After Elite Education in Texas

By Greg Moses

When Art Laffer and the Dallas Fed converge on message, who can doubt that Texas elites are listening to what they most want to hear? In a 2008 review of Texas taxes, Reagan-era supply-side guru Laffer co-authored a report that ranked Texas seventh in the nation on an “Education Freedom Index” that tested for “vouchers, tuition credits, and corporate tax-deductible scholarship programs.” Yet, seventh place is no reason for celebration argued the “Laffer Report”:

“The U.S. rankings are clustered so closely together that a high score, on a curve, still means the state is a long way from potential levels of education freedom. If other states implement choice systems, Texas’ relative rank would fall precipitously. Texas should not see its high rank as a reason to celebrate; rather as evidence that Texas is making important first steps in a crucial and lengthy reform process.” (p. 24: pdf format)

On Friday the Federal Reserve Bank of Dallas agreed that 2009 will be no year for higher education complacency:

“The Texas higher education system faces many challenges in enrolling students from low- and moderate-income households. The state has a low overall graduation rate and, compared with other states, one of the smallest percentages of college-age population enrolled in college. A recent study by the Texas Public Policy Foundation’s Center for Higher Education suggests that the state’s public university system may be promoting a growing elitist society where only those students from families with considerable assets have access to the state’s top universities. In the U.S. as a whole, about 35 percent of American undergraduates receive federal Pell Grants, need-based grants to low-income students. Texas’ top-ranked universities (ranked by U.S. News & World Report), and those that receive the most state resources, have a significantly smaller percentage of students receiving Pell Grants.”

The Dallas Fed posts a graph of the “top Texas universities” and their lack of educational freedom as measured on a Pell Grant scale.

Of course, the ideological packaging for Laffer and the Dallas Fed precludes any outright call for more government spending. The “Laffer Report” favors an environment of low wages, low taxes, and less government. The Dallas Fed is touting “asset building” for low income families. If public money is spent, it would be used to “match” higher education savings accounts for qualified low-income families (see Smart Savings Accounts). Banks would get the money first.

Between the two publications we get a call for improved bootstraps, the better for the poor to lift themselves higher. And so far as that goes, who could oppose them? But neither report tells us that the hurdles in this race for educational freedom are getting higher by the year as elite incomes move further and further ahead of low- and middle-income Texans, and as tuition increases cater to the elites who don’t need to bring Pell Grants with them.

When the history of the 21st Century is written, it will record early years when Texas enjoyed an infusion of young talent from the South. What Texas did with that bounty of youthful labor and talent is what the next chapter will tell.

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