Topic: Education and Child Policy

Good Intentions, But No 529 Plans for K-12, Thanks

It sounds like school choice fans are pretty happy to see the GOP tax plan allowing up to $10,000 per year from tax-favored 529 savings plans to be used for elementary and secondary expenses (though the much smaller Coverdell would go away). Previously, 529 funds were just applicable to postsecondary education. But happy or not, for several reason this is probably bad policy. Here’s a quick list:

  1. Regulation: Current 529 plans allow earnings to be used tax free only if spent on accredited institutions. But accreditation has been a backdoor way through which the federal government has regulated colleges. We don’t want to see private K-12 schools similarly subjected to federal control, greatly constricting the extent to which they can be real choices.
  2. Complication: A complicated federal tax code is an efficiency drain on the economy, but wealthier people able to pay for financial advisors, or who have the time to become well versed in the code, can game the system. Ditto student aid. Not so much the poor or average person. The 529 thumb-on-the-scale for education would seem to favor the wealthy who already have choice. Much better would be to just get rid of this kind of distorting, complicating incentive.
  3. Price: The evidence is powerful that student aid programs—including, though not primarily, tax incentives—help to fuel extraordinary price inflation in higher education. Better to not have the feds inject this further into K-12 education.
  4. Constitution: Outside of prohibiting discrimination by state and local governments, the Constitution gives the federal government no authority to meddle in education. This includes through the tax code.

Worse things, certainly, could have come from Washington. School choice is, after all, generally a policy well worth pursuing. But so is federalism, and states have been doing pretty nice work expanding choice by themselves. Why introduce these unconstitutional dangers?  

Is Supporting Racists’ Free Speech Rights the Same as Being a Racist?

Student protesters at the College of William and Mary recently shut down a campus speaker from the ACLU invited (ironically) to speak about “Students and the First Amendment.” Students explained their shut down was in retaliation for the ACLU’s defense of white nationalists’ free speech rights in Charlottesville, Virginia where a white nationalist rally recently took place. What motivated the students?

The Black Lives Matter of William and Mary student group wrote on their Facebook page, where they live-streamed their shut down of the event: “We want to reaffirm our position of zero tolerance for white supremacy no matter what form it decides to masquerade in.” From these students’ perspective, the ACLU supporting someone’s right to say racist things was as bad as being a racist organization.

The Cato 2017 Free Speech and Tolerance Survey helps shed light on these students’ reasoning. First, nearly half (49%) of current college and graduate students believe that “supporting someone’s right to say racist things is as bad as holding racist views yourself.” This share rises to nearly two-thirds among African Americans (65%) and Latinos (61%) who agree. Far fewer white Americans (34%) share this view.

65% Say College Students Should Discuss Offensive Halloween Costumes without Administrator Involvement

Two years ago at Yale, a controversy erupted over a series of emails about offensive Halloween costumes. A resident advisor and Yale lecturer pushed back against an email from college administrators advising students not to wear offensive Halloween costumes. The advisor emailed her students and expressed confidence in students’ capacity to discuss offensive Halloween costumes among themselves without administrators getting involved. Many students interpreted her email as an endorsement of offensive costumes, rather than of freedom of expression and the ability of people to discuss and resolve offense without oversight. What do Americans think?

The newly released Cato 2017 Free Speech and Tolerance Survey finds that nearly two-thirds (65%) of Americans agree that “college students should discuss offensive costumes among themselves without administrators getting involved.” A third (33%) say “college administrators have a responsibility to advise college students not to wear Halloween costumes that stereotype certain racial or ethnic groups at off-campus parties.”

Full survey results and report found here.

A significant racial divide emerges about how to handle offensive Halloween costumes. A majority (56%) of African Americans feel college administrators should intervene and advise students against offensive costumes. Conversely, a strong majority (71%) of white Americans and a majority of Latinos (56%) believe that college students should discuss offensive Halloween costumes among themselves without administrator intervention.

A majority (54%) of college and graduate students agree that students should discuss offensive costumes without intervention from school authorities. However, students (45%) are 12 points more supportive than Americans overall (33%) of administrators advising about offensive costumes.

You can learn more about public attitudes about free speech, campus speech, and tolerance of political expression from the full survey report found here.

Sign up here to receive forthcoming Cato Institute survey reports

The Cato Institute 2017 Free Speech and Tolerance Survey was designed and conducted by the Cato Institute in collaboration with YouGov. YouGov collected responses online August 15-23, 2017 from a national sample of 2,300 Americans 18 years of age and older. The margin of error for the survey is +/- 3.00 percentage points at the 95% level of confidence.

 

Don’t Blame Us Libertarians for School Choice Disappointment

The headline of Megan McArdle’s latest Bloomberg View piece stings, at least for a libertarian whose job is to advance educational freedom: “We Libertarians Were Really Wrong About School Vouchers.”

Ouch! But to this I say: Speak for yourself!

To be fair, I don’t know how things work for big-time columnists, but there’s a good chance McArdle didn’t pen her own headline. Pubs need clicks, and the shrewd marketeers at Bloomberg were no doubt well aware that such an inflammatory header would draw in all roughly ten professional libertarian school choicers, boosting readership by huge hundredths of a percent. And it is worth saying: While I’m not sure you would call them libertarians, John Chubb and Terry Moe’s Politics, Markets, and America’s Schools was seminal in launching the modern choice movement, and they did assert that choice would be a “panacea.” If that is what libertarians expected from the tiny choice programs we’ve gotten so far, yes, we were wrong. But that is not what libertarians should have expected.

The fact is we have not even come close to getting what we need—real, broad freedom, which McArdle and lots of libertarians call “the market.” (I’ve decided, by the way, that a “market” is a horrible way to conceptualize what libertarians want, because it implies education is all about efficient financial transactions. What we want is full-on human freedom.) None of the voucher, charter, scholarship tax credit, or education savings account programs we have gotten have even come close to a free market, as many libertarians have been decrying for decades.

How far are we? Thankfully, you don’t have to dig into old books to find out—we give you the lowdown in Educational Freedom: Remembering Andrew Coulson, Debating His Ideas (available in free PDF version or wherever fine books are sold)! Andrew was a leading critic of the kinds of hamstrung programs many choice supporters lauded for years—a few thousand kids with small vouchers here, public charter schools there—and the book contains multiple chapters examining what is needed for a true free market. As the Heartland Institute’s George Clowes lays out:

  • Parental choice of school
  • Direct parental financial responsibility
  • Freedom for educators to establish different types of schools
  • Explicit competition among educators
  • The profit motive for educators (and the need for a reliable revenue stream)
  • Universal access (including low- and high-income families)
  • Per-pupil funding comparable to the public schools, with the funding following the child

When’s The Student Loan Money Coming Back?

A new report on federal student loans from the National Center for Education Statistics came out today, and it is troubling. Much of the media attention is likely to focus on the default rates of borrowers who attended for-profit colleges—and they are atrocious—but the report’s contents condemn the entire system.

Delving into the data reveals that there is a whole lot of defaulting going on—among first-time students who began school in 1995-96 and took out federal loans, 13.7 percent had defaulted on their most recent loan—but there’s been a whole lot of deferring payment, too. The share of borrowers who were deferring or in forbearance stood at 13.3 percent. 31.8 percent were still repaying. And the 41.3 percent listed as “paid or closed without default” hadn’t necessarily fully paid off their loans, either. No, “this includes either loans that are paid off by the borrower or forgiven [italics added].”

As for students attending for-profit schools, yes they had the highest default rate. But, remember that for-profits take on the students with the greatest obstacles to success while receiving essentially no state subsidies or tax-preferred donations. Indeed, they pay taxes. Their default status for students starting in 2003-04—during the for-profit boom—is terrible at 34.8 percent. However, community colleges came in at 15.7 percent, which is also awful, given their low, directly subsidized prices and considering that, while their students often have significant obstacles, students at for-profit schools tend to have bigger ones. Of course, a smaller percentage of community college students borrow. And default rates at about 9 percent at public and private, nonprofit, 4-year colleges is hardly anything with which to be impressed.

The higher education system is flooded with taxpayer money producing oodles of negative results, including skyrocketing costs, credential inflation, and increasingly anemic learning. The federal loan story told by these data reinforces how much draining needs to happen, and a good place to start is phasing out federal loans.

Is It “Banning” To Reject the Book in the First Place?

We hear a lot about book “banning,” especially when “we” maintain Cato’s Public Schooling Battle Map, but probably lots of other people hear it, too. Indeed, it just so happens that we are in Banned Books Week right now, an event that highlights challenges to books stocked by public libraries, including in public schools. But what is suddenly getting attention is not the Week, but a Cambridge, Massachusetts public school librarian rejecting a bunch of Dr. Seuss books that First Lady Melania Trump selected the district to win. Which raises two questions: Is it not just as much “banning” when public librarians choose not to stock books as when parents or citizens ask that those already stocked be removed? And isn’t it a threat to basic freedom to have librarians or anyone else decide for taxpayer-funded institutions—government institutions—what constitutes acceptable art or thought?

The first answer is of course it is just as much “banning” for public institutions to reject books in the first place as to remove them later on. The ultimate result is the same: not making a book available for the public to borrow. Of course, this is not really banning, which would be to prohibit people from reading a book at all—making it illegal to purchase or possess—not refusing to let people borrow it for free. But if people want to misapply the term, they should misapply it equally.

Which takes us to the root problem: Public institutions force all taxpayers to fund decisions by other people about what books are valuable, or age appropriate, or just plain morally upright. We are forcing them to fund someone else’s speech and opinions, even if they find that speech or those opinions offensive, or just wrong, and even if their views are rejected.

K-12 Schollies = More College

Want to increase college-going while saving some dough? Scholarship tax credit programs may be for you, or so indicates a new report from the Urban Institute.

The report, from co-authors Matthew Chingos and Daniel Kuehn, finds that the low-income students who enrolled in private schools via the Florida Tax Credit scholarship program were about 15 percent—or 6 percentage points—more likely to enroll in college than statistically matched public school students. The effect was greater the longer kids were in the program. There was also a small, more tenuous positive effect on associate degree attainment for scholarship users. Topping it all off, while cost was not the focus of the report, the authors note that the superior outcomes were achieved at a saving to the state: “The positive effects are noteworthy in light of the evidence that the FTC program more than covers the foregone tax revenue through reduced spending on the public schools many participants would have attended.”

There are, of course, important caveats to the findings. First, this was not a random assignment study, so unobserved characteristics such as differing degrees of motivation between scholarship users and matched public school students could not be well controlled for. Next, the study only looked at students entering Florida public colleges, though this might have underestimated the program’s positive effects due to low-income private school students tending more to attend private or out-of-state colleges than their public school peers. Finally, there is good reason to question whether credentials represent much increase in real, useful, learning.

Even with these caveats, this is clearly encouraging evidence for school choice. Alas, some of the early media reports about the study seem to want to temper it with mentions of a few recent choice evaluations, focused on standardized test scores, that have not been so hot. Of course, those studies have important caveats too, but more important, the articles I have seen about the Urban report have mentioned the recent spate of negative reports while ignoring the many positive studies that preceded them. Fortunately, the Urban authors give readers one more useful nugget, noting, “Until recently, this research showed neutral to positive effects of private school choice on student achievement.”

The choice debate will continue, but most of the evidence remains on the side of freedom.