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A "Crisis," More Hype, and Another Call for Bailouts

Posted By Bethany Aronhalt On June 18, 2010 @ 1:00 pm In Education | Comments Disabled

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Brace yourselves – America is about to fall into an “education catastrophe [2],” says Secretary of Education, Arne Duncan. Up to 300,000 educational workers may receive pink slips [3] this coming fall. The only solution is the same solution to all our other economic problems. Yes, you know the drill. It is time for another bailout, this time to save our education system.

Last Sunday, President Obama wrote a letter to Congress [4] urging members to provide $23 billion in relief to state and local governments to supposedly prevent the layoffs of thousands of teachers nationwide.  Countless newspaper articles [5] have concluded that if Congress does not act now, class sizes will become so large that student achievement will fall far behind, the academic year will shorten, and some schools will even lock their doors for good [2].  Well, is the hysteria pushing this agenda really necessary?

Charles Lane from the Washington Post calls this plea for more funding simply hype [6]. Lane accurately reminds his readers that educational workers not only include K-12 teachers but also bus drivers, custodians, administration, etc., as well as some college faculty.  Moreover, consider the ambiguity behind the broad estimate of 100,000 to 300,000 future layoffs. From January 2009 to May 2010, which includes the deepest points of the recession, a total of 61,600 state and local educational jobs were lost, at a 0.59% rate of job loss. Over the entire last three years, from December 2007 to May 2010, there was actually a net increase in total state and local educational jobs by 20,700. Yet, the Obama administration is leading Americans to believe that up to 300,000 educational jobs will be lost this coming fall alone.

Of course, state budget deficits that may lead to future educational jobs losses are certainly something to be concerned about.  However, when comparing job losses in the public sector to those in the private sector, it is clear the real job losses are occurring in the private sector. From December 2007 to May 2010, there was a net loss of 49,300 total state and local jobs at a rate of 0.25%. In the same time period, there were 7,972,000 job losses in the private sector at a rate of 6.9%. The industries hardest hit were manufacturing (2.1 million job losses, 15.1% of total), professional and business (1.4 million, 7.7%), financial activities (628,000, 7.6%), and construction (1.9 million, 25.4%). These figures make job loss rates in the public sector that are less than 1% appear minuscule in the broader economic picture.

The argument remains that educational job losses will result in larger classrooms and thus lower academic achievement. However, if 300,000 job losses really occur, the student to teacher ratio would rise by a slim margin from 15.3 – 1 to 16.6 – 1. At 100,000 job losses, the ratio would rise to 15.6 – 1. [6] To put this number is perspective; the student-teacher ratio in 1950 was 27:1. In addition, public schools at the time employed 2.36 teachers for every non-teacher. Today that ratio is closer to one to one. More importantly, throwing money at states merely puts a band aid on the problems facing our education system and prevents districts from pursuing actual reform and more efficiency.  If the administration insists on using its usual spending fix, it can start by using some of the $421 billion in unspent stimulus funds from last year’s Recovery and Reinvestment Act.

True economic growth arises from entrepreneurship and the small businesses that create jobs. Taxing the private sector which is facing much higher levels of unemployment [7] to save government jobs is simply a transfer of resources and in the end does not save or create jobs at all.  There is no such thing as a free lunch, and in this case the private sector will pay for it.

Bethany Aronhalt is a member of the Young Leaders Program at the Heritage Foundation. For more information on interning at Heritage, please visit: http://www.heritage.org/about/departments/ylp.cfm [8]


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URL to article: http://blog.heritage.org/2010/06/18/a-crisis-more-hype-and-another-call-for-bailouts/

URLs in this post:

[1] Image: http://www.foundry.org/wp-content/uploads/Chalkboard-10-6-18.jpg

[2] education catastrophe: http://www.nytimes.com/2010/04/21/education/21teachers.html

[3] Up to 300,000 educational workers may receive pink slips: http://www.washingtonpost.com/wp-dyn/content/article/2010/04/20/AR2010042003215.html

[4] letter to Congress: http://www.whitehouse.gov/sites/default/files/rss_viewer/president_letter_6-12-10.pdf

[5] Countless newspaper articles: http://www.washingtonpost.com/wp-dyn/content/article/2010/06/12/AR2010061204152.html

[6] Charles Lane from the Washington Post calls this plea for more funding simply hype: http://voices.washingtonpost.com/postpartisan/2010/06/myths_about_the_teacher_layoff.html

[7] facing much higher levels of unemployment: http://www.bls.gov/iag/tgs/iag65.htm

[8] http://www.heritage.org/about/departments/ylp.cfm: http://www.heritage.org/about/departments/ylp.cfm

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