Much to Learn About Vouchers Rhee Still Has

April 25, 2012

(Guest Post by Matthew Ladner)

Last month Sean Cavanaugh interviewed Michelle Rhee about vouchers over at Ed Week. Overall I’m happy to have Rhee and other “Cool Kids” support parental choice, even if it is on a limited basis. I hope they think deeper on the subject however, as many Cool Kids are far more misguided on vouchers than Rhee. It is easy however to detect shoot-from-the-hip attitudes in the interview. Rhee told Cavanaugh:

“When people talk about universal vouchers, first of all, I’ve never seen an economic model that actually made sense and laid that out in way that’s sustainable,” Rhee said. I haven’t seen any kind of model that makes economic sense. … My support for vouchers is around a specific group of kids.”

“There are a lot of people out there who sort of believe, the free market, let the free market reign, the market will correct itself—give every kid a backpack with their money in it and let them choose wherever they want to go,” she added. “I don’t believe in that model at all.”

I’m still waiting for the day when supporters of means-tested vouchers come out and explain why they don’t support means testing public schools. Bill Gates could move to Milwaukee right now and enroll his children in public schools that cost taxpayers $13,000 per year. No one blinks. If he were to move to Milwaukee and get $6,400 vouchers however some of us want are inclined to view it as a grave injustice. I’ve yet to hear anyone propose that we should have economic cleansing of charter schools either-out with you middle and high-income children and don’t come back!

Don’t get me wrong- I have fought for a number of means-tested programs and continue to support them. I also strongly support an advantage for the poor, but not means-testing. Rhee is discussing the ideal however, and as an ideal, limited programs have some unresolvable problems.

Rhee also seems to be influenced by straw-man arguments. Very few people advocate a complete free market in education, and those that do don’t support vouchers. From Milton Friedman’s original formulation of the voucher concept he argued for public financing of K-12 education rather than financing and provision. Friedman also recognized the need for some level of regulation. The appropriate level of course remains an issue for debate.

As an aside, Rhee goes on to specifically distance herself from Florida governor Rick Scott’s proposal for universal education savings accounts during his transition, on which Rhee served. National Review Online rightly described this as “the most significant, transformative idea ever advanced by an actual elected official with any real power.” Sadly Scott’s proposal activated the hyperbolic anti-choice antibodies of Florida’s newspapers, and Governor Scott stopped pushing the proposal. Testing new ideas with pilot programs can be a agonizingly slow process, but that process has begun in Arizona. Florida’s private choice program continues to expand incrementally through the Step Up for Students program. I remain hopeful that something between Governor Scott’s initial ambition and the current slow pace of bringing funded private choice eligibility to Florida children will be enacted. Zero to sixty to two seconds sometimes wraps a Ferrari around a telephone pole, the price of being aggressive, but it isn’t an argument in favor of indefinite gradualism.

But I digress. Rhee went on:

“It has to be a heavily regulated industry,” she said. “I believe in accountability across the board. If you’re going to be having a publicly funded voucher program, then kids have to be taking standardized tests. We have to be measuring whether kids are academically better off in this private school with this voucher than they would be going to their failing neighborhood school. If they’re not, they shouldn’t get the voucher. … I’m about choice only if it results in better outcomes and opportunities for kids.”

Rhee’s faith in regulation is odd. The public school system is super-heavily regulated with laws and policies streaming down from the federal, state and local levels. Despite all of that, much of the system performs at a tragically poor level.  That of course is not to say that vouchers should have no regulation, but the right level of regulation is not “heavy.”

Rhee also places far too much weight on the results of standardized test and gives far too little deference to the judgment of parents. Parents make decisions about schools for a large variety of reasons- including things like school safety, peer groups and the availability of specialized programs. In addition to missing the whole point about school choices being multifaceted with parents best able to judge all the factors, individual test scores bounce around from year to year, they often take a temporary hit when a child transfers and adjusts to a new school.

The notion of having program administrators looking at the math and reading tests and deciding to cast children back to their ‘failing neighborhood school’ is very problematic. Pity the poor voucher program apparatchiks who have to drag children back to a public school where they had been continually bullied because they had the flu on testing day. Pity the children more. The subject of what to do about poorly performing private schools in a choice system is a complex topic and opinions vary widely. Rhee’s proposed solution however does not begin to capture this complexity.

Rhee wraps up:

The ideal public school system, Rhee argued, will include high-quality traditional public schools and a charter sector, as well as some vouchers.

“But the vast majority of kids are going to be in a high-performing public school environment,” she said, adding: “I’m a believer in public schools. I’m a public school parent. I ran a public school district.”

Public schools will continue to serve as the primary conduits for education regardless of what we do on the choice side of things.We are a long, long way from having high-quality public schools for all children, and choice can play a role in moving us in that direction. Choice improves public schools and we can hardly will the ends without the means.

If however we embrace only tiny choice programs targeted at limited student populations, that positive role will likewise remain limited. In the end, catastrophically under-performing schools do so because they can get away with it. I’m all for efforts to improve the laughably ineffectual quality of our regulation in an effort to curtail this, but choice is the only decentralized system of accountability that allow parents to hold schools accountable for individual results.

We need as much parental choice as we can get.

(Edited for typos and clarity)

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Jindal Triumphs in Louisiana, Brewer vetoes in Arizona

April 4, 2012

 (Guest Post by Matthew Ladner)

Louisiana Governor Bobby Jindal got both his tenure reform and his voucher/charter school expansion bills through the Louisiana Senate tonight. The bills will either go to the House for concurrence or to a conference committee, but they are getting close.

On a far more disappointing note, Arizona Governor Jan Brewer vetoed a bill expanding Arizona’s Empowerment Scholarship Program.

Her veto message noted the fact that Arizona public schools get funded on last year’s student count, and raised concerns over first year double counting of students in the transfer year.

Time will tell whether Governor Brewer and the Arizona legislature are able to work things out. For now, Governor Jindal is to be congratulated for his strong leadership and courage in taking action to improve Louisiana’s public school system.

UPDATE: The Louisiana House concurred with the Senate 60-42- the choice bill is off to Governor Jindal’s Desk.

 

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Arizona Passes the First New Private Choice Program of 2012

February 29, 2012

 (Guest Post by Matthew Ladner)

Arizona Governor Jan Brewer signed the first new private choice program of 2012 into law today. The new law will create a new individual tax credit the same size as the current one ($500 for an individual and $1000 per couple) that will operate under the rules of Arizona’s corporate tax credit (i.e. means tested and aimed at students transferring from public schools). Individual taxpayers will be able to make donations under both credits each year. Arizona lawmakers are also considering an expansion of eligibility of the Education Savings Account program to students attending low rated schools.

Governor Jindal is gearing up for what sounds like a broad choice program. Florida lawmakers are considering an increase in their tax credit program, Virginia has a chance to join the ranks of choice states.

After the 2011 blowout, perhaps Greg’s original bet with Jay Mathews would make for a high but obtainable bar for a good year for private choice in 2012. Greg’s bet is to legislative monitoring what the NCAA tournament is the college basketball.

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Jonathan Butcher debates the Arizona Education Association on ESAs

January 16, 2012

(Guest Post by Matthew Ladner)

GI’s Butcher debated Andrew Morrill, President of the Arizona Education Association on Education Savings Accounts. Check it out.

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Heritage Foundation on Education Savings Accounts

October 5, 2011

(Guest Post by Matthew Ladner)

The Heritage Foundation has published a new web memo on Education Savings Accounts as a vehicle for parental choice. At this point, Arizona has passed an ESA program for special needs students, a proposal is under consideration in Ohio, Florida lawmakers considered a provision last year, and Utah has a whopper of a proposal on the way.

I had the opportunity to speak to Utah legislator John Dougall about his forthcoming proposal.  Rep. Dougall plans to file a bill that would send all education funding into Education Savings Accounts controlled by parents and guardians, but does not intend to make private school tuition a permissable expense for funds in the account. Dougall in essence plans to have a discussion about customized learning rather than a public vs. private school debate.

Being a Longhorn, this of course brings to mind a scene from the master thespian of our era, the great Matthew McConaughey:

McConaughey: Hey man, you got some private school choice in that ESA proposal?

Passenger: No man, not in this proposal.

McConaughey: Well, it would be alot cooler if you did!

Seriously though, Dougall’s proposal is sufficiently mind-blowing that it doesn’t really bother me that he is choosing to leave private schools out of the mix. If ten years from now Utah is funding district and virtual schooling through an ESA system and the private choice options available were going through tax credit and voucher mechanisms, you won’t hear any complaints from me.

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The Way of the Future: ESA for a la carte

September 20, 2011

(Guest Post by Matthew Ladner)

Utah state Rep. John Dougall has announced plans to introduce legislation to fund student education through a system of education savings accounts rather than through a system of payments to districts.

From the Salt Lake Tribune:

The plan would be unique in the United States and, just like initiatives from the Utah Legislature on public employee pension reform and Medicaid reform, could become a model for other states, its supporters boast.

For example, one parent of a Highland High School student contacted me recently to complain that his straight-A student wanted to take an AP European history class that is not offered by Highland, but is offered by Skyline, which is in a different school district. The request to remain a full-time student in the Salt Lake District’s Highland High but take that one class in the Granite District’s Skyline High was denied, mostly for reasons of state funding of the school districts, although the  Skyline administration said the class was full anyway.

Dougall says his legislation would solve the problem for that student.

He said the student would not be tied to one particular school. He or she could take, say, four classes at Highland, and pay Highland out of the student account for those four classes, then take two at Skyline, paying the money to Skyline from the account, then take a class at applied technology school and pay that school out of the account.  The student could move between school districts while utilizing his or her schedule and could also use the money for charter schools or online instruction.

The plan would put into the student’s account nearly $6,000 a year under the assumption a typical high school class costs a school district about $700. The account would cover up to eight classes per year, with the ability of rolling the money over to the next year if the entire $6,000 was not spent.

Under Dougall’s vision, if the student didn’t spend all the money in the account during his or her four high school years, that student could use the left-over funds toward college.

Educators say that, conceptually, the plan is intriguing, but myriad details would need to be worked out.

Dougall’s proposal would profoundly empower parents, increase parental involvement, require careful consideration of opportunity costs, and spur education innovation. It builds upon previous steps taken to fund digital learning on a per course basis in Utah.

Let’s see how the discussion unfolds-these types of very far-reaching steps represent precisely the conversation and debate that we should be having.

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News Video on Arizona ESA program

July 29, 2011

(Guest Post by Matthew Ladner)

 

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Clousseau vs. Cato (Institute)

April 22, 2011

(Guest Post by Matthew Ladner)

So in the old Pink Panther movies, Inspector Clousseau had this butler named Cato. Apparently, at some point, Clousseau had ordered Cato to conduct surprise attacks in order to keep his fighting skills sharp. Cato took to this role with relish, and Clousseau was unable to get him to stop. Clousseau did not seem to think that the value of the practice outweighed having his apartment destroyed on a regular basis, but Cato certainly seems to have thought it to be the case.

So…

My pals at the Cato Institute hold a strong preference for tax credits over vouchers. They have some reasons to do so- tax credits have thus far proven more durable to court challenge, and so far operate with fewer regulations on private schools. We’ve lost voucher programs in the courts in Colorado, Florida and Arizona and no tax credits yet.

Voucher-only supporters (I am not of this camp) usually about now would note their preference for programs that provide a meaningful level of subsidy to low-income people, and then would recite a litany of perceived deficiencies in existing school tax credit programs. The Illinois personal tax credit program, for instance, can certainly be justified given that taxpayers sending their children to private schools are suffering a double payment penalty.  With a maximum subsidy of $500, however, it doesn’t help anyone much and does very little to put private education within reach of the poor. They would also note that there is less to this less regulation business than meets the eye, given recent tax credit programs in Arizona and Florida which (gasp) require students to take a nnr exam.

Personal tax credits cannot address the needs of poor, especially of the poor with multiple children, or children with disabilities. There are two possible fixes- refundable credits, and scholarship credits. Under a refundable credit, the government would provide you a payment for private school expenses even if it exceeds your tax liability. Cato opposes refundable credits, and we don’t have any examples of them in any case. Scholarship credits involve having non-profits pool donations from tax-donors (either personal or corporate donors depending on the program) and giving scholarships to kids.

Arizona lawmakers passed a school voucher program for children with disabilities in 2006. Edu-reactionaries sued against it and killed it with a Blaine Amendment. We passed a corporate tax credit program in an effort to save the kids on the program, but it debuted during a national financial collapse that impacted housing-crazy Arizona especially hard. The program has helped some students, but I don’t think it is unfair to say it underwhelmed, and had a $5m cap in any case. There was zero possibility that this program could grow into something like the fully scalable, elegantly operating McKay program, which funds special needs children on demand.

The Arizona Supreme Court did repeatedly broadly hint that a program with multiple possible uses for funds would not violate the Blaine Amendment. Nick Dranias and I researched the matter carefully and proposed a system of public contributions to ESAs as a solution. School choice champions in the Arizona legislature crafted a bill, which has now been signed into law by Governor Brewer.

Out jumps Cato from behind the leftovers in the fridge to the attack!

I could go into full OCD point by point refutation mode, but I will spare you by making a few brief comments. First, Adam’s discussion about “third-party payers” is odd to say the least, given Cato’s support of scholarship tax credits. Scholarship tax credits don’t just have third-party payers, they also have fourth party payers- donors and scholarship organizations.

Perhaps the Cato Institute only supports personal credits these days, although I doubt it. Such a preference would constitute utter indifference to equity concerns.

I also think Adam should not rush to jump to any conclusions regarding constitutional issues. When an Arizona Supreme Court justice gets a teacher union attorney to admit that a program with multiple uses solves a Blaine problem in open court, I’m willing to bet that ESAs are constitutionally distinct from vouchers in some circumstances. Further, Adam may be premature in concluding that deposits into these accounts remain “public funds.” Payments to individuals under contractual agreements with the government are not considered public funds- otherwise someone could sue to prevent the state from hiring anyone. Some of the money will end up paying for private school tuition, verboten under Blaine! Some of the top Constitutional attorneys in the country contributed to the development of this proposal including the crack team of Dranias and Bolick at the Goldwater Institute and Tim Keller at the Institute for Justice. I’ll take my chances with them in any court.

I encourage my friends at Cato to give equity concerns some serious consideration. Personal use credits are weak tea when dealing with poor children, children in large families, and children with disabilities. Some families are large, poor and have children with disabilities. This is not to say that personal use credits are bad- in fact, I say that they are a good but limited tool. The same applies to scholarship credits- they are good as far as they go.

Nor finally are choice mechanisms mutually exclusive, and we need every tool we can get.

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The Way of the (Near) Future: Arizona Legislature Passes ESA choice bill

April 8, 2011

(Guest Post by Matthew Ladner)

Yesterday the Arizona Senate gave the final passage for SB 1553, Arizona Empowerment Scholarship Accounts, the nation’s first system of public contributions to education savings accounts as a choice mechanism, 21 to 7.  The bill is now on Governor Brewer’s desk. Designed to replace Arizona’s special needs voucher program lost to our Blaine amendment, the ESA program will allow the parents of a child with a disability to withdraw their child from a public district or charter school, and receive a payment into an education savings account with restricted but multiple uses.  Parents can then use their funds to pay for private school tuition, virtual education programs, private tutoring or saving for future college expenses.

Congratulations and thanks to sponsors Senator Rick Murphy and Represenative Debbie Lesko, my colleagues at the Goldwater Institute especially my coauthor for the ESA paper Nick Dranias. The tireless hard work of Arizona’s school choice coalition resulted in this passage, including but not limited to: A+ Arizona, the Arizona School Tuition Organization Association, the Arizona Catholic Conference, the Center for Arizona Policy, the Goldwater Institute and the Institute for Justice in additional to national partners such the Alliance for School Choice, the Foundation for Educational Choice and the Foundation for Excellence in Education.

This has been quite the week for parental choice in Arizona. First, the United States Supreme Court dispatched a challenge to the tax credit program that had been bouncing around in the 9th circuit for many years. Somehow in the fevered imagination of the ACLU an entirely voluntary program in a state which subsidizes secular options at a much higher rate than the tax credit scholarship compels parents to send their children to religious schools. It would be nice if these guys would follow the lead of the ACLU in Los Angeles and do something useful like suing against tenure policies that really damage the education of children.

Instead, they will probably go straight into court on the ESA program. Sigh. Nick and I followed the lead of very perceptive questioning in the Arizona Supreme Court’s deliberation over special needs voucher programs to make the case for the constitutionality of the ESA concept under the restrictions of the Arizona Constitution. Attorneys on both sides of the case agreed that a program allowing multiple uses of funds would not violate a restriction on providing aid to private or religious schools. Otherwise, we can argue that it is unconstitutional to pay state workers salaries out of the public treasury: some of that money winds up paying private school tuition in religious schools. 

Quelle horreur!

Parents will be using this program for things other than private school tuition, and parents have an incentive to look for education programs which deliver strong results and a low-cost due to the possibility of saving for college expenses. Paging Dr. Technology! As I’ve argued here before, this is a superior design for a parental choice program, and I’ll go further by saying that when we get any kinks worked out, choice supporters should seriously consider converting voucher programs into a system of public contributions to ESAs.

Next the legislature expanded the maximum size of an individual tax credit contribution from $500 for an individual and $1,000 for a married couple filing jointly to $750 for an individual and $1,500 for a couple in addition to the ESA bill.  The legislature also voted to eliminate the statewide cap on the corporate credit.

Great team wins all. Now we need to roll up our sleeves and get these programs to work for the kids who need them.

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The Way of the Future: ESA over KKK

January 31, 2011

 (Guest Post by Matthew Ladner)

The United States began as an experiment in freedom, but has at times struggled with intolerance. America’s culture wars surrounding the assimilation of Catholic immigrants represented just such a struggle in the 19th and early 20th Century. In the 1920s, the Ku Klux Klan successfully abolished private schools in Oregon. The KKK, you see, wanted to standardize Oregon Catholics into “real Americans.” If that thought frightens you, and it should, read on. It’s not enough to reject having the KKK standardize children, we need to embrace a customized education for all children.

The KKK aimed to do this in Oregon with a public school curriculum of which they approved and by banning private school attendance. Thankfully, the U.S. Supreme Court struck down this incredibly illiberal measure in 1925. Today we should not only reject discrimination in schooling, but more fundamentally the notion that one size fits all. Americans can embrace customized education for all children and improve our 19th Century factory-like model of public schooling. We can do this by directly funding students through education savings accounts controlled by parents.

Looking past the ugly religious discriminatory intent of the attempt to ban private schools, this effort reflected a broader problem: an intolerant belief in a “one true way” to educate children. The Klan is not alone in having sought to control schools for their own purposes. Today we see groups on both the left and the right engaged in a never-ending battle over school curriculum. From Creationism to environmentalism to “Heather Has Two Mommies,” the struggles never cease. Worse still, American public schools fail to educate far too many of our students to an internationally competitive level.

Milton Friedman proposed a solution to these problems in the 1950s: separating the school finance from the operation of schools. This would allow parents far greater freedom to choose the sort of education they want, and reflects a liberal “to each their own” system. Over the years, advocates of greater parental choice have carried Friedman’s concept forward in the form of school vouchers and tuition tax credits. Vouchers are essentially state funded coupons that parents can redeem at public or private schools. Tax credits provide indirect aid for parents bearing the expense of a private education in addition to paying their public school taxes. The first modern voucher program began in Milwaukee in 1990, and over 26 voucher and tax-credit programs operate around the country.

Empirical research confirms significant benefits to parental choice, including Friedman’s central claim that it can serve as a catalyst for public school improvement. The need for improvement could not be clearer. Although America has a large number of excellent public schools, the recent PISA exam found that Hispanic and Black American 15 year olds score little better in literacy than their peers in Mexico. Mexico spends a mere quarter per pupil of the American average, and has substantially lower average family incomes. Those receiving the least from the status-quo have the most to gain from reform.

Last week,  Nick Dranias and I released a study for the Goldwater Institute proposing public donations to education savings accounts as a strategy for improving education outcomes. Parental choice supporters in multiple states have proposed public contributions to education savings accounts. Education saving accounts can serve as a new and more powerful method for expanding parental freedom and improving public schools. Parents should have full control over the education of their children, down to the penny, and multiple options in seeking the best possible education for their child.

ESA contributions represent a substantial improvement over school vouchers as a parental choice mechanism. Rather than simply choosing between schools, parents should be free to choose from a growing array of education services from a variety of providers. Today, students take classes online, can seek private tutoring, or enroll in community colleges or even universities for coursework.

Accounts for education and health care serve as important precedents upon which to build. Lawmakers must construct strong systems of state financial oversight and provide for the auditing of accounts. Near bankrupt states can save money by fashioning contractual agreements with parents to provide greater flexibility in return for smaller overall per pupil subsidies.

With control over funding, parents could purchase full enrollment at public or private schools. Alternatively, our parents might choose to have their child attend classes at a variety of providers, public, private or virtual. Allowing parents to save funds for later college and university expenses would provide a powerful incentive to consider cost-effectiveness from all types of providers, whether public or private.

Contrary to the demonstrably mistaken fears echoing through the parental choice debate, our existing public schools would grow stronger as a result. Public schools will always be the bedrock of our education system, but might evolve to resemble the course-by-course offerings of our universities, especially at the high-school level.

American parents deserve their own experiment in freedom. The question is not whether we should have public schools, but rather who should be in charge of them, and how many other options should our system provide. I believe the answers to these two questions are “parents” and “as many as possible.” Students all have unique needs and aspirations they are not widgets to be mass-produced. The time has come to let go of our attempts to standardize the educations of children, and instead give parents the liberty to customize them.

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