What Does Education Spending Buy?

Posted on

MD Education TrendsOne of the most persistent causes of lousy policy decisions at all levels of government is that politicians and voters alike tend to focus on policy goals without paying nearly enough attention to policy effectiveness.

So, for example, a proposal to spend more public money on education is widely regarded as a pro-education proposal, whereas a proposal to spend less public money is widely regarded as anti-education.  Nearly everyone is pro-education, so politicians who want to spend less on it generally lose, and that has two important consequences.  First, education spending increases steadily.  And second, if the increased spending fails to improve the schools, future candidates who hope to win will argue not that the spending increases were misguided, but rather that we just haven’t spent enough yet.

But eventually, if we increase spending substantially, year after year for many years, shouldn’t we expect to see some measurable improvement in educational outcomes?  And if we don’t see any measurable improvement, isn’t that something that someone ought to tell the voters?

Fortunately, Andrew J. Coulson of the Cato Institute’s Center for Educational Freedom has published a study that does exactly that, state by state.  His findings are pretty grim:

“The performance of 17-year-olds has been essentially stagnant across all subjects since the federal government began collecting trend data around 1970, despite a near tripling of the inflation-adjusted cost of putting a child through the K-12 system.”

In more technical terms, Coulson found “essentially no link between state education spending (which has exploded) and the performance of students at the end of high school (which has generally stagnated or declined).”

But why use words when we can get to the point so much better with a couple of graphs?  Here’s what has happened to education spending and education outcomes right here in Maryland over the last forty years:

MD Education Trends

Now, many people tend to revere the public education system with an almost religious fervor; in fact, many people are substantially more fervent about public education than they are about any religion.  But let’s try to step back a bit from all the fundamental philosophical questions one might ask about public versus private education; let’s assume that whatever we had in 1972 was a good idea, and let’s just ask about the policies we have adopted since that time:  Have those policies succeeded, or have they failed?  To me (and my children have been in both the public and private systems, in case anyone cares), there is no way to avoid the conclusion that we have received a lousy return on the billions of dollars we’ve invested in the public education system since 1972.

Have we been particularly incompetent with educational spending in Maryland?  Unfortunately, that’s not the explanation for the disappointing results.  Maryland’s experience is entirely consistent with the experience in other states, as anyone can see by browsing quickly through the state-by-state data Coulson reports.  Nationwide, from 1970 to 2010, the average total cost of educating a student from kindergarten through 12th grade rose from $56,903 to $164,426—and that’s in inflation-adjusted terms.  (See Figure 1 of the Coulson study.)  Inflation over those forty years was 462%; that is, it took $562 in 2010 to buy as much as $100 bought in 1970.  But on top of that five-fold increase, education spending per student roughly tripled, with no discernible effect on outcomes.

What did go up?  Enrollment was up a bit, but less than 10%.  The number of employees, however, nearly doubled.  Coulson points out how unusual all of this is for those forty years in particular:

“In virtually every other field, productivity has risen over this period thanks to the adoption of countless technological advances—advances that, in many cases, would seem ideally suited to facilitating learning.  And yet, surrounded by this torrent of progress, education has remained anchored to the riverbed, watching the rest of the world rush past it.”

Is it, then, possible, that our educational system would be far worse than it is if we had not spent all that extra money?  That suggestion is also doubtful in light of the data.  Coulson found four states (Alaska, California, Florida, and New York) where inflation-adjusted spending on education actually fell 20 percent or more over multi-year periods, yet “none of these states experience noticeable declines in adjusted SAT scores—either contemporaneously or lagged by a few years.”

So what does education spending buy?  The answer, unfortunately, is not “better education.”  It may just be “votes.”  After forty years, if we want to improve education, shouldn’t we try something that actually works?