National Center for Policy Analysis

MONTH IN REVIEW

Education
June,1996

SCHOOL CHOICE IMPROVES PERFORMANCE

Most school choice programs restrict choice to public schools, but the Educational Choice Charitable Trust (CHOICE) in Indianapolis uses private funds to help parents send their children to the private school of their choice.

Researchers at the Hudson Institute recently published the results of a multi-year evaluation of the CHOICE program based on more than 1,500 surveys of parents and student scores on standard academic achievement tests. Among their findings:

The grades of students who had attended public schools improved after they began attending private school.
Nearly half the parents surveyed rated the private schools with an "A," while only 35 percent rated their previous public school experience with either an "A" or "B."
Scores on reading, math and language tests were higher for students participating in the CHOICE program than for comparable public school students.
Middle school students seem to be avoiding the drop-off in performance at those grade levels that generally occurs in public schools.
Overall, the study's authors conclude parents are more satisfied with and more involved in their children's education -- contributing directly to improved performance.

Now in its fifth year of operation, CHOICE gives vouchers to low-income families in the Indianapolis Public School district covering half of a private school's tuition up to a maximum of $800. Grants are awarded on a first-come, first-served basis for use in any private school located within the public school district, including religious schools.

To be eligible for funds, a family has to qualify for free or reduced-price lunch programs. Half of the scholarships are reserved for parents whose children already attended private schools.

Source: David J. Weinschrott and Sally B. Kilgore, "Educational Choice Charitable Trust: An Experiment in School Choice," Hudson Briefing Paper No. 189, March 1996, Hudson Institute, Herman Kahn Center, P.O. Box 26-919, Indianapolis, IN 46226, (317) 545-1000.

GOOD-BYE COLLEGE, HELLO JOB MARKET

This month's college graduates will earn appreciably more over their lifetimes than those not attending college.

Graduates earn about 80 percent more than someone with just a high school degree and more than three-times as much as a high school dropout -- gaps that have steadily widened since the late 1970s.
Half of those among the top fifth of incomes have a college degree -- while just 2 percent in the top tier were high school dropouts.
One-fifth of those in the lowest income bracket are high school dropouts while 4 percent went to college.

Costs for a college degree can be daunting, with tuition alone averaging about $16,000 a year.

Tuition and fees at private colleges have jumped an average of 4.5 percent a year since 1980, according to a study from Duke University.
At public universities, they have risen at a 2.8 percent average annual rate since 1980 compared to 0.3 percent annually in the preceding 20 years.
After adjusting for financial aid and inflation, tuition has increased 2.7 percent annually at public universities and 3.9 percent at private ones.

But according to the National Association of Scholars, students now get 23 percent less teaching for three times the price. Colleges are spending less on teaching and more on research. Over the past two decades, the number of non-teaching jobs more than doubled, compared to an increase of just 30 percent in teaching positions.

Source: Perspective, "Is College Worth It?" Investor's Business Daily, June 12, 1996.

SCHOOL CHOICE PROPOSED

The usual response to failing public schools is increased spending, which requires increasing the tax burden and leads to demands for tax relief. In Illinois, for example, the Governor's Commission on Education Funding has recommended shifting the tax burden from property taxes to income taxes.
The Heartland Institute has responded by offering a statewide school choice plan to improve student performance and rein in spending increases.

The goal of the plan is to improve education for all students, and the key is market-based reforms that:

Change the incentives of education stakeholders -- such as financial awards to students and teachers for academic improvement and better information to colleges and employers about academic achievement.
Give parents a choice of schools -- which can increase students' motivation, empower parents and motivate teachers and administrators by exposing them to competition.
Allow private schools to participate with public schools in choice programs.
Create a system of privately developed examinations based on the curriculum that schools can choose to have administered to students by outside agencies.
Use competition to reduce spending.

The plan's authors recommend giving every student a state scholarship worth $1,500 plus a local scholarship whose amount would be determined by local voters. Any school that meets existing state standards and agrees to administer a state-certified curriculum-based exam could participate.

Source: Joseph L. Bast et al., "The Heartland Report on School Finance Reform for Illinois," Policy Studies No. 72 & No. 73, May 1996, Heartland Institute, 800 East Northwest Hwy., Suite 1080, Palatine, IL 60067, (847) 202-3060.

EDUCATION AND DOLLARS

A new study claims that family income is a crucial factor in determining teenage students' expectations for higher education and the type of institution they will attend. This was one of the conclusions of a study by the National Opinion Research Center at the University of Chicago, which tracked 25,000 teenagers over a six year period.

It found that income counts more than race, ethnicity, sex or scores on achievement tests in determining a student's educational future, although the study's authors caution that the results are open to various interpretations.

Some of the findings:

Some 48 percent of those in the lowest income group attended two-year community colleges and only 37 percent in that group attended four-year institutions.
In contrast, 74 percent of those in the most affluent quarter of the group attended four-year schools, while 23 percent attended two-year institutions.
In 1988, 66 percent of the then eighth-graders expected to earn at least a bachelor's degree and 22 percent said they anticipated some post-secondary education.
By 1994, nearly 63 percent of this group had attended some sort of post-high school education.

Of those, about 57 percent attended a four-year institution, 36 percent attended a two-year institution and 7 percent attended a trade or technical school for less than two years.

More women than men reported in 1992 that they expected to obtain bachelor's or higher degrees, and woman also reported being more concerned than men about the prestige of the institution they chose.
Asians and Pacific Islanders, more than any other racial or ethnic group, said they expected to earn bachelor's degrees or higher -- and more of them than any other group had graduated from high school and enrolled in post-secondary education by 1994.
Hispanics, more than any other group, enrolled in public two-year institutions, while blacks enrolled in private four-year colleges at rates comparable to Asians and whites.

Source: William F. Honan, "Report Finds That Income Best Predicts Education," New York Times, June 17, 1996.

THE IMPACT OF SPECIAL EDUCATION COSTS

Soaring costs for handling "special education" students, along with inflation, are responsible for flat or decreasing spending on regular education students in many districts across the nation, according to statistics.

In Dayton, Ohio, for example, the annual per-pupil price for a disabled student is $25,000. The cost for a general education student is $5,611.

Many parents and educators are becoming concerned because special-ed students are guaranteed by law an "appropriate" education, while rank-and-file students are covered by no such guarantee. The result, they say, is that any increases in school funding are channeled to special education classes, with general education classes left only the crumbs if there are any.

Experts say that the rule of thumb -- developed years ago -- is that special education students cost 2.3 times as much as regular education students, which, they say, is probably an understatement today.
Today, special-ed students make up about 12 percent of the school population.
In 1991, those students absorbed nearly four out of every 10 new dollars added to school budgets.
In Dayton, where the special-ed population has risen from 11 to 14.5 percent over the last five years, the special-ed budget has soared from $10 million to $19 million over the past 10 years.

Source: Richard Whitmire, "Special Ed: Is the Price Too High?" USA Today, June 17, 1996.

FOR-PROFIT SCHOOLS AWARDED HIGH MARKS

Four schools opened last fall by the Edison Project, a for-profit educational venture, are being hailed as rousing successes by parents, teachers and local officials. The schools are located in Boston; Mount Clemens, Michigan; Sherman, Texas; and Wichita, Kansas.

At the Wichita Dodge-Edison school, for example:

Extras such as computers in each student's home, Spanish classes that start in kindergarten and additional tutoring are standard, without parents having to pay the tuition of private schools.
The school day is one and one-half hours longer than at public schools in the district, the school year is 20 days longer, and students spend a hour and a half on reading every day.
In its first year of private operation, Dodge-Edison's attendance record was 96 percent, and the number of students leaving the school during the year was 7 percent -- compared to 36 percent the previous year.
Some 320 families are on the waiting list for next year.

Here's how the Edison Project works:

Edison contracts with districts to operate individual schools for the same amount of money per pupil that is given to each district's other schools.
It earns a profit if it keeps the cost of running the school lower than the amount of money it gets from the district.
While teachers' unions have sometimes been hostile to Edison's for-profit schools, it reports that it has attempted to cooperate with unions and has largely succeeded in doing so.
The computer given to each student's family allows parents to receive messages from teachers, view homework assignments, converse with other Edison parents locally or in other cities and send E-mail to the project's top officials.

Also to Edison's advantage are the inefficiencies which plague many public schools, allowing it to run schools for the same per-student financing while putting in more resources and still making a profit. For example, Edison saved $68,000 in payroll costs for services that an outside contractor provided for $3,000 and an estimated $43,000 for a painting job that parents did for $500.

The Edison Project is the brainchild of Christopher Whittle, a media entrepreneur, who launched the project in 1991. In 1992, he hired Benno C. Schmidt, Jr., the president of Yale University, to run the program. After initial delays, the four schools were opened last year and serious talks are underway with school officials in 25 to 30 other districts aimed at opening schools there in the l997-98 academic year. Forty-five to 50 other districts have expressed interest, and officials in all four districts where schools are currently operating want Edison to expand there.

Investors who were once leery of Edison now show so much interest that some observers believe the company will be publicly traded in a few years.

Source: Peter Applebome, "Grading For-Profit Schools: So Far, So Good," New York Times, June 26, 1996.

HOMESCHOOLING KEEPS GROWING

The ranks of homeschooled children is rapidly growing. From 15,000 to 20,000 in the late 1970s, their numbers have grown to perhaps 600,000, with some estimates at more than one million. The trend is likely to continue as CD-ROMs, Internet services and educational networks allow scattered students access to specialized expertise. For example:

Software publisher Corel has a classic books program that incorporates more than 3,500 unabridged literary works, video clips and hundreds of illustrations.
The Clonlara School provides on-line support, resources and evaluations for more than 5,000 students worldwide for an annual tuition of $475 per family.
Scholars' Online Academy links instructors and students all over the country in a college preparatory program that offers a core curriculum at prices ranging from $250 for one course to $1,120 for eight.

More than $300 billion is spent annually in the U.S. on education from kindergarten through grade 12. Hal Clarke Inc., a publishing and market research firm, estimates that home school families spend about $1,500 a year on books, software, videos and educational materials.

There is evidence home school children get a better education than children in public schools. They consistently test above national norms on standardized tests, according to a researcher at the U.S. Department of Education.

On the other hand, a three-year Temple University study of 20,000 high school students found that one-third to 40 percent of them aren't trying very hard or paying attention in class.

Source: Britton Manasco, "Special Ed: Factory-like Schooling May Soon Be a Thing of the Past," Reason, July 1996, Reason Foundation, 3415 Sepulveda Blvd., Suite 400, Los Angeles, CA 90034, (310) 391-2245.