The Opportunity Costs of No Child Left Behind

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The Opportunity Costs of No Child Left Behind

March 9, 2007 3 min read
Jay Kingham Senior Research Fellow, Margaret Thatcher Center
Brett is the Jay Kingham Senior Research Fellow in International Regulatory Affairs in Heritage’s Margaret Thatcher Center for Freedom.
The Opportunity Costs of No Child Left Behind
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By Dan Lips

This year, as Congress debates the future of No Child Left Behind, American families and taxpayers need to consider an important question: What are we giving up to pay for it?

In economics, "opportunity cost" refers to the next best use of a resource. We think about opportunity costs every day as we decide how to spend our time or money. Should I spend the next hour reading the newspaper or watching television? Should I use this dollar to buy a cup of coffee or orange juice?

When it comes to No Child Left Behind, the opportunity cost is the other ways that we could use the $23 billion taxpayers spend on the program, as well as the time teachers and administrators spend implementing it.

This year, Congress will send $23.3 billion to the Department of Education to pay for No Child Left Behind. After funding the operations of the federal education headquarters, this money will be allocated to dozens of different programs, each with its own bureaucracy. As those funds travel from Washington, D.C., back to local school districts, a good portion will be consumed by administrative costs and bureaucracy before they reach schools or classrooms.

Congress owes it to the American people to think about the opportunity costs of No Child Left Behind. Couldn't this investment be put to better use to improve education opportunities for American kids? Consider some of the alternative ways those funds could be used to improve education.

One idea often pushed by liberals and teachers' unions is to increase pay for America's school teachers. According to the Department of Education, there are about 3 million public school teachers in the country. That means the $23.3 billion currently spent on No Child Left Behind would be enough for a pay raise of more than $7,000 for every single public school teacher in the country. For the average teacher, that would be a salary boost of about 14 percent.

Alternatively, this money could fund another liberal policy recommendation: hiring more teachers and reducing class sizes. Since the average public school teacher's salary is about $47,700 per year (according to the American Federation of Teachers), $23.3 billion could hire about 490,000 new school teachers and reduce class sizes in America's public schools from an average of 16 to 14 students.

Research suggests, however, that neither of these options would be the best use of taxpayer dollars. Contrary to conventional wisdom, teachers earn more than other white-collar workers. And an across-the-board pay hike certainly wouldn't be a cure-all for all the problems of our schools.

Research on efforts to reduce class sizes casts similar doubt on its effectiveness. Hiring an additional half-million schoolteachers, even if they were available, would not be a good use of money.

Nonetheless, both of these examples show what kinds of tangible things could be done with the $23.3 billion we currently spend on No Child Left Behind.

What about conservative education reforms? The $23.3 billion could be used to create new school choice options for disadvantaged kids.  There are about 18 million economically disadvantaged children in America's schools.  The $23.3 billion could give each of these students a scholarship worth about $1,300. These scholarships could help pay for private school tuition, one-on-one instruction from an after-school tutoring center, or a summer learning program.

But just as conservatives would object to an across-the-board pay hike for teachers, liberals would oppose a national scholarship program for disadvantaged kids. Perhaps the most appropriate measure of the opportunity cost of No Child Left Behind, then, is what would happen if the funding currently distributed through the federal bureaucracy were returned to state and local governments.

A large state like California would receive $2.7 billion, while a smaller state like New Hampshire would get $67 million, with most states falling in between. The $23.3 billion currently funneled through the Department of Education's bureaucracy would be controlled by governors, state legislators, state education leaders, and local officials - people who are more likely to know the names and faces of the kids in local schools.

Different states would try different reform strategies. Some states might try school choice; others, reducing class sizes or hiking teacher pay. In both cases, decisions would be made closer to the people they affect. Parents, teachers, and taxpayers would be more likely to have their say.

Americans think about opportunity costs every day as we judge how to spend our money and our time. Lawmakers should apply that same scrutiny to No Child Left Behind.

Dan Lips is an Education Analyst at the Heritage Foundation


Brett Schaefer

Jay Kingham Senior Research Fellow, Margaret Thatcher Center