Public education funding is the way in which public schools, including primary, secondary, and universities are financed in the United States (McCann 4). The federal, the state, and the local governments play a significant role in funding public schools. Education is a fundamental need, and as such, the United States supports its schools to make sure that everyone has equal opportunities to receive quality education, and especially for those who are economically deprived. Research shows that public school funding budget has increased over the past 4 decades, and it has been consuming approximately 4-6 percent of the national income (McCann 5). Other studies indicate that federal, state, and local governments spend a significant amount of their income, around 7.3 percent of the GDP on funding public schools (Jackson, Rucker, and Claudia 1). Given that the funds are drawn from the government revenue, financing public education has a direct impact on the economy. Public school funding is also highly associated with the students’ outcomes. On the other disparities have been identified in the way schools are funded. This paper discusses how public education funding in the United States affects the nation.
Public education funding has a direct impact on the country’s economy both positively and negatively. The world is becoming rapidly competitive as a result of globalization and international trade, which increased the need to have an educated workforce. According to Radcliffe (15), “a country’s economy becomes more productive as the proportion of educated workers increases since educated workers can more efficiently carry out tasks that require literacy and critical thinking”. What is more, an educated workforce makes it possible for a country to have a competitive advantage over other nations, which eventually creates a prosperous economy. As such, when a nation finances its education system, they are investing to improve their economic performance. The economic growth in countries with many people having their studies finished is said to be faster than in the countries having less-educated workers. By increasing the competitive advantage in a region, public education funding facilitates the creation of more employment opportunities, which in turn alleviates the level of poverty. However, an educated workforce demands an increase in the wages, which is likely to limit the number of people who can be employed given a certain amount of spending.
The negative aspect of public education funding concerning the economy is that the federal, the states and the local governments use their revenue, which is obtained from taxes to facilitate public education funding. When more people enroll in public schools, more funding is required. The income gains and sales taxes are the primary sources used by states to fund public elementary and secondary schools (Biddle, Bruce, and David 49). This will have a direct impact on the private sector as more tax will be imposed on them by lowering the demands for the local goods and services, as well as increasing the business costs. For instance, an increase in the sales tax will affect a business in the sense that it will have to raise the price of its products or services. Consequently, this will lead to a decrease in the number of buyers increasing the chances of the business closure since the profit margins are low (Sims 7). Also, when a business closes down, it means that people will lose their jobs, and it leads to high levels of unemployment, and eventually, poverty. On the other hand, an increase in the individual tax reduces the supply of labor in the sense that it reduces the households’ disposable income, and the low-income earners are more likely to suffer.
Public education funding affects the nation by increasing the students’ outcome. However, some people argue that financing public schools does not in any way increase achievement among the students. School funding is used to employ not only more but also highly qualified teachers who will also spend more time in classes with the students. School funding enables educational institutions to offer good remuneration to their teachers because a good pay acts as the motivating factor to help students realize their potentials. When more students can achieve their academic goals, it means that they are capable of being internationally competitive, which eventually benefits their country since they can come up with new ideas or exploit their talents. Moreover, funding public schools gives education institutions the money to purchase learning equipment as well as building their infrastructure and creating conducive environment for learning (Biddle, Bruce, and David 49). When students are provided with a friendly environment for education, they are more likely to perform well in their academics.
However, private schools, which are not funded by the government, are associated with higher levels of student achievement. Private schools can pay high-qualified teachers a better salary than the public schools. What is more, private schools have fewer students than the public schools, which mean that they provide a friendlier learning environment, promoting the students’ outcomes. A recent study on the effects of funding on learning outcomes found solid proof that money is a key factor because schools can afford better resources, which are necessary for improving the long-run outcomes of students’ performance (Jackson, Rucker, and Claudia 4).
Another impact that comes along with public education funding is inequalities in the distribution of money. Since most local government depend on property taxes to fund education, areas with higher property values finance their schools better than areas with few businesses (McCann 12). As such, schools located in wealthy districts receive more funding than schools in poor communities. Besides, the public education money allocated for each area by the state government varies based on some factors, such as the number of pupils in a region, the number of students with physical disabilities, and the number of poor students, just to mention a few (McCann 13). The fact that public school funding is not standard all over the countries means that some students receive a high-quality education and stand high chances of employment than others. For instance, students who come from poor districts are more likely to drop out of school because the local government is not financially capable of sponsoring their higher education On the other hand, a student schooling in a public school within an affluent neighborhood is more likely to achieve their academic goals because their local government is well off.
Overall, public education funding has positive and negative direct impacts on the economy of the country. Financing public education enables more children to enroll in school, which produces a large education workforce that facilitates the competitive economic advantage on the international platform. However, it leads to tax increasing, which proliferates the private sector, and also leads to loss of jobs. Most importantly, funding public education enables the students to achieve their academic goals. Lastly, public education funding is primarily associated with inequalities in schools.
Works Cited
Biddle, Bruce, and David C. Berliner. "Unequal School Funding in the United States." Educational Leadership, May 2002, pp. 48-59.
Kirabo, Jackson, Rucker C. Johnson, and Claudia Persico. "The Effects of School Spending on Educational and Economic Outcomes: Evidence from School Finance Reforms." The Quarterly Journal of Economics, Jan. 2015, pp. 1-81.
McCann, Clare. "School Finance". Ed Central, http://www.edcentral.org/edcyclopedia/school-finance/. Accessed 18 Apr. 2018.
Radcliffe, Brent. "How Education and Training Affect the Economy." Investopedia, https://www.investopedia.com/articles/economics/09/education-training-advantages.asp. Accessed 18 Apr. 2018.
Sims, Richard G. "School Funding, Taxes, and Economic Growth: An Analysis of the 50 States. NEA Research Working Paper." National Education Association Research Department, Apr. 2004, pp. 1-30.
