Red States: Waking Up to Public Responsibility for Educating Children?

This is the first of two updates on this spring’s wave of walkouts by schoolteachers.  Today’s post will examine the fiscal implications.  Tomorrow’s will explore what the walkouts may mean about shifting attitudes across some of the Heartland’s Red-states.

In a fine piece for NPR’s All Things Considered, Cory Turner provides some context for the fiscal crisis beneath walkouts across a number of states: “How did we get here? When you put that question to people who study teacher pay, you’ll often hear something like this: ‘I have been saying, Why aren’t (teachers) in the streets?  What took them so long?‘ says Sylvia Allegretto, a labor economist at the University of California, Berkeley.  She’s compared teachers’ weekly wages to workers with similar levels of experience and education and says teachers consistently earn less.”

In a brief for the Economic Policy Institute, Allegretto’s bar graph displays the nationwide disparities in pay between schoolteachers and other college graduates—but it is a lot worse in some places than others.  Oklahoma’s teachers have been making only 67 percent of the income of their college-educated peers in other fields.  Arizona’s teachers (the lowest-paid) have been making 62.8 percent; West Virginia’s teachers 74.6 percent; and Kentucky’s teachers about 78.8 percent. Across the United States, teachers’ wages average 77 percent what others make with equivalent education, and in not one state do teachers’ salaries exceed what their peers are making.

Turner also quotes Bruce Baker, the school finance expert at Rutgers University: “‘Teachers in Arizona are actually at the bottom of the heap…. And teachers in Oklahoma are pretty near that’… He mentions Tennessee and Colorado as other states with a teacher wage gap.  ‘What’s really so striking to me is that it’s had to get this bad. It was kind of like that slow boil over time.'”

Turner adds: “When you focus on teacher salaries, which make up the lion’s share of schools’ spending, data published by the Education Department show that, after adjusting for inflation, U.S. teachers earned less last year, on average, than they did back in 1990. In Oklahoma, teachers’ wages averaged $45,245 last year, down roughly $8,000 in the past decade. Over the same span, in Arizona, teachers’ wages are down roughly $5,000.”

Turner also addresses the myth of the gold-plated teacher pension: “(I)n many states, teachers don’t qualify for Social Security benefits, either. So they really depend on that pension.”  However, new teachers usually have to teach in a school district for five years even to qualify for the pension system. Turner quotes Chad Aldeman, who edits a publication about teacher pension systems: “In the median state, about half of all new teachers won’t stick around long enough to qualify for any pension at all.”  And while school districts must pay, on average, 17 cents on retirement costs for every dollar in teachers’ salaries, Aldeman explains: “Of that 17 cents, about five of it is actually going in benefits, and 12 cents of it is going to pay down unfunded pension obligations.”

One reason the massive walkouts have exerted so much pressure on legislatures is that huge salary disparities across state borders have fed teacher shortages in states paying less.  Teachers in West Virginia have been leaving for Maryland and in Oklahoma for Texas.  POLITICO’s Caitlin Emma quotes Tulsa School Superintendent, Deborah Gist speaking from her cell phone as she marched with striking teachers from Tulsa to Oklahoma City. Gist compared the average teachers’ salary in Texas at $52,575 to the Oklahoma average of $45,245: “I’ve had superintendents in Texas thank us because they hired our teachers. It creates an extraordinarily unstable situation.” Emma adds: “The Sooner State has had to issue emergency certifications to thousands of people in recent years to staff classrooms, raising concerns about qualifications.”

What have teachers won so far through the mass walkouts?  Though teachers have won raises and in some cases school funding boosts, legislators have not been willing to restore cuts to progressive income taxes or to bring back capital gains taxes on wealthy residents and corporations.  Sadly, regressive sales, consumption and sin taxes have prevailed.

Last month West Virginia’s teachers achieved a five percent raise, after the state’s governor had previously offered only one percent. And the state will give the five percent raise to all state employees. It is still unclear where the money will come from as the Governor has promised not to increase taxes.

In Oklahoma, teachers also will get a significant raise, though not the kind of increase they’d hoped for to increase overall school funding. The NY TimesDana Goldstein and Elizabeth Dias report: “In a deep-red state that has pursued tax and service cuts for years, teachers won a raise of about $6,000, depending on experience, while members of schools’ support staff will see a raise of $1,250…  To fund the measures, as well as some limited new revenues for schools, the Republican-controlled Legislature and Gov. Mary Fallin instituted new or higher taxes on oil and gas production, tobacco, motor fuels, and online sales. The state will also allow ball and dice gambling, which we will be taxed.”

After days of striking, Kentucky’s teachers returned to their classrooms after the legislature passed a budget that increases funding for K-12 education and a tax plan to pay for the increase, but Governor Matt Bevin vetoed the spending plan and the taxes to pay for it.  So, last Friday, Kentucky’s teachers closed school for an additional day and brought their enormous presence back to Frankfort. The legislature responded, according to the Associated Press report: “With the chants of hundreds of teachers ringing in their ears, Kentucky lawmakers have completed an override of Gov. Matt Bevin’s veto of a more than $480 million tax hike that helps pay for increases in public education spending.”

The Washington Post‘s Jeff Stein adds that Kentucky’s funding scheme, important as it is, is the definition of regressive: “The plan would flatten Kentucky’s corporate and personal income-tax rates, setting both at 5 percent. Currently, Kentucky’s corporate tax rates runs between 4 and 6 percent, while its income-tax rate ranges from 2 to 6 percent. The new flat rate of 5 percent for everyone means that small companies and Kentuckians with below-average incomes will face tax hikes, and higher earners will get tax cuts. The bill attempts to make up for those cuts by nearly doubling the cigarette tax and imposing sales taxes on 17 additional services, including landscaping, janitorial work, golf courses and pet grooming.”

Pressure from teachers’ walkouts in all these states and a #RedforEd movement threatening its own walkout in Arizona seems to have awakened Arizona’s Governor Doug Ducey, who announced a plan late last week to raise teachers’ salaries 20 percent by 2020. The Arizona Republic reported: “Gov. Doug Ducey on Thursday boosted his proposal for teacher raises next year to 9 percent, up from 1 percent he proposed in January, saying lawmakers would work through the weekend to figure out how to fund the plan.  Coupled with 5 percent raises the following two years—and the 1 percent raise given last year—Ducey said his proposal would give teachers a ‘net pay increase’ of 20 percent by 2020.”

Columnist for Tucson’s Arizona Daily Star, Tim Steller warned, however, on Saturday that it’s too early to celebrate in Arizona: “Everybody was right that the governor’s announcement was hopeful news, but this is no time for teachers or the #RedForEd movement to declare victory and stash away their crimson shirts. The only thing that has gotten them this far is collective action and increasing pressure. They cornered the governor in an election year, and they shouldn’t let him out till they’ve got their raises and increased school funding in hand… Ducey’s dramatic announcement was a great relief, but it was just words. It was a proposal to use money of unclear origin to raise the pay for teachers but not other employees like counselors and teachers’ aides. It’s a good gesture, but so far nothing more.”

Meanwhile on Sunday, April 8th, legislators in Kansas—under pressure from the state’s supreme court which had, last October, set an April 30 deadline for compliance with its earlier court order to increase school funding—passed a $534 million increase in school funding over five years. The state’s funding for public schools had collapsed in recent years as a result of former Governor Sam Brownback’s  failed experiment with tax cutting and supply side economics. However, after some hope early in April that the Legislature has likely appropriated enough money to meet the Kansas Supreme Court’s expectation, it turns out there was an $80 million flaw in the math behind the plan. The Associated Press‘s John Hanna reports: “The bill approved by lawmakers early Sunday was meant to phase in a $534 million increase over five years, and with the flaw, the figure is $454 million or perhaps a little less.” After a two week break, the Legislature will now return on April 26. There seems to be hope that the miscalculation will be fixed.

In these all-Red states across the Heartland, it is clear that a reckoning has begun. But so far there is neither clear agreement that paying taxes is a responsibility of citizens and businesses nor that taxation should be progressive with the heaviest responsibility falling on those who can best afford to support the public. At least, driven by the voices and actions of desperate schoolteachers—and in Kansas by a supreme court enforcing the state constitution—governors and legislators are having to face that their citizens seem suddenly to agree that there is a floor beneath which education services must not fall. And there seems to be an awareness that enough well qualified teachers are at the heart of what is necessary. That is a positive development.

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Tax Slashing Predictably Reduces Government’s Capacity to Do Its Job

Commenting for the NY Times yesterday on the tax reform bill being rushed through Congress, Peter Goodman and Patricia Cohen explain: “The tax plan has been marketed by President Trump and Republican leaders as a straightforward if enormous rebate for the masses, a $1.5 trillion package of cuts to spur hiring and economic growth. But as the bill has been rushed through Congress with scant debate, its far broader ramifications have come into focus, revealing a catchall legislative creation that could reshape major areas of American life, from education to health care.”

This warning about the persistent effort to reduce government should frighten those of us who worry about government’s capacity to educate the 50 million children and adolescents who fill public schools across our states. Perhaps you are taking comfort in the fact that fiscal responsibility for schools is shared by local, state, and federal governments, but it isn’t really that simple. What happens at the top—the federal level—or at the middle level, in your state—or in your local school district’s passage or failure of your most recent school levy is tightly woven together with the funding at other levels. On Wednesday, the Center on Budget and Policy Priorities released A Punishing Decade for School Funding, the latest in its annual bird’s eye surveys of what is being spent across the United States on K-12 public education.  This latest report comes a decade after the Great Recession caused tax collections to collapse across many states. The report examines whether and to what degree states and their public schools have been able to recover.

The Center on Budget and Policy Priorities (CBPP) emphasizes the essential concept of interconnectedness. Public education is primarily a state function; schools are established by the 50 state constitutions, not the federal constitution. Forty-seven percent of money for public schools is provided through taxation by state governments; 45 percent of school funding comes from local school taxes; and only 8 percent is currently provided by the federal government. The number of students enrolled has grown in the decade when the Great Recession hit in 2008: “(W)hile the number of public K-12 teachers and other school workers has fallen by 135,000 since 2008, the number of students has risen by 1,419,000.”

So… what has happened to cause the number of teachers to fall even as the number of students has risen?  “When the Great Recession hit… property values fell sharply, making it hard for school districts to raise local property taxes—schools’ primary local funding source—without raising rates, which is politically challenging even in good times. Raising rates was particularly difficult during a severe recession with steep declines in housing values in many areas.  As a result, local funding for schools fell after the recession took hold, exacerbating the even steeper fall in state funding.”

State funding has not caught up (when adjusted for inflation): “In 29 states, total state funding per student was lower in the 2015 school year (the most recent year for which data is available) than in the 2008 school year, before the recession took hold.  In 17 states, the cut was 10 percent or more.  In 19 states, local funding per student fell over the same period. In the other 29 states for which we have data local funding rose, but those increases usually did not make up for cuts in state support. In 29 states, total state and local funding combined fell between the 2008 and 2015 school years.”

And even before we learn what will happen with the current tax-reform bill being considered by Congress this week, we learn from CPBB that, “Federal policy makers have cut ongoing federal funding for states and localities—outside of Medicaid—in recent years, thereby worsening state fiscal conditions. The part of the federal budget that includes most forms of funding for states and localities… known as non-defense ‘discretionary’ funding (that is, funding that is annually appropriated by Congress), is near record lows as a share of the economy. Federal spending for Title I—the major federal assistance program for high-poverty schools—is down 6.2 percent since 2008, after adjusting for inflation.”

Authors of CBPP’s new report cite peer-reviewed research by C. Kirabo Jackson, Rucker Johnson and Claudia Persico, scholars at Northwestern University and the University of California at Berkeley, who tracked the long-term impact on children of their school district’s funding level: “As common sense suggests—and academic research confirms—money matters for educational outcomes. For instance, poor children who attend better-funded schools are more likely to complete high school and have higher earnings and lower poverty rates in adulthood.” Here are the learning essentials the CBPP report attributes to adequate school funding: recruiting, developing, and retaining high-quality teachers; trimming class size; and expanding learning time. Nothing fancy here: These are basic but very expensive fundamentals.

Why has spending on K-12 public education in many places never caught up to where it was in 2007?  The CBPP reports: “States disproportionately relied on spending cuts to close their large budget shortfalls after the recession hit, rather than a more balanced mix of spending cuts and revenue increases… State revenues have been hurt this year and last by a variety of factors, including falling oil prices, delayed sales of capital, and sluggish sales tax growth.”

Finally and not surprisingly, “Some states cut taxes deeply. Not only did many states avoid raising new revenue after the recession hit, but some enacted large tax cuts, further reducing revenues. Seven of the 12 states with the biggest cuts in general school funding since 2008—Arizona, Idaho, Kansas, Michigan, Mississippi, North Carolina, and Oklahoma—have also cut income tax rates in recent years.”

Austerity government and tax slashing—the reality in too many states in recent years—ought to serve as a warning to us all as Congress considers big reductions in federal taxes. There will inevitably be serious consequences for people who depend on government for things like healthcare and education.