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Pension Pilfery

Let’s Deep-six Prop. 30

The signatures for an initiative that would extend 2012’s “temporary” tax increase in California are due today.

Four years ago Californians voted in Prop. 30, a “temporary” tax, to pay back schools “from the years of devastating cuts.” But as I show here, there was hardly any devastation; in fact, our spending had continued to be quite robust. The measure jacked up income tax on people with incomes exceeding $250,000 through 2018 and increased sales tax on all of us through the end of this year. But, the Beholden State teachers unions are trying to get an initiative on the 2016 ballot that would continue the higher income tax through 2030. (The sales tax increase would expire as scheduled.) Earlier this month, California Teachers Association president Eric Heins told the union’s State Council that “…we need to gather 900,000 signatures to get our measure on the ballot. We are about 60 percent there, and we only have about three more weeks.”

Today, in fact, is the deadline. If enough signatures are gathered, the extension has a good chance of success. As reported by EdSource’s John Fensterwald, a Public Policy Institute of California poll found, “…among all Californians, 64 percent support the extension, 32 percent oppose it and 4 percent are undecided. Among likely voters, 62 percent back it, 35 percent oppose it and 2 percent haven’t decided. By party affiliation, 82 percent of Democrats support it while only 32 percent of Republicans do.”

When I read poll numbers like this, I always wonder if the people questioned know what we actually spend on education. My guess is that many don’t. A recent Education Next poll, which included a question about that issue, is instructive. The school districts in which their survey respondents resided spent an average of $12,440 per pupil in 2012 (the most recent data available). But when asked, the respondents estimated per-pupil expenditures in their local school district, they guessed, on average, just $6,307 – about half of what was actually spent. (By the way, these dollar amounts would be considerably higher if expenditures for transportation, capital expenses, and debt service were included.)

Should Prop. 30 (or any future such tax increases) make it on to the ballot, I would ask voters to consider the following:

  • The unions will tell you that the tax is only on the wealthy, whom they claim don’t pay their fair share. But a look at the actual numbers tells a different story. A report issued by the Congressional Budget Office in 2012 shows that the top one percent of income earners across the nation paid 39 percent of federal individual income taxes in 2009, while earning 13 percent of the income. Hence, it’s clear that the rich are already paying considerably more than their “fair share.”
  • Courtesy of Cato Institute’s late, great Andrew Coulson, we see that between 1972 and 2012 California’s education spending (adjusted for inflation) has doubled, while our students’ SAT scores have actually declined.
  • The latest study on the relationship between spending and achievement, recently conducted in Michigan, found no statistically significant correlation between how much money the state’s public schools spend and how well students perform academically. Mackinac Center Education Policy Director Ben DeGrow, who coauthored the study said, “Of the 28 measurements of academic achievement studied, we find only one category showed a statistically significant correlation between spending and achievement, and the gains were nominal at best.” He added, “Spending may matter in some cases, but given the way public schools currently spend their resources, it is highly unlikely that merely increasing funding will generate any meaningful boost to student achievement.”
  • Unconditional money poured into public education from the private sector doesn’t help either. In 2010, Facebook founder Mark Zuckerberg donated $100 million to the Newark public schools, which was matched by another $100 million from unnamed donors. As documented in The Prize: Who’s in Charge of America’s Schools, a book about the gift, the money went up in smoke, with the teachers union playing a big role in vaporizing it. As reported by the New York Times, Newark Teachers Union leader Joe Del Grosso “demanded a ransom of $31 million to compensate for what he felt members should have received in previous years — before agreeing to discuss any labor reforms.” The new labor contract accounted for almost half the $200 million. In a review of the book, Cato Institute’s Jason Bedrick wrote, “The union boss… made the back pay a condition for even holding the negotiations. ‘We had an opportunity to get Zuckerberg’s money,’ Del Grosso later explained, ‘Otherwise, it would go to the charter schools. I decided I shouldn’t feed and clothe the enemy.’” But it wasn’t only the unions that abused the gift. As Bedrick says, “The Prize demonstrates in depressing detail just how difficult it is to reform public schooling in the United States. Laws, regulations, and labor contracts favored adult jobs over kids’ education and this entrenched bureaucracy was difficult to change—especially because reforms met opposition from special interests and their political allies.”

With a debt of over $1 trillion and counting, California clearly has a spending problem, not a too-little-tax problem. The taxpayers must take action. First, we all need to know specifically where our edu-bucks are being spent. You can start at the Ed-Data website for general expenditures. Do some digging to find out how teacher union (and all public employee union) pensions are bankrupting cities across the state. For that kind of information, Pension Tsunami is an invaluable resource. Perhaps most importantly, communicate with legislators and demand school choice. Among other things – just as in business – competition lowers prices while increasing product quality. And God knows we would benefit from both.

Randi Weingarten and other union leaders have a prized talking point: “You can’t fire your way to a teaching force.” It’s a ridiculous claim, which I debunked last week. And at the same time, they erroneously believe we can spend our way to success. But they make no real case for this, because there isn’t one. It’s time for all of us to stop falling for the feel-good fairy tales. Just saying “No!” to the Prop. 30 extension – should it get to the ballot – would be a great place to start.

Larry Sand, a former classroom teacher, is the president of the non-profit California Teachers Empowerment Network – a non-partisan, non-political group dedicated to providing teachers and the general public with reliable and balanced information about professional affiliations and positions on educational issues. The views presented here are strictly his own.