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Podcast: State Budget Cuts Put Education Reforms at Risk

May 4, 2010

In this podcast we will discuss the risk that state budget problems will derail education reform. I'm Shannon Spillane and I'm joined by the Director of the Center's State Fiscal Project, Nick Johnson.

1. Nick, how has the recession affected state budgets for education?

Education is the single biggest item in state budgets. So when the recession triggered an unprecedented decline in state revenues, most states cut education spending to help balance their budgets.

Over the past two years, at least 29 states and the District of Columbia have cut K-12 spending and at least 39 states have cut funding, raised tuition, or both, for public colleges and universities.

2. How do these budget cuts affect schools and students?

Budget cuts undermine the kinds of education improvements and reforms that experts agree help students learn and achieve. For example:

Research suggests that teacher quality is the most important determinant of student success. But a number of school districts have reduced teacher wages through furloughs since the start of the recession and have resorted to hiring freezes. Reducing wages, needless to say, is not a good strategy for attracting and keeping great teachers.

3. What are other ways that budget cuts are undermining student achievement?

For a number of years, states have been trying to reduce class sizes because there's some evidence it helps student learning. To get smaller classes, you need more teachers. But when teachers are being laid off, it's difficult to reduce the size of classes. In fact, in a survey of school administrators, a quarter of them said that they're increasing class sizes this year.

Here's another example. There's research showing that more student learning time can improve achievement. But, budget cuts are making it more difficult to provide that extra learning time. Hawaii's schools are closing on Fridays because of teacher furloughs. And, New Jersey is cutting funding for afterschool programs, which will reduce learning time.

4. There is some evidence that the economy is growing again. Does this mean that state budgets are out of the woods - and education won't be cut further?

Unfortunately not. State budgets won't really improve until people start earning more and spending more and generating more revenue for state governments, and that won't happen until unemployment starts to decline.

That means more cuts are on the way for states' next budget year, which starts July 1 in most states. Proposed cuts include layoffs for nearly 22,000 teachers in California and 17,000 teachers in Illinois, while New Jersey is considering roughly $1 billion in cuts to K-12 and higher education. That survey of school administrators found that 62 percent of them expect to increase class sizes next school year, and a third of them say they might have to eliminate summer school next year altogether.

5. You've talked about some of the ramifications that cuts like this have on students. What about their impact on the economy?

The economic impact is huge in the short run and in the long run. In the short term, cutting education weakens the economic recovery. For example, teachers who get laid-off don't spend much money in local stores. There's a ripple effect that really endangers the whole economy.

In the long term, employers need skilled workers. The way to create the workforce of the future is to have great schools. If we want our economy to grow down the road, we have to make smart investments in our children now.

6. Has the Recovery Act helped reduce these education cuts?

Absolutely. The Recovery Act allocated to states $140 billion to help maintain public services. These funds cut the size of states' budget shortfalls by about a third, and if you talk to state legislators and governors, they will tell you that the cuts in education and other services would have been a lot worse without these changes.

Here is the problem, though. This aid was designed to be temporary and expire after roughly two years, and we're coming up on that expiration date. The federal funds will run out before state budgets recover.

7. What should Congress do?

Congress should extend the federal funds -- even just for six months or so. This will help get the unemployment rate down, which will help state revenues recover -- then states can get back to the important business of making sure our schools produce the well-educated work force we'll need for this country to remain competitive and to prosper.

Thanks for joining me, Nick.