For years, conservatives have been promoting publicly financed private school vouchers for low-income students. There doesn’t seem to be much to recommend them: not only do the vouchers divert public funds away from public schools, but the evidence is very mixed about whether such programs improve the academic achievement of the vouchers’ recipients. Despite these concerns, Republicans in Congress are now proposing to spend billions of federal funds over time to subsidize private-school education for the children of higher-earning families. The provision, included in the Tax Cut and Jobs Act, expands Section 529 (which currently provides tax incentives that encourage parents of all income levels to save for college) to allow such tax-deferred savings to be used for private K-12 education.
Unlike existing programs, which allow families to put aside $2,000 a year for K-12 education, the new plan will allow for $10,000 per year to be set aside and grown tax-free. Furthermore, the income limits of the existing K-12 savings plans ($220,000 for joint filers) would be lifted entirely.
There are major problems with this proposal. First, in practice, the bill will likely simply subsidize private K-12 education for many families that were already planning, and can already afford, to send their children to private schools. Second, if the provision does induce a significant number of additional families to leave public schools, that will certainly undermine support for public schools generally, and potentially exacerbate even further the racial and class-based segregation that many public schools face. Third, given that there is little evidence that these vouchers do any good for education quality, it is flat-out fiscally irresponsible to spend potentially billions of federal dollars on a new education subsidy that is likely to have negative, not positive, effects on overall student achievement.
It is flat-out fiscally irresponsible to spend potentially billions of federal dollars on a new education subsidy that is likely to have negative, not positive, effects on overall student achievement.
Another widely discussed provision of the Republican tax bill proposes to put limits on the deductibility of state and local taxes (SALT), which is likely to harm investment in public schools. Part of the reason that upper middle-class families currently use public schools, rather than private schools, is that public schools in upper-middle class areas are relatively well-funded. The public schools in upper-middle class areas can draw high-quality teachers with competitive salaries and can offer a rich curriculum and extracurricular activities because the families of their students are willing to support taxes on property and income at a level that will finance good schools. And those families are willing to support those higher state and local taxes because the federal deductions now in place make them more affordable. Taking that deduction away could make upper-middle class families reject future state and local spending on education.
The stakes are high. A 2011 report of the Center on Education policy estimated that complete elimination of the state and local tax deduction would deprive public schools of $17 billion—an amount greater than the entirety of Title I federal financing for public education. Michael Dannenberg of Democrats for Education Reform estimates that the House bill “would whack about $250 billion in support for public education over the next ten years.”
Public schools, even in more affluent neighborhoods, would decline as a result. And coupled with the new tax incentive for parents to use private education, we could see the flight of upper-middle class families from public to private education accelerate even further.
If this happens, public education will lose much of its political muscle, and state legislators will be under less pressure to adequately fund public schools. In turn, public schools will decline even further, leading to a vicious cycle.
Observers have noted that the deductibility of state and local property taxes hits blue states most heavily, which surely plays into the proposal’s motivation. But something even more serious than partisan politics is on the table: the viability of public education as an institution, one that educates nearly all—90 percent—of our country’s students.
Something even more serious than partisan politics is on the table: the viability of public education as an institution, one that educates nearly all—90 percent—of our country’s students.
These privatization schemes began by picking off lower-income families, then worked their way up to the middle class. And now they seek to encourage upper-middle class families to secede from the public-school enterprise. With our democracy under great stress, we must do all we can to nourish and support American public education, not inflict on it greater damage.
Tags: public education, Trump administration, Betsy DeVos, private education, taxes
Tax Incentives to Secede from Public Education
For years, conservatives have been promoting publicly financed private school vouchers for low-income students. There doesn’t seem to be much to recommend them: not only do the vouchers divert public funds away from public schools, but the evidence is very mixed about whether such programs improve the academic achievement of the vouchers’ recipients. Despite these concerns, Republicans in Congress are now proposing to spend billions of federal funds over time to subsidize private-school education for the children of higher-earning families. The provision, included in the Tax Cut and Jobs Act, expands Section 529 (which currently provides tax incentives that encourage parents of all income levels to save for college) to allow such tax-deferred savings to be used for private K-12 education.
Unlike existing programs, which allow families to put aside $2,000 a year for K-12 education, the new plan will allow for $10,000 per year to be set aside and grown tax-free. Furthermore, the income limits of the existing K-12 savings plans ($220,000 for joint filers) would be lifted entirely.
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There are major problems with this proposal. First, in practice, the bill will likely simply subsidize private K-12 education for many families that were already planning, and can already afford, to send their children to private schools. Second, if the provision does induce a significant number of additional families to leave public schools, that will certainly undermine support for public schools generally, and potentially exacerbate even further the racial and class-based segregation that many public schools face. Third, given that there is little evidence that these vouchers do any good for education quality, it is flat-out fiscally irresponsible to spend potentially billions of federal dollars on a new education subsidy that is likely to have negative, not positive, effects on overall student achievement.
Another widely discussed provision of the Republican tax bill proposes to put limits on the deductibility of state and local taxes (SALT), which is likely to harm investment in public schools. Part of the reason that upper middle-class families currently use public schools, rather than private schools, is that public schools in upper-middle class areas are relatively well-funded. The public schools in upper-middle class areas can draw high-quality teachers with competitive salaries and can offer a rich curriculum and extracurricular activities because the families of their students are willing to support taxes on property and income at a level that will finance good schools. And those families are willing to support those higher state and local taxes because the federal deductions now in place make them more affordable. Taking that deduction away could make upper-middle class families reject future state and local spending on education.
The stakes are high. A 2011 report of the Center on Education policy estimated that complete elimination of the state and local tax deduction would deprive public schools of $17 billion—an amount greater than the entirety of Title I federal financing for public education. Michael Dannenberg of Democrats for Education Reform estimates that the House bill “would whack about $250 billion in support for public education over the next ten years.”
Public schools, even in more affluent neighborhoods, would decline as a result. And coupled with the new tax incentive for parents to use private education, we could see the flight of upper-middle class families from public to private education accelerate even further.
If this happens, public education will lose much of its political muscle, and state legislators will be under less pressure to adequately fund public schools. In turn, public schools will decline even further, leading to a vicious cycle.
Observers have noted that the deductibility of state and local property taxes hits blue states most heavily, which surely plays into the proposal’s motivation. But something even more serious than partisan politics is on the table: the viability of public education as an institution, one that educates nearly all—90 percent—of our country’s students.
These privatization schemes began by picking off lower-income families, then worked their way up to the middle class. And now they seek to encourage upper-middle class families to secede from the public-school enterprise. With our democracy under great stress, we must do all we can to nourish and support American public education, not inflict on it greater damage.
Tags: public education, Trump administration, Betsy DeVos, private education, taxes