policy choices

Do vouchers actually expand school choice? Not necessarily — it depends on how they’re designed

PHOTO: Matt Barnum
U.S. Education Secretary Betsy DeVos at Providence Cristo Rey in Indianapolis.

Who benefits most from private school voucher programs: families with few options or the schools themselves?

This is a hotly debated question among supporters and critics of school vouchers, and is especially relevant as U.S. Secretary of Education Betsy DeVos has vowed to allow more families to use public dollars to pay for private school tuition.

A 2016 study considers this question and comes back with an answer: It depends. Programs targeted at certain students, like low-income ones, lead to an increase in private school enrollment; but universal choice programs with few if any eligibility requirements don’t cause more students to enter private schools, with schools instead raising tuition.

That’s the conclusion of the research, published in the peer-reviewed Journal of Public Economics, which examined eight private school choice initiatives, including both voucher programs and tax credit subsidies, which offer generous tax breaks for private school fees.

The researchers, Daniel Hungerman of Notre Dame and Kevin Rinz then at the National Bureau of Economic Research, divide the programs into two categories: what they refer to as restricted and unrestricted. Restricted programs limit availability to certain students, such as those who are low-income or have a disability; unrestricted programs are open to everyone.

An example of a restricted program is Florida’s tax-credit program, which incentivizes donations to nonprofit groups that offer tuition scholarships to low- and middle-income families. Arizona’s tax-credit initiative is similar in structure, but is classified as unrestricted because it is open to all students. (Arizona also has tax credit programs targeted at low-income students and those with disabilities.)

The study then looks at how the two types of programs affect school enrollment and finances, using data from tax returns of thousands of private schools.

Restricted-choice programs cause large increases in the number of students attending private school. But “programs that offer unrestricted subsidies lead to price increases but no change in enrollment,” the authors conclude.

In other words, under the universal programs studied, private schools did not admit additional students, but did raise tuition — by an amount the researchers estimated to be roughly the same as the public subsidy. (It’s possible that different — just not more — students enrolled as a result of the choice program.)

This gives credence to concerns that untargeted programs fail to create additional access to private schools, but are a revenue boon for schools.

At the same time, targeted programs seem to have their intended effect of allowing more families to choose private school. (Of course, whether that ends up helping students academically remains the subject of much debate.)

This suggests that school choice advocates who want to expand enrollment in private schools — as opposed to simply allowing them to raise tuition — should favor targeted programs. Some choice supporters have recognized this concern, recommending the creation of education savings accounts, which give families a pot of money to spend on any combination of educational expenses. Anna Egalite, a professor at North Carolina State University, argues that this approach, unlike traditional vouchers or tax credits, puts “downward pressure” on prices by “encourag[ing] parents to be cost conscious.”

DeVos and the Trump administration have not released any details on their promised school choice plan, but some past federal proposals have been focused on low-income student, and most existing state voucher and tax credit programs have restrictions of some sort. However, key school choice groups, including EdChoice and the American Federation for Children, which DeVos used to lead, have supported universal choice policies.

The study is one of the only analyses of how choice programs affect private school enrollment, but it comes with a number of caveats.

The research examined unrestricted programs that offer fairly small subsidies, often significantly less than in voucher initiatives. It’s unclear if the finding — that programs open to all don’t increase private school enrollment — would hold in cases where there were more generous subsidies.

Another caveat: it might be hard to categorize programs with eligibility requirements that most families can meet.

Take Indiana’s voucher program, the largest in the country. The state initially had tight income requirements, limiting the program to poor families; when those rules were in place, private school enrollment rose.

But after the state raised the income threshold to provide partial vouchers to some middle-income families, private school enrollment has essentially flatlined, raising the possibility the school choice initiative hasn’t actually given parents new choices — but simply subsidized existing ones. Since then, the number of students using the program has increased, while the number attending private school without a voucher has dropped precipitously.

It’s impossible to know the effects of Indiana’s voucher program on private school enrollment without a more careful analysis, and the recent study would have categorized it as a restricted program. In recent years many states have seen private school enrollment fall, so the fact that it remained steady in Indiana could be the result of the voucher system.

However, the income requirements in Indiana were more lenient than many of the other programs studied, and over half of students in the state are eligible to receive a voucher.

“At some point the [income] threshold gets so high that the breakdown we offered would not be useful,” said Hungerman, one of the study’s authors.

blast from the past

Who is Dan Loeb? The billionaire investor that chairs Success Academy’s board has a checkered past

A screenshot taken from an American Enterprise Institute event published in 2014.

Success Academy’s board chairman and major charter school donor Daniel Loeb made headlines this month for posting a racially charged comment on Facebook that compared an African-American New York state senator with the Ku Klux Klan.

Loeb deleted the post, apologized, and left Success Academy and other charter school organizations scrambling to condemn his behavior — and explaining why he would remain on their boards.

Loeb represents a double-edged sword for charter schools. He is a wealthy and well-connected hedge fund manager, who has given millions of dollars to the charter school cause. But his actions force Success Academy CEO Eva Moskowitz and other charter leaders to make a calculation: Is his behavior a fair price to pay for the boost to their cause?

So far, they have apparently decided that it is. He has not yet been removed from Success’s board. Here are other things Eva Moskowitz has had to grapple with — which include a string of insensitive comments, but also his support for other progressive causes— as she has navigated her relationship with Loeb over the years:

He’s a nonpartisan ally — and antagonist. Loeb supports both Democrats and Republicans, and he also attacks candidates and lawmakers on both sides of the aisle. For example, he’s a major backer of New York Gov. Andrew Cuomo, but he also has given to Republican mayoral candidate Nicole Malliotakis and supported Mitt Romney is past presidential campaigns. At the same time, he has lashed out at both Hillary Clinton and Barack Obama, often in withering and offensive terms, while also telling friends he would not vote for Donald Trump.

This isn’t the first offensive comment he’s made. Far from it, in fact. Loeb is fast-fingered on Facebook and frequently uses derogatory language to lash out at people who have made him unhappy. Here are a few of the examples that have been reported previously:

  • Another time Loeb compared the unions and their supporters to the KKK: Loeb posted the following on his Facebook page in 2016, first reported by Dealbreaker: “If you truly believe that education is the dividing line (and I concurr) then you must recognizer and take up the fight against the teachers union, the biggest single force standing in the way of quality education and an organization that has done more to perpetuate poverty and discrimination against people of color than the KKK.”
  • Using a derogatory term for people of color: Loeb once got into a fight with Fairfax Financial, a Canadian insurance company, which resulted in a lawsuit. Reported Reuters in 2011: “Fairfax’s filing quotes Loeb as saying he found the situation somewhat ironic because “the odds are much greater of being strung up by a Canadian Jew than a Canadian schwarze.” Loeb, who is Jewish, used “schwarze,” a derogatory Yiddish word for a black person, to describe Watsa, who is of Indian ancestry.”
  • Making light of domestic violence by comparing Obama to an abuser: In a 2010 letter to hedge fund managers who had supported Obama, Loeb wrote, according to CNBC: “I am sure, if we are really nice and stay quiet, everything will be alright and the President will become more centrist and that all his tough talk is just words; I mean he really loves us and when he beats us, he doesn’t mean it; he just gets a little angry.”
  • Making a xenophobic, homophobic attack against a rival: A damning 2013 Vanity Fair profile dredged up an anecdote from 1999, when Loeb was feuding with John Liviakis, a San Francisco public-relations executive. In an “imaginary monologue” in the voice of Liviakis, Loeb wrote under a pseudonym: “Then I will laugh at you fools for buying my shares and I will celebrate with a bottle of grappa, some fresh feta, and a nice young boy-just like in the old country.” Liviakis sued him for libel.

Loeb’s allies say his mean-spirited comments don’t necessarily reflect deep-seated beliefs. “I have known Dan to be a champion for underserved children who has worked tirelessly for years on their behalf,” said Jenny Sedlis, the head of StudentsFirstNY and a former deputy to Moskowitz, last week. “I know from first-hand experience the post he made does not reflect his true beliefs or the person he is.”

He has championed progressive causes in the past. Most notably, Loeb helped get gay marriage on the books in New York by throwing his influence into winning over Senate Republicans. This position put him in line with most Democrats and with Moskowitz, who has had wide support in New York City’s gay community for nearly 20 years. It also suggests that some of his internet posts, which have included seemingly homophobic comments, do not necessarily reflect the entirety of his beliefs.

It’s also not his first ethical challenge. Loeb had an account on the marital cheating site Ashley Madison, though he later said he did not use the site to engage or meet anyone on the site. He also has garnered criticism for the way he uses online message boards, where some business insiders say he plays fast and loose with federal regulations about the ways hedge fund operators can communicate with investors. And multiple accounts have him hitting a Cuban child with his car during a vacation in 2002, although he and his friends tell different versions of that story.

His friends and investors have their own problems. At Third Point Management, Loeb manages $17 billion and has a host of high-profile investors — including someone else who landed in hot water for speaking freely this summer. Anthony Scaramucci told Vanity Fair that Loeb was “one of the best investors of his generation. . . . He is the guy that would chew through the wallboard to create a return for his investors.” At the time, Scaramucci had invested about 10 percent of his own fund’s $500 million with Loeb. Now, of course, he’s better known as the man who served for 10 days as Trump’s White House communications director before resigning after making a profanity-laden public attack on other White House officials.

Tough talk

State ed officials rip into ‘insulting’ SUNY charter proposal and ‘outrageous’ Success Academy chair

PHOTO: Monica Disare
State Education Commissioner MaryEllen Elia and Board of Regents Chancellor Betty Rosa

The state’s top two education officials did not pull punches at a panel Wednesday that touched on everything from last weekend’s racist violence in Charlottesville to recent charter school debates.

State Education Commissioner MaryEllen Elia took an uncharacteristically combative position against SUNY’s proposal to let some charter schools certify their own teachers — arguing it would denigrate the teaching profession and is not in the best interest of children.

“I could go into a fast food restaurant and get more training than that,” Elia said about the proposal, which would require 30 hours of classroom instruction for prospective teachers. “Think about what you would do. Would you put your children there?”

Board of Regents Chancellor Betty Rosa denounced Success Academy’s board chair, Daniel Loeb, whose racially inflammatory comment about state Senate Democratic Leader Andrea Stewart-Cousins drew headlines, and pointedly referred to New York City officials’ reluctance to talk about school segregation.

Wednesday’s conversation was sprawling, but its discussion of race and education had a particular urgency against the national backdrop of Charlottesville — and the president’s reluctance to denounce neo-Nazis and white supremacists in its aftermath.

The following are some of the most charged moments of the panel, held at the Museum of Jewish Heritage and hosted by City & State:

Segregation — “you’ve got to name it”

In response to a question about New York City’s diversity plan, which was widely criticized for not using the word “segregation,” Rosa suggested the city should have gone further.

“We committed to, as a department and as a Board of Regents, [the] notion of naming it,” Rosa said, referring to the state’s draft integration statement, which referred to New York schools as the most segregated in the country. “You’ve got to name it.”

Elia chimed in too, tying integration to the recent events in Charlottesville.

“I would say the last six days have pointed out to all of us that, clearly, this is something that must be on the agenda,” Elia said.

Dan Loeb — “absolutely outrageous”

Loeb ignited a firestorm over the past week with a Facebook post that said people like Stewart-Cousins, an African-American New York State Senator he called loyal to unions, have caused “more damage to people of color than anyone who has ever donned a hood” — an apparent reference to the Ku Klux Klan. (He has since taken down the post and apologized.)

Rosa strongly condemned the comments in the same breath as she denounced the violence in Charlottesville, and said children of color at Success Academy would be “better served” without Loeb leading the board.

“I am outraged on every single level,” she said. “Comparing the level of commitment of an African-American woman that has given her time and her commitment and dedication, to compare her to the KKK. That is so absolutely outrageous.”

Elia seemed to pick up on another part of Loeb’s statement, which referred to “union thugs and bosses.”

“For anyone to think that we can be called thugs,” Elia said. “People [do] not realize the importance of having a quality teacher in front of every child.”

SUNY proposal — “insulting”

SUNY Charter Schools Institute released a proposal in July that would allow some charter schools to certify their own teachers. The certification would require at least 30 hours of classroom instruction and 100 hours of teaching experience under the supervision of an experienced teacher.

But as the requirements currently stand, both Elia — who compared the training to that of fast food workers — and Rosa took aim.

“No other profession, not the lawyers who are sitting in that SUNY Institute, would accept that in their own field. So if you don’t accept it for your very own child, and you don’t accept it for your very own profession, then you know what? Don’t compromise my profession. I think it’s insulting,” Rosa said.

Joseph Belluck, the head of SUNY’s charter school committee, said earlier this month that the committee is considering revising those requirements before the draft comes to the board for a vote. But he fired back after Rosa and Elia bashed the proposal on Wednesday.

“Commissioner Elia and Chancellor Rosa are proponents of the status quo,” Belluck said in an emailed statement. They have “no substantive comments on our proposal — just slinging arrows. Today, they even denigrated the thousands of fast food workers who they evidently hold in low esteem.”