No, school vouchers did not cause a ‘budget meltdown.’
No, school vouchers did not cause a ‘budget meltdown.’
A merica’s teachers’ unions never met a government-spending increase they didn’t like. Perhaps that’s why they’re so upset about the savings accruing from Arizona’s universal education-savings-account (ESA) program — that, or the fact that the state’s latest financial reports have exposed their ongoing anti-parental-choice PR campaign as a fraud.
Two years ago, Arizona set a new national standard by making every child eligible for a K–12 Empowerment Scholarship Account to support his or her private or home-based education. Ever since, activists opposed to school choice, and their media allies, have howled in protest against the enactment of Arizona’s universal ESA program, claiming that it costs the state more per student, that it has caused a massive budget deficit and is bankrupting the state, and that it amounts to “welfare for the wealthy.”
Through a coordinated media blitz, these groups have tried desperately to scare off lawmakers in other states from enacting similar policies. The left-wing outlet ProPublica, for instance, blanketed newspapers across the nation this summer with an article that claimed that “Arizona’s voucher experiment has . . . precipitated a budget meltdown.” Union-backed hysterics aside, the data from the Grand Canyon State have decimated this narrative.
As the Goldwater Institute recently documented at length, the two-year financial history of Arizona’s universal ESA program is one of great inconvenience to the Left’s preferred narratives. Rather than harm Arizona, the expanded ESA program serves families at a lower cost per student than does the public-school system, and its implementation coincided with budget surpluses.
Specifically, in 2022–23, the first year of universal ESA expansion, Arizona posted a $2 billion overall state-budget surplus (even after accounting for the massive enrollment growth in the ESA program that followed the expansion). In its second year — even as record (non-ESA) spending and revenue shortfalls combined to produce an overall state-budget deficit — Arizona’s K–12 funding formula (which funds public schools and ESA awards) actually resulted in a net savings of $4 million compared with what lawmakers had projected in the originally enacted budget. As the state’s analysts reported last month, while enrollment in the ESA program surged by thousands of more students than originally budgeted for in the 2023–24 school year, the corresponding decrease in public-school enrollment led to an overall savings for the state’s general fund compared with what lawmakers had estimated.
In fact, it was only after the Arizona’s left-wing governor, Katie Hobbs, vetoed the original state budget for this past year (which would have left over a billion dollars in surplus cushion) — and instead signed a budget that brought state spending to its highest levels of all time — that revenues failed to meet projections and the state ran into a deficit. Nevertheless, union activists have sought to paint Arizona’s ESA program as the cause of the state’s (now resolved) financial shortfall in hopes of convincing other states that school choice is a budget-buster.
This sudden feigned fiscal conservatism is nowhere to be found among the same activists when it comes to the true budget behemoth: public education. In Arizona, as in most states, spending on public schools has surged by billions of dollars a year — even after the universal expansion of ESAs. In fact, the total increase in spending from Arizona’s universal ESA program is hundreds of millions of dollars less than the new funding state lawmakers poured into public schools in 2022 alone, even as district enrollment has been flat or declining for years.
In spite of this, union apologists speak only of the need for more “funding” for public schools (which currently rake in more than $14,000 per student in Arizona) while complaining of the “costs” of ESAs (currently about $7,500 per student). In fact, in states such as Arizona, taxpayers currently spend ten to 20 times more on “wealthy” families (those making over $150,000 annually) in the public-school system than they do on providing financial assistance to similarly situated families who’ve joined the ESA program from private-school or homeschooling arrangements since its expansion. Many, including the left-leaning Brookings Institution, have tried to square such incongruities by simply doubling down on the Left’s hypocrisy when it comes to K–12 funding, freely admitting that “Americans have long accepted — in fact, embraced — a double standard for public and private schools.”
Anti-school-choice activists and their allies have painted private-school and homeschooling families as undeserving of financial support if they choose to pursue an ESA, but they have no qualms about taxpayers’ footing an even larger bill for those same kids as long as they agree to attend a government-operated school.
This hypocrisy is lost on union allies such as Governor Hobbs, who attended private school and has acknowledged the financial sacrifices her family had to make for her to do so. Such families, who have historically borne the full cost of their children’s education (while subsidizing the cost of others’ via their taxes), do not harm state finances or other children now that they receive a small share of their child’s education-funding allotment.
The 75,000 children now served in Arizona’s ESA program — and the tens of thousands of others served by similar ESA programs around the nation — have proven that states can successfully operate a traditional public-education system and a growing community of private-school-choice families.
The success of Arizona’s ESA program may be bad news to America’s entrenched education establishment. But so far, it has come with good news for families and state finances.