Early education investment shows big dividends

The pre-k class at the Ignacio Cruz Early Childhood Center in Perth Amboy, N.J.

Fewer American children are getting an early start on their education. A study out Tuesday says states cut nearly $30 million in funding to preschools last year. That leaves only one-quarter of 4-year-olds enrolled in Pre-K programs. Jim Axelrod found how an investment in early education can pay big dividends.

PERTH AMBOY, N.J. - Serving a low-income, under-educated population in Perth Amboy, N.J., the Ignacio Cruz Early Childhood Center is beating some long odds by performing above the national averages for Pre-K programs.

"When you come into my classroom you would probably say 'The children are playing,' and I would argue they're not playing -- they're learning," said teacher Meghan Lawton.

Lawton's got a point. Her 4- and 5-year-olds already seem to be a step ahead with their numbers, their letters and even on a computer.

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"The evidence is really clear...pre-school makes a big difference...by itself it can cut school failure in half," said Steve Barnett.

One study found high school graduation rates 17 percentage points higher in a district with public Pre-K.

But not every state has enough money to pay for what the evidence shows is worthwhile. Ten states cut Pre-K funds this year. Ten more don't have Pre-K at all.

The economic downturn has been felt across the country in classrooms, as many states scale back funds for preschool education. But in New Jersey spending is actually up -- and the evidence suggests that it's money well spent.

New Jersey is laying out more than $11,000 a year per child -- nearly $400 more than last year. The result? The number of kids who repeat first grade has been cut in half in poor districts that offer two years of Pre-K.

"Investments in preschool increase achievement, decrease crime and delinquency, those kinds of things result in higher incomes later on," said Barnett.

It seems like the proof is in Perth Amboy.

"They're sponges at this age, so the earlier I get them, the better they are in the future," said Lawton.

Even if other places aren't learning their lesson.

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    Jim Axelrod is the chief investigative correspondent and senior national correspondent for CBS News, reporting for "CBS This Morning," "CBS Evening News," "CBS Sunday Morning" and other CBS News broadcasts.