Regarding that ‘Stop Digging’ Idea about When You’re Already in a Hole

Illinois and New Jersey both have claims to the title of most disastrous state finances in the nation. In fact, the Mercatus Center 2017 report “Ranking the States by Fiscal Condition” said that on a guaranteed-to-be-paid basis, Illinois’ unfunded pension obligations are $344.85 billion, or 54 percent of state personal income. Good Lord.

Illinois’ finances were ranked 49th worst, better than only the Garden State.

With this backdrop, we learn about a new recommendation from the Superintendent of the Illinois State Board of Education: Spend $7.46B more of state general funds on public education in FY 2019, or $15.7B, a 90.9% increase or near doubling over the $8.2B allocated for FY 2018. (Those figures can be found on page 112 of this document to be formally presented tomorrow at the State Board of Education public meeting.)

The idea represents an effort to realign funding away from local property taxes and instead rely more on state coffers to pay for schools, an initiative called Evidence-Based Funding (EBF). The state superintendent’s budget proposal says this shift to state-based funding would result in a fairer system, since “school districts in Illinois range from having 46% to having 284% of the resources necessary to provide a quality education to students.”

Michael Jacoby, CEO of the Illinois Association of School Business Officials, Tweeted about the giant increase, without noting that the recommended figure was nearly double that of previous years.

It’s easy to be sympathetic to the superintendent’s stated intent — giving low-income students a better chance at a good education. Yet the proposal represents a toxic combination of two bad ideas: A doubling down (almost literally) on the inputs-based, “spending equals quality” paradigm of thinking about education, and treating government spending as if it’s disconnected to fiscal realities. To the first point, once the quality of an important government service becomes equated with how much money is spent, endless future increases, cloaked in public virtue signaling, are nearly guaranteed. And to the second point, notable by its absence in this plan is any acknowledgement that the state is already beyond broke. Wouldn’t you at least expect to see an, “While we realize this increase might sound crazy, since we’re already swimming in suicidal levels of financial obligations, we think it’s justified because….”? Instead, the tone is more like an Alfred E. Neumanesque, “Debt, what debt?”

To be sure, a proposal by a state superintendent or state board of education does not a legislative budget passage, nor gubernatorial signature make. But it’s a window into the thinking of an educational establishment still clinging to an if-only-the-monopolies-had-more-money ideology.

Instead, Illinois should consider a different path toward greater education equity: Expanding the fledgling $75M tax credit scholarship initiative passed in 2017. The program is means-tested — which means no rich families are eligible. More importantly, the bigger it is, the more new, innovative and specialized schools will form across Illinois, with low and middle-income families having a new way to pay the tuition. This would bring both more educational options to those kids, as well as the small detail of not worsening the state’s desperately beleaguered finances.

Or, they could go with the state superintendent’s proposal and just keep digging.

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