This Cato policy forum was very, very informative. Not surprising given the expertise of the discussants:
Patrick Byrne, CEO, Overstock.com, and Chairman, The Foundation for Educational Choice; Kil Huh, Director of Research, Pew Center on the States; and Adam Schaeffer, Policy Analyst, Cato Center for Educational Freedom; moderated by Robert Enlow, President, Foundation for Educational Choice; with introductions by Neal McCluskey, Associate Director, Cato Center for Educational Freedom.
Health care is the budget buster at the federal level, but K-12 education is what’s poised to bankrupt state and local governments. Spending on public education eats up around half of the general budget in most states, and it’s by far the priciest single item. For every dollar raised by state and local governments for Medicaid, three dollars go to K-12 schooling. As a result, combined state budget gaps in the high tens of billions of dollars are predicted through at least 2012.
That’s the immediate problem. Just over the horizon, things look worse. State public-employee pension systems are facing a trillion-dollar shortfall in their commitments, driven in large part by the massive costs of public-school employee benefits.
So exactly how bad is the education spending crisis? Is there anything we can do to avoid huge state and local tax increases or a serious decline in the breadth and quality of educational services?