What Is America Getting from Its Investment in Education?

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What Is America Getting from Its Investment in Education?

October 2, 2008 3 min read

Authors: Rea Hederman and James Sherk




What Is America Getting from Its Investment in Education?

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By Lindsey Burke

With Congress considering a $700 billion rescue package for our financial market, taxpayers are rightfully asking questions about how these funds will be spent. But all too often we forget to apply the same scrutiny to the nearly $600 billion we spend in state and federal dollars each year on K-12 education.

Any fair accounting should conclude that we're getting sub-par returns on this investment.

While many of the nation's best and brightest go off to pursue fulfilling educational experiences at colleges and universities across the country, significant numbers of students leave high school with gaping holes in some fundamental academic concepts.

National test scores reveal that many students are failing to master basic skills. On the National Assessment of Educational Progress, 33 percent of fourth-graders score below basic on reading, as do 26 percent of eighth-graders. According to the Department of Education, fourth-graders not performing at a basic level are unable to make general conclusions about what they read. At the eighth-grade level, this means students are unable to make simple inferences or interpret ideas. For both grade levels, these are crucial skills to master to ensure future academic success.

In addition, a poor grasp of basic content knowledge means children are exiting high school unprepared for college or the workforce, if they even graduate at all.

National graduation rates have stagnated around 73 percent, with numbers significantly lower for minority students. In 2006, only 61 percent of Hispanic students and 59 percent of black students graduated. An independent analysis found that, in some of our nation's biggest cities, fewer than half of all students finish high school. In the Baltimore City and Cleveland Municipal City school districts, only about one-third of all students graduate. Indianapolis has a graduation rate of only 30 percent, and a mere 24.9 percent of Detroit students complete high school.

These shockingly low graduation rates should incite a national outrage. And while some politicians will surely call for investing more tax dollars for public school as the solution, a lack of funding is not the source of the problem.

Detroit, for example, spends more than $13,000 per year on each student. In addition, the city school districts of New York, Philadelphia, Dallas, Denver, and Atlanta all spend well over $10,000 per pupil yet have graduation rates below 50 percent.

Historically, decades of increased funding for public education have not led to better outcomes. A new Heritage Foundation report, Does Spending More on Education Improve Academic Achievement? found that education spending is at an all-time high, and student performance has flat lined.

The report details a 23 percent real increase in per-pupil spending in the past decade and a real increase of 49 percent over the past 20 years. With these figures in mind, it is hard to make the argument that a lack of funding is the problem. Per-pupil spending has more than doubled since 1970, yet academic achievement has remained flat.

So if more money isn't the answer, what will lead to academic improvement?

While policymakers need to continue implementing education reforms to improve the efficiency and productivity of our schools, a big part of the solution will come from the home. In a new Heritage Foundation report Academic Success Begins at Home: How Children Can Succeed in School, Christine Kim reviews the social science literature and finds a strong link between family structure and parental involvement with student outcomes.

According to the study, evidence suggests a correlation between family structure and high school dropout rates. This fact naturally influences future educational outcomes and opportunities for our nation's children. Family structure, or a lack thereof, appears to affect college admission and completion rates.

Parental expectations have a greater influence on children than peer influences. Kim notes, "Parental expectations of achievement, particularly adolescents' perceptions of such expectations, appear to strengthen their actual motivation and ability in school."

Kim explains that reform efforts emphasizing involvement and greater parental choice in education will be the best steps in enhancing student academic achievement.

"Instead of favoring proven ineffective education policies, policymakers seeking effective education reform should consider policies that strengthen family structure in America and bolster parental involvement and choice in education."

Regardless of the quality of school that a parent must send their child back to this fall, one thing is certain: Their involvement in that child's education-meeting with teachers, helping with homework, classroom involvement-will prove to have a positive, significant effect on educational attainment and aspiration. In an era of demoralizing national data on academics, it is encouraging to know that the ultimate underpinning of a child's success still resides with the family.

The newfound attention aimed at federal spending thanks to the financial market rescue should focus attention on government spending overall, especially in the case of education, where exorbitant spending has proven ineffectual in combating current tribulations. Basic laws of subsidiarity tell us to leave the money-and the choice-in the hands of parents.

To learn more about these and other education issues facing our nation, please see A Parent's Guide to Education Reform, a new resource from The Heritage Foundation.

Lindsey Burke is a Research Assistant in Domestic Policy Studies at The Heritage Foundation.


Rea Hederman

Executive Director, Economic Research Center

James Sherk
James Sherk

Research Fellow, Labor Economics