Does money matter in education?

Fights over the role money plays in K-12 education continue across the country, with states like Kansas embroiled in a 9-year lawsuit over education funding and Texas overhauling its school finance system just last month. Moving forward, these discussions should be informed by a new landmark paper from leading education scholar Eric Hanushek. The study analyzes performance data from over 2.7 million students and finds that the achievement gap between advantaged and disadvantaged U.S. students has remained unchanged for nearly 50 years.

During that time, state and federal policymakers implemented education reforms they thought would work. Class sizes decreased by 20 percent, and overall education funding per pupil quadrupled in inflation-adjusted dollars. It is clear that more money alone won’t solve the underlying problems affecting our country’s education system. That’s not to say money doesn’t matter in education — but what’s important is where the funding goes, rather than just how much is spent.

History shows us just how true that is. Since the 1960s, public education funding has changed quite a bit. There was a massive expansion in federal spending for disadvantaged students and special support programs, a general increase in state resources being directed to high-need student populations, decreases in average class size, and significant growth in administrative and support staff relative to student enrollment.

Altogether, these changes certainly yielded some benefits — accommodations for special needs students improved, the achievement gap between black and white students shrank substantially between 1970 and 1990, and a wave of reforms that directed more dollars to low-income districts in the 90s generated significant improvements in achievement for some disadvantaged students.

However, the broader perspective on these education trends brings into question whether the benefits of some policies have kept pace with their tremendous costs. Hanushek’s report notes that the achievement gap on test scores and key performance measures between black and white students has plateaued over the last quarter-century, and the achievement gaps between low-income and non-low-income students have remained almost stagnant. Faced with these disappointing results, legislators and educators would be remiss not to consider charting a fresh course.

Policymakers should acknowledge that some spending increases aren’t always worth it. For example, the left-leaning Brookings Institution notes that incremental class size reductions, though quite popular, are very costly and often don’t provide significant benefits to student learning.

Adding more support staff isn’t the answer, either. Research from EdChoice reveals that the nationwide surge in non-teaching staff such as administrators and guidance counselors between 1992 and 2015 spurred zero improvement on standardized test scores. The study also notes that had non-teaching staff simply grown in proportion with enrollment, taxpayers would have saved at least $805 billion.

Nevertheless, looking beyond Hanusheks’ report, some spending strategies do work.

Ample research indicates that both teacher quality and funding fairness, where schools have equal resources for each type of student and more dollars follow higher-need students, make a substantial difference for disadvantaged students. In fact, they’re some of the most promising routes for closing achievement gaps. But no unilateral policy prescriptions see consistent results across all types of communities, suggesting that top-down spending restrictions on things like staffing decisions and special programs are the hidden culprits responsible for lagging student achievement.

Education funding needs equalization, with standardized dollar amounts following each type of student to their school, and more dollars following higher-need students, such as English-language learners or children with disabilities. This allows disadvantaged schools the additional resources they need to serve their students.

Most importantly, we should give school-level leadership the power to make decisions about how resources are spent, particularly over hiring and retaining staff that serve their kids best. Shockingly, most principals can only make decisions over 1-5 percent of their total school-level budgets. Policymakers and central administrators should hold principals and administrators accountable for student outcomes — but refrain from doing their jobs for them.

Not all education spending is created equal. So rather than focusing on across-the-board increases to state and district education budgets or installing rigid rules over how resources can be used, legislators ought to step back and allow those closest to the children to make decisions. Continuing the current track of mandates from on high will only ensure that the next half-century fails students in the same ways the last one did.

Christian Barnard is a contributor with Young Voices and an education policy analyst with the Reason Foundation, a think-tank advancing free minds and free markets. Follow him on Twitter @CBarnard33.