Death of Tax Hike Is a Victory for Kids

Death of Tax Hike Is a Victory for Kids
June 17, 1997

Joseph Bast

Joseph L. Bast c.v. Joseph Bast is president and CEO of The Heartland Institute, a 29-year-old... (read full bio)

Too bad Bernie wasn't here to see it.

Last week, a plan to increase Illinois' income tax died in the Revenue Committee of the Senate. The plan was backed by Governor Jim Edgar (R) and House Speaker Michael Madigan (D), yet only narrowly passed the House. The legislature adjourned without passing any tax increase legislation.

Bernard Pedersen, a state representative from Palatine, was dean of fiscal conservatives in the Illinois House up to his death immediately following last year's election. Bernie (as virtually everyone knew him) had the thankless task of rallying opposition to the tax hikes proposed by Edgar's predecessor, Jim Thompson, also a liberal-leaning Republican.

During the Thompson days, it was difficult to tell a Republican from a Democrat. Thompson used big tax increases, big state "investment" programs, and big increases in social spending to get along with Democrats and buy the favor of special interest groups. It took real courage to stand on principle and vote against the pork. More courage, it turned out, than most Republicans had at the time. Not Bernie, though. More than once, Bernie cast the sole vote against a new spending program or tax hike.

This time, though, the shoe is on the other foot. Only seven House Republicans voted for the tax hike compared to 51 against. (Fifty-five Democrats voted to raise taxes, and only five voted not to.) Bernie, for once, would have found himself on the winning side.

During a radio interview on June 3, Edgar blamed the "right wing" of the Republican party for his plan's defeat. If that is so, then the "right wing" accounts for nearly 90 percent of the Governor's party in the House.

A more plausible explanation is that the broad center of the Republican party is willing, for now, to stand up for such principles as local control, accountability, and no tax increases. Even if that means opposing a popular Governor, and being slandered by liberal editorial writers.

Partisan politics aside, this was a huge victory for taxpayers who would have seen their income taxes go up in exchange for a smaller and probably short-lived amount of property tax relief. The plan was a classic shell game that counted on the general public being too dim to see that their taxes overall were going to be higher and not lower. As word gradually got out, elected officials began to hear from real citizens who opposed the plan.

This was a major victory for kids, too. Shifting reliance for funding from local taxpayers to the state would have made it more difficult to hold schools accountable for efficiency and results, and would have undermined public support for public schools. Dr. John Berthoud, executive vice president of The Alexis de Tocqueville Institution, an independent research organization located in Virginia, estimated that average test scores for Illinois citizens would have fallen 15 percent had the Governor's plan passed.

But what about those school districts that can't afford to spend enough to provide a quality education for every child? As Edgar said on June 3, our reliance on local property taxes means unequal spending by school districts. But this point is much less important than advocates of the tax swap make it seem.

Even the poorest school districts in Illinois spend as much as the average parochial school in Chicago, yet the latter report much better graduation rates, test scores, and college entry rates. (It isn't because parochial schools hire nuns: fewer than 10 percent of teachers in parochial schools are members of a religious order.) If $3,000 is sufficient for these schools, why isn't it sufficient for a government school?

When government schools are given more than the bare minimum needed to operate a school, the additional money is not spent on services or equipment that cause more learning to take place. Instead, it goes to higher salaries and benefits for people who would have worked for less; expensive additions to facilities such as swimming pools, carpeted hallways, and ball parks; and an ever-growing bureaucracy of aides, administrators, supervisors, counselors, nurses, and consultants. No surprise, then, that nearly all research on the subject finds that student achievement is not related to per-pupil spending.

Over the years, our understanding of why some schools fail and others succeed has improved. Experts now talk of a "school culture" that fosters academic excellence and discipline, schools that derive support from the local community, and decentralized and flexible management systems that use competition and choice to reward good decisions and penalize bad ones. Spending more money is far down the list of things that might improve the quality of a school. More money, for example, wouldn't necessarily change a school's culture in a positive direction, and it may even have the opposite effect.

Defeat of the tax swap plan means Illinois might finally be ready to seriously debate the pros and cons of school vouchers and tax credits. Other states, including Wisconsin, Maine, Vermont, and Ohio, empower some parents to enroll their children in private schools, with all or some tuition paid with money that otherwise would have gone to a government school. Taxpayers in those states actually save money every time a parent chooses a private school rather than a government school. Parents love the programs.

Minnesota this year is debating a refundable tuition tax credit of up to $2,000 per family. Giving parents the freedom to choose results in a healthy competition among schools and greater accountability to parents, and (according to a recent study by a Harvard University researcher) higher student test scores. When choice is extended to private schools, the tremendous power of the market is tapped to make schools more efficient and effective.

Could 1998 be the year Illinois adopts a comprehensive statewide voucher program? It is possible. The broad outline for such a plan has been circulating since May of 1996, part of The Heartland Institute's response to the Ikenberry Commission report. A detailed bill was drafted by Rep. Calvin Skinner last year but not introduced. Pilot voucher bills have passed the state Senate twice in recent years. Many elected officials I talk to say, in private, they support the idea of statewide school choice.

Bernie Pedersen was a big fan of school vouchers and choice. Maybe, if such legislation were to be considered in 1998, it could be nicknamed "Bernie's Bill." I think Bernie would have liked that.


Joseph L. Bast is president of The Heartland Institute, an independent nonprofit organization based in Chicago, Illinois.

Joseph Bast

Joseph L. Bast c.v. Joseph Bast is president and CEO of The Heartland Institute, a 29-year-old... (read full bio)