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School Choice in Utah?
Utah could be getting a reasonably serious school choice program. In Friedman's vision it is students that are funded not schools and students are funded equally regardless of where they choose to attend school - i.e. no fiscal discrimination. In the Utah plan, in contrast, the voucher money is still less than is spent per public school student and it is means tested. Nevetheless, the voucher is reasonably large and the program is state wide which together would make it the most significant voucher experiment in the United States.
Thanks to Fred Hastings for the pointer.
Posted by Alex Tabarrok on February 5, 2007 at 03:01 PM in Education | Permalink
Comments
So in your dream scheme how do you deal with the de facto subsidization of education that comes from the people who already have children in private schools pre-voucher? Will you raise taxes or reduce the funding per-child for education? Does the fact that many private schools are subsidized in ways that aren't generally available to public schools (e.g., parish funds going towards the parochial school, alumni contributions etc.) change your view about how the per-child funding should be distributed?
Posted by: don Hosek at Feb 5, 2007 3:47:21 PM
Go Utah! Personally, grew up in a upper middle income area, so our public schools were quite good, especially if you were an honors student (taking honors and AP level courses). At the time, we had one of the largest AP course selections of a high school in Virginia. If you were a below average student, however, they just kinda ignored you.
Posted by: Shaun M at Feb 5, 2007 9:02:39 PM
don Hosek,
This can all play out in a much simpler way than you think. The way I understand it is through the analogy of food stamps. You get some allotment that you can spend at any store, which would probably be a for-profit private grocery store, but doesn't have to be (I suppose there could be government run stores, but it seems silly to think of a government run grocery store). Grocery stores compete for your dollars by offering what you want at the prices you want.
So, you take all of the money the public spends on education a slice it by how many students you have and create "education stamps," like a food stamps. This is a ridiculous amount of money per student by the way (simple arithmetic: 25 students * 10-15k per student = $250-375k…25 students to a teacher, pay him/her $100k! and you still have a lot left over for other administrative costs and profit). The government can auction off all of its school buildings too. Schools pop up to try to grab a piece of all this money and compete away the profits by offering customers what they want, be it religious, non-religious, trade schools, college prep…all sorts of choices I’m sure. Parents choose the school that is best for their kid like they choose the food that is best for them at the grocery store. If they choose to spend more than the stamp, then they can do so. To appease the paternalists, the government can still have minimal standards to meet, which we are quite familiar with our food.
I may be oversimplifying this a bit; but, it doesn’t seem all THAT complicated. Right now, we have the equivalent of one government run grocery store in each district, which offers basically one product. Hence, there is no choice other than expensive private schools (which you pay in addition to your taxes). And, the quality is probably a lot lower than it should be, as with any monopoly. Profit and competition drive grocery stores to be the best in the world, attracting bright minds/talent who bring innovative spirit and deliver what the customers want.
I think, if nothing else, it would be fascinating to see how this would all play out if a state had the stones to do all this. GO UTAH!
Posted by: Scott W at Feb 5, 2007 11:39:13 PM
P.S. The way I just decribed it is roughly similar to how Milton Friedman and others viewed it ideally. Such sweeping changes like this are unlikely anywhere. The way vouchers are usually described are in a much more complicated quasi-privatized system. I didn't mean to make my previous post sound like that's how they are necessarily going to work in Utah or other places (though it would be most interesting if it did work that way).
Posted by: Scott W at Feb 5, 2007 11:54:36 PM
Excellent news!
At one point, I started to build a spreadsheet arguing for vouchers. It tries to convey that a voucher can be set at below the variable cost of an additional student, thus each voucher used increases the funds available per public school student.
The work-in-progress is posted here (or on the url link):
http://spreadsheets.google.com/pub?key=powc4wlhTDRAbJc32eUSMDw
Any feedback is welcome, and I'd be glad to provide write-ability for anybody interested in furthering the analysis.
Posted by: Erich at Feb 6, 2007 1:24:25 AM
School choice referendum failed in California twice or three
times. It failed in liberal counties, it failed in conservative counties.
The reason is white/asian middle class is solidly against it,
no matter how liberal and tolerant they profess themselves to be. And they
will never tell the polsters the truth why they are against
the school choice.
White middle class does not want getto kids in their
nice suburbian middle class schools. It is as simple as that.
Ironically, "conservative" establishment punditry that pushes
for school choice typically is rich enough to send their kids to
very expensive private schools. School choice is not going impact very
expensive private schools, so punditry can ignore the middle class
concerns, perhaps even accuse them of being intolerant.
Thus giving middle class yet another reason to desert the stupid party (GOP).
School choice will fail in any state with a significant presence of black or
hispanic minorities.
Posted by: mik at Feb 6, 2007 2:57:05 AM
It kind of already works this way in Michigan -- the funding comes from the state on a per-student basis, and many districts have opened themselves to outside students (and the funding that comes with them). And charter schools are included in the system as well. But funding of charter schools is really not equal after all, since what the state provides are operating funds, not capital. Local school districts, of course, already have huge reserves of capital in the form of land and buildings and are still permitted to float bonds for school construction and other major capital expenditures (building upgrades, purchases of computers, etc), which means the local public school districts still have a major financial advantage over charters. And private and parochial schools aren't included at all.
Posted by: Slocum at Feb 6, 2007 7:01:32 AM
As a non-libertarian (maybe anti-libertarian) I must say that this is excellent news. I have always suspected Friedman was on to something when he advocated for vouchers.
Posted by: Ragerz at Feb 6, 2007 7:15:38 AM
If it is true that states wildly overspend on education isn't the disparity a potentially good thing?
If private schools can successfully educate a child (or, indeed provide superior education) for a fraction of the cost it would show quite convincingly that the problem with schools today isn't, in fact, lack of money.
My concerns about vouchers have always been that it would lock in school pricing too high - by "underfunding" vouchers they defeat this problem before it has a chance to materialize.
Posted by: Chris at Feb 6, 2007 9:00:16 AM
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Posted by: mirror at Feb 6, 2007 1:42:55 PM
What about expensive-to-educate kids? No voucher school is going to want to take a kid with Asperger's, or some other disability that requires the kid to have an aide. So doesn't that mean that the voucher schools can skim off the cheap-to-educate normal or bright kids, leaving the disabled kids in bad, underfunded schools?
Posted by: Cardinal Fang at Feb 6, 2007 5:31:17 PM
> What about expensive-to-educate kids? No voucher school
> is going to want to take a kid with Asperger's
Presumably, students with serious health or learning problems would receive more valuable vouchers. Not necessarily Asperger's though--many of those kids are high achievers.
Posted by: Slocum at Feb 7, 2007 7:17:15 AM
Presumably, students with serious health or learning problems would receive more valuable vouchers.
That would be nice, but no voucher plan I've ever seen has that feature. Do you know of any that do? Does the Utah plan offer better vouchers for disabled kids?
Another way to get around the problem would be to require any school that accepts vouchers to accept any student who applies (in the right age range, of the right gender if it's a single gender school). If there were too many applicants, the school would have to have a lottery-- younger brothers and sisters could be given priority because parents like to have all the siblings in one school.
Otherwise schools that accept vouchers could skim off the cream, leaving, again, the harder-to-educate kids no one wants to the public schools.
Here and here are a couple of popular press articles about the education costs of autism and Asperger's. The short version: it costs a fortune to educate a kid on the autism spectrum.
Posted by: Cardinal Fang at Feb 7, 2007 4:02:01 PM
I hate to do this, but I am not aware of any research that proves private education at the same price point as public education is worthwhile. Mr. Freidman's idea is just that. An idea. It seems pathetic for the US to do this without knowing whether it has a chance of working. Every bit of evidence provided the last five years has proven to be flawed - as in deliberately distorted.
This may turn out to be the same kind of distortion issue that has been revealed by the global warming hearings.
There are many changes you can make to education that can improve it. For instance, funding. A good private school costs over fifteen thousand dollars for high school. Anything under ten thousand will be competitive with public schools in terms of test scores and college admissions after the student body is adjusted for family income. The average public school budget is around six thousand per student. To the best of my knowledge, there are no private schools that are providing an education more efficiently than the huge ugly public institutions.
Scott's budget of twelve to fifteen thousand dollars per student would be fabulous. A monkey could run a successful school on that kind of budget. Bill Gates' people picked up a sixteen million dollar plant out of bankrupcy and currently spend ten thousand per student. It works. Dee dee dee.
Posted by: Bob Calder at Feb 8, 2007 8:31:15 PM
Bob, you misunderstand the idea of vouchers. Vouchers are not a good idea because private education is better than public education. The idea is that education is like any other industry, competition will make the industry better. First, it will make schools respond to students and parents instead of taking their presence for granted. Second, it should allow for differentiation among schools. Some can specialize in math/science, others in arts. Some can allow prayer in schools and call it Christmas break, others can teach sex ed to 6 year olds. And people can stop complaining about being the victim of the majority because they can change schools to fit their desires.
Also competition will lead to more accountability. If a school is failing, it will be much more noticeable. Either people will be fired or the school will cease to have students. No more day cares where students don't learn.
But the main thing to remember is that the gains from school choice are not from the actual switching from one school to another. The gains are from the incentives this gives to schools, principals, and teachers. Schools have to respond to problems and fix them or else they will lose students and money. The more the competition, the bigger the effect. That's why this universal system is so important from a Friedman perspective.
It's also why the small means-tested programs in some cities theoretically shouldn't work nearly as well as a universal system. The small programs rely on the actual switch making a big difference. A universal system should improve public schools and that is better for everyone.
Posted by: Adam C at Feb 8, 2007 10:40:29 PM
You would be hard-pressed to find anyone who thinks that public schools are so great and wonderful and good that nothing about the system needs to be changed. Most of us are eager for a new way, so I don't think it's pathetic at all for Utah to be trying a version of the voucher system without knowing in advance whether or not it will work as intended. We already know the current system is fraught with shortcomings, and really, if people never tried something new unless they were sure it was going to work, then that would be truly pathetic, and our world would be a much different place. No, experimentation is great in my book. I won't pretend to have all the economics of this issue sorted out, but on principle alone I support vouchers. Why should we grant government a monopoly on educating our children? Essentially, that's what is happening when our tax dollars are used for government schools, but a person who opts out and sends their child to private school still has to pay for the public. At the very least we need to have some mechanism by which that parent would not have to pay twice. Voucher systems satisfy that plus you get the benefit of competition. I belive in liberty, so I relish the idea of being able to more freely choose where our children are educated. I also believe in the power of the principle of competition. Generally, it brings a better product at a lower cost. Since the product of education is so extremely important and valuable to a functioning society, don't we owe it to ourselves to give competition a chance? OK, you might say that private schools already have the chance to compete with public schools since the government does not bar them from doing so, but I disagree: there are simply not enough private schools out there, when compared to the enormous quantity of public ones, to say that there truly is any serious competition. Plus, since the government schools are entirely subsidized at the expense of taxpayers, you could hardly argue that any competition we do have is fair competition. Our country was not intended to be a monolith. The Constitution that our States ratified granted no authority to the new Federal Goverment in the area of education. States should be free to experiment with alternatives to the tired and ailing status quo. Oh, and as for Bob Calder's suggestion that public education can be improved just by dumping more money into it - sorry, but I respectfully disagree. School Boards all over have been saying the same thing to their State Legislatures for as long as anyone can remember, but when those bodies dutifully respond and shell out the cash, the outcome always seems to be more of the same - the schools that are perfoming poorly don't show any marked improvement from the extra funds received.
Posted by: caleb at Feb 8, 2007 11:54:03 PM
What I said about money is that schools that have what I consider to be the best results cost a lot to run. They are all private schools. Andover, Exeter, St Andrew's, Gulliver, Choate et cetera all cost over seventeen thousand a year. It can't be done cheaply because the professors all teach inside their specialty and have advanced degrees from decent universities. "Dumping" money into these schools seems to work quite well. On the other hand, legislatures have demonstrably not responded generously (in my state) where the average budget per student is under six thousand dollars a year. Are you aware of a state where legislators have pumped up the budget to over ten thousand dollars a student basic without counting special programs?
These private schools have always operated in a highly competitive environment. This is where you can examine the experiment of competition in K-12 education. Of course, the same is true for post-secondary schools in the ivy league. Does anybody know of a school where tuition doesn't out-pace inflation?
The schools get highly stratified as a result. In the Baltimore area where private corporations have been running some schools, the results have been uniformly poor. I don't know why.
I do understand the idea behind vouchers. What I don't agree with is that the stated benefits can be predicted accurately.
There is a lot of talk that conflates untested ideas with results seen in places where the characteristic (competition) and result (smart kids) are very loosely coupled. Close examination of a high performing school discloses a host of contributing factors that people consider unimportant because it doesn't fit into their emotional agenda.
The system people are messing with is a complex one where poking it in one place will cause unexpected results. I can guarantee you won't get what you expect. I also believe the example of private school competition proves that it doesn't drive costs down. I limit my sample to schools with average SAT scores over 600-650 per section. When you talk about results you have to talk about specific results and I have standards.
What we don't need is Utah being dishonest like Texas. The problem is that although people *say* it is OK to experiment, the penalty for failure is not something you want to happen, so the states lie a lot. Take Florida for instance. This summer the fourth graders improved a whole standard deviation over last year. Impossible? Yes. In fact they kept enough low performing kids back to achieve the effect. It made Jeb Bush's education package sound like it had worked and helped elect a bunch of Republicans.
If you hitch your wagon to a politician who wants to get your vote and says vouchers will solve the problem, you are just asking for disappointment because the problem is huge and complex. BTW, Paul Ormerod is my favorite economist, not Freidman. The core of my argument is taken from his work on complexity.
Posted by: Bob Calder at Feb 10, 2007 12:00:27 AM
I am completely blowing my own horn here, but voluntaryXchange was on the team that did the econometrics work underlying this proposal, and personally did the cost function estimates showing that the state could save money with a voucher system.
Posted by: David Tufte at Feb 10, 2007 11:12:40 PM
Several of the comments above mention that the writers don't know whether the Utah bill includes some feature or other. So I thought I'd pass on this link to the actual bill. It's an easier read than you might think.
I'm also interested in seeing some of the econometrics work on this just mentioned. When I interned at the Utah state legislature a few years ago, proponents of a similar bill tried to sell it by arguing that since the voucher was for less than the average cost of educating a Utah student, it would actually leave a public school better off financially if a voucher student transferred to a private school. Can you spot their mistake? They ignored the concept of marginal costs. I love the idea of vouchers, but I'll stay very skeptical of claims that they leave public schools better off until I see an analysis showing that they leave more money in the public school than it would otherwise actually take to educate the students that leave.
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Posted by: wslmwps at Aug 21, 2007 1:15:31 AM
People who have handicapped kids would be able to force the public school system to educate thier children.It is part of the federl disabilities act.I think eventually the poor and immigrant and disabled will be in the public schools.Anyone who can afford it will jump ship snd leave the public school system with thier vouchers and the students.Looks like the US is on its way to becoming like Great Britton, A caste society.
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