With a sluggish economy and rising costs for everything, state and local governments are facing serious budget problems. It’s clear that there’s a lot of spending that they should simply cut outright. But politicians hate doing that.
But there is one way to save billions of dollars without cutting a single program or budget; broad-based education tax credits.

A fiscal impact analysis of our Public Education Tax Credit from our own Andrew Coulson and economist Anca Cotet was released today that shows the potential savings for 5 states.

Education spending makes up about half of most state budgets and is the biggest item at the local level, so we expected major savings from our broad-based program. But the totals surprised even us.

Here are the pretty stunning highlights:

Illinois saves $5.1 billion in the first 10 years and $1.6 billion every year after the program has been in operation for 15 years.

New York saves $15.1 billion in the first 10 years and $4.8 billion every year after the program has been in operation for 15 years.

South Carolina saves $1.1 billion in the first 10 years and $350 million every year after the program has been in operation for 15 years.

Texas saves $15.9 billion in the first 10 years and $5.4 billion every year after the program has been in operation for 15 years.

Wisconsin saves $9.3 billion in the first 10 years and $3.2 billion every year after the program has been in operation for 15 years.