Excessive Regulation and the Law of Unintended Consequences

It goes without saying that we all want students to succeed academically. In private school choice programs, however, policymakers must be especially cautious not to inadvertently harm students by overregulating in the name of ensuring school quality. Corey DeAngelis, a policy analyst at the Cato Institute, reminds us of this paradox in a column for the Washington Examiner.

Most private parental choice programs require that scholarship students take at least one norm-referenced assessment per year to track academic performance. In some cases, like Florida, results of these tests are compiled, analyzed, and reported publicly. This type of arrangement ensures that schools evaluate students’ progress each year and that state officials can see how well the program is meeting those students’ academic needs.

Sometimes, though, elected officials decide that heavier regulation is needed to “ensure quality.” By tightening standards and restrictions, they reason, the state can prevent disadvantaged families from picking bad schools. For instance, policymakers can force state testing in private schools, modify admissions policies, require that every teacher hold a state license, or set other restrictions for participating private schools.

But is this approach effective? No, for one very important and often overlooked reason: Private schools do not have to participate in choice programs. If a private school is already successful and financially stable outside of a scholarship program, its leaders may well decide that the additional regulation is not worth the extra revenue. Less stable schools, on the other hand, may not have the luxury of declining that revenue.

This theory is supported by DeAngelis’s recent study on heavily regulated choice programs in Milwauke and Ohio, in which he finds that high levels of regulation lead better-rated and more expensive schools to decline participation at a higher rate than other private schools. These findings mirror those of an earlier study using similar methods to examine private school participation in Washington, D.C., Indiana, and Louisiana.

Encouraging stable, successful schools not to participate while incentivizing less stable schools to take the plunge can result in a supply of schools skewed heavily toward the lower end of the performance spectrum. And, naturally, such a skewed supply of schools can severely impact student performance.

The first negative results ever found in an American private school choice program emerged in 2015 from Louisiana’s voucher program (notably distinct from the Tuition Donation Credit Program, in which ACE participates). When researchers dug deeper, they found that in Louisiana’s program, which boasts some of the heaviest regulation in the country, participating private schools tended to have low tuition and declining enrollment—both signs of schools in distress. Roughly two-thirds of the state’s private schools choose to stay away from the program, presumably because they can afford to do so.

The evidence seems clear: We cannot regulate our way to higher-quality schools in private school choice programs. We can, however, do whatever we can to incentivize successful private schools to participate in these programs and trust parents to make the right decisions for their children.

Poll Finds Spike in Support for School Choice

Every year, Education Next conducts a nationwide poll of public opinion on various education-related issues. The last couple editions of that poll have shown some discouraging trends in a handful of areas, including some forms of school choice. This year’s poll results, by contrast, are far more positive.

The less-than-spectacular poll results in recent years were not terribly surprising given how polarized the political environment around education has become. However, at least some of those results now appear to have been largely temporary reflections of the political mood at the time. Here are some key results from this year’s poll:

A majority of the public supports government-funded private school choice programs. Fifty-four percent of the public supports expanding educational options for public school parents by “allowing them to enroll their children in private schools instead, with government helping to pay the tuition.” This reflects an increase of 9 percent from the 2017 poll. Opposition to this concept has also fallen from 37 percent to 31 percent since last year.

Notably, these results seem to reflect support for universal rather than income-specific choice programs. Public support for income-based voucher programs remains at 43 percent—a number driven largely by low support among white families. Strong majorities of African American (56 percent) and Hispanic (62 percent) families support the concept of income-based choice provided by government funding.

Income-based scholarship tax credit programs remain the most popular form of school choice. Fifty-seven percent of the general public and 62 percent of parents support policies that provide tax credits to individuals and corporations who donate private money toward scholarships for low-income students. Both Republicans and Democrats favor such policies, with levels of support at 58 percent for both parties.

By comparison, just 43 percent of the public reported a favorable view of public charter schools. As mentioned above, only 43 percent of the public supports income-based, government-funded scholarship programs.

ACE Scholarships currently participates in two scholarship tax credit programs targeted at lower-income students, one in Kansas and one in Louisiana. In Louisiana, ACE is the largest nonprofit scholarship-granting organization in the state and plans to serve approximately 1,400 students in the 2018-19 school year.

There’s a whole lot more to unpack in this year’s Ed Next poll if you are interested, including opinions on teacher pay, collective bargaining, and the types of fees addressed by the landmark Janus decision earlier this year. You can review the full results here.