Let a Thousand Magnolias Bloom: ESA Enrollment in Mississippi

February 5, 2016

southern20magnolia20-20photo201

(Guest Post by Jason Bedrick)

Citing low enrollment and bogus “research” that excludes the mountain of random-assignment studies, one anti-choice group says Mississippi’s education savings account program for students with special needs is a “failure.”

Of the more than 50,000 children with special needs in Mississippi public schools, 251 were qualified and approved to receive vouchers. Of those, only 107 appear to have used them, .0018 of one percent of Mississippi’s children with special needs.

The research claim clearly doesn’t hold water (unsurprisingly, the only gold standard study they cite is the recent one from Louisiana) but what about the low enrollment? Is this a program that parents don’t really want? Or perhaps there just aren’t enough private school seats for parents?

First, it’s pretty rich that a group that opposes educational choice cites low enrollment as a reason it is “failing.” If enrollment was high, do you think they would see that as a sign of success?

Second, the ESA program is still in its first year. As Empower Mississippi demonstrates in this helpful chart, programs that start small can grow significantly over time:

Screen Shot 2016-02-05 at 10.05.01 AM

As Empower Mississippi notes, detractors were probably quick to declare Florida’s McKay scholarships a “failure” when only two students used them in the first year, but after experiencing 1,505,100% growth in the next decade and a half, I doubt anyone is making that case anymore.

That said, detractors might be right that there aren’t enough private school seats right now. However, one of the purposes of educational choice is to expand the market. Greater demand should spark greater supply, if the price is right. Unfortunately, that’s a big “if.” The Magnolia State’s ESAs are currently funded at only $6,500 per year. Funding is tied to the state’s base student cost rather than the cost for students with special needs, as Arizona does.

If Mississippi lawmakers want to see greater supply in private school seats for students with special needs — and empower parents to use the ESAs to tailor their child’s education using tutors, online courses, educational therapy, etc. — then they should make sure that the ESAs are adequately funded.

[UPDATE: Grant Callen of Empower Mississippi wrote to let me know that I got one very important detail wrong: the image I used originally was of a Japanese Magnolia, not the North American Magnolia that is Mississippi’s state flower. I stand corrected!]


Ludacris Endorses ESAs

January 28, 2016

(Guest Post by Matthew Ladner)

Our pal Mike P. may be feeling a bit squeamish about ESAs, but rapper/actor LUDACRIS is ALL IN BABY! From the Atlanta Journal Constitution:

“Regardless to social status, all children should be able to access a great school,” said Ludacris. “Education savings accounts empower all children to be able to access a great education.”

!!!BOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOM!!!


Petrilli’s Regulatory Porridge

January 28, 2016

goldilocks

(Guest Post by Jason Bedrick)

Fordham’s Michael Petrilli offers new taxonomy for school choice tribes dividing the school choice world in three: Purists, Nannies, and Realists.

First, as Matt noted, this is not Mike’s first foray into Hemisphere Fallacy territory. (Or the second. Or even the third.) Like the guy who thinks anyone who is more religious is crazy and anyone who is less religious is a heretic, Mike thinks he has found the Perfect Goldilocksian Mean and everyone else is wrong. In Mike’s view, those who support more regulation than he does are paternalist Nannies, and those who support less regulation are utopian Purists, but the temperature of his regulatory porridge is just right.

Second, as I noted on Twitter, it’s adorable that Mike thinks he’s not a Nanny. He decries their “micromanagement” but he supports forcing private schools to administer the state test (de facto determining what is taught when and even how), as well as price controls that economists will tell you leads to shortages and obliterates the essential price signal (without which we may have competition, but we most certainly do not have a functioning market). He may fancy himself a “Realist” but, if these categories really mean anything, he just has minor disagreements with his fellow Nannies.

Third, Mike is engaging, once again, in the Means and Ends Fallacy. It goes something like this:

I think X is a problem. I believe Solution Y solves X. Group A opposes Solution Y, therefore Group A must not think X is really a problem.

Of course, this is a fallacy because it is entirely possible (as is the case here) that Group A agrees that X is a problem but doesn’t think Solution Y actually solves it. Mike thinks his preferred regulations solve the problem of bad schools, but we think those regulations are more likely to have adverse effects. More on that in a moment.

Mike accuses the “Purists” (those who, like Milton Friedman, conclude based on the evidence from nearly every other industry that markets spur innovation and lead to greater quality and efficiency) of being utopian. He writes:

Start with the Purists. I’m skeptical of all utopian visions, including theirs—one imagining that a full-fledged system of choice (perhaps through universal Education Savings Accounts) will yield greater innovation, productivity, and customer satisfaction—and produce better-educated young people to boot.

But there’s nothing utopian about that. We see that ESAs have already begun to produce greater innovation, productivity, and customer satisfaction. We don’t yet have any data on test scores or graduation rates, but we have no reason to believe that ESAs will underperform the many voucher programs that have produced positive results. No one in the free-market crowd is expecting miracles. We’re expecting the sort of incremental improvement that the market regularly brings about through the process of experimentation, evaluation, and evolution.

(For that matter, the most utopian schemes in education come from the Nannies. Can you imagine a more fantastically utopian scheme than “No Child Left Behind”? Is there a more utopian slogan than that anywhere in education policy? And did anyone in the administration really believe we’d ever achieve 100% proficiency in any state, let alone every state? Either they set up the nation to fail or they were delusional. Or perhaps they just set up the DOE for a naked power grab. But I digress.)

Mike’s central challenge to the Friedmanite crowd is the Payday Lender Problem. What do we do about bad private schools?

First of all, Mike doesn’t have a whole lot of evidence that the government does a better job ensuring quality than the market. Indeed, the Louisiana debacle should give him great pause about that article of faith.

Second, eliminating the least-bad option doesn’t guarantee a better option. Payday lending serves an important function in the market (in the Third World, we call it “microlending,” a concept for which Muhammad Yunus won a Nobel Peace Prize). Poor people who need funds to cover rent or buy food while waiting for payday often turn to payday lenders. If they repay the loan on time, the fees are generally marginal. If they repay late, the interest rates can be exorbitant, especially if (misleadingly) expressed in annual terms. (The interest is so high both because the loans are so small and because the rate of default is so high, which is why banks generally just refuse to lend to the poor.) But eliminating the payday lenders can have serious unintended consequences that make the poor even worse off. The payday lender may charge a steep fee for late payment, but at least Rocky Balboa doesn’t come break your legs.

Kicking a school with poor test scores out of a voucher program doesn’t guarantee those poor kids a seat at a better school. Rather, the state just eliminates that kid’s least-bad alternative. Even in Louisiana, where the voucher schools appear to be doing much worse on the state test than the district school alternatives, the families who chose those schools may well have had good reasons for doing so. Perhaps they were safer. Perhaps they had higher graduation rates. We don’t know. But those families chose them for a reason and they may well be worse off overall if deprived of that choice.

Third, as Michael McShane explained previously, the market process has proven time and again to significantly improve absolute quality (and efficiency) over time:

Cars today are uniformly better than cars in 1950. They are safer. They are faster. They are more comfortable. They are more fuel efficient.  But it wasn’t a clear upward-sloping line to get here. People bought Edsel’s in the 50’s, Corvairs in the 60’s, Chevettes in the 70’s, Yugo’s in the 80’s, Suzuki Sidekicks in the 90’s, and Pontiac Aztecs in the 00’s. These were bad cars.

But “bad” has two meanings in this case, an objective one and a relative one. There are relatively bad cars out there today. That is, my hail-damaged ’05 Kia Spectra with no cruise control and a blown-out right front speaker is worse than Jay-Z’s Maybach on almost every calculable measure, relatively speaking. But my Spectra, which is still purring like a kitten after over 100,000 miles with darn near nothing more than oil changes, tires, and brake pads is a helluva lot better than the burn-out-after-five-years cars that automakers made for decades.  That’s absolute quality.

Markets work when the spectrum of relative quality drives improvements in absolute quality.  Someone sees my little tin can driving down the road and says “I want to buy a car that doesn’t look like it’s going to blow away in a stiff breeze” and cars get less tin-canny.  Someone buys a Ford Excursion and then gas prices go up and says, “I’m never doing that again” and cars get more fuel efficient. It’s a slow winnowing process, but over time it is superior to centralized systems, that, for example, made the Trabant in an essentially unchanged manner for over three decades.

Rather than thinking we can regulate bad schools out of existence, a better goal is to develop a system that continuously improves what we think a “bad” school is.

Mike Petrilli is right to be worried about kids who are in bad schools today, but the regulations he proposes to ensure that those students are attending relatively good schools interfere with the market process that could otherwise be driving up absolute quality for everyone (and, as Louisiana has shown, those kids may end up in low-performing schools anyway).

Imagine if government officials, following Mike’s logic, had decided decades ago that every low-income family should have access to a phone. Now, these Realist officials aren’t Nannies — they’re not going to have the government make the phones or micromanage the specs. They’re just going to ensure that everyone has access to a good phone, so they create a phone voucher but prohibit companies selling phones from charging more than the value of the voucher. What would have happened?

Well, there’s the seen and the unseen. We would have seen, perhaps, that everyone would have had access to a phone and many would have applauded that (although given the price controls, it’s likely that supply would not have met demand). But what we wouldn’t have seen was that the iPhone had not been invented. With no way to charge more than the meager voucher, there’d be no market for expensive smartphones. And that wouldn’t just have harmed the wealthy, it would also have harmed the poor. After all, Walmart now sells a $10 smartphone that has better specs that the original iPhone. Innovations that at first benefit the wealthier early adopters tend to benefit even the poor after a while.

In short, Mike’s admirable passion to help the poor immediately through state action may well harm them in the medium-to-long run without any guarantee of actually helping them in the short run. That doesn’t sound very Realist to me.

 

 

 


The Three Bees release New Study on Tax Credit Funded ESAs

January 21, 2016

(Guest Post by Matthew Ladner)

Jason may have not yet developed the shameless self-promotion bug that afflict the rest of us here at JGPB, so I’ll mention for him that he has a new study out along with Jonathan Butcher and Justice Bolick (ah….I just love the sound of that…) on tax-credit ESAs.

The Three Bs make a strong case on the desirability of converting existing tax credit programs over to multiple uses, and also correctly note possible constitutional advantages under some state constitutions for a tax credit approach. The technology for allowing multiple uses for funds looks to be better and cheaper than one might expect (account management/oversight technology is fairly advanced) which may allow for oversight within the admin fees typically allowed by scholarship tax credit programs.

The Three Bs did not directly address the topic of scale. The mighty Florida tax credit program currently looks likely to reach the practical limits of its ability to scholarship children somewhere below 100,000 out of Florida’s 2,500,000 students. This might change if new taxes can be added to credit, but the mechanics of creating a credit against some taxes seems somewhere on the speculative to work-in-progress spectrum at present.

Thus I enthusiastically support conversion of existing tax credit programs to multiple uses, and under some state constitutions, it might be a very good idea to choose this option over a state funded model. Outside of those circumstances, I’d recommend taking your chances with a state funded model if aiming for more than a pilot project.


Florida Renames ESA to Honor Senator Gardiner

January 14, 2016

(Guest Post by Matthew Ladner)

The Florida legislature strikes first in 2016- expanding their special needs ESA program and renamed them the Gardiner Scholarship program after the Florida legislature’s tireless champion for special needs children. RedefinED reported on the floor debate in the Florida Senate:

“This is a bill that people come up to us with tears in their eyes and talk about how it’s changed their life,” Gardiner said, calling attention to a girl with special needs who was seated in the back of the chamber.

“She said, ‘I just want to go to college,’” Gardiner said. “Your bill will provide that path, from cradle to career.”

Senate President Gardiner, the original sponsor of the Florida ESA law, follows in the footsteps of former of another special needs father and former Senate President John McKay in crafting an innovative program to serve the needs of Florida’s special needs students. Senator Gardiner is deeply deserving of the honor that the Florida legislature has bestowed upon him, just as Senator McKay was before him.

Greg btw is one signature away from 1 down, 6 to go in piling up yet another victory over Jay Mathews.

 


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.)


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