Education Savings Accounts

School choice policies are increasing at a rapid rate, with conventional voucher plans now joined by neovouchers plans funded through donor tax credits as well as plans to fund private schooling through personal tax credits for parents. Into this mix, we can now add Empowerment Scholarship Accounts, the name given by Arizona lawmakers when they adopted the nation’s first Education Savings Account (ESA) plan in 2012. A recent report, The Way of the Future: Education Savings Accounts for Every American Family, promotes these ESAs as well-designed to bring Milton Friedman’s concept of school vouchers into the 21st Century.

A new review of the report, however, finds that it ignores research and lacks fundamental details that could guide policymakers as to the viability of ESAs – much as Friedman’s original voucher proposal also lacked necessary details.

The report, was written by Matthew Ladner and published by The Friedman Foundation for Educational Choice. It was reviewed for the Think Twice think tank review project by Charisse Gulosino, of the University of Memphis, and Jonah Liebert, of Teachers College at Columbia University.

The review was published today by the National Education Policy Center, housed at the University of Colorado Boulder School of Education.

Like conventional vouchers, ESAs are conceived as providing parents with public funds to purchase approved educational services, including private schools, online education, private tutors and even higher education. A parent opting for an ESA would divert state public school funding from the local school and would instead have 90% of that funding amount placed in a personal account designated for these uses.

Gulosino and Liebert observe that the new Friedman Foundation report presenting ESAs as “the way of the future” nonetheless “lacks fundamental information to guide policymakers on their design, implementation, financing, and sustainability.”

Such details are important because they determine the equity, efficiency and cost effectiveness of ESAs, Gulosino and Liebert write. While advocates present the use of public dollars to purchase private schooling as a means to level the playing field, the reviewers see serious equity concerns in the ESA concept.

For example, they note that the Arizona ESA law allows affluent parents to supplement publicly funded accounts with their own resources, enabling them to purchase high-quality educational services inaccessible to low-income families. In theory, an ESA policy—like many conventional voucher policies—could require private schools to accept the ‘voucher’ as payment in full, but the new report does not advocate this. Yet without such limitations, the policy is likely to do little to even the playing field for lower-wealth families.

The reviewers note that the Friedman Foundation’s report also suggests ESAs as a way to sidestep state constitutional language prohibiting the support of religious organizations with public funds. Whether this attempt to avoid church-state limitations would be successful, however, is far from clear, Gulosino and Liebert write.

Finally, the reviewers note, the report fails to consider research that could inform its assertions. “Relevant, peer-reviewed evidence on school choice policies suggest that the claimed academic and economic benefits of ESAs are speculative and overstated,” the reviewers write.

These shortcomings in the report—the lack of any sort of comprehensive, in-depth analysis of ESAs, their design, or their efficacy—make it unsuitable as useful research. Instead, it merely stands as “a propaganda document,” they explain.

Gulosino and Liebert conclude: “While the report claims a better education at lower cost, and a more equitable and democratic provision of education, no evidence is presented to support these claims. In fact, it is more likely that the implementation of ESAs would have exactly the opposite effects.”



The Think Twice think tank review project (http://thinktankreview.org) of the National Education Policy Center (NEPC) provides the public, policy makers, and the press with timely, academically sound reviews of selected publications. NEPC is housed at the University of Colorado Boulder School of Education.