The Senior Services Tax Proposal in St. Louis County Is as Bad as It Gets

Posted on by Scott Tanner
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If you sat down and intentionally tried to come up with the worst tax policy you possibly could, you would want to include the following elements:

  • Raising taxes on some people, but not all people;
  • Replacing charitable giving with mandatory taxation;
  • Creating another obscure taxing authority with little to no oversight;
  • Creating services with the new tax that benefit people who specifically do not pay for those services; and
  • Directing the entire program of new services at people who are exempt from the tax, and who also happen to be the wealthiest group in society.

This would be about as bad a tax policy program you could imagine, and, voila, this is exactly what voters in St. Louis County get to decide on in November.

Many Missouri counties have a property tax that funds senior services. However, almost all of them passed it before the senior service property tax freezes were put into place, so at least senior citizens paid the taxes that funded the services. That is not how it works in Jackson County, which adopted the tax freeze and then passed the senior service tax in 2024, and is not how it would work in St. Louis County if voters approved this tax. Senior citizens who get the services would be exempt from paying the new tax if they own their home. Yes, seniors who rent would possibly pay the new tax through their rent payments, but keep in mind that many seniors who don’t live on their own live in senior communities, which are sometimes non-profits (entirely, or in part) that also won’t pay the new tax.

It is bad enough that seniors now vote, thanks to the freeze, on tax increases that they don’t have to pay. But to create a new fund specifically to fund senior services from a new tax they (mostly) won’t pay is truly entering the tax policy Twilight Zone. (Note that seniors who own their homes will be exempt from this tax if it passes. People saying it won’t apply in this instance, such as in this story, are wrong.)

Missouri’s Reading Crisis with Chad Aldeman

Posted on by Zach Lawhorn

Susan Pendergrass speaks with Chad Aldeman, education policy researcher and founder of Read Not Guess, about Missouri’s early literacy crisis and why the legislature has struggled to address it. They discuss what it means for a fourth grader to be below basic in reading, why three-cueing may be harmful to early readers, the science of reading and what it actually prescribes, the case for third-grade retention policies, and more.

Learn more about Read Not Guess at www.readnotguess.com.

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Episode Transcript

Susan Pendergrass (00:00):
Looking forward to this conversation with you, Chad Aldeman. I just want to give you a little background on why I want to talk to you today. Missouri just wrapped up its legislative session in late May. This is the second year in a row that we have tried to make some inroads into what I consider to be a crisis, which is that 42 percent of our fourth graders are below basic in reading. We have tried to force the state education agency, the Department of Elementary and Secondary Education, to improve how reading is taught and to create a system of guardrails around kids being promoted without knowing how to read, all of which have failed. What does it mean for a fourth grader to be below basic in reading? Given that more than four in ten Missouri fourth graders scored below basic, what does that mean?

Chad Aldeman (00:59):
Below basic is a very low level. It means that kids cannot read an unfamiliar passage and understand what it means. In fourth grade, maybe you’re not super worried about those kids, but you probably should be, because that is a key milestone. If you’re not reading in fourth grade, you’re really going to struggle with everything that comes next. You’re not going to be able to understand social studies and science. You may not be able to read owners’ manuals or instruction manuals when you’re trying to build things at your house. You’re really going to be dependent on other people interpreting words and language for you. YouTube is helpful, lots of things are helpful, but we’re still in a written culture, and there’s lots of information that’s written that if you can’t pass even the basic level you’re going to struggle with in life going forward.

Susan Pendergrass (02:02):
Yeah, so this is kind of the problem, which I consider to be basically a crisis. Forty-two percent of our kids are below basic. What we call it when we’re trying to fix it goes by a bunch of different names: early reading, early literacy, read to learn. But when my kids were little, about thirty years ago, I think it was called whole language, this language-rich environment where kids would just learn to read. But now there’s a thing called three-cueing. What is three-cueing? I assume it means that kids are supposed to look three different places for cues, but what specifically is it?

Chad Aldeman (02:37):
Three-cueing and whole language have a lot of similarities. They’re basically trying to get people to memorize words. Rather than sounding out, like my name is Chad, which is pretty phonetic, rather than understanding that the CH combination makes the ch sound, they want you to just memorize the picture in your head of what the word looks like. Really good readers do have a lot of memorized words. I don’t have to sound out my name. There are lots of words that my brain just goes to instantly because I’m so familiar with them. But taking what expert readers can do and using that as a method to teach kids is actually really harmful. Kids develop those skills by learning the core elements. The CH combination makes the ch sound, and they need to practice that when they’re learning to read. Over time they’ll just see it and recognize it quickly. English is quirky. English is not entirely phonetic, but it’s still quite phonetic, and phonics is still the building block of reading. There are cases when CH doesn’t make the ch sound, when it makes the hard C sound. Kids need to understand and recognize those as well. They need repetitions, and they need to understand what the normal rule is and what some of the exceptions are.

Susan Pendergrass (04:04):
So would three-cueing be considered part of the science of reading or not?

Chad Aldeman (04:08):
Three-cueing is not part of the science of reading. Three-cueing is saying, rather than teaching kids the building blocks of the language, have them guess at the words based on a picture they see. So there’s a picture of a horse, and they see a word, and they just guess horse. The text may actually say pony, and sometimes those differences really do matter.

Susan Pendergrass (04:29):
Ha.

Chad Aldeman (04:38):
The second cue is the first letter of the word, and the third is other context clues. So if it’s a story about horses, you might guess horse. And those cues are actually detrimental to learning how to read, to knowing what the words and letters actually translate into.

Susan Pendergrass (05:02):
Why? Why is it detrimental?

Chad Aldeman (05:04):
Because it leads to guessing. It might be harmless for a four-year-old to say pony when the word actually says horse. But as kids get older and start reading more complex texts, those types of mistakes really do matter. And if you haven’t learned the phonetic skills, you’re not going to be able to read a word like ribonucleic acid or something like that. When you start reading more complex words, all of a sudden you can’t break them down. Your mind doesn’t have the ability to understand how to break down a word that you’re not familiar with.

Susan Pendergrass (05:33):
Mm-hmm. So two years in a row at least, the legislature has tried to ban three-cueing so that teachers would not be allowed to use it. They punted a little bit and said it can’t be the first thing they use, but could still be a tool in their toolbox. They’ve gotten a lot of pushback. In Missouri, legislators are sometimes former teachers, sometimes married to a teacher, sometimes their best friend is a teacher. And they’ll just say, you know what, we’re a local control state, so we can’t tell these teachers what to do. When they’re in the moment in the classroom, they know best, and that’s how we roll in Missouri. But what I hear you saying is it can actually be harmful.

Chad Aldeman (06:39):
Yeah, and there actually is a science about how kids learn to read. It’s been well documented for a long time through empirical researchers looking at whether kids do better under method A or method B. What they found is that teaching kids the building blocks of reading, the phonetics, is more helpful, particularly for students who might struggle, or who are dyslexic, or have other language issues. If you teach the three-cueing strategies, you’re teaching them the wrong thing and leading them down a side road. It can lead to bad habit formation, which is then really hard to kick later on. The other thing that’s relevant here is that reading is somewhat sequential, and kids need a lot of practice in the early grades in order to be proficient readers. If you use the three-cueing tactics, you will not be giving them the building blocks they need to develop. And it’s a challenge to get kids back on track if they’re off. There’s all kinds of data about delays in reading, and kids who aren’t proficient by third grade will struggle in the short and long term. So it’s really important to catch those issues as early as possible in K through two.

Susan Pendergrass (08:14):
Well, on that note, another component to the legislation that’s been considered and that we have been supportive of is that if a child at third or fourth grade has demonstrated that they are substantially behind in learning to read, they should not be promoted to the next grade. What do you think about that policy?

Chad Aldeman (08:34):
Some people may hear that policy and think it’s punitive and it’s going to be bad for kids, but it’s not really about what happens at the end of third grade. I see that policy as more of a threat to the adults in that student’s life about making sure that doesn’t happen. In K through two, those students are being flagged and identified as being at risk of potentially being held back.

Susan Pendergrass (08:39):
Mean.

Chad Aldeman (09:04):
And they’re given interventions and supports so that they’re ready to take and pass the assessment in third grade. That’s really my read of the evidence. In the states that have these types of policies, kids who are flagged as needing more help get the help. That is the key: this sort of threat of being held back, and then the interventions and all the adult behaviors it changes. Teachers then know which kids need extra help. They then communicate to parents, hey, your child is behind and they need to catch up, and here’s what we’re going to do to help them. I wrote about this in Mississippi. They have learning plans, specific, tailored, individualized instructional plans for children who are at risk of being held back. And parents are brought into the conversation. It’s pretty scary that your child may be at risk of being held back, and here’s what we’re going to do in the interim to get them ready. That is the key for me. It’s not what happens in third grade. It’s all the stuff that happens before and what the adults can do to make sure kids are ready.

Susan Pendergrass (10:19):
Yeah, because if I understand it correctly, Mississippi has that policy, but they don’t actually retain that many kids.

Chad Aldeman (10:26):
Yeah, that’s right. In state after state, the states that have these types of policies, the number of kids who are ultimately retained is not that high. There are screens that are identified earlier in K through two, and then interventions are put in place. There are oftentimes some exceptions for students with severe disabilities or English learners who are newly arrived, and chances for retakes if there’s something about stress on the day or they go through a summer program. There are other ways to get students ready. It’s not just the third-grade cut point.

Susan Pendergrass (11:07):
Yeah, it seems like one of those situations, and I doubt it’s unique to Missouri, where people in charge of teaching young children to read feel threatened or feel like they’re being criticized, because we have a real problem with 42 percent of our kids being almost illiterate. And the adults are taking it personally, and therefore they’re resistant to any policy that would force the hand of these districts or teachers. And to me that’s just a shame.

Chad Aldeman (11:47):
Yes, I agree. I think part of it goes to the culture in education where every teacher is supposed to create their own idea and method for how to teach. We don’t really give teachers the building blocks of here’s a well-scripted curriculum, and if you follow this your kids are likely to be successful. Some of the highest-performing schools, school districts, and countries do a much better job of being clear that here’s a well-defined, articulated curriculum, and we’re going to support teachers to do it. There’s still the question of how it gets implemented, but the what is pretty well articulated. And this goes back to the science of reading idea: there is a science. It is evolving in the sense that there’s still more research being conducted and we’re still learning new things, but we know a fair amount about how kids learn to read. So teachers, schools, and teacher preparation programs should be equipping their teachers to use those things.

Susan Pendergrass (12:58):
So you have spent a lot of time studying and writing about this, and you decided to take a leap and start your own company?

Chad Aldeman (13:06):
Yes. I got interested in this because my own child was taught to read using three-cueing. He came home during the pandemic and I was oblivious. I kind of thought my son could read. We had been to school and celebrated his reading superpowers that the teachers had taught, and they were things like guessing at pictures, picture power.

Susan Pendergrass (13:26):
Yeah.

Chad Aldeman (13:33):
During the pandemic, he was a kindergartner and he came home, and we sent him up to his room to do silent independent reading. It turns out he was just guessing. He hadn’t been taught how to sound out words. After working with him, I came up with a program called Read Not Guess. It’s designed for parents to work with their kids, both to build early literacy building blocks like phonetic skills, and also as a way that they can spot early reading issues with their own children. It gives parents the tools to work with their kids, support them from home, and be an advocate by their side.

Susan Pendergrass (14:12):
And your son was in what’s considered to be one of the top school districts in the country, Fairfax County, Virginia.

Chad Aldeman (14:17):
Yeah, Fairfax County Public Schools. People move here for the schools, and yet we were using a balanced literacy three-cueing approach to teaching reading. To the district’s credit, partly because the state forced them to change, they have now moved to a more phonics-based approach and are using something called content knowledge building. So they’ve adopted a curriculum that’s also trying to build

Susan Pendergrass (14:22):
Yeah. Sure.

Chad Aldeman (14:47):
content knowledge along the way, which I’m supportive of. I’m sure there are people within the district who are upset, but the state said this is what we’re going to do, and so they’ve moved in that direction.

Susan Pendergrass (15:01):
You’re certainly not anti-teacher. You’ve been working on teacher issues for as long as I can remember, right?

Chad Aldeman (15:06):
No, I’m very pro-teacher. I’m pro-good policy. I’m pro-helping kids learn to read, and I think that’s one of the basic things that schools can do and that they should be doing.

Susan Pendergrass (15:08):
Yeah. Yeah. It really is frustrating to me that when something’s not going well in our state, we have 520 school districts, not county-based like Virginia’s, and it just feels like a throwaway line to say, well, we’re a local control state. As a matter of fact, somebody in our state education agency said out loud in a recorded meeting, it’s not our fault the kids can’t read, we’re local control. Everyone passes the buck and no one takes any responsibility. Some of them actively work against retaining third graders who can’t read or banning three-cueing. The last thing we were looking for was just that every student in the state would take essentially the same test with the same cutoff score so we could know consistently across districts which students are in that at-risk group so that we could identify them early. We got pushback on all of it. It’s baffling to me. We’re not trying to be mean to teachers. We’re trying to help little kids, because I see it ultimately impacting the Missouri workforce and everything else. We are graduating kids from high school who cannot really read.

Chad Aldeman (16:30):
Yeah, there’s a reason that the state created an education system in the first place, and the districts are entities of the state. They’re state standards, and so they should be teaching kids to those standards, and reading is a big essential building block of that. How far they get down into curricular choices is something that people can still debate, but the ultimate goal of teaching kids to read, and the argument that here are some methods that have been fundamentally disproven that we should as a state abandon, I think is a good and valid argument.

Susan Pendergrass (17:09):
Mississippi seemed to lead the way with this with the Mississippi Miracle, and then we have Louisiana and some other states. Do you see this spreading nationwide, this idea of forcing schools to use the science of reading?

Chad Aldeman (17:25):
Yeah. More states have science of reading laws, and they vary in their components. Last I saw it was 42 states. So Missouri is one of the last stragglers to not have one of these laws. The laws vary across the country in terms of how strict they are, what the state does versus what they put on districts, in terms of the third-grade retention policy versus state mandates on curriculum, whether they’re giving districts a menu of

Susan Pendergrass (17:37):
Right.

Chad Aldeman (17:56):
options or just saying they can’t use three-cueing. There are also other things around screening what happens for students in K through two, how much parents are notified, and what they’re given to help their children. All those things vary, but I think the most interesting point for Missouri is that most states have now adopted one of these laws and are pushing in this direction because they see the crisis as you’ve articulated it and the urgency for it. There’s still some important implementation work to get right if Missouri wants to see strong outcomes. Being focused on third-grade reading is very important, building it into accountability systems, building it into everything the state does, trying to simplify that and keeping it a priority. If the state is saying we don’t really care if it happens, then you’re not going to get outcomes. But if you focus on it and think about ways to drive it, there are levers that can be used.

Susan Pendergrass (19:03):
Yeah. Well, I hope we do it. Read Not Guess, where do folks find out more about that?

Chad Aldeman (19:10):
Read Not Guess is a website. It’s an email-based program. Parents can sign up for free at any time. There are three levels, starting with a beginner level, level one, then level two and level three. They’re all 30-day sequences. When parents sign up they receive

Susan Pendergrass (19:17):
Free, right?

Chad Aldeman (19:32):
a sequence of 30 emails for each of the levels. I also have one for slightly older kids who just need more practice, called a daily decodable program. There’s an app version of that program as well, or a workbook if parents want it in print form.

Susan Pendergrass (19:43):
Well, that’s great. Way to jump in and try to solve the problem yourself. I appreciate that. Thanks so much, Chad. Always great to talk to you. This was fairly narrow. We might need to have you come back and talk about school finance and teacher pipelines, but I’m going to reserve you for early literacy today. Thank you so much.

Chad Aldeman (19:52):
Thanks for having me.

Produced by Show-Me Opportunity

What Happens after States Hand Out Massive Corporate Subsidies?

Posted on by Scott Tanner
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Economic development incentives are usually sold as investments. The state offers tax credits, cash grants, or other subsidies to persuade a company to expand or relocate. If the deal works, supporters claim, taxpayers get jobs and the state or local economy is strengthened.

I’m skeptical of those claims. Back in 2017, I wrote:

What’s more, studies in Missouri and across the country have noted that these programs do not help create jobs or spur neighborhood investment in the aggregate. Often they simply enrich political cronies.

A new study concludes that some other beneficiaries of large incentive programs are lobbyists.

Instead of asking whether subsidies create jobs, the authors ask what happens to businesses’ behavior after states begin offering exceptionally large incentive packages. Their answer is striking, if not surprising: Businesses appear to devote more resources to lobbying government.

The study, recently published in Small Business Economics, examines more than 40,000 state economic development awards made between 1997 and 2019. The researchers identified the point at which a state first awarded what they call an “extraordinarily large” incentive—defined as more than 3,500 times larger than that state’s historical median award—and then compared those states with similar states that had not yet crossed that threshold.

Rather than counting announced jobs or measuring state economic output, they looked at employment in the lobbying industry.

The reasoning comes from economist William Baumol’s distinction between productive and unproductive entrepreneurship. Entrepreneurs are talented at recognizing opportunities. Sometimes those opportunities involve creating new products or better ways of serving customers. Sometimes they involve obtaining advantages through government. Public policy can influence which of those activities becomes more profitable.

The authors found that after states began offering these unusually large subsidies, employment at lobbying firms increased by roughly 3.6%. Those gains were concentrated in state capital counties, where lobbying activity is naturally centered. They also found lobbying employment became more geographically concentrated around state capitals after these awards.

The study is not claiming that lobbying is improper. Businesses have every right to petition government. Instead, the paper documents something more modest—and perhaps more important. When governments begin offering extraordinarily valuable subsidies, businesses respond by investing more heavily in political activity.

Several Show-Me Institute researchers reached a similar conclusion in 2018 when they examined the relationship between subsidy awards and political contributions in Kansas City.

If winning a government incentive can be worth hundreds of millions of dollars, devoting additional resources to influencing government becomes a rational business decision.

That makes perfect sense if you’re running a business. But is it where we want to invest our resources as a state or community? Shouldn’t that entrepreneurial energy be going toward making our lives better rather than thinking up new ways to squeeze tax dollars out of government?

In politics, we often argue about how best to solve problems. That is good. It is when we ask how government can best solve problems that we invite all sorts of additional problems. This study tells us what we likely already know: When you start handing out lots of money, you encourage more people to ask for it. We may be creating jobs—but it’s likely not the jobs you were hoping for.

How to Grow Missouri’s Economy with Joseph Haslag

Posted on by Zach Lawhorn

Susan Pendergrass speaks with Joseph Haslag, Donald R. Street Endowed Professor and Department Head of Economics at Auburn University, about his new Show-Me Institute report, “Looking for Growth: A Productivity Story.” They discuss why Missouri ranks 44th in GDP growth and labor productivity, the case for eliminating the state income tax, why industrial policy tends to fail, the role of higher education in driving innovation, and more.

Read the full report here,

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Episode Transcript

Susan Pendergrass (00:00):
So great to be joined today by Professor Joe Haslag of Auburn University, formerly of the University of Missouri. You’re an expert on all things economic in Missouri, and you have a new paper for the Show-Me Institute about the Missouri economy. A lot of people when they think of the economy only think of the national economy and not the fact that states have economies too, with GDPs and all kinds of things that influence them, and not all state economies are the same. One of the things I was struck by initially in the paper is that Missouri is ranked 44th for GDP growth. What do you think is going on with that? Why has Missouri fallen so far?

Joe Haslag (00:52):
We couldn’t answer that question in half an hour, Susan. That’s a big one.

Susan Pendergrass (00:55):
Yeah, well let’s just give it a shot. Why have other states’ economies grown faster than ours?

Joe Haslag (01:03):
Well, Missouri has not been a center of innovation, and those things are hard to pin down. There are states that have grown really fast. Since air conditioning has become more accommodating and cheaper, we’ve seen some growth in the South, and there are states like Florida and Texas that have opted for faster growth and attracted a lot of people. So there’s always this question of are you talking about just the total economy and how it grows, or are you talking about the economy per person? Both matter and both are relevant measures depending on the story you’re trying to tell. At the heart of it, though, where growth comes from is not just from adding a bunch of people. If that were the case, we would have grown during the Middle Ages just from population growth. It’s not just about adding people and workers, it’s about the productivity of those workers, how much each one can produce. We’ve seen innovations: the tractor was an innovation compared to the horse and plow, and computers were an innovation compared to adding machines. And when you say 44th, that’s one of the critical things. Missouri is also 44th in the average rate of productivity growth per worker. We just haven’t been a source of super

Susan Pendergrass (02:26):
Sure.

Joe Haslag (02:54):
strength in that area. And I still say “we” because I was born in Missouri and spent a major chunk of my professional career at the university there. Until we change, and it’s hard, what you’d like to say is is there an easy path? Can we just do X, Y, and Z and guarantee it? No. There is no one thing that fits all. But what we do see is that people respond to incentives. What you’d like to set up is a business environment, a tax environment, and other kinds of settings that just make people take some chances. Some are going to pay off and some are going to fail, and you recognize that, but over time you see faster growth in those places.

Susan Pendergrass (03:41):
Yeah. You talk specifically about states in terms of labor productivity. States that invest in certain sectors of the economy, particularly construction, where productivity may be growing faster than other sectors. Is that something Missouri should do? Should we be placing bets on labor sectors?

Joe Haslag (03:57):
That’s a great question. The evidence in this paper is that industrial policy is not something that works very well. Trying to pick winners and losers is exactly the kind of thing we saw in the failed experiments of the USSR and some other places. We all talk about China’s explosive growth for a couple of decades. That wasn’t part of the planned economy. That was coming from the part where they just let loose their entrepreneurs and gave them the right environment, that word again, where they could take chances and succeed. So yeah, picking an industrial policy, there’s just no evidence that growth in one sector’s labor is going to give rise to faster productivity growth.

Susan Pendergrass (05:10):
Okay, so let’s look at a different lever that we’re talking about a lot in Missouri right now, which is reducing or getting rid of the income tax. It feels like a lot of states are trying to do it. And what if all the states around Missouri did the same thing? Would that have an impact on how much our GDP benefits from it?

Joe Haslag (05:29):
Sure. I mean, if we, first of all you said something interesting at the beginning. We think about the national economy, but you can draw borders around any area you want, a state, a city, a metropolitan area like St. Louis, and ask how they’re doing. One of the things that is remarkable is the biggest metropolitan area in Missouri has been stagnant for four or five decades. The population in the St. Louis MSA has been about two and a half million people for at least thirty or forty years. Where they live on the Missouri side or the Illinois side may fluctuate, but the total hasn’t changed. And the city of St. Louis proper has this weird status. Missouri has a unique thing where the city of St. Louis is its own county entity. And the city of St. Louis is

Susan Pendergrass (06:05):
Yeah. Right.

Joe Haslag (06:25):
almost becoming a ghost town. It went from a million people in 1900 to somewhere around 300,000 right now.

Susan Pendergrass (06:32):
Yeah. And they of course have the earnings tax. I can definitely see the counterfactual to this argument. I know people who live in states where they keep raising the income tax and piling on other taxes, Oregon comes to mind, and people are leaving. And we know that Texas and Florida, like you said, people are moving there and they don’t have income tax.

Joe Haslag (06:50):
I think it’s more to it than just the income tax rate, but the income tax rate is part of this package of incentives. Alone, the income tax is a pretty powerful thing, because it changes the returns to every kind of business activity, every kind of trade where we’re exchanging work or productivity or investment for something. Getting rid of the income tax, and there’s a piece in the paper where there’s actually an estimate, a projection of how much, based on the evidence across the country, getting rid of Missouri’s income tax would add to the growth rate.

Susan Pendergrass (07:32):
And how much would it add to people’s pockets?

Joe Haslag (07:33):
Well, the growth rate is about between a

Susan Pendergrass (07:35):
I mean, this is a number that people have been talking about in Missouri the last year. We get rid of the income tax, everyone will have $2,800 or $2,900 more. And your estimate is $2,900?

Joe Haslag (07:39):
Right around $2,900. And it takes a few years to get there, but the point is you get an immediate pop and then faster growth for the rest of the time.

Susan Pendergrass (07:57):
And you have a similar estimate if we improve our labor productivity. How do we go about doing that?

Joe Haslag (08:02):
You create incentives. Productivity still comes from what human beings do, what men and women in the labor force do. My incentive to innovate in a state where the income tax rate is eight or nine percent is a lot lower than it is in a state where it’s one or two percent,

Susan Pendergrass (08:06):
Yeah. Right. Yeah.

Joe Haslag (08:29):
simply because I get to keep more of what the risk produces. We often talk about business as us versus them. But at the heart of the matter, there are people out there saying, I want a better standard of living for myself and my family, and I’m willing to take some risk. I may start in my basement, or in an office with just two or three people. But if my idea is a winning idea, those people who started with me, the people I employ as I expand my business, sure, do I benefit? Yeah, I do. But I also took a lot of risk to do that. I could have fallen flat on my face and come away with nothing.

Susan Pendergrass (09:05):
Yeah. I think you make that point quite well where you talk about dividing up the pie versus growing the pie. You could grow the size of the pie and everyone could theoretically get a bigger slice of it. And I think that’s where people assume everything is fixed. In fact, in the data you were analyzing, we have both the Great Recession and COVID bookending it, and that has to have some impact on Missouri’s long-term growth trajectory, right?

Joe Haslag (09:26):
Yeah, it’s harder to discern. The financial crisis cleared out a bunch of stuff where people had taken risk, some of those were financial risks, and it spread to a bigger group of people. The Great Recession

Susan Pendergrass (09:48):
Did it muddy things up at all?

Joe Haslag (10:09):
It goes back to the idea of creative destruction. Sometimes you have a big destruction and it creates an opportunity for lots of creation. Did the financial crisis of 2008 give rise to the AI expansion? It might have sped it up.

Susan Pendergrass (10:12):
Yeah. Yeah.

Joe Haslag (10:26):
I don’t know for sure, but I think COVID probably had some impacts on that as well. Since we couldn’t be with one another and couldn’t get those spillovers from working together, we relied on computer hardware and software to do those things for us.

Susan Pendergrass (10:36):
Yeah. It was an engine of change in education because people started tutoring and teaching online, realizing you could get a tutor from across the country. It really opened up a lot of interesting new things that I’m not sure have completely sifted out, and I assume that’s true throughout the economy. In a lot of ways, necessity being the mother of invention, it increased productivity.

Joe Haslag (11:16):
No doubt. But I also think that what we’re seeing is the call by so many corporations across the country that, sure, you’ve worked five days a week remote for a couple of years, but we really want you to come back. We think it’s in our best interest as a corporation, for our shareholders, for those folks to be back in the office. Maybe four days a week instead of five, but there’s something about being together that creates possibilities for innovations as well. I’ll tell you a quick story. The semester after the University of Missouri got off of any sort of

Susan Pendergrass (11:38):
Mm-hmm. Yeah. Yeah.

Joe Haslag (11:55):
remote or semi-remote teaching, I was teaching an undergraduate class. That class is typically between 60 and 80 kids, an advanced course, mostly juniors and seniors. You can tell with senioritis, somewhere about 12 weeks into a 16-week semester, you’re down to somewhere between 60 and 70 percent attendance.

Susan Pendergrass (12:11):
Yeah. Yeah.

Joe Haslag (12:19):
That first semester back, it stayed close to 90 percent the entire semester, simply because they were dying to just be in the same room with each other. They recognized that there were spillovers from being in the classroom.

Susan Pendergrass (12:27):
Right. That’s interesting. So if you were given a magic wand and you wanted Missouri’s GDP growth to not be 44th, to be maybe top 25, what would you do with the Missouri economy to really kick-start it?

Joe Haslag (12:52):
I think two things. The easiest one is on the policy front: we just let the returns go back to the people. The tax rate in Missouri, I wouldn’t say it’s an abomination, but I just don’t think it’s been very helpful. But on top of that, our K-12 education, and this is going to appeal to you, has been an issue. We don’t have much competition. But I’m also going to put in a plug: I think Missouri has almost turned its back on higher ed.

Susan Pendergrass (13:20):
Yeah. You say this in the paper. Our educational attainment is tanking, right?

Joe Haslag (13:36):
Yeah. We just don’t have a commitment to it. The question I think would be most interesting is what would the St. Louis economy look like if Wash U wasn’t there? Wash U is an engine of innovation. There’s a lot of great things going on at the med school and the engineering school, and I think it’s just teaching people to learn how to think. Now those people end up going all over the world, but if there was a commitment to, I mean, the University of Missouri has lagged behind some of our Midwestern counterparts. Illinois, Michigan, Wisconsin are all suffering from the same straitjacket, which is that the amount of state funding they receive is down. But I’d also say Missouri is sort of doubly hurt because the state gives the university system whatever money they’re going to give, but then the university system is also controlled by the state in terms of how much they can raise tuition. So there’s no freedom to test what the market forces would look like. And at higher ed, maybe more so than K-12, spending per student at K-12 is not always the recipe for predicting success. However, at higher ed, because there are market forces that tend to work at a different level,

Susan Pendergrass (15:08):
It is not. Yeah.

Joe Haslag (15:19):
money and innovation tend to go hand in hand. Higher ed seems to be going through some sort of shift right now, and I’m not sure I understand exactly what’s going on with it. But if you were to tell me what the two big policies would be, I’m not saying the state of Missouri should spend more on higher ed, but they should loosen the purse strings and let those institutions compete with the market and see what they could do.

Susan Pendergrass (15:31):
Yeah. I think it’s one of the easier parts of the budget to cut. And as our revenue is going down, there seems to be a larger group of stakeholders in K-12: there are 520 superintendents and school boards. That’s a tougher one to cut than higher ed, and I feel like they’ve taken budget cuts.

Joe Haslag (15:55):
And maybe it’s not that the state should be paying the university systems more, but they should let them go. Let them set tuition rates at whatever they think is right. And if it doesn’t work and they fail, then you end up looking more like the University of Idaho than the University of Michigan in terms of how you’re contributing to the state economy. But

Susan Pendergrass (16:22):
Yeah.

Joe Haslag (16:37):
I think there are opportunities to exploit there and we just can’t seem to. There also seems to be this weird critical mass that’s important in higher ed. You have to have a bunch of people together who are all pulling the wagon in the same direction.

Susan Pendergrass (16:42):
Yeah. Well, we also have declining enrollment. Fewer kids coming up. I think we had our largest graduating high school class last year or the year before, so that’s going to make it tough. So just to clarify,

Joe Haslag (16:59):
Yeah.

Susan Pendergrass (17:03):
if Missouri were able to move its income tax rate down close to zero, you, based on your research, feel confident that Missourians would have more money in their pocket?

Joe Haslag (17:12):
More than confident. I think it’s unambiguous. The math is pretty straightforward. If you have a hundred-dollar paycheck and your taxes go from five percent to two percent,

Susan Pendergrass (17:15):
Okay. You heard it here.

Joe Haslag (17:35):
it was my pleasure. Susan, it’s always good to see you and cross paths. I wish I could be there on the ground and have all those conversations I had fifteen years ago when we were talking about this. Thanks for your service.

Susan Pendergrass (17:44):
We’ll welcome you back. Thank you so much. Appreciate it.

Produced by Show-Me Opportunity

Frequently Asked Questions About Amendment 5

Posted on by Zach Lawhorn
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1. What would Amendment 5 do?

Amendment 5 would require the legislature to phase out the state income tax over time, with the pace of reductions tied to revenue-growth triggers. Amendment 5 would also allow lawmakers to reform Missouri’s sales tax system, require that any sales tax changes that increase state revenues be used to reduce the state income tax on at least a dollar-for-dollar basis, require local governments to reduce other local taxes if changes to the sales tax increase local revenues, and prevent the income tax from being reinstated once eliminated.

2. What decisions would Amendment 5 leave for future lawmakers?

The amendment itself does not change the sales tax, make any goods or services taxable, or determine how quickly the income tax must be eliminated. The details of the revenue-growth triggers and any possible changes to the sales tax base would need to be established in statute through the normal legislative process.

3. Why is Missouri considering this proposal?

Missouri has experienced slower population and economic growth than much of the country in recent decades. IRS migration data show that Missouri loses hundreds of millions of dollars in income to other states each year through domestic migration. Amendment 5 reflects an effort to reverse those trends by reforming the policies that affect where families and businesses choose to locate.

4. Why does state tax policy matter?

States are in a national competition for families, workers, businesses, and investment. States with no income tax, like Tennessee, have seen stronger population and economic growth than Missouri in recent decades. If Missouri hopes to improve its economic trajectory, examining what high-growth states are doing differently is a logical place to start.

5. Why eliminate the income tax?

Decades of academic research conclude that taxes on income are more harmful to economic growth than taxes on consumption because they reduce the rewards for work, entrepreneurship, saving, and investment.

6. Why does Amendment 5 authorize changes to Missouri’s sales tax system?

Missouri’s primary sources of tax revenue are income and sales taxes. If income tax rates are reduced over time, the structure of Missouri’s sales tax system becomes increasingly important. Missouri’s sales tax system was designed for an economy centered on the sale of physical goods, but consumers now spend a larger share of their earnings on services and digital purchases, leaving a system full of exemptions and carveouts that no longer reflect the modern economy. Amendment 5 would allow lawmakers to modernize that system while phasing out the income tax.

7. Why does the amendment change constitutional limits on taxation?

Missouri’s Constitution currently prohibits lawmakers from expanding the sales tax to goods and services that were not taxable in 2015. Amendment 5 would remove that restriction, allowing lawmakers to modernize the sales tax system. Separately, the 1996 update to the Hancock Amendment requires voter approval when lawmakers increase net state tax and fee collections beyond a certain threshold in a single year. Amendment 5 would also exempt new sales tax revenues from that threshold for five years, but only if any additional state revenue generated is paired with corresponding income tax reductions.

8. Would eliminating the income tax require much higher sales tax rates?

Amendment 5 does not mandate any future sales tax rates or require lawmakers to broaden Missouri’s sales tax base. Broadening the sales tax base by taxing additional goods and services or by reducing exemptions and carveouts would affect the sales tax rates needed to raise a given amount of revenue. Any additional state revenue generated by those changes would be used to reduce income taxes, as required by the text of the amendment. Estimates projecting very high sales tax rates typically assume Missouri’s current sales tax base remains unchanged and that the income tax must be replaced all at once. Amendment 5 makes neither of these assumptions.

9. How could local governments and taxation be affected?

Missouri’s local governments are among the most reliant on sales taxes in the country. If state lawmakers broaden Missouri’s sales tax base, local sales taxes would apply to those newly taxable items as well. If those changes increase local revenue, Amendment 5 requires local governments to reduce other local taxes by an equivalent amount. Local officials and statutory enactments would determine whether those reductions come from property taxes, sales taxes, earnings taxes, or other local taxes.

10. Could Amendment 5 create a hole in Missouri’s budget?

Amendment 5 is designed to prevent such a scenario. It requires income tax reductions to be tied to growth in state revenues, requires any sales tax changes that increase state revenue to be paired with offsetting income tax reductions, and, importantly, does not establish a fixed timeline for income tax elimination.

11. How is Amendment 5 different from the Kansas tax cuts?

Kansas reduced income tax rates immediately, created new tax preferences, and did not pair those changes with spending reductions or other offsetting measures. Amendment 5 takes a different approach on all three fronts. It phases out the income tax gradually, does not create new tax preferences, and requires any sales tax changes that increase revenue to be accompanied by corresponding income tax reductions.

A Disappointing Veto, but the Right Fiscal Direction

Posted on by Scott Tanner

The other day, Governor Mike Kehoe issued vetoes on some appropriations passed by the legislature and withheld spending on other measures.

One of the items vetoed was $2 million for Missouri’s Violent Crime Clearance Grant Program. That was a disappointment. I’ve written previously about why improving violent crime clearance rates is one of the smartest public safety investments Missouri can make.

Even so, I understand why it was vetoed. Missouri cannot continue expanding government..

Spending restraint means worthwhile programs will sometimes be cut. The question isn’t whether every veto was perfect. No governor gets every decision right. The question is whether Missouri is finally willing to reverse a spending trajectory that accelerated during the years of extraordinary federal COVID aid and continued even after those dollars disappeared.

I hope lawmakers and the governor revisit the Violent Crime Clearance Grant Program when Missouri’s finances allow. Public safety is government’s first responsibility, and I continue to believe this is a high-return investment.

But spending restraint only works if programs with genuine merit are still subject to scrutiny. If every worthwhile program receives an exemption, then spending never declines. The test of fiscal reform is whether Missouri begins living within its means and creates the conditions necessary to reduce the tax burden on its citizens over the long term.

The Case for an Education Outsider in Missouri with Andy Smarick

Posted on by Zach Lawhorn

Susan Pendergrass speaks with Andy Smarick, senior fellow at the Manhattan Institute, about Missouri’s education leadership shake-up and what comes next. They discuss how to find the right commissioner of education, why outside reformers tend to succeed where insiders struggle, what the dismantling of the US Department of Education means for state accountability systems, why public complacency about poor academic outcomes persists, and more.

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Episode Transcript

Susan Pendergrass (00:00):
Thank you so much, Andy Smarick, for joining once again on the Show-Me Institute Podcast. We love having you on and I appreciate you taking the time. You’re a busy man, so it’s really wonderful to have you back.

Andy Smarick (00:06):
I love being here. It’s a treat. Thank you for having me. I always like talking to you, but also anytime I get to talk about state-level education policy, it’s a treat.

Susan Pendergrass (00:19):
Well, I know that you have experience serving on a couple of state boards, both K-12 and higher ed. Just to bring you up to speed on what’s happening in Missouri: we have a relatively new governor, about a year in, and we had a state board of education where people stayed in expired seats, rubber-stamped decisions, and were very complacent, I feel comfortable saying. Our governor shook up that group and appointed new people who came in and said, what do you mean we don’t have bylaws? It was like, this is bananas. At the same time, the governor issued an executive order requiring letter grades on schools and districts, new school report cards. I don’t know exactly how everything went down, but our Commissioner of Education resigned, our Deputy Commissioner resigned, and our president of the state board of education resigned, all in about one week. So we are now straightening things out and there is a new board president. But this new, relatively new board now has the task of finding a commissioner. The way things have happened in Missouri is we always get a new commissioner from the ranks of the state education agency, maybe from the legislature, always from Missouri. Just a real this-is-how-we’ve-done-it mentality. And we have not been big reformers. No Chiefs for Change in Missouri. Like a lot of states, our reading scores for young kids are tanking, forty percent below basic for third and fourth graders. We have a state accountability system called the Missouri School Improvement Plan in which 516 of our 520 districts are fully accredited and about four are provisionally accredited, none unaccredited. So we have this meaningless accountability system where every district is fully accredited, even St. Louis, which I can’t even go into. So here we are, and I want to know a few things from you. Number one, if you were on the Board of Education in Missouri, how would you go about finding a new commissioner? What would you look for? And then later I want to get into what’s happening at the national level. We are not doing well academically, we have never had a bold reformer in charge, we keep doing the same thing and getting the same result. What would you do if you were in their spot?

Andy Smarick (02:59):
So in education, I’m going to wind up to this answer, so just bear with me for a second. Conservative can mean two different things. One is the traditional conservative view, which is to preserve, to stand athwart big, swift, dramatic, perpetual change. You’re trying to keep things the way they are because there’s a lot of wisdom that has gone into it and people are accustomed to it. In education, there’s also this other right-of-center conservative view, which is we have to be much more open to choice, competition, accountability metrics, and so on. And it seems that Missouri has been one of those very red states that has tended to believe in the first kind of conservatism: protect our traditional school districts, protect the hierarchies we have, protect the tradition of you grow up as a professional, as a teacher, then a superintendent, then maybe go to the state education agency. A lot of people believe that’s the way to do it.

There probably is an ethic among a lot of people to keep it that way. The only way you get out of that is if there’s a recognition among leadership that we can’t continue to preserve the status quo, that we have to change some things. That is a big step for a place that has elevated the idea of preserving for a very long time. If they get to that step, then they have to do the very tough things, which is start to pull out the Jenga pieces of that conservatism. The most important one is having board leadership and having a state superintendent who come from outside the state, and then having a board chair or board president who is not going to just do what the staff of the state education agency says or what the district superintendents say. We saw this work quite well about fifteen or twenty years ago. There was a big movement nationwide in educational reform led at the state level, and a number of states chose out-of-state superintendents and commissioners of education who did a terrific job of shaking things up and advancing a bunch of important proposals. The downside is a lot of them were so brash and so young, and I have to say so cocky, that they made unnecessary waves and kicked a lot of people in the shins in the states where they landed. So my view is a place like Missouri should pick someone from out of state for a state chief, someone with a long track record of success, but someone who isn’t so green as to think he or she knows everything. Someone with enough humility and enough time on task to know what they don’t know, and who can come in and be bold enough to make some changes, but not think that everyone in the state is a dummy who needs to be ignored. That’s how I would think about it. And if you have a board chair and board membership who get all of this, it makes things a whole lot easier. But that might be the hardest part of all. Who is your board president? Who are the board majority going to be? They have to be the ones with the backbone.

Susan Pendergrass (05:57):
Yeah. I feel like we’ve had people come in and say, well, I’m only the commissioner, it’s not my fault that the kids don’t read. And then people say, well, we’re a local control state, so it’s really the local guys’ fault that the kids can’t read. Then the legislators are like, well, who’s supposed to be making sure the kids can read? And technically, kind of they are, but them plus the board, and there’s just fingers pointing every different direction with nobody really taking responsibility. If we had the capacity for hard things, we would not have all of our districts be fully accredited. There’s even pushback on the letter grade idea because folks will say, well, then the teachers in those F schools feel bad and the parents feel bad and the kids who go there feel bad. I’ve seen some states change it to colors or something where nobody feels bad. I’ve also heard folks say it’s racist because a lot of the D and F schools enroll large percentages of students of color. So there are just all of these reasons to resist. It’s going to happen because there’s an executive order, but I feel like we’re going to have a hard time finding somebody who’s willing to do those things.

Andy Smarick (07:17):
Well, your state, like every other state, has a state constitution that makes the state ultimately responsible for education. Your state, like others, has both tradition and some laws that give a number of powers to local districts. The weird thing, and I’ve seen this in a lot of different states, is the state government ends up in a very weird position. The state can get sued and state leaders can get criticized if kids aren’t learning, because the state actually has constitutional authority to make sure kids are learning. But as a matter of practice, and often of state statutes, a lot of this power is delegated to districts. States then try to recapture some of that power through the accreditation system. It’s the way the state can say, okay, districts, you have the power to do these things, but we’re going to hold you accountable for results and we’re going to accredit you or not. And then it turns out it’s virtually impossible to take away the accreditation of these districts because of legislative pushback, and the state typically doesn’t have the capacity to run a district if it does take away accreditation. It just becomes a complete hot mess. That’s why you need state leadership who has some experience but also some backbone to say, this is how we’re going to thread the needle of state authority, state responsibility, local control, and still making sure that kids learn. This is not easy, other states have gone through it, but it isn’t the kind of thing that someone who has lived in Missouri all their life and grown up professionally there can do easily. It’s going to be hard for that person to get out of that box. Having someone from the outside who can start to do some bold things, including hiring smart, tough lawyers, having board leadership who’s going to stick by it. But I just want to emphasize this point: every state I ever talk to begins by saying, well, you know, we’re a local control state, our districts have all the power. Everybody says that. Go back to your state constitution. The state is the one that’s going to be responsible. And if the state has the backbone, it can do a whole lot. But whether it has the backbone is the operative phrase.

Susan Pendergrass (09:41):
Yeah. So about seven years ago we developed our own school report cards with letter grades, called MOSchoolRankings. I’ll just plug it. It was with GPAs, and this year for the first time I just took the GPAs and converted them to letter grades because folks found GPAs tricky. I put up the methodology. I took all the data from our state education agency, DESE, and just tried to make it a map you can zoom in and out on, easier to navigate. And my thinking is you have to do these things, make sure you say how you do it, and then people can argue with you and debate whether it’s right or wrong or good or bad. And many people have. A lot of people don’t like that the average is a C. I’m open to discussing why the average should be anything other than a C, but you have to at some point just make the move and then be confident enough in what you did that you can defend it and change it if people point out flaws. But this is where I think we struggle at DESE. They struggle to just put that out there because they worry about every negative outcome and consequence. And it’s like, yeah, but at some point to not do it is worse than to do it.

Andy Smarick (11:10):
For sure. And I’ve gotten to the point of realizing that if you have been in a system at different ranks for thirty or thirty-five years, all of your friends, your reputation, your pension, your income, everything about your identity is wrapped up with that system. Expecting these folks to suddenly turn the corner and say, you know, we’ve messed up, tens of thousands of kids are not learning right now today in classrooms, and we have to start holding the adults accountable for that, including teachers and principals and local school board members and local superintendents, and we have to be courageous about it. That’s asking a lot of people who are of, by, and for the system. It can be a whole lot easier if you just get someone from the outside with the courage to do it.

Susan Pendergrass (11:54):
Yeah. So can you think of an example of a state that has done this well?

Andy Smarick (12:02):
Definitely during the late No Child Left Behind era and then the Race to the Top era, a number of states found people from outside. Tennessee was famous for this. Arne Duncan ended up going to a couple of different places, including Rhode Island. New Jersey ended up picking Chris Cerf. There was a movement where probably ten or fifteen states did this quite well. My state, Maryland, brought in the superintendent of Mississippi after Mississippi had had so many gains, so she could carry some of those especially reading reforms to our state. This is not uncommon. Texas did something like this for a while. Louisiana became very famous during the John White era for doing this. But in all of these cases it began often with a governor, and then some members of a state legislature who said, we just can’t keep doing things the way we’ve done in the past. We have to do things differently. Once the governor says something like that, he or she can appoint people to the Board of Education who will do things differently, and the legislature, at least his or her party, will start to fall in line, and the media then starts to understand how serious it is. It is hard to do this without the governor leaning forward and giving the blessing to the bureaucracy to do things differently. So the question for you is, is your governor going to spend any political capital on this and say things are messed up and we have to do things differently?

Susan Pendergrass (13:29):
I don’t know. I hope so. But I haven’t seen evidence of that. I suspect, though I could be wrong, that they’re looking more internally than externally. However, I just want to add one wrinkle to this context that we’ve been thinking a lot about at the Show-Me Institute. If you’re following the US Department of Education, I believe you used to work there. Is that right?

Andy Smarick (13:54):
Yes, back in the day.

Susan Pendergrass (13:55):
Last week they moved the Office of Special Education over to the Department of Health and Human Services. They moved the Office of Civil Rights over to the Department of Justice. The building where the Department of Education used to be is now vacated. All those people are over at an old Department of Energy building. It’s a significantly reduced staff. Without touching the Every Student Succeeds Act, they are effectively dismantling most of the structure over there, at a time when the current president said that sending education back to the states was one of his priorities. I’m particularly concerned that at a time when Missouri has this vacuum, we could be looking at the apron strings being cut, states being told to sink or swim from the federal perspective. You don’t have to maintain the accountability systems. The Secretary is encouraging states to submit requests to waive parts of the law. I don’t really know exactly where it’s headed, but that concerns me. Do you think they’re going to let off the gas on mandated accountability systems in exchange for flexibility?

Andy Smarick (15:15):
Such a good question. To begin with just some editorializing: it is astonishing that Congress has allowed this to happen. In general I’m a big fan of decentralizing education power to the states, but that they’ve been able to administratively dismantle a department without Congress doing anything about it is just shocking to me. Even members of the Republican Party twenty years ago, let alone forty or sixty years ago, who jealously guarded the prerogatives of the legislative branch to create departments and fund departments, would have been appalled at this. There would have been unanimous consent to stop this from happening. So that says a lot that Congress has just sort of excused itself from the discussion. It has been remarkable the extent to which that building where we used to work, and the thousands of people there, is just empty, and they are handing off all the tasks to other places. I don’t know how this is legal, but I guess they’re figuring out a way to do it.

Now, the people who are leading this from inside genuinely believe that education will be better off if Uncle Sam isn’t meddling in it so much. That requires a theory of action, or at least a theory, that the reason why things are bad is that Uncle Sam is causing them to be bad, as though if Uncle Sam backs up there’s going to be a sunnier future ahead. Or it requires believing that it is just morally wrong for Uncle Sam to get involved, and whether states sink or swim after he gets out, that’s up to them. That’s a theory, it’s an ideological approach, and they have the right to pursue it. Donald Trump was elected and he gets to hire who he wants to. But then, to your point, it starts to implicate the Every Student Succeeds Act, which still requires the federal government to do some things related to state accountability systems. And if you believe you have the power administratively to undo a cabinet department, I suspect you probably believe you have the power to ignore some federal accountability provisions and just allow states to do what they want. So we’re going to be left in this position of saying, all right, the federal government is getting out of the business of accountability, therefore the states need to do it well. And then anyone who cares about kids learning will ask, okay, are states going to do this well? And so I turn to you as a state leader. Is Missouri going to

Susan Pendergrass (17:23):
Yeah.

Andy Smarick (17:47):
kick butt and take names?

Susan Pendergrass (17:48):
I’m concerned. I mean, No Child Left Behind was difficult and a lot of people didn’t like it, but test scores went up. Strict accountability, test scores went up. As we backed off, the Race to the Top era with waivers, and then Every Student Succeeds, which allowed more waivers, states were able to lower a lot of bars. Some states raised bars, like you mentioned, Mississippi and Louisiana. Some states are doing a great job, especially with early literacy. Others are not. And so Missouri, I think of it like this: you have a college student and you’re paying all their bills. You’re writing the checks, ordering their textbooks, doing all that work. Then one day you say, you know what, instead of that, I’m going to give you $3,000 a month: you pay your rent, your utilities, get your own books. There are going to be kids who step up and do fine. And there are going to be a lot of kids who take that $3,000 and immediately go to Cancun. We know this. It kind of depends on what you’ve done with the kids so far. And I feel like we have lulled the states into a feeling of compliance. If we just tell you how we spend our Title I dollars, fill out this form, and report that our test scores keep going down, no one cares. There’s no stick. They don’t withhold the money. We just say our test scores this year are lower than last year, and they say, good to know, here’s your

Andy Smarick (19:14):
Yep.

Susan Pendergrass (19:22):
check. So if that’s how you were raising your kids so far, why would you expect them to step up and become suddenly responsible?

Andy Smarick (19:31):
Okay, I have to admit that I have learned a hard lesson in my years doing education policy, which is that I was wrong that the political system of its own volition will always push for big action to make sure schools are great. I believed that if we had accountability systems showing that schools were underperforming, there would be a perpetual energy within the public to say we have to fix this, that it was just a matter of making the knowledge available and then everything else would take care of itself. It turns out it just doesn’t work that way. You need leaders at the top to constantly push and say, we are not doing well enough, we have to do dramatic things to make sure kids are going to be better off. Otherwise, No Child Left Behind is in place for a while and then people get sick of it. Or you have some interesting testing regimes and then there’s pushback to that, or just resistance to Uncle Sam in general. And people like the two of us say, but kids aren’t learning anything anymore. We are seeing a cratering of student learning since the peak of No Child Left Behind’s learning gains. This is horrible. Kids just aren’t learning anymore. The Andy of twenty years ago would have assumed the nation would revolt and say, how dare we do this to our schools and our kids, we have to do something differently. Instead, I don’t want to say it’s crickets, but there has not been a major wave of energy to change things again. The only way to do this is for governors or presidents to say this is not good enough and keep pushing. It is the ultimate dog that didn’t bark. The story is why something isn’t happening. If things are so bad in student learning, why is there not a dramatic energy within the public to do things differently? So maybe I look to you. In Missouri, are people just satisfied? Do they just not want the hassle?

Susan Pendergrass (21:28):
Why do you think? Yeah, they are like, we love our schools. All the time: we love our schools. We love, love, love our rural schools. It’s hard, kids show up with a lot of baggage, it’s just hard. But we love our schools. God forbid we have tiny districts getting below fifty kids. We love it. There isn’t an appetite to say, well, thirty-some percent of our rural high schools don’t offer calculus, and we don’t think we need it. It’s like, well, those kids are going to join a world where a lot of other kids had access to these things. It’s just, I don’t know the word. Complacency for sure. And it gets exhausting to continue to talk about it because it feels like

Andy Smarick (22:20):
Yeah. So this is why it can feel that way. And listen, if I were a state superintendent, based on the things I have learned, I would always begin a big reform movement by saying, first, all of the things you just said, but sincerely, because I believe this. I would say I love our public schools. I know how much they do for kids. I know that we love our teachers. I know that these schools are part of the community. I know that they help shape young people in ways beyond reading and math scores. I know that we love to go to these sports events. I know that we love to go to our fifth-grade graduation. This is an important strand in the fabric of our community. We love these schools, we love our teachers, we need to protect them, and we have to do better. What I found in that previous movement of big, dramatic out-of-state actors who came in and took over is they were awesome at the we-have-to-do-better part and absolutely lousy at the we-love-the-schools-and-teachers part. And that just caused a lot of anger. It was toxic in the long run. It is so important to a state to hear the we-love-our-schools message. That’s why they end up picking leaders, board presidents and superintendents who are of the system, who sincerely love their schools and say that. But they’re bad at the second part: we have to do things differently. The key to leadership right now is finding someone who can say both. We love these schools. We love public education in our communities. But Lord, our kids deserve a whole lot better than this. We have to do some things differently. That’s a rare leader.

Susan Pendergrass (24:00):
Yeah. Well, I think that’s a great place to end, because what else can you say? That’s awesome. That’s what we’re looking at. We’re going to find out soon, and not just Missouri. Many states have the same problems. I would love to have you come back again, Andy. We love having you.

Andy Smarick (24:16):
I love getting emails from you or Zach asking me to come on. I’m happy to give my bad opinions on anything.

Susan Pendergrass (24:23):
No, you have such a good, crystallized view of these things, and your experience on state boards is invaluable. I do appreciate it. Thank you for taking the time. I know you’re busy and hopefully you’ll come back soon.

Andy Smarick (24:40):
Whenever you call. Have a great summer.

 

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