Commentary

Critic Still Misses Mark on Detroit Charter Research

The trouble with doubling down on anti-DeVos criticism

In a recent New York Times op-ed, economics professor and Brookings Institution fellow Douglas Harris declared that Secretary of Education-Designate Betsy DeVos “devised Detroit’s [charter] system to run like the Wild West.” He interpreted the best available research on Detroit charters to say they “performed at about the same dismal level as [the city’s] traditional public schools.”

Critics, including the Manhattan Institute’s Max Eden, sharply challenged the claim. The 2015 CREDO study actually cites Detroit as one of four urban charter sectors that “provide essential examples of school-level and system-level commitments to quality that can serve as models to other communities.”

Impelled to respond to the criticism, Harris revised and extended his remarks. He conceded in the second piece that, according to the 2015 CREDO study, Detroit charters “do look somewhat better than the comparison traditional public schools.” He then sought to explain why the empirically tested finding should not be trusted.

The University of Arkansas’s Dr. Jay Greene wasted little time in thoroughly exposing most of the assumptions in Harris’s follow-up piece. But a couple points deserve further elaboration.

First, not only does Harris speculate Detroit charters “cherry-pick” the best students from the local district with no evidence, but that speculation assumes charters are willingly breaking the law. No Michigan charter is allowed to “discriminate in its pupil admissions policies or practices on the basis of intellectual or athletic ability, measures of achievement or aptitude.” Meanwhile, traditional schools in Detroit can and do: four DPS schools have selective admissions based on academic ability.

Second, Harris suggests that not operating under a proposed system that would have given city leaders the power to restrict choice means Detroit charters operate without accountability. In fact, the legislative package that accompanied bailout dollars to Detroit requires the adoption of an A-to-F school grading system, national accreditation for authorizers to open charter schools in the city and more stringent closure guidelines for failing charter schools.

In terms of raw scores, too many students in the Motor City still lag behind. But CREDO’s measures show that enrolling in a charter school on average yields two to three months of extra learning in math and reading. By the time Detroit school district leaders expect to see any academic progress, a student who opts to enroll in just an average-performing charter today should expect to be years ahead of their peers by the time they’re ready to graduate.

Forthcoming publications from the University of Michigan’s Charter School Research Project may shed further light on the results of educational choice in the city. But for now, the current evidence gives every reason to believe that charter schools provide a net benefit for children and families in Detroit.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

Commentary

Michigan House Rejects Cronyism Bills

‘TIF on steroids’ legislation dead for now

As Michigan continues to recover economically, a Michigan House committee rejected bills that would have taken us back to the “lost decade” way of doing business.

Legislation that would give private developers taxpayer cash died in Lansing today. Senate bills 1061 through 1065, which had passed the Senate, found opposition in the House Local Government Committee. While it is common practice to resurrect lame-duck legislation in a new year, these bills should remain buried.

The reasons are multiple. These bills are unfair to those who are not lucky enough to obtain such a deal and are ineffective as economic growth generators. They also take revenue that might be put to better use somewhere else in government and make it harder to roll back taxes for everyone who is not part of the favored few. Members of the House were clearly unimpressed with the legislation.

The bills were designed to mimic Tax Increment Financing (TIF) programs that traditionally have allowed some units of government to capture new property tax revenues purportedly generated from some new development. That revenue can be used to pay off bonds floated on behalf of a private, for-profit business by, say, a city.

The obvious first use of this law, had it passed, may have been a new soccer stadium and related construction in southeast Michigan. Detroit developers were particularly big backers of the legislation.

Lee Chatfield, chair of the committee, told Gongwer News, “I didn’t feel like it was the best direction for our state to take.”

Fortunately, he wasn’t the only House member to oppose the legislation in what could be a called a ‘profiles in courage’ moment. Speaker Kevin Cotter and other House members did too despite enormous pressure from a non-profit group and well-heeled business interests to vote for the bills.

Chatfield told the Michigan Information Research Service, a Lansing-based newsletter Chatfield believes that “low-tax, low-regulation environment are the tools he would propose to use to attract industry, business and talent to Michigan.”

The bills died on a day of great news about Michigan’s growing economy, underscoring just one reason that such bills are unneeded. The Bureau of Economic Analysis reported that Michigan had the fastest economic growth (as measured by its gross domestic product) of any Midwest state in the second quarter of 2016.

This type of legislation does not necessarily foster economic growth, and academic literature has painted an unflattering portrait of its effectiveness. A 2015 study out of Indiana’s Ball State University, as one example, reported that “TIF districts in Indiana were actually associated with less employment, less taxable income and slightly higher tax rates.”

The deals are also unfair. Those developers not lucky enough to strike such deals are put at a competitive disadvantage. Their own tax dollars, paid on income generated from their unsubsidized investments, are used against them.

The end to this legislation is Christmas come early for most taxpayers and developers alike.

Editor's note: This column was updated with additional comments.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.