Making Education Spending Really Pay Off: An Interview with Jay Greene

Educational researcher Jay P. Greene believes the great crisis in American schools is that for several decades the United States has been spending ever-increasing amounts of money on K-12 education with no improvement in student performance to show for it.

What’s needed, Greene says, is to give schools and the people in them incentives to get better results using the resources they have.

Greene, who earned his doctorate in political science from Harvard in 1995, has taught at the University of Houston and the University of Texas at Austin. He is a senior fellow at the Manhattan Institute’s Education Research Office, based in Florida. His research on school vouchers was cited several times in the U.S. Supreme Court decision upholding the Cleveland voucher program.

Greene spoke with News editorial writer Linda Seebach. The interview has been edited for length and clarity.

Seebach: Explain why you’re concerned about declining productivity in K-12 education.

Greene: Productivity means getting more out of the resources you have. The crisis in education is that we’ve been spending a lot more to educate children, but we haven’t been getting any more achievement as a result.

Over the last 30 years, adjusting for inflation, we’ve doubled per-pupil spending. Colorado is a little behind the national average, with per-pupil spending increasing by 92 percent over 30 years. Yet student achievement has been flat. It hasn’t gone down the tubes, as some people say, but it hasn’t gotten any better. If you look at scores on NAEP, the National Assessment of Educational Progress, our 12th-grade students are performing about the same on math and reading tests as they were over the last several decades.

We can look at other long- term indicators - for instance, graduation rates, which have been declining slightly since the late 1960s. Not a big drop, but in the late ’60s the graduation rate was in the high 70s. Now the graduation rate is about 70 percent nationally and in Colorado it’s about 68 percent.

Since it’s a small drop it just reinforces the notion that we have relatively flat outcomes over this period. There’s no precipitous drop either in graduation rates or in achievement. And any industry where you doubled your inputs but your outcomes were unchanged would be an industry that would be in bankruptcy. Nobody can function in the private sector without in fact improving their productivity, getting more out of their resources all the time. In education we’re doing the opposite, getting no more even though we’re spending a lot more.

This is the central crisis in education, that we’re just not getting better. We’re trying a lot, we’re putting in a lot of resources, and when we look around to the teacher unions for guidance on what it is that works to improve student achievement . . .

Seebach: They say “more money.”

Greene: They’ll say more money, but we’ve been trying this for a long time. Everyone agrees that schools need sufficient resources to do the job, but it’s clear from this 30-year experience that resources alone cannot address the crisis. Simply spending more will not produce better outcomes, so we have to think about how we can get more out of those dollars. Schools need incentives to use their resources effectively.

There are two broad reform strategies for increasing productivity. One strategy uses command incentives, and the other uses market incentives. The idea behind command incentives is that we establish goals for performance. We say, “You’re going to increase your output by this amount, by this time, and there will be consequences if you don’t.” And setting things up that way provides schools and people in those schools with incentives to try to meet those benchmarks.

And the market incentive strategy tries to use the power of competition to provide incentives to educators to improve their output. If schools are no longer guaranteed students and the revenues those students generate then they have stronger incentives to attend to the needs of their students to earn the resources that those students generate.

Seebach: How does productivity count in something that is as labor-intensive as teaching? You can’t suddenly decide that we used to have 16 kids in a class but we can do just as well with 32. Doctors are more productive today because they have better technology and better drugs and so forth. But they don’t on average see any more patients than they used to see. What’s the educational equivalent of the new technology?

Greene: There are productivity increases in the service sector as well as in the manufacturing sector. It can occur through doing things more effectively than before and it can involve the use of new technology to get more out of the labor.

So for example I recently visited a classroom where they were using a computer program that gave questions to students and if students’ answers were incorrect the program would then walk the student through how to answer and actually break the problem down into its components, which is what teachers do. If students were still having a hard time it could ease the level of questions that were asked. Or if students were answering questions correctly it would increase the difficulty.

This was an incredibly clever thing that you could do that didn’t require labor, and it also allowed a customized education for each child in the class. But the teacher was very concerned about the program because some students were being asked to solve division problems and she said, “We haven’t gotten to division yet.” She uses the program, but she will not incorporate it into how she thinks about how she teaches her class. She won’t switch from delivering the same kind of education that she’s always done to one that uses this new technology to improve her efficiency.

Class size is actually an excellent example of a reduction in productivity. It’s really clear that the expense involved is not justified by the benefits that we receive, and in part this occurs because the more we lower class size the more we have to expand the teacher pool. And so we have to dip deeper and deeper into the labor pool to find teachers and the lower quality teachers that we may have to hire may offset the benefit of having fewer kids in the classroom.

Another alarming anti-productivity trend over the last 30 years is that we’ve gone out and hired an army of new teachers. Adjusting for changes in student population we have 48 percent more teachers, yet during this time we’ve not seen a significant reduction in the actual average classroom size. Now how could that be? The answer is that teachers on the average are in the classroom fewer hours per day than they used to be, they have more planning periods, they have more noninstructional responsibilities, so they perform monitoring functions during lunch, or crossing guard duty or after-school curricular activities. These may substitute for their teaching requirements and therefore they work fewer classroom hours.

Seebach: Colorado allows complete freedom to transfer, but in practical terms there’s often no transportation money available.

Greene: Let me be clear: We’ve always had school choice in this country and so there’s no debate about whether we should have school choice or not. We’ve always had school choice in the form of residential choice, people could move to where they want to get the school they want, and when they move money follows them. And nobody says that you’re taking money away from the public schools by moving, nobody says you shouldn’t be allowed to move because you’re hurting public schools by taking money away from them.

Residential choice is a fairly inefficient form of choice because you have to move to take advantage of it and moving is really hard on people - it’s expensive to relocate, and it disrupts your family and friends networks; you may have to switch jobs. So it’s a very difficult thing for people to do and so people will put up with a lot in a bad school before they’ll move.

So I think we need to be looking at ways to lower the cost of choice in general. Colorado has made steps along these lines with the introduction of charter schools. A charter school is essentially a one-school district and so you can transfer to another school district without even having to go a long distance. And the money follows you from one institution to another and so that does provide incentives to schools to improve. And in fact we have research on this that where there is greater access to choice, public schools perform better. Where there are more charter schools competing with traditional public schools, traditional public schools improve their performance more. Where there are more school districts closer together so that it’s easier to transfer between them, public schools do better. But we have to recognize that the amount of choice that exists out there - while it’s always been out there - is fairly limited still, it’s fairly expensive and difficult for people to exercise choice. And it’s not that available to those who are being least well-serviced by the existing school system.