The latest BLS state-level jobs report for February shows that Texas continues to lead the way in job creation for the last 12 months and keeps the state's near record low unemployment rate of 3.8%. Here's the statement by the Texas Workforce Commission.
The presentation below provides an overview of Texas’ economic, labor market, and fiscal situation while also comparing Texas with other large states. There are also policy recommendations to strengthen the Texas Model of limited government so that it can foster more individual liberty and economic prosperity.
My prior research on how institutions matter takes a deeper dive into these figures. I recommend reading it along with watching my vlog on the subject. To summarize, Texas should increase economic freedom by eliminating unnecessary government barriers to competition to let people prosper.
Watch my explanation of previous state-level labor reports and other videos at my YouTube channel: Vance Ginn Economics.
In this Let People Prosper episode 67, let's discuss the importance of sustaining and improving the Texas Model of no personal income tax, relatively low taxes, relatively less government spending, and sensible regulation that allow entrepreneurs opportunities not available elsewhere. This can be boiled down to: Institutions Matter. Let's recall previous discussions highlighting these key points while noting how Texas led the way in job creation again in 2018.
In this Let People Prosper episode 58, let's discuss education-related issues in Texas of school finance reform, property tax relief, and the Teacher Retirement System (TRS) of Texas pension solvency.
To sum up, taxpayers have increased funding for public schools for years (see here and here) and now it's time for those elevated current dollars to be spent wisely to the classroom for improved education outcomes. School finance also includes property tax relief which should be accomplished by following the TPPF plan of actually lowering property taxes. And the latest TPPF-Reason Foundation paper highlights the mounting problems with the TRS pension that must be addressed soon before the pocketbooks of teachers and all taxpayers are hit.
There's much on the line for education in Texas. Serious discussion about spending taxpayer dollars wisely, lowering property taxes, and assuring the TRS pension system is solvent through reform are essential elements of improving education in the Lone Star State.
In this episode, I discuss the current state of the markets, give a quick recap of the jobs report, and primarily discuss the recent announcement by the Teacher Retirement System of Texas to lower the assumed rate of return and what the implications are for teachers and taxpayers.
In this episode, I explain why we need educational freedom to let people prosper. It's unfortunate that so many students are stuck at a particular school based on a zip code. Here is a list of the 1,343 failing schools across Texas.
Sure, some people already have school choice, but some is not enough. It should be everyone. Sure, the government should probably not be involved in education, but because it is we should demand that every taxpayer dollar be spent as families see fit instead of the government.
We should let each student learn in their unique way through student-centered funding achieved with education savings accounts (ESAs). These accounts allow families to use the dollars for a number of educational services, which can include tuition, tutors, books, etc.
Human capital is one of the main drivers of economic prosperity, let's not fail our students any longer by a public school monopoly (read this) and let's not fail our quality teachers with low pay any longer by a public school monopsony (read this).
Watch the episode to learn more.
In this episode, I discuss the need to eliminate property taxes starting with limiting government spending so state dollars can permanently buy down school maintenance & operations (M&O) property taxes until they are eliminated. I also discuss how the state spending more on education by itself won’t lower property taxes because that’s not how the funding system works.
Here is the paper on eliminating school property taxes (half of property tax burden). Here is a paper on education funding in Texas.
This content was originally featured in the Houston Chronicle on February 5, 2018.
Students across Texas enjoyed a rare snow day - or even two - last week, as ice and snow kept campuses closed from Houston to Tyler to Austin. For most, it was a welcome break, though they knew there would be work to make up when they return.
One critical topic they'll need to address is education.
Although most of the debate has centered on how much money has been or should be spent, the focus should not be on taxpayer dollars spent, but on how to spend that money equitably and effectively. The facts show that Texans need more education for their money, not more money for education.
Texans can prosper by revamping the school finance system through education freedom, not by pouring more money into a broken system. Student-centered funding will ensure that dollars flow to the child and the classroom, not to bureaucratic bloat and infrastructure.
Critics say, as they have always said, that we must spend more. They even contend that Texas has cut funding for public education.
But when the dollars are adjusted for inflation, we see that Texas spends billions more on public education now, on a per-student basis, than the 2004-2005 school year. In fact, education spending is on the rise.
Critics often point to a couple of years - 2008 to 2010 - to show that the Legislature has "cut" school funding. But that's misleading.
It's true that per-student spending was higher, but that was because of a massive, one-time infusion of funding from the federal stimulus bill – the American Recovery and Reinvestment Act.
School district budgets in 2008 also benefited from another phenomenon.
Following a Texas Supreme Court ruling that declared the school finance system unconstitutional, lawmakers enacted a new business margins tax to pay for a reduction in property taxes. But any relief that Texas property owners saw from that cut was short-lived, as appraisals kept their tax bills high.
And that's why it's disingenuous to use 2008 - a high-water mark for education spending in Texas - as the standard. A broader view shows that Texas is spending $23.4 billion more for education than it was in 2004-2005.
But are we getting sufficient education for our money? The evidence says we are not, and the reason is clear. Education spending in Texas is not focused on the students; it's focused on the school system.
In the 2015-16 school year, for example, Texans spent $12,257 per student, with a standard classroom of 20 students receiving roughly $245,000. But teachers - the biggest factor in the quality of education - received only 21 percent of that per-classroom expenditure. The average teacher salary was $51,891.
Where did the money go? In large part, it went to administration.
Since 1993, the number of students in Texas has increased by 48 percent, while the number of staff has increased by 61 percent. Yet the number of administrators and other staff employees, not including teachers, has increased by 66 percent. Our public schools grew rapidly, but their administrations grew more rapidly still.
One study shows that if school districts had kept the growth of non-teaching staff to the same rate as the increase in students, Texas' public education system could have saved $2.2 billion annually or increased each teacher's benefits by $6,318.
What's the solution? We must refocus Texas education on the consumers - students and their families.
The courts have consistently found that Texas education is inequitable on a per-student basis. So that's what our approach should be - equity for students. We should move to student-centered funding, which lets money follow the student and allows parents to decide the best way to meet their children's needs.
Last year, the Legislature created the Texas Commission on Public School Finance. That group has the opportunity to recommend real reform - increasing educational freedom through a student-centered funding model, the kind that research shows will improve educational outcomes.
And when lawmakers are called back from their long break, they'll have the opportunity to make these reforms real, for the benefit of Texas.
Does Texas need more money for public education? This question can cause heated debates, which were on full display during the 85th Texas Legislature’s regular and special sessions.
Although most of the debate has centered on how much money has been or should be spent, the focus should not be on taxpayer dollars spent, but really on how best to increase student achievement.
Read this paper to learn more: https://www.texaspolicy.com/content/detail/texans-need-more-education-for-their-money.
Vance Ginn, Ph.D.