Goldwater Institute

It’s been said that federal money is like a drug: once you have a taste for it, you want more. When that happens, the drug dealer has power over the user.

For decades, the federal government has hooked the states on federal taxpayer money. The number of federal aid programs for state and local government grew from 327 in 1965 to 1,122 in 2010. Sixty-five percent of that growth has occurred since 2000. Today, the federal government spends over $650 billion on these programs.

The lion’s share of these programs is not state and federal partnerships like the federal highway system. Transportation programs only account for about 10 percent of the total – the third biggest chunk. The biggest portion is health and welfare programs (accounting for 55 percent), and the second largest is education (20 percent).

Some states, however, are more prone to this addiction than others. Arizona, for instance, is practically a ward of the federal government. Arizona’s federal aid as a share of total state expenditures in 2011 was at least 30% according to the most recent Census Bureau data. This puts Arizona in the top ten of all states. Some of this is certainly a function of demographics, poverty rates, and the presence of federal and Indian land. But some of it is self-inflicted.

“Free” federal money is quite an enticement for some policymakers. For instance, federal matching funds have been part of the rationale Governor Brewer’s office has put forward for expanding Arizona’s Medicaid program. Yet the federal government often pulls its share of the funding stream at a later date, leaving state taxpayer’s on the hook for a program they may not have supported in the absence of the federal subsidy.

States can avoid much of this dependency on the federal government – and the strings that always come with federal money – by simply refusing to expand state programs for the purpose of getting federal matching funds. And federal policymakers looking for ways to balance the U.S. government’s budget can look to state and local funding as part of any budget-cutting package. Such a move would not only encourage more prudent decision-making by state policymakers but it would also help restore federalism like the U.S. Constitution’s authors envisioned.

Learn more:

Census Bureau – State Government Finances 2011

State Budget Solutions – Federal Aid to State Budgets Rise . . . But is the End Near?

Cato Institute – Federal Aid-to-State Programs Top 1,100

Reason – Get States off the Federal Dole

Goldwater Institute - Arizona's Struggle for Sovereignty: The Consequences of Federal Mandates

Everyone would like to be first in something. First across the finish line. First one picked for a team at recess. First one to explore uncharted waters. Thanks to Arizona's private school scholarships, Sarah is going to be the first person in her family to go to college.

"She continues to inspire me everyday, and she is so gifted and smart," her mom, Star, says. Sarah attends St. Gregory College Preparatory School using a scholarship awarded by a school tuition organization. In Arizona, individuals and businesses can make charitable contributions to these organizations and receive a dollar-for-dollar tax credit for their donation. Individuals can contribute $1,000 and married couples can donate up to $2,000, while statewide, the total amount of tax credits to businesses for their donations cannot exceed $20 million (this limit increases by 20 percent annually).

More than 30,000 scholarships were awarded to Arizona children in 2011, including scholarships to 115 children with special needs and more than 4,500 low-income students.

For children trapped in failing schools or assigned to schools that simply aren't a good fit, these scholarships are a lifeline. "Sarah believes she can change the world. There is no doubt in my mind that she will and already is," Star says.

Sarah’s favorite classes are biology and geometry, and she admits, "I'm not a big fan of English, but I love to write." Last fall she had A's in every class but one.

In 2011, Arizonans gave $51 million to scholarship organizations to give children better school opportunities. Sixty-nine businesses gave a total of $11 million. Policymakers can make it easier for businesses to contribute funds by streamlining the donation system and allowing S-corps, or incorporated small businesses, to make contributions.

Sarah still has a few years to go before she applies for college, but she wants to major in environmental studies with a minor in architectural history. The scholarship to St. Gregory is helping to make her dream for her life possible.

Learn more:

Goldwater Institute: Tax Credit Scholarships: Questions and Answers

Goldwater Institute: Tax Credit Scholarships Encourage Big Dreams

AZCentral: Range of school options allows children to thrive

Todd, a public school English teacher, and Andrea, a former teacher, know the value of a good education. So when it came time to decide how to teach their four children, they considered several different options.

“We’ve both been in the public school system and went to public schools ourselves. We decided that we would be able to educate our own children more efficiently than the public system can,” Todd says.

As a homeschool family, Todd and Andrea can advance their children at their own pace and set expectations as high as they need to for each one. Jesse, age 11, excels at math and is already 2-3 grades ahead of her peers in traditional schools. “We are able to address the specific needs of each of our children both in terms of their educational needs and their behavioral needs,” Todd explains. He expects all of his children will be taking courses at the local community college by the time they are 15 or 16.

More than 22,500 Arizona families homeschool their children and some 2 million children are homeschooled nationwide.  Each year, Arizona Families for Home Education, the state homeschool association, hosts a conference; more than 5,000 families attended in 2011. At the conference and through homeschool groups parents share best practices and learn about different teaching approaches like Charlotte Mason, which focuses on short lessons and focused reading sessions, or the Classical method, which emphasizes grammar, logic and rhetoric.

Todd says Arizona has a lot to offer homeschool families. “There are a lot of resources and homeschooling communities in Arizona,” he says, “and more opportunities than any one family could ever take full advantage of.”

Learn more:

Arizona Republic: Thousands of Arizona children are being homeschooled

National School Choice Week: Official Website

Jen’s son, Maxwell, is highly intelligent. Jen recognized this early in his life, but she also saw the difficultly he had in some social situations. Anticipating the challenges he would face in a traditional classroom, Jen enrolled him in Benchmark Charter School.

Benchmark uses ability grouping and multiple-teacher classrooms to provide instruction that helps both excelling and struggling students move at their own pace. Jen says this approach “has done wonders because … [Maxwell] is taught to his ability so he can learn with the higher learners in the group,” she says.

Benchmark is one of 535 Arizona charter schools, independent public schools that operate free from most state restrictions in exchange for higher levels of accountability. Charter schools face regular financial audits like traditional schools, but charters are also subject to academic review and can be closed for low levels of student achievement.

Charter schools’ freedom to choose their own curriculum and school mission allows some schools to focus on math and science while others design their classrooms around art and literature. The result is hundreds of different schools parents can choose from to provide unique challenges to their children.

Two of the best schools in the country are Arizona charter schools, according to Newsweek.

Jen thinks Benchmark’s approach to instruction helps all students in Maxwell’s class: “None of them feel excluded and they can learn at their own pace. A superior product comes out of it for all of the groups,” she says.

Learn more:

Goldwater Institute: Comparison of Traditional Public Schools and Charter Schools on Retention, School Switching, and Achievement Growth

Arizona Charter Schools Association: Official Website

The Daily Beast: America's Best High Schools 2012

National School Choice Week: Official Website