The funding folly
Increasing education spending will get us nowhere
- Tuesday, March 31, 2009
State Sen. Mike Schneider has introduced legislation that would require Nevada's per-pupil spending level to meet the "national average." He assumes that increased education spending will improve the quality of Nevada education because it will allow new schools to be built, teacher salaries to be raised and supplies to be purchased.
The theory here is simple: You get what you pay for. It's a plausible scenario that actually works in many areas of the marketplace.
Unfortunately, education is unlike almost anything else in our economy. The reason for this, too, is simple: Public K-12 education is a monopoly, not subject to competition.
Parents cannot choose what school their child attends. Schools and teachers face no serious consequences when quality is bad — or rewards when quality is exceptionally good. In fact, funding levels for public education in Nevada are, in no way, shape or form, tied to the ability of a school to provide quality educational service to students, parents and taxpayers.
This is just one of the reasons why more spending does not translate into better educational results — a reality documented in a massive body of research.
In 1960, Nevada's per-pupil spending was at $460, according to the National Center for Education Statistics. By 2006, the state was spending $7,345 per student. Even adjusting for a significant amount of inflation, the 2006 figure means we have more than doubled real-dollar spending.
Today, when expenditures for capital outlays and debt are included, Nevada spends more than $10,000 per student, ranking it 31st highest in the nation. The fact that nearly 30 cents of every dollar spent by Nevadans on public K-12 education goes into debt and maintaining or building schools or equipment is something many policymakers don't want widely known.
Nevada spends $1,842 per student on capital outlays, ranking it third-highest in the country. Of that sum, $1,376 goes toward building new — and often palatial — schools. The Big Education crowd justifies these expenditures by noting that Nevada has long been the country's fastest-growing state. But Arizona, the second-fastest-growing state, spends just $848 per pupil on school construction. Nevada would save more than $300 million per year if our lawmakers were as prudent as Arizona's.
Nevada's education debt ratio is the largest in the country at 121 percent of our yearly K-12 expenditures. Our education debt per pupil is $11,776, almost double the national average. This massive debt cannot be blamed on fast growth: Arizona's debt per pupil is just $4,061.
When lawmakers rubber-stamp current educational outcomes, they demean themselves. We provide our students a substandard K-12 education and allow them no practical exit from that substandard system. In effect, we mandate that Nevada children must receive the shoddy educational product of a rigid, bureaucratic, government monopoly even though we all understand that it means handicapping them for life.
If Nevada lawmakers want to improve Silver State education, they will change the system so that new schools can respond quickly and flexibly to the needs of parents and students. Schools need to face competition, bad schools need to be closed and good teachers need to be rewarded.
Patrick R. Gibbons is an education policy analyst at the Nevada Policy Research Institute.