as well as pressure to perform better overall. One of these, greater equity and closing the gaps, is a more immediate problem that really tears at the nation's social contract. Essentially, to borrow President Clinton's formulation—or Horatio Alger's—the idea is that if you work hard and play by the rules you can achieve a middle-class lifestyle, enjoy opportunity, and some degree of self-determination.

But today we know that from an educational standpoint, that’s too often not true, and that within the country, within states, within communities, and often even within school districts, opportunity is not equitably distributed in terms of school effectiveness. The data are crystal clear on that point. In the near term though, this is less a problem of global competitiveness than what kind of country we want to live in because it puts us on the path to being a very bimodal one with little social mobility and a small middle-class.

At the same time, although the problems are longer-term, we shouldn't minimize the need to improve performance overall as well. While too much can be made of various international comparisons, the reality is that American students don’t perform as well relative to their peers as they should. For a long time this didn’t matter. For instance, in engineering the old saw was that sure, German engineers were on average better than American ones, but it didn't matter because we could put four of ours on a problem while they only had one.

Today, if countries like India and China do succeed in getting their act together from an education and social policy standpoint, we're not going to win a numbers game. For instance, if the population of India under 14 years of age were its own country, it would still be the world's eighth-largest and China the 13th largest. And that's today, those countries are growing. Meanwhile, we're competing against a lot more countries than those, some of whom feel a greater urgency around schooling than we do and have key elements like higher education, an English-speaking population, democratic governments, and market-oriented policies.

The second pressure is the demand for more choice and customization in schools. To be a bit glib about it, the generation that enjoys HBO on demand wants everything else on demand, too. Yet in education we vociferously resist efforts to empower our consumers. This is an enormous mistake because throughout American history, consumers battle producers, and over time the consumers win. That's true of railroads, ice, airlines, telecom, and it ultimately will be true of education.

Today's consumers don't want to be told how things will be; they want a participatory and interactive relationship. Just think about how people consume entertainment, music, news, food, and so forth. This is a consumer culture, and the generation that most takes that as a given is the generation that is increasingly going to be the public school constituency.   

Of course, there is a Maslow's hierarchy at work in terms of what customization means in public schooling. If you're sending your child to a school where you worry daily about their physical safety, then you have more basic needs you want met. But if those are met, then you want academic quality. And then there are all these other aspects of schooling that are harder to measure but nonetheless matter a great deal to people.

Researchers Brian Jacob and Lars Lefgren took a look at this and in a study of parents found that low-income parents were more concerned about academics while upper-income parents worried about "softer" aspects of schools, for example, student satisfaction. But whether it’s theme schools, Core Knowledge, Montessori, or just schools without metal detectors, parents in all communities increasingly want things they are not getting today. And they are not wrong. In addition to improving quality, mass customization holds tremendous potential to serve students better and broaden and deepen support for public schooling.

Finally, schools face the finance pressure that I discussed. Today we spend $500 billion dollars on schools. That’s about the size of the world's 26th largest economy. Since 1970 we’ve more than doubled spending on schools. This has been for the good and improved the quality of education. Overall, America's public schools are better than they were 40 years ago. This money has hardly been wasted as some claim. But that spending trajectory is just not sustainable. That means that public schools are going to have to learn to do more with the same, or even with less.

Traditionally, we've approached spending and resources from the standpoint of accretion. We always add spending items and rarely think about using time, people, or resources differently. Yet going forward we're going to have to entertain some seemingly radical ideas, like perhaps increasing rather than decreasing class size but paying, training, and supporting teachers much more than we do today, or giving some high school teachers larger classes but also providing them with assistants to help them grade student work more thoroughly. Education is always going to be a labor-intensive field; that has been the nature of it since the beginning: Teachers teach students. But we simply have to think about how to deploy resources differently given the constraints we face today.

Yet despite all this, today the way we approach education as a policy matter seems almost calculated to antagonize the people we will most need to support public schools. The field resists most serious efforts at accountability and improved performance, relentlessly fights against any scheme that gives parents the ability to choose among public schools or more importantly expand choices by letting new providers of public education into the marketplace through ideas like public charter schools, and all the while demands that taxpayers dig deeper while not seriously addressing efficiency or productivity. And, our field too often approaches our various problems as at least as much a public relations challenge than an actual substantive problem. That's a time-limited strategy in a country where history tells us to bet on the consumers when producer—consumer fights break out.

So the bottom line is that the public education industry is still almost wholly unprepared for all three challenges and the demographic shifts that underlie them. We don't organize ourselves in a way that promotes performance or creates real accountability for it. And despite the clear rise of a choice-based generation, we resist measures that would take power from vested interests and stakeholders and place it in the hands of our consumers—who over time will be our supporters, or not. And we persistently demand more money while paying scant attention to basic questions of resource effectiveness or really forward-looking ideas to radically enhance productivity.

The problem is not a lack of good ideas.  Across American education you see problems being addressed in various ways. That's the most frustrating aspect of this problem—the wildly varying quality of schooling within close proximity. And, there are inspiring new ideas. Teach for America shows how we can start to address our human capital pipeline problem and attract outstanding people who will go on to play a variety of roles in education inside and outside of the classroom. KIPP, Uncommon Schools, Achievement First, Green Dot Public Schools, and other high-performing networks of schools show what’s possible even with the most challenging students. The New Teacher Project and ideas like the residency-based teacher training at the Academy for School Leadership and High Tech High in San Diego show new ways of approaching training and human resources. And superintendents like Alan Bersin, Michael Bennet, Michelle Rhee, Arne Duncan, and Joel Klein bring new energy and ideas into the field. These ideas are not without their own complications and challenges, but they do show that it's possible to harness the energy of entrepreneurs and new ideas, the same spirit that fuels our most successful enterprises overall, and apply it to the challenges we face.

In the end, Americans, regardless of their other differences, want quality, choice, and customization in their lives. Against today's backdrop the public schools fail to provide them with these things at great peril to the institution. We're in a time of pretty intense change as a nation, and it's a mistake to think that progressive projects like the public schools will remain as broadly supported public institutions without adapting to the changing nature of American life.