Notes/Explanation

They Say: “Funding Not Key – Greene”

Greene isn’t credible.

Martin 5 — Doug Martin, Education Blogger at Schools Matter, holds a Ph.D. in Literary Prosody, Research, and 19th Century American Literature from Oklahoma State University, 2005 (“Who is Jay P. Greene, and Why is He Going to Arkansas?,” Schools Matter—an education blog, July 28^th, Available Online at http://www.schoolsmatter.info/2005/07/who-is-jay-p-greene-and-why-is-he.html, Accessed 06-25-2017)

Today's Arkansas Times has a great piece of reporting by Doug Smith. Smith reports that Jay P. Greene, lead education propagandist for the Manhattan Institute, the conservative think tank, has been pegged to head University of Arkansas at Fayetteville's new Department of Education Reform. It seems that Greene's previous self-published "research" to pump school privatization through vouchers will now have an actual university to sponsor the junk studies and "working papers" that have been widely cited in the Washington Times, the New York Sun, the National Review Online, and other non-academic, non-peer reviewed outlets—all of them fair and balanced, of course.

This is all interesting enough, but what make it really interesting is, as Smith points out, the money for financing (20,000,000 dollars) the new department (and its endowed chair) comes from Arkansas's other favorite son, Sam Walton and the Walton Family Foundation. Now we are talking serious money, enough to lure Greene from his Manhattan Institute digs (located somewhere outside Orlando, Florida, by the way).

They Say: “Funding Not Key” – Prefer JJP

Prefer JJP — it’s high-quality.

Yinger 14 — John Yinger, Trustee Professor of Public Administration and Economics, Director of the Education Finance and Accountability Program, Director of the Center for Policy Research, and Associate Director of the Metropolitan Studies Program at The Maxwell School of Citizenship and Public Affairs at Syracuse University, former Assistant Professor of Economics at the Kennedy School of Government at Harvard University, holds a Ph.D. in Economics from Princeton University, 2014 (“School Spending Matters!,” It’s Elementary—a monthly column published by Syracuse University’s Education Finance and Accountability Program, August, Available Online at http://cpr.maxwell.syr.edu/efap/about_efap/ie/August14.pdf, Accessed 07-06-2017, p. 1)

An important study by Jackson, Johnson, and Persico provides powerful new evidence that school spending matters.1 This study is directly relevant to debates about education policy in New York State.

Using national data for the U.S. over a long period of time (1967-2010), these scholars show that school finance reforms “have been instrumental in equalizing school spending between low- and high-income districts.” Moreover, they find

that for children from poor families, increasing per-pupil spending by 20 percent for a child’s entire K-12 schooling career increases high school completion by 22.9 percentage points, increases the overall number of years of education by 0.928, increases adult earnings by about 24.6 percent, increases annual family income by 52.2 percent, and reduces the incidence of adult poverty by 19.7 percentage points.

They also find “no discernable effects of increased school spending on children from non-poor families.”

This is a high-quality study. The data set is appropriate and impressive and the methodology is sound. The authors conduct numerous checks and find that the results hold up very well.

The estimated effects are not only statistically significant but also large. As the authors put it, a 20 percent increase in spending on poor children for their entire K-12 career would “eliminate between two-thirds and all of the gaps in these adult outcomes between those raised in poor families and those raised in non-poor families.”

Prefer JJP’s methodology.

Sawhill 15 — Isabel V. Sawhill, Senior Fellow and former Director of Economic Studies at the Brookings Institution, former Senior Fellow at The Urban Institute, former Associate Director of the Office of Management and Budget during the Clinton Administration, holds a Ph.D. from New York University, 2015 (“Does money matter?,” Real Clear Markets, September 8^th, Available Online at https://www.brookings.edu/opinions/does-money-matter/, Accessed 07-06-2017)

The age-old debate about whether money matters for educational outcomes is sure to be debated in the 2016 Campaign. Gov. Scott Walker has cut aid to local schools evidently believing that school budgets are bloated. In the meantime, many Democrats are said to be too close to the teachers’ unions and too interested in throwing money at the problem. What should we believe?

The latest research suggests that money does matter. Of course, it matters how and where it is spent and it needs to be combined with accountability for results. But the whole notion that we can reduce spending on education and do no harm or that new resources don’t have the potential to improve both the level and the distribution of student outcomes is just plain wrong.

Skepticism about the impact of education spending on outcomes was initially fueled by the Coleman report in 1966 and was heightened by a much-cited review by Eric Hanushek in 1986 suggesting that in a large number of studies there was no consistent evidence of a relationship between expenditures per pupil and student performance.

In a rebuttal of this thesis and a more up-to-date review, Rutgers professor Bruce Baker notes that Hanushek never said that money didn’t matter; he simply showed that the evidence didn’t all point in one consistent direction. Moreover, subsequent studies with better data and more robust methodologies have tended to show that money does indeed matter. Some studies, for example, focus on state-initiated reforms in aid formulas and look at the effects of changes in spending on student achievement. This approach avoids the problem of assuming that any correlation between existing levels of funding and school success are causal when, in reality, they more likely reflect other confounding factors. For example, if federal or state aid to education is targeted on schools in high-poverty areas, this will tend to suggest that resource levels don’t matter or may even reduce student performance when it is really the poor performance that leads to the extra funding.

The most recent study that attempts to deal with this methodological problem is by C. Kirabo Jackson of Northwestern University, Rucker C. Johnson of Berkeley, and their colleague Claudia Persico. They find that increased school spending improves student outcomes, especially for low-income students. For example, increasing per-pupil spending by 10 percent in the K-12 years increases the probability of high school graduation by roughly 10 percentage points for low-income children and by 2.5 percentage points for higher-income children. The positive effects appear to be the result of a reduction in class size, a higher ratio of adults to students, increases in instructional time, and increases in teacher salaries that help to attract and retain higher quality teachers.

Teacher salaries are, in my view, a huge issue. Schools are now competing for talent with other sectors in a way that wasn’t true in a world where well-educated women had few professional opportunities. Until more people accept the need to raise teacher salaries significantly, schools are not likely to improve. To be sure, salaries need to be linked to performance and better measures of teacher performance should be developed. But the main reason that money matters in education is because teachers matter, and attracting and retaining the best talent has to be a priority.

Historical trends support our conclusion.

JJP 16 — C. Kirabo Jackson, Associate Professor of Human Development and Social Policy at Northwestern University, Faculty Fellow at the Institute for Policy Research, Faculty Research Fellow at the National Bureau of Economic Research, holds a Ph.D. in Economics from Harvard University, et al., with Rucker C. Johnson, Associate Professor at the Goldman School of Public Policy at the University of California-Berkeley, Faculty Research Fellow at the National Bureau of Economic Research, Faculty Research Fellow at the W.E.B. Du Bois Institute at Harvard University, Research Affiliate at the National Poverty Center at the University of Michigan, Research Affiliate at the Institute for Poverty Research at the University of Wisconsin, holds a Ph.D. in Economics from the University of Michigan, and Claudia Persico, Assistant Professor of the Economics of Education in the Department of Educational Leadership and Policy Analysis and Faculty Affiliate of the La Follette School of Public Affairs at the University of Wisconsin-Madison, Research Affiliate at Northwestern University, holds a Ph.D. in Human Development and Social Policy from the School of Education and Social Policy at Northwestern University, 2016 (“The Effects of School Spending on Educational and Economic Outcomes: Evidence From School Finance Reforms,” The Quarterly Journal of Economics, Volume 131, Issue 1, February, Available Online at http://socrates.berkeley.edu/~ruckerj/QJE_resubmit_final_version.pdf, Accessed 07-06-2017, p. 213-214)

Given that school spending levels have risen significantly since the 1970s, our results might lead one to expect to have seen improved outcomes for children from low-income families, and indeed, other research suggests this occurred over the relevant time period. For example, Krueger (1998) documents test score increases over time, with large improvements for disadvantaged children from poor urban areas.32 The CPS shows declining dropout rates since 1975 for those from the lowest income quartile (NCES 2012). Murnane (2013) finds that high school completion rates have been increasing since 1970 with larger increases for black and Hispanic students; Baum, Ma, and Payea (2013) find that postsecondary enrollment rates have been increasing since the 1980s, particularly for those from poor families. Our results suggest increased school spending may have played a key role.

Given that per pupil spending roughly doubled between 1970 and 2000, our point estimates might lead one to expect much greater convergence in outcomes across income groups. To help explain this, we point to studies documenting countervailing forces such as increased residential segregation by income (Reardon and Bischoff 2011; Watson 2009; Owens 2015), [end page 213] increases in single-parent families (Guryan, Hurst, and Kearney 2008; Waldfogel, Craigie, and Brooks-Gunn 2010), the crack epidemic (Evans, Garthwaite, and Moore 2012; Fryer et al. 2013), and mass incarceration (Raphael and Stoll 2009; Kearney et al. 2014). All of these forces tend to have large deleterious effects on those from low-income families. It is therefore likely that any positive school spending effects were offset by deteriorating conditions for low-income children in other dimensions. Aside from these countervailing forces, our evidence suggests that exogenous spending increases went toward more productive inputs than endogenous spending increases. Accordingly, our results predict that the effect of endogenous aggregate increases in school spending will be smaller than those implied by our estimates. Finally, we point out that we find that a 25% increase in per pupil spending throughout the school-age years could eliminate the attainment gaps between children from low-income and nonpoor families. This is a sizable effect. However, to put this effect size into perspective, the average family income was $31,925 for those from low-income families and $72,029 for those from nonpoor families, whereas in 2011 the 10th percentile of family income was $9,478 and the 90th percentile was $113,868 (all in 2000 dollars). The spending differences necessary to eliminate outcome difference between children from families at the 90th and the 10th percentiles of family income or between children from the poorest and the richest families are likely much larger than those we examine in our study. For all these reasons, the moderate convergence in outcomes across income groups observed over time in the aggregate are compatible with the magnitude of our estimated spending effects.

After Coleman et al. (1966), many have questioned whether money matters, and whether increased school spending can improve the lifetime outcomes of children from disadvantaged backgrounds. Our findings show that increased per pupil spending induced by state SFR policies did improve student outcomes and helped reduce the intergenerational transmission of poverty. Increased school funding alone may not guarantee improved outcomes, but our findings indicate that provision of adequate funding may be a necessary condition. Importantly, we find that how the money is spent may be important. As such, to be most effective it is likely that spending increases should be coupled with systems that help ensure spending is allocated toward the most productive inputs.

Increased funding makes a huge difference — prefer JJP.

Darling-Hammond 15 — Linda Darling-Hammond, Charles E. Ducommun Professor of Education and Faculty Director of the Stanford Center for Opportunity Policy in Education at Stanford University, former President of the American Educational Research Association, former Senior Social Scientist and Director of the RAND Education and Human Resources Program at the RAND Corporation, holds an Ed.D. in Urban Education from Temple University, 2015 (“Society Benefits When We Spend More on Education,” Room for Debate—a New York Times scholarly blog, March 26^th, Available Online at https://www.nytimes.com/roomfordebate/2015/03/26/is-improving-schools-all-about-money/society-benefits-when-we-spend-more-on-education, Accessed 06-07-2017)

The promise of equal opportunity, most especially in education, is at the heart of the American dream: If you study and work hard, the promise goes, you can achieve your aspirations.

Yet our schools are among the most unequally funded in the industrialized world, with some states spending more than double what others spend per pupil, and some districts within each state spending double or triple what others can allocate.

Worse still, many states spend less in school districts that serve low-income students and new immigrants who need more support to succeed. While some students attend spacious, well-outfitted schools with extensive libraries, science labs, computers and small classes, others attend crumbling, overcrowded buildings where they lack access to basic textbooks and trained teachers.

More than 40 states have experienced school funding lawsuits about these unjust conditions, and in each case, defense attorneys bring in experts who argue that money doesn’t make a difference. Yet money that is properly spent on the right educational resources for students who need them the most — especially on well-qualified educators and keeping classes at reasonable sizes — can make a huge difference.

A recent study of school funding reforms over the last 40 years or so shows just how much of a difference money can make: For low-income students who spent all 12 years of school in districts that increased their spending by 20 percent as a result of court-ordered reforms, graduation rates rose by 23 percentage points and adult poverty rates fell by 20 percentage points. The students’ family incomes were about 52 percent higher than they would have been without the greater education investment. The effects were large enough in many cases to entirely eliminate the gap in adult outcomes between those raised in poor families and those raised in non-poor families.

When young people are gainfully employed rather than in prison or on welfare, when they are earning higher wages and paying greater taxes that support the retirement, health care and social needs of other citizens, everyone wins. Money, invested well in education, makes an enormous difference to the welfare of everyone in our society.