Thursday, March 25, 2010

Balancing the budget on the heads of children

This tax year, California has deducted the income tax exemption to 1/3rd of its original value. The state has also significantly cut spending on education, and taken away money that was supposed to go to schools.

I guess they figure that children can't vote, so they most be a great target for tax increases and revenue cuts.

Still, you have to wonder where all the money goes. With some of the highest sales tax and income tax rates in the nation, why does California have so many budget problems?

Well, part of it must have to do with the tendency to spend everything that comes in when times are good, then attempt to balance the budget by borrowing when times are "not so good". These loans do eventually come due. D'oh!

Similarly, labor relations are not the state's forte. When times are good, they are willing to give great benefits to workers. When times are bad, well, its difficult to take those away. (Though they have had a little success with furloughs, there still is the huge pension liability.)

Excess regulation also hurts things. Propositions lead to all sorts of craziness. And court cases don't help. California has some of the most expensive property values around, yet some of the lowest property taxes. And those taxes are often sucked up by the state instead of sent to the schools and cities. Schools can't raise property taxes, so they are stuck asking for parcel taxes and doing sneaky tricks with bond money. The parceling out of money from other sources leads to the ""not my money" problem, and thus crazy spending.

Schools in general bring out other questions. Why are schools suffering so much? The population has increased significantly, while the school-age population has declined (with the public school population being smaller still.)

In a lot of the Bay Area, the schools are long since paid for. Even with a 30 year bond, the debt from the school building would be long gone. Maintenance may be higher for older buildings, but we are in a temperate zone where utility costs, even in buildings with poor insulation, would not be too terribly high. As a bonus, the districts often lease out some of their schools to other private schools. Thus, they get an additional source of revenue from the schools. (If they are not making a profit from this leasing, then that is another big problem...)

Schools have also outsourced transportation. Parents generally drive their kids to school. Very few school buses exist, and walking and biking are rare.

Incidental school costs are also footed by parents. Supplies, field trips, parties, and even library books are paid for by parents or PTA organizations.

Taxes? Well, supposedly all properties will increase 2% per year, with greater bumps for property changing hands. An increasing revenue should easily cover a relative stable population. Occasionally new housing developments will pop up, adding new students. However, these should also add a nice bump to revenue. (This assumes that property tax revenue actually makes it to the schools, a thought which borders on wishful thinking.)

So, it comes down to the classroom. Computers and technology. On one hand, computers are deemed to be a vital educational tool. On the other hand, schools assume that students have computers at home in order to carry out assignments. If they can do the work at home, why do they need them at school? The cost of obtaining the computers, as well as networking, housing and maintaining them is not trivial. And that doesn't include time wasted on them. Typing is a useful skill. However, significant time and effort is needed to develop good typing skills. Unfortunately, computer time is often spent playing "educational games", which tends to be a great way to waste time.

Then there are teachers. When they want more money, they are highly skilled professionals that bring unique talents to the classroom. When layoff time comes, they are replaceable cogs to be removed based on union seniority. The state and nation over-regulate the teaching profession, turning schools in to education "factories". The teachers union responds by unionizing the teachers as they would factory workers. School administration does some of both, spending countless hours dealing with state regulations and union "rules". What happened to simple teaching?

The current regulatory environment has also encouraged the very inequality among schools that it sought to avoid. Poorly performing schools are more likely to lay off teachers and pay less. Better schools can pay more and hit up parents for more money when needed. The better schools have better test scores. The bad ones have bad scores. The same teacher or principal will look good at one and bad at another. So which one would you like to work at?

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