Many of us share the goals of improved funding and accountability for our schools. Where we have differences of opinion is on how best to achieve these goals.
Whenever we seek the best solution to a problem involving spending and quality, I like to refer to a simple yet elegant framework that I first heard espoused by former GOP Congressman Bob McEwen of Ohio. In his framework, he highlights the differences between what he refers to as first party, second party, and third party transactions. A first party transaction is when you purchase a service for your personal benefit with your personal funds.
Quality and cost are both drivers in your purchase decision. A second party transaction is when you purchase a service for someone else using your personal funds (e.g. birthday gift). Cost is the primary driver while quality simply needs to pass the sniff test (Can you say “re-gifting”?). A third party transaction is when you purchase a service for someone else using someone else’s funds. Neither quality nor cost is a principle concern in your purchase decision. Importantly, almost all government transactions are third party transactions.
This third party model for government services is only effective when we are served by moral and virtuous public servants who prioritize the best interests of others over their own. While I am happy to say that many public servants fit this mold, I believe that most people would acknowledge this is not always the case. This is one of the reasons that I am such a staunch advocate for limited government.
That being said, it is clear that the more we promote government policies that feature first party transactions, the more we will promote higher quality services that cost less.
Our current funding model for schools is a distinctly third party model. The state collects taxes from all of our citizens and redistributes these taxes in the form of per pupil foundation allowances to schools on the basis of overall headcount. Our principle education customers, parents and students, have virtually no say on how that money is spent.
To promote accountability under our current third party model, the state has instituted an intensive statewide assessment that drains classroom time from instruction. Teacher performance is judged on the basis of student assessment results which is often difficult to correlate to any individual teacher’s performance. Many reports based on these assessments are submitted to an alphabet soup of government accountability organizations. These reports lead to more legislation that piles on even more centralized oversight from the state.
How could we invest our resources more effectively? Implement a first party model for public schools called education savings accounts. While many parents would like to use these funds for private schools, Michigan’s Blaine amendment effectively blocks the use of public funds for core education services delivered by non-public organizations. So, we need to focus on public schools.
Student-specific ESAs would put parents and students in direct control of how their education dollars are spent. Parents would be able to shop for the best value. This promotes accountability without the need for a largely ineffective (but expensive) government “bureau of accountability.” Furthermore, the student-specific nature of these accounts opens the door to other funding sources that don’t involve tax increases.
It is time to put our education customers back in charge.
State Sen. Patrick Colbeck, R-Canton, represents Michigan’s 7th District.