Testimony before the Senate Education Committee on Senate Bill 1506

Testimony before the Senate Education Committee on Senate Bill 1506
Robert D. McTeer
Distinguished Fellow
National Center for Policy Analysis
March 29, 2007

Madam Chair, Senators, my name is Bob McTeer.  I'm representing the National Center for Policy Analysis, which is a nonpartisan, free-market think tank headquartered in Dallas.  Before coming to NCPA, I was Chancellor of the Texas A&M University System for two years, and before that I was President of the Federal Reserve Bank of Dallas for 14 years.

For the record, I attended public schools, both my sons attended public schools, and both my grandchildren attend public schools.  I believe in public schools, and I have the highest admiration for public school teachers. More school choice, in my opinion, will make public schools better-not harm them.

We did have some choice in where our sons attended school in Virginia and Maryland.  We moved to neighborhoods known to have excellent schools.  Homes were more expensive in those neighborhoods because of their schools, but we were fortunate enough to afford it-barely.  But I don't think choice should be limited to those who can afford it, and it shouldn't be based on real estate.

As an economist, I've witnessed the power of competition to improve quality everywhere I've seen it introduced.  I was a college student when we started importing high quality, low cost Honda's and Toyota's in large quantities.  Those who purchased them enjoyed those benefits immediately, but it wasn't long before the added competition began to improve our Fords and Chevrolets and our fathers' Oldsmobiles.

In the 1980s, I ran the Federal Reserve office that processed and cleared checks in the greater Washington, D.C. and Baltimore areas.  It was a large operation in part because we provided that service to banks free of charge.  Large correspondent banks couldn't compete effectively against our zero price-we had a monopoly. 

Then Congress opened up competition by requiring us to charge for our check and other services and recover our costs.  Overnight, our check volume fell by almost half.  Then we got serious about quality and service, and earned much of our lost volume back.  Competition and choice made us-the government provider-as efficient as the private sector.

As Chancellor of the A&M System, I became aware of how many of our high school graduates entered college unprepared for college level work and required remedial instruction-not so much at the flagships, but at most of our other universities.  Only later, when the Friedman Foundation study came out, did I realize how many of our students were dropping out before high school graduation.  Statewide, it was about a third.  In the inner cities, it was about half.

This is, of course, tragic for the dropouts. But it's also a major financial burden for the taxpayers of Texas-even those outside the areas covered by this pilot choice program.

We are in a new, global, information economy-an economy that requires education, knowledge and stills.  We are in an economy where the penalty for not having those attributes grows larger every day.  The Texas education system increasingly resembles that of an underdeveloped, third-world nation-elites at the top with the under-served below.

In this country, we have world-class universities, but second-class primary and secondary education in too many schools.  Why?  What is the source of the difference?  In higher education, we already have choice and competition.  In primary and secondary education, we have government monopoly.

It's not the teachers.  It's not the schools.  It's the system.  The system is broken, and more of the same-meaning more money-has not fixed it.

A limited school-choice pilot program is a necessary start to a better approach.  It may cost some money up front.  But any additional cost will be more than offset by higher state tax revenues and low medicade and prison costs.

And the cost of doing nothing is the highest cost of all.

Thank you.

Comments (2)

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  1. pete speer says:

    This is a paper which I have written, but not yet circulated. I think it addresses the true state of the national problem.


    The face of Public Education is going to change. The Education Function is not delivering the quality product which this country needs. No Child Left Behind is merely a prelude. There is a growing national realization that Public primary and secondary education in its present form is delivering unsatisfactory value to a nation facing a competition in the 21st Century Word Economy during the Information Age. Papers are being written at the national level by groups of all types offering suggestions for the morass of public education.

    You have the opportunity to become a leader and influence Illinois policy in the face of the School reform that is coming. You may, of course, choose otherwise to maintain the expensive status quo in our broken system and continue to tax and appropriate more funds on the assumption that money by itself buys results. It does not.

    The Education function is a three legged stool on which the student sits. These legs are the parents, the local schools and the state. The legs are not presently in balance.

    Good education is a necessary condition for the continuing drive of our citizens to achieve interclass mobility and the ancillary benefits that brings to our society. Today, we have in our society the makings of an underclass which no longer believes that education is an economic or a social good. Their own experience in our public schools and thereafter has brought about this perception.

    This has resulted in a ‘welfare dependent’ class against which Bill Cosby has preached – parents who do not motivate and can not assist their children. The functioning family unit is an essential part of our history and our future. We can and should be concerned about reeducating these early school leavers. Education of the parents to a GED level is part of the solution. This reeducation needs to be a necessary condition for obtaining welfare benefits.

    It is the parent who provides the first impetus for learning and the continuing motivation towards success throughout the child’s school life. We see this motivation in our oriental immigrants, who are told by their families that the sacrifices made by the parent are given as an obligation to the child to succeed.

    Just as schools can not succeed without the complementary activities of parents, students can not reach their potential unless the school provides both the learning environment and the dedication of teachers who have and can communicate both subject matter mastery and the a love of learning as well as an affection for their students.

    By every international measure American schools lag the remainder of the world. Our advanced placement courses in 2004 in Math and Physics rank at the sixth and the zero percentile respectively.. At other grade levels there are bad results as well. How can that be when state institutions are reporting good grade level results to parents?

    Within the local school systems there are ongoing problems. Each results from the closed loop organization of the system, with insiders in the Schools of Education, at the ISBE, in school administration and in the teaching profession.

    First, the system provides underqualified teachers – able instructors but without Subject Matter Mastery; second, the state dumbs down the standardized tests, norms up the results and lowers certification standards for teachers while eliminating recertification; third, Boards and Administrators refuse to accept the outside evaluation of NCLB. We have a continuing morass in which the students are at risk.

    Teachers with Education Degrees are encouraged to continue schooling in Education subjects by rewarding them with step salary increases in addition to longevity increases. While Districts brag about the number of teachers who have advanced degrees, investigation shows that the vast majority of them are not in the subject matter they teach. Subject Matter Mastery can not be achieved and updated because the teachers do not qualify for graduate courses in those subjects.

    How can the legislature accept the actions this year of the ISBE? Standards are supposed to be firm measurements. They are not graded on a curve. Dumbing down and norming up exist only to whitewash the teaching failures and give the parents a good feeling – at the expense of the next generation of adults, the State and the Country. When certification standards are lowered for any teaching field with the excuse that schools are having difficulty finding otherwise qualified teachers, this is a base canard.

    Thousand of subject matter qualified persons with teaching experience are retiring at age 41 with a pension from the military. They are ready to be recruited and able to step into the breach. The Schools of Education and the unions place impediments to their immediate employment. Recruited during their penultimate year, they could easily prepare themselves to step right in.

    In the private sector, a corporation, required to keep an underperforming division operating, will send its best personnel to effect a turnaround. In public education the union can invoke seniority rules to stop such personnel transfers. Further, seniority permits underqualified teachers to bump out of a job younger, more qualified educators in any reduction in force.

    Administrators, acting to hide poor performance have opted out of the NCLB program. The legislature must insist that it receive detailed rationale as to why the District may not receive the NCLB benefits. What are the Districts hiding?

    Additional school funding routinely goes into additional salaries and step increases, the infamous last three year pre-retirement bumps and some ‘enrichment’ programs and extra-curricular activities. Where is the enhanced Subject Matter Mastery necessary for increased Education Value? Smaller class size is also supposed to be the cure. How can it be? Hiring additional underqualified teachers is not a solution. Districts now tout Content Mastery, which at its worst is keeping one chapter ahead in the textbook – a thin alternative to knowledge.

    The one sure way to increase knowledge is to place excellent teachers with Subject Matter Mastery into the system. The only known way to do this is through Competitive Choice. That means allowing other accredited schools to educate District students with the benefit that competition lowers costs. Vest the students; allow the family to select the school, save money for the home District. That is a win-win situation. That is what must be done.

    To date, legislatures have probably viewed parent and teacher as a single entity, relying on the votes of the former and the contributions from the latter. Now they must be able to separately parse Education Cost and Education Value. The former is a function of special interest to the teachers. The latter should be of special interest to the family, the children, the State and the Country.

    America must compete in a 21st Century World Economy. Our foundation is the knowledge with which our students enter the marketplace at every level and the opportunity that knowledge engenders.

    Paul D. Speer, Jr.
    May 17, 2007

  2. BlepSymmesy says:

    Hi guys and girls!

    You have a very interesting forum.

    So i’d like to ask you if your income reduced because of the world financial crisis?