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New Report Debunks Anti-School Choice 'Welfare for the Wealthy' Narrative

May 23, 2024

Just two years after Arizona passed the nation’s first universal education savings account (ESA) program, state taxpayers are pouring billions of dollars a year into subsidizing the education of high-income students, a new Goldwater Institute report reveals. There’s just one catch: nearly all of this “welfare for the wealthy” is going to the aid of public—not private—school families, and has nothing to do with the state’s Empowerment Scholarship Account program.

Indeed, as documented in the new report, The Anti-ESA Double Standard: How Arizona Taxpayers Spend Billions More on High Income Households Through Public Schooling, the Grand Canyon State spends 10-20 times as much money each year subsidizing the education of “wealthy” students through public schooling than it does supporting similarly situated students via the universal ESA program expansion.

Unfortunately, Arizona Gov. Katie Hobbs’ FY 2025 budget proposal—like the talking points of other union activists, media mouthpieces, and Ivory Tower intelligentsia—suggests that certain families are undeserving of financial assistance through the ESA program even as the state actively encourages them to enroll (at even higher taxpayer cost) in the public school system instead.

This incongruity reflects a major discrepancy in the logic of anti-school choice activists: On one hand, they hold that scholarship assistance for children enrolled in private schooling options is too financially burdensome to the state. At the same time, however, they hold that taxpayer spending on children from families of identical wealth in the public school system is to be celebrated—if not increased.

This new report exposes the arbitrary nature and hypocrisy of such positions. Specifically, using data from the United States Census Bureau’s Household Pulse Survey and related government estimates, the report finds:

  • Over 80% of children from higher-income households enroll at taxpayer expense in public schools in both in the United States overall and in Arizona.
  • Arizona taxpayers spend $2-$4 billion a year to subsidize public school instruction for children from households earning over $100,000.
  • Arizona taxpayers spend 10–20 times more money subsidizing public school instruction for children from households earning over $150,000 than they do on similarly situated families who have joined the ESA program from a private or home-based school under universal expansion.
    • Arizona taxpayers spend $1-$2 billion a year to subsidize public school instruction for children from households earning over $150,000, compared to under $100 million for similarly situated universal ESA families.
  • Contrary to erroneous media analyses, Arizona taxpayers spend hundreds (in some cases thousands) more to educate virtually every single grade school student (1st–12th grade) in the public school system than it would cost to educate that same student in the ESA program.
  • By excluding ESA students from the Classroom Site Fund and other state-level per pupil funding measures they received while enrolled in public school, the current statutory framework financially penalized students switching to the ESA program—and needlessly so.

ESA opponents may object that spending on “wealthy” students in the public school system is acceptable because it goes to the public school at large, which aggregates its funding for students of all income backgrounds together. Yet as the report notes, such arguments apply similarly to private education options as well, with major private education providers such as the Brophy Community Foundation reporting that the average family income of recipients who received its tax credit scholarship tuition assistance in 2022-2023 was $45,500—a far cry from any upper income classification.

It is true that the Arizona state constitution requires the provision of free public schooling open to all students regardless of income, but does not mandate such access to students participating in the ESA program. Yet the report notes that this, too, has little bearing on the actual fiscal implications of each system. Just as opponents of the ESA program seek to alter statute to remove ESA access, so too could voters amend the state constitution to establish such legal parity.

Regardless, Arizona lawmakers should seek to empower families of all income levels, not play favorites based upon whether a family chooses a public, private, or home-based education for their children.

Matt Beienburg is the Director of Education Policy at the Goldwater Institute. He also serves as director of the institute’s Van Sittert Center for Constitutional Advocacy.

 

 

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