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Opening Arguments

The yo-yo effect

Indiana is heavily invested in the great charter school experiment, so this Cato Institute study is of more than passing interest:

While most students are drawn from traditional public schools, charter schools are pulling large numbers of students from the private education market and present a potentially devastating impact on the private education market, as well as a serious increase in the financial burden on taxpayers.

Private school enrollments are much more sensitive to charters in urban districts than in non-urban districts. Overall, about 8 percent of charter elementary students and 11 percent of middle and high school students are drawn from private schools. In highly urban districts, private schools contribute 32, 23, and 15 percent of charter elementary, middle, and high school enrollments, respectively. Catholic schools seem particularly vulnerable, especially for elementary students in large metropolitan areas.

The flow of private-school students into charters has important fiscal implications for districts and states. When charters draw students from private schools, demands for tax revenue increase. If governments increase educational spending, tax revenues must be increased or spending in other areas reduced, or else districts may face pressures to reduce educational services. The shift of students from private to public schools represents a significant shift in the financial burdens for education from the private to the public sector.

During all the debates over the possible effects, both good and bad, of charter schools, I don't remember a lot of attention being paid to the pressure put on private-school enrollment. This bears close watching under the "beware of unintended consequences" rule. I'm not sure what the proper mix of public and private schools is, but private schools perform an important function so we'd better be careful about messing with them. The situation is even more complicated in Indiana because we've now in the middle of the nation's biggest experiment in vouchers, which has the effect of increasing private-school enrollments. Will charters and vouchers cancel each other out when it comes to private enrollments? My head hurts.