Education in an Era of Austerity

Let’s face it.  The economy stinks and may continue to stagnate for a while.  And the financial picture stinks even more for local and state governments who are not only continuing to experience shortfalls in revenue, but are finally beginning to pay the tab for irresponsible and not easily changeable spending commitments.  The pensions of public employees, including teachers, may bankrupt a number of states and localities even if the economy picks up soon.  The huge and unfunded liabilities from healthcare reform will also begin to hit state budgets hard.  I’m not sure why public employee unions, including teacher unions, backed the bill so enthusiastically because it will inevitably come at the expense of state spending in other areas.  Since health and education are the two biggest state budget items, a big increase in state health spending without rapid economic growth driving up public revenues will result in enormous pressure on education budgets.  Thing are going to be very tough for education spending going forward.

But there is a silver lining to this very dire situation:  tight budgets improve the odds for serious education reform.  Traditionally, education reform has been “purchased” with big spending increases for traditional education interests.  The DC voucher program was won only after promising to pour even more millions into the traditional public schools than were poured into vouchers.  Merit pay in Denver was only won after a huge increase in education spending and salaries.

Unfortunately, the price of reform has almost always been too high.  Public schools could almost always get a ton more money without having to make any concessions to reform, so it would take truck-loads of money to get public schools to grudgingly tolerate even the weakest reform.

Those days are over and the price of reform has just come down a lot.  State and local politicians who have no interest in vouchers or charters, per se, will suddenly become very enthusiastic about any proposal that helps them figure out how to pay pension obligations without huge layoffs, giant tax increases, or bankruptcy.

Check out how localities are taking extraordinary actions, like out-sourcing the police department, just to make ends meet.    A similar desperation will soon hit education policy as state and local officials realize that the economy will not pick up fast enough and the feds will not come to their rescue.

2 Responses to Education in an Era of Austerity

  1. Patrick says:

    You should follow the Governor’s race in Nevada – terrible economy, 14 percent unemployment, looming budgetary shortfall, and expiring taxes (the government kicked the people while they were down and squeezed us with the second largest tax increase in state history during the state’s worst downturn since the Great Depression).

    The Democrat candidate (Rory Reid) basically wants to convert all public schools into (publicly owned) charter schools – something we call “empowerment schools” in Nevada. These schools are autonomous, control their own budgets, are only funded when students enroll and students will be free to pick whatever public school they want (that is the plan at least). He also wants to tie tenure to teacher performance and use value added assessment to determine teacher quality.

    The Republican candidate, Brian Sandoval agrees, wants the same, but also wants to toss in vouchers, a social promotion ban, merit pay, and eliminate teacher tenure.

  2. […] conclusion seems to fit nicely with Jay Greene’s blog post a couple of days ago. Jay made the argument that reform is easier in periods of austerity. It could be a very […]

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