The Lifetime Pandemic Education Tax

Dr. Eric Hanushek, a senior fellow at the Hoover Institution at Stanford University, has been studying the relationship between academic achievement and spending for decades. Recently, he has been putting numbers to the lost opportunities experienced by students who were in school when they all shut down in 2020. The consequences are real. His prediction is that this generation will lose around 6 percent in lifetime earnings. For Black children, it’s 8 percent.

This is essentially a lifetime tax that isn’t being addressed as the crisis that it is. Collectively, our nation could lose as much as $28 trillion because the workforce will simply have more people who know less. That’s more than 15 times the current estimate of the economic cost of the pandemic.

The future of Missouri’s workforce is certainly not promising. Our K-12 enrollment is declining. Four in ten of our 3rd graders, who were in kindergarten in 2020, do not have even a partial understanding of 3rd-grade reading material. And last year, 40 percent of our high school graduates were not college or career ready, as measured by state standards.

Test scores matter. Declining test scores matter. Watering down the tests, backing off the grading scale, and not holding students and families accountable for chronic absenteeism only add to the negative impact.

Dr. Hanushek’s policy recommendations may seem harsh, but they’re the kind of bold ideas we ought to consider. He suggests creating meaningful financial incentives for “good” teachers to teach more students and buying out the contracts of low-performing teachers. These are solutions that prioritize the children in the system over the adults. What are the chances that Missouri is willing to take that approach?

Riverview Gardens and Normandy Are Regaining Local Control

After a decade of state control, the Missouri Board of Education recently announced it will restore local control to two struggling districts, Riverview Gardens and Normandy Schools Collaborative. While the state intervention brought financial stability and higher graduation rates, it didn’t lead to academic improvement. In 2022, only 12% and 2% of Riverview Gardens students scored proficient or advanced in English/language arts and mathematics, respectively. Normandy students scored slightly higher at 12.4% and 8.4%, but these are still alarming numbers. The lack of progress that has existed for decades under both state and local bureaucracies highlights an important question: why don’t families have the opportunity to send their children to the school that will give them the best chance to succeed?

Around a decade ago, both these districts failed to meet state standards and received the status of “unaccredited.” Because these districts lost accreditation, students were allowed to transfer to an adjoining district—and Riverview Gardens and Normandy had to pay tuition to these nearby districts.

Over 2,000 students (a quarter of the two districts’ enrollment) immediately took the opportunity to transfer—with many enrolling in Kirkwood, Mehlville, Hazelwood, Ferguson-Florissant, and Francis Howell. No receiving district gained more than a five percent increase in its student body. This exodus of students was rooted in families’ desire to improve their children’s livelihood—a sentiment that still exists today. One mother described the ability to choose a different district as follows: “She is thriving and has found a place where she fits in. She feels safe in her school environment and as her mother, I don’t worry about her safety while she’s at school.”

Reverting back to the local control is probably not going to dramatically improve the situation in Riverview Gardens or Normandy; these districts have performed terribly both before and after state control.  Parents need to be able to hold these districts accountable. Parents demonstrated they wanted choice back when students transferred out of these failing districts, and they still want it now.

Some people worry what would happen to struggling districts if families had school choice. However, these districts would not simply collapse, as they are allowed to use enrollment from any of the past four years for funding. And school choice could have other benefits for these districts. A smaller student body could lead to more academic success, and the threat of closure could serve as a wake-up call to those who love these school districts.

How much better would it be for a district if students were enrolled because they actually wanted to be there? Perhaps having a student body who actually wants to be at their school would lower the soaring absentee rates we see in these two districts and throughout the state. While I cannot guarantee that parental accountability through choice will save these districts, saving particular school districts isn’t the goal of education policy. It’s giving every student in Missouri the best opportunity to succeed. And that means giving every student in Missouri the chance to pick a school that best fits their needs.

A New Way to Tax, Redevelopment Retry, and Close the Gap

David Stokes, Elias Tsapelas, and Avery Frank join Zach Lawhorn to discuss Detroit’s land tax experiment, redevelopment subsides in North St. Louis, an important deadline for Missouri parents and more.

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Produced by Show-Me Opportunity

Looking For Bureaucratic Efficiencies in All the Wrong Places

There is a famous joke about the State Department. Whenever a president asks the State Department for options on a diplomatic matter, the State Department always gives the same three options:

  • Nuclear War
  • Total Surrender
  • Recommended State Department policy

The understanding of the joke is that whatever policy or ideas elected officials want to enact, it is the government employees—the bureaucrats—who have to carry it out. Too often, the bureaucrats carry it out in a manner that benefits them, not the elected officials or the public. (I care more about the latter.)

The City of St. Louis is experiencing a problem like that right now, with its efforts to combine its three 911 systems into one. Consolidating 911 centers should be one of the low-hanging fruits for service sharing among local governments. There are numerous examples of it benefitting communities in Missouri. Unfortunately, while many efforts have succeeded, a few have been stalled due to resistance from local bureaucrats.

The problems in St. Louis are all the more confusing because this effort is entirely within the same city government. In theory, it should be easier to implement service sharing in one government rather than sharing 911 services across different governments (which isn’t really that hard, either.) But, shockingly, the various city employee unions have thus far been able to stall the reform efforts. The mayor’s plans to consolidate and improve the 911 system have been blocked, thus far, by the unions representing the dispatchers who are currently within different departments. From the article:

One union represents police dispatchers, and another represents EMS and fire dispatchers. The unions have demanded bargaining over any dispatcher cross-training. Uncertainty about which union would represent a combined dispatcher position slowed attempts by Mayor Tishaura Jones and her former public safety director, Dan Isom, to allow dispatchers to handle all types of emergency calls.

The unions complained Jones and Isom’s plans for consolidation were made without consulting them and that the changes in job duties were clearly something that should be covered in contract negotiations. [emphasis mine]

Missouri attempted major public-sector union reforms a few years ago. While some reforms were passed into law, a lawsuit unfortunately led to the reforms being overturned by the Missouri Supreme Court.

St. Louis has public sector unions delaying improvements to a system that would improve the city’s currently terrible 911 system and spend tax dollars more efficiently. But hey, fiefdoms have to be protected, right?

FDR was right about public sector unions. They shouldn’t exist.

The Future of Missouri’s Workforce with Susan Pendergrass

Zach Lawhorn speaks to Susan Pendergrass, director of education policy at the Show-Me Institute, about her new report The Future of Missouri’s Workforce.

Read the full report here.

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Produced by Show-Me Opportunity

Application Deadline for Close the Gap Grant is Almost Here

The application deadline for Missouri’s Close the Gap Grant Program is quickly approaching. The law was passed back in 2022, but after finally solving some logistical hurdles, the program is up and running. Parents have until October 23 to apply for a one-time grant of up to $1,500 to spend on education expenses.

So, what exactly is the “Close the Gap Grant”?

Close the Gap is a one-time grant paid to families with students enrolled in Missouri public schools—those in private school or homeschool are not eligible to receive these funds. With these tax-exempt funds, parents can pay for:

  • Tutoring services
  • Academic/summer camps
  • Educational materials
  • Computer equipment
  • Internet connectivity
  • Learning-relating subscriptions
  • Software to support educational activities
  • Before- and after-school programs
  • Study skills services
  • Costs associated with college credit for AP, dual credit, dual enrollment, ITV (instructional television), and international baccalaureate
  • Art enrichment lessons (such as piano, singing, or dancing lessons)

Additionally, because this program was supposed to be up and running last year, parents can also request reimbursement for an allowable service or product they purchased since July 1, 2022.

After all the applications are received, grant awards will be divvied out to families below 185 percent of the federal poverty level. If there are surplus funds still available (which there could be from the $75 million budget), applicants above the stated poverty level will receive grant awards. Parents will be notified regarding the amount of their grant reward starting on November 1st. For the awardees, grant funds do not roll over and must be used by June 1, 2024. These funds are a one-time payment; these payments are not recurring and are only available for this year. Unless Missouri finds a way to carve out new funding to continue this program, there will be no grant in 2024–2025—this grant comes from emergency federal COVID relief funds in 2022.

Who is administering this program?

An organization called Odyssey will be administrating the program. The founder of Odyssey previously founded SchoolHouse, an at home micro-school company. Odyssey is a startup that manages education scholarship accounts (ESAs) and microgrant programs. Odyssey will handle basically everything required for the Close the Gap grants: all application management, marketing and outreach, marketplace creation, payments, and customer support.

Odyssey will have an online marketplace with listed vendors where individuals can see all allowable education services and products. Along with a marketplace, the Odyssey Parent Portal will also have a tab to upload receipts for reimbursement.

With the deadline quickly approaching, make sure to sign up and get your grant award now.

College Readiness Declines

ACT, the organization that administers one of the most widely used college entrance exams, just released the scores for last spring’s graduating class and the results are troubling. Scores are down nationally and in Missouri. As a reminder, this is the class of students who were freshmen when schools closed in 2020 and most likely spent at least part of their sophomore year trying to learn remotely. We now know that this was not successful for very many students and these data confirm that.

Nationally, the average composite ACT score fell from 19.8 in 2022 to 19.5 in 2023. Prior to 2022, scores hadn’t been below 20.0 in more than thirty years. In Missouri, scores fell from 20.3 to 19.8, the lowest average composite score for the state since 2000. Missouri’s average was near that point (19.86) in 2018 when the test was required for all students, whether they intended to go to college or not. That is no longer the case. Last year, 66 percent of graduating students took the exam.

So, what does this mean? As predicted, students who were at “important” points in their K-12 education are in real trouble. Nearly 40 percent of Missouri’s 3rd graders (kindergartners in Spring 2020) scored below Basic in reading last year, meaning they don’t even have a partial understanding of the subject. They missed a critical window to develop a skill that is fundamental to their future success in school.

The same can now be said of students who were starting high school. They are, as a group, less ready for postsecondary education. This has implications for their lives as well as the quality of the Missouri workforce. Our state leaders should be addressing this as the crisis that it is. It should be a policy priority. They should be talking about it routinely. Is that what you’re seeing or hearing?

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