Coons and Sugarman called for ESAs-in 1978!!

September 9, 2015

(Guest Post by Matthew Ladner)

Okay so yes it took us 33 years to figure out how to create ESAs after someone first proposed them, and yes we had to stumble into it. Don’t blame me- I was battling my Luke Skywalker action figure against my Stretch Armstrong, and well, er, better late than never! Ron Matus with a great post on Berkeley law professors Jack Coons and Stephen Sugarman’s call for what we now call ESAs- in 1978. Here is a taste:

John E. “Jack” Coons and Stephen Sugarman didn’t use the term “education savings accounts” in their book, “Education by Choice.” But they described a sweeping plan for publicly funded scholarships in terms familiar to those keeping tabs on ESAs. They envisioned parents, including low-income parents, having the power to create “personally tailored education” for their children, using “divisible educational experiences.”

To us, a more attractive idea is matching up a child and a series of individual instructors who operate independently from one another. Studying reading in the morning at Ms. Kay’s house, spending two afternoons a week learning a foreign language in Mr. Buxbaum’s electronic laboratory, and going on nature walks and playing tennis the other afternoons under the direction of Mr. Phillips could be a rich package for a ten-year-old. Aside from the educational broker or clearing house which, for a small fee (payable out of the grant to the family), would link these teachers and children, Kay, Buxbaum, and Phillips need have no organizational ties with one another. Nor would all children studying with Kay need to spend time with Buxbaum and Phillips; instead some would do math with Mr. Feller or animal care with Mr. Vetter.

Coons and Sugarman were talking about education, not just schools, in a way that makes more sense every day. They wanted parents in the driver’s seat. They expected a less restricted market to spawn new models. In “Education by Choice,” they suggest “living-room schools,” “minischools” and “schools without buildings at all.” They describe “educational parks” where small providers could congregate and “have the advantage of some economies of scale without the disadvantages of organizational hierarchy.” They even float the idea of a “mobile school.” Their prescience is remarkable, given that these are among the models ESA supporters envision today.

Sounds very, very familiar eh?




ACLU v. Nevada Children

August 27, 2015

(Guest Post by Jason Bedrick)

The American Civil Liberties Union announced today that it is filing a legal challenge against Nevada’s new education savings account program. The ACLU argues that using the ESA funds at religious institutions would violate the state’s historically anti-Catholic Blaine Amendment, which states “No public funds of any kind or character whatever…shall be used for sectarian purposes.”

What “for sectarian purposes” actually means (beyond thinly veiled code for “Catholic schools”) is a matter of dispute. Would that prohibit holding Bible studies at one’s publicly subsidized apartment? Using food stamps to purchase Passover matzah? Using Medicaid at a Catholic hospital with a crucifix in every room and priests on the payroll? Would it prohibit the state from issuing college vouchers akin to the Pell Grant? Or pre-school vouchers? If not, why are K-12 subsidies different?

While the legal eagles mull those questions over, let’s consider what’s at stake. Children in Nevada–particularly Las Vegas-–are trapped in overcrowded and underperforming schools. Nevada’s ESA offers families much greater freedom to customize their children’s education–-a freedom they appear to appreciate. Here is how Arizona ESA parents responded when asked about their level of satisfaction with the ESA program: Parental satisfaction with Arizona's ESA program

And here’s how those same parents rated their level of satisfaction with the public schools that their children previously attended:

Parental satisfaction among AZ ESA families with their previous public schools

Note that the lowest-income families were the least satisfied with their previous public school and most satisfied with the providers they chose with their ESA funds.

Similar results are not guaranteed in Nevada and there are important differences between the programs–when the survey was administered, eligibility for Arizona’s ESA was limited only to families of students with special needs who received significantly more funding than the average student (though still less than the state would have spent on them at a public school). By contrast, Nevada’s ESA program is open to all public school students, but payments to low-income families are capped at the average state funding per pupil ($5,700). Nevertheless, it is the low-income students who have the most to gain from the ESA–and therefore the most to lose from the ACLU’s ill-considered lawsuit.

(First posted at Cato-at-Liberty.)

Heritage Foundation’s Burke recruits Arizona All-Stars to talk ESAs

August 11, 2015

(Guest Post by Matthew Ladner)

I finally got to watch this Uncle Milton birthday event at the Heritage Foundation on ESAs with Jason Bedrick, Jonathan Butcher and Tim Keller of Cato, Goldwater and IJ Arizona respectively.  Cactus patch represent! Spoiler alert but look for guest appearances by a famous spymaster and another by a very famous animated character.


Yo Mick! Call me an ambulance, I’m getting in the ring with Howard Fuller

July 20, 2015

(Guest Post by Matthew Ladner)

The school choice tent stretches broadly over a wide stretch of the philosophical turf, hanging over rich intellectual traditions on both the right and left. Any movement that can encompass people as diverse as Milton Friedman and Daniel Patrick Moynihan is going to have more its share of philosophical disagreements- and someone else’s share for dessert.

In my early years of serving as a school choice padawan I found this discord disorienting. Eventually however I grew to appreciate the beauty of the movement’s diversity. Howard Fuller, one of the founders of the modern choice movement, helped to inspire a deep appreciation of the importance of equity that I continue to carry with me today. Recently however Dr. Fuller took a position against the new Nevada Education Savings Account program. It’s time for a good ole fashioned rumble under the tent.

Dr. Fuller recently came out against the Nevada ESA program due to the near universal eligibility in the law. It is with no small amount of trepidation therefore that this school choice middle-weight will step into the ring with a school choice heavy-weight to explain why I think Dr. Fuller’s critique fails. I’ll do my best to give Dr. Fuller a good fight to defend Nevada’s honor. Win, lose or draw I am confident we will walk out of the ring friends, although I may be a more than a bit worse for wear.

Dr. Fuller delivered a blistering synopsis of his viewpoint in a podcast interview for the RedefinED blog. I am fearful to report it to you, as it is incredibly compelling. Here goes:

The thing that I most worry about is that people will forget the importance of protecting poor people in this. Because one thing I found about movements, and particularly as we begin to talk about we got to protect the middle class – all of which I’m not opposed to – what I learned over time is that there’s not some group of people, and I hope BAEO is going to at least be that group, that consistently and unapologetically says we’re in this to protect the interests of a lot of the poorest people.

Because I found that if that doesn’t happen, that somehow their interests will be put aside. And we get all kinds of reasons why and this and that. So I just want people to know … when folks move towards universal, just know that some of us are going to fight it. And we’re going to fight it because our history has taught us what happens when you establish a program that’s allegedly for poor people and then all of a sudden we all got to get in it and this and that and all lifeboats get lifted and this and that. I have found that all the life boats don’t get lifted.

And so I just want everybody to be clear that there’s some of us in this room that will never give up on the notion of standing for the poorest people in our society. And we will not let people just lightly go on as if America has proven that it cares deeply about the poorest people. Because to me the opposite is true.

That’s the thing that worries me about this movement and it’s something people don’t always like to hear. Why is he saying that? I’m saying it because I just want people to be clear where we are. And why we are where we are. Because every day, I see our poorest children dealing with issues that most of us will never even contemplate, let alone live.

Okay so that does look like a knockout- but let’s assume for the sake of argument that Howard put me on the canvass but I got a standing 8 count and my corner is administering to my impaired vision. Cut me Mick!

I agree with Dr. Fuller that expanding opportunity for poor children is vitally important. I also believe that Nevada’s very limited supply of seats in existing private schools will go quickly and much of that limited supply of seats some of those seats will be beyond the means of those utilizing ESA funds alone. I also believe however that this is of limited significance to the bigger picture: NVESA can and will expand opportunity for the Silver State’s poor children.

Nevada begins its private choice journey with a very small private school sector-about half the national average (see page 25) at 5.5% compared to a national rate of 10%. The number of private school seats in existing private schools will therefore prove limited. The tuition at some of these existing schools will exceed the maximum subsidy amount for either low or high-income kids. The interests of the vast majority of Nevada students choosing to participate in the program- both poor and non-poor-must focus primarily focus on the options outside of private schools and in the creation of new private school seats.

First let’s discuss equity. NVESA provides 12% greater funds to low-income and students with disabilities than to middle and high-income students- $5,700 to $5,100. The modesty of these funds was not driven by ideological fervor on the right, but rather by an instinct to protect school districts-which receive far more than either of these figures in total funding. NVESA is only accessing state funding, whereas districts get a great deal of funding from the local level. It may be possible to supplement the ESA for disadvantaged children with the state’s also new tax-credit program, but with a $5m statewide cap it can only do so much.

A $600 advantage for poor children under the ESA program may look small in isolation, but huge compared to the way Nevada finances public schools. Current funding per pupil in Nevada districts varies between around $8,500 per pupil in Clark and Washoe districts (Las Vegas and Reno areas) to as much as $38,284 in one of the small rural districts (see page 86). The vast majority of kids-and poor kids-find themselves clustered in the two large districts with more modest per pupil funding.

Even more important than equity issues between districts are those within districts. Dig around a bit into the finances of fancy public schools in Nevada and you’ll find that they spend vastly greater amounts than average for the district. Spending per pupil, for instance, in the posh Incline Village High School stood at $13,248 per child compared to a statewide average of $8,274.

Should we worry that some in Incline Village may give up their spot at their $13,248 per year public school for a $5,100 ESA? I’m not going to lose sleep over it for two reasons. Only 48% of Nevada’s middle and high income Anglo students scored proficient or better on the 2013 NAEP 8th grade reading test. You read that correctly- less than half. Perhaps Incline High could use a little competition. Second, to the extent that Incline parents do take advantage of the program, it may open spots for transfers among students whose parents work in Incline but who cannot afford to live there.

The Nevada public school system gives the most to the kids who start with the most. This should come as a shock to no one- the taxpayers in Incline Village almost certainly pay more tax than average to go along with their higher levels of spending. John Rawls might imagine a world in which Incline parents pay their big tax bills but send their children to public schools with below average funding. It’s not however the public school system of the world we live in.

The ESA program on the other hand gives the most to the kids who start with the least- making it far more progressive than the public school system itself. Granted that both Drs. Fuller and Ladner would like to see it do still more for disadvantaged kids (I’m especially anxious to add a system of special education funding weights that Nevada currently lacks even for public schools to the program). “Better than the public schools at equity” may not mean adequate mind you. Unless however either of us is going to call for the dissolution of the Nevada public school system on equity grounds for poor children, we should both support the ESA program.

Dr. Fuller could still oppose private choice programs that he fears will not benefit poor children, even if it involves applying a bit of a double and/or higher standard. I believe the Nevada ESA will create such opportunities. Let’s again focus on those preexisting private schools. They educate 5.5% of Nevada’s school children, which amounts to around 24,000 students. Let’s make the heroic assumption that they can squeeze and increase enrollment by 50%. That’s around 12,000 students. The United States Census Bureau currently projects Nevada to add almost 300,000 5-17 year olds between 2010 and 2030, with a total school aged population of 765,000 in 2030. One should view the current private schools, in other words, as of limited relevance to the ultimate success of NVESA. The game in Nevada will be won or lost based upon making options outside of traditional schools work for kids, and in the creation of new school seats.

Let’s discuss the non-traditional options first. NVESA allows for an a la carte approach through the use of private tutors, online programs and individual courses from various providers. Homeschooling serves as the obvious model for study for an a la carte approach. Homeschooling has been the fastest growing parental choice option, which ESA parents should regard as a decades long learning experience to examine.

“Do it yourself” education is obviously not an option that fits every child or every family’s schedule, but decades of experience has led to the development of co-ops that makes the practice more accessible including the need for custodial education. Cooperative education moves “do it yourself” to more of a “do it ourselves” voluntary association, making this option less intimidating for many people. What can low-income parents make of this experience and $5,700 in a use-restrict education account? I’m not sure, but I am anxious to see how they proceed with their new freedom. This much is for certain: every low-income child in Nevada will have opportunities which they lacked before the passage of ESA, even if there were not a single private school seat available. ESA is not your father’s Oldsmobile.

In the more traditional custodial private school space, the challenge will be to open new schools that can deliver a high-quality education at a $5,700 per pupil or lower price point. Can this be done?

We can’t be sure, but the stage is set for innovation. The price point is very low by today’s standards, but we do have people experimenting with new schooling models in the private sector space that aim to deliver good results at low costs. The grandfather of these efforts would be the Cristo Rey schools- which began the process of having low-income students share an office job in order to keep their costs down. Cristo Rey serves 9,000 students nationwide, 96% of whom are children of color and they charge an average tuition of $1,000 per year. All of Cristo Rey’s 1,400 graduates were accepted into college in 2014. Fire up the Bat-Signal over Vegas and put the pedal to the metal on reaching scale in Nevada!

Cristo Rey began an experiment with blended learning in 2014. Other private school operators have begun exploring blended models school models as well. While the academic results from the blended Cristo Rey school demonstrated strong early promise (students averaged a year and a half sized mathematics gain during a summer preparatory camp) the ultimate goal of these experiments will be to find an appealing mixture of in-person and technology based learning that increases academic return on investment.

Philanthropic effort will almost certainly focus on the Las Vegas area, where the vast majority of Nevada low-income students reside, not on Incline Village. This is a huge challenge, and a great deal of work lies ahead in implementing this law if it is to realize anything close to its full potential. Banish any thought that NVESA is a “fire it and forget it” type of program- the devil lies in the details of implementation.

Nevada’s low-income children will have new opportunities as a result of this program. The advantages created for the already advantaged pale compared to those already offered to them in the public schools.  Unlike the public school system, the ESA program creates an advantage for the poor. Finally Nevada’s ESA program will live or die on innovative education strategies and new private school seats. The school choice supporting philanthropists who Dr. Fuller and I have worked with for decades will have a heart for the poor in that process. I’ve thrown almost all my punches, but I’ve got one left that I saved for the final round.

My last punch is a question of fairness and soundness of strategy. I do not believe that there would be a public school system today if Horace Mann had labored under a notion that high-income people should pay school taxes but should not be eligible to send their children. I have yet to hear anyone seriously propose to means test public schools-the mere thought of it is outlandish. Some very wealthy people choose to pay private school tuition above and beyond their school taxes, but try to take away their child’s eligibility to attend public schools and you will have a fight on your hands-and rightly so. Wealthy people pay their taxes just like poor people do, and in most places they pay far more taxes. Rather than make the well to do enemies of public education, our forefathers decided (wisely in my view) to allow them to attend like everyone else.

We have universal access to district schools, charter schools and digital education programs and public universities. Everyone helps to pay for them, everyone deserves access stands as a guiding principal. Everyone pays Social Security and Medicare taxes; everyone is eligible for the programs. Defenders of those programs treat means-testing proposals like a mortal threat because they understand that universal access stands as the foundation of broad public support. Perhaps until recently, school choice programs operated at such a small scale that it might be possible to avoid the elephant in the room: everyone pays for school choice programs so on what basis would we deny them to anyone?

The poor do have among the biggest problems in Nevada education, but they do not have the only education problems. The Nevada ESA program strikes an appealing balance of near universal eligibility with a funding advantage to the poor. Policymakers can improve upon the equity in the program. I and many others will activity support such improvements. I think the program merits Howard’s support however as it stands as a huge improvement in the opportunities available to Nevada kids.

Yo Adrienne! I’m all punched out and the final bell has sounded. Let’s go to the judges. They (meaning you dear reader) can decide whether this is Rocky where Apollo wins and is still the champ, or Rocky II where our raw-egg chugging everyman scrapes himself off the canvass faster than the champ and pulls the upset. Either way, if Dr. Fuller takes the time to respond, I am up for a rematch.

West Overtakes East in Improbable 2015 Comeback

June 4, 2015

(Guest Post by Matthew Ladner)

While East leads West 3 ESA programs to 2, West has pulled an improbable victory over East with much broader eligibility.

To wit:

The once lonely Arizona program has been joined by neighboring Nevada. The Arizona ESA makes around a quarter of Arizona public school students eligible to participate. The new kid on the Western bloc makes 100% of public school students eligible.

While East has three programs, wonderful programs I might add, all three focus exclusively on special needs students, and in two out of three cases not even all special needs students.

I’m calling it: West is your leader in the clubhouse.

Florida ESA expansion receives unanimous House support

April 26, 2015

(Guest Post by Matthew Ladner)

A bill to expand Florida’s Personal Learning Scholarship Accounts eligibility to children with muscular dystrophy and a wider array of the autism spectrum, and to include 3 and 4-year-old children otherwise eligible for special education services passed the Florida House of Representatives without a dissenting vote last week. The bill’s Senate companion also passed without dissent, and a large increase in the appropriation for the program is in the works, although just how large remains to be agreed upon. That increased funding will be needed given that parents have already begun 10,000 applications for next year, which outnumbers current participants by more than 5 to 1.

So far ESA programs have doubled from 2 to 4, with Mississippi and Tennessee joining the family, and we are waiting on word from Montana. The lawmakers in the states with the pre-existing programs have expanded eligibility in both. Bills in a number of other states remain in play. Delightfully, our experiment in ordered K-12 liberty continues to gain momentum.

Let’s see what happens next.



Raising the Bar on the Forster-Mathews Bet

April 1, 2015

(Guest Post by Matthew Ladner)

Thus far I am aware of a tax-credit improvements in Alabama and Arizona, new special education scholarship programs in Arkansas and Mississippi, and many other measures pending in many other states. I think it is safe to say that Greg will once again defeat Jay Mathews in the over/under of 7 enactments.

WSJ choice


While we celebrate yet another Greg victory, it may be a good time to pose a different question for ourselves: how many states have enacted a choice program or a combination of choice programs sufficiently robust to see a growth in private education in the face of a strong charter school law? A Rand Corp study found private schools will lose one student for every three gained by charter schools in Michigan.  We would not expect to find an exact match for this nationwide, but charter schools do by definition draw upon the universe of would-be choosers: parents who are looking for alternatives outside of their zoned district school. It makes sense that they would have a larger impact on private education.

If we assume the Michigan finding to be roughly equivalent to a national average, then we can proceed to check the tape. First charter school enrollment by state:

Charters school enrollment

Next private choice program enrollment by state (from the Alliance for School Choice Yearbook):

Private choice students 1



Private choice students 2

So how many states have one-third or more as many private choice students as charter school students? Indiana is matching private choice students with charter school students despite a strong charter law thus far, and so is the leader in the clubhouse. Florida barely met the 1 private choice for 3 charter school students standard between the combination of the corporate tax credit program and the McKay Scholarship program. Without new revenue sources however growth in the Florida tax credit will stall in the next few years even as statewide student growth continues. Moreover Florida charter schools have almost certainly drawn a relatively advantaged group of students from private schools (charter schools have universal eligibility). The private choice programs have been aiding only low-income and children with disabilities and providing significantly fewer resources than those students receive in public schools (smaller tax credit scholarships in the case of low-income children, no local top-up funds in the case of McKay students).

Florida lawmakers have been busy improving the ability for high quality charter operators to open new schools (as they should) but balked last year at providing new tax credit revenue sources. Absent some large policy changes Florida will soon slip below the 1 to 3 ratio.

Iowa met the standard because of a healthy and growing tax credit program and a weak charter school law (3 total schools), so give them an *. Wisconsin meets the bar with the combination of private choice programs and a charter school program that (last I heard) is still bottled up in Milwaukee, so kind of an * too.

The Illinois and PA programs would require some sort of estimate regarding the price elasticity of demand for private schooling, but I’ll just heroically guess that charter schools have the better end of the deal in those states. Arizona and Ohio have more than three charter students for every private choice student. Other states like California, Michigan, New York and Texas seem content to watch their charter school sector batter their private school sectors into gravel.

Bear in mind that this comparison would look even more lopsided if we counted dollars rather than students. For instance the average tax credit scholarship in Arizona runs around $2,000 while the average charter school receives around $7,000 per pupil. Very few of the private choice programs come near to matching the per pupil level of subsidy provided to charter, much less district schools. Emblematic of this failure was the choice of 12 Catholic schools in Washington D.C. to give up the ghost and convert to charter schools after a (poorly designed) voucher bill had passed.

The goal of the private choice movement should not be to preserve a preexisting stock of private schools per se, but rather to allow parental demand to drive the supply of school seats. Those District of Columbia Catholic schools did not convert to charters because the parents were clamoring for it, but rather because the Congress had offered almost twice as much money per pupil to do it. States like Texas invest hundreds of millions of dollars per year into a charter sector that draws disproportionately from private schools while providing parents who would prefer a private education for their child nothing but the prospect of struggling to pay their school taxes and private school costs simultaneously.

Seen in this context, many private choice victories seem worthy but incremental. Incremental change is the equilibrium point of American politics, but the choice movement needs more Indiana style successes. Once more unto the breach dear friends…


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