Persisting Inequities in Education in Spite of Increasing Investment

Julissa Vargas
Writ340EconSpring2024
10 min readApr 30, 2024
Photo by Ivan Aleksic on Unsplash

In public K-12 education, significant disparities in school funding results from the history of discrimination and inequality in the United States (U.S.). Historically, schools with a greater proportion of students of lower income backgrounds and students of color have received less educational funding relative to schools with greater proportions of affluent and white students. Since the 1960s, scholars have raised concerns about the American school finance system which in some cases violates federal and state laws that ensure equal access to public services. In 1989, the Kentucky Supreme Court ruled in Rose v. Council for Education that every student must have an equal opportunity to have an adequate education, which implied that “equal funding was not sufficient, and articulated a stand closer to equality of outcomes for students in low-income districts” (Lafortune et al., 2018, p. 5). Thus, for decades, education policy experts have recognized the need to reform the education funding system in the U.S. due to inequitable outcomes for historically disadvantaged students, which include students from a lower-socioeconomic background, students of color, English language learners (ELL), and students with disabilities. Still three decades after the Rose v. Council ruling, equal funding for all schools is not enough to close the achievement gap for historically disadvantaged students.

Although funding all schools equally will not be enough to counteract social inequities, several education researchers have shown that increased school funding has a positive impact on student achievement levels, such as graduation rates and test scores, in the short and long term. Miller (2018) estimated that increasing school spending by 10% would improve graduation rates between 2.1 and 4.4 percent and test scores by 0.05 to 0.09 standard deviations (p. 2–3). Wenglinsky (1997) postulated a possible relationship between economic resources and school environment such that increasing per-pupil expenditures improves school environment by increasing teacher morale and administration productivity which contribute to greater academic achievement (p. 224–225). Despite the demonstrated importance of increasing school funding for improving student achievement, schools with the most historically disadvantaged students are currently still significantly less funded than schools serving historically advantaged students. According to a 2022 report from the Education Trust, “across the country, districts with the most students of color receive 16% less state and local revenue than districts with the fewest students of color” (p. 5). Their report also found that districts with the most ELL students receive less revenue than districts with few ELL students, which is particularly concerning because general consensus among education researchers is that ELL students need more resources and investment in order to have equitable education outcomes but these funding gaps don’t allow them to have this.

State and federal governments recognize the importance of addressing the funding gaps in low income districts by increasing the additional aid to schools. According to Lafortune et al. (2018), in 26 states that have implemented school finance reforms aimed at reducing achievement gaps, the average revenues per pupil have increased between 30 percent for high-income districts and over 50 percent for low-income districts and in these states, low- and high- income districts have been in rough parity since around 2001 (p. 2). The closing of the gap in average revenue between low-income and high-income districts in these financial reform states demonstrates that state legislation and judicial intervention have caused state and federal governments to intervene to gradually equalize the funding in low-income and high-income districts. The increased spending on education does have a positive impact on student outcomes; however, simply providing equal funding to all schools regardless of need or student demographics is not enough to achieve equity and close the achievement gap for historically disadvantaged students. Kang’s (2021) findings show that New York State, the state that spends the most on public education and has a relatively equitable funding policy, spent US$22,394 per pupil in the Pittsford Central School District (PCSD) and US$23,289 per pupil in the Rochester City School District (RCSD); however, the PCSD had a 96% graduate and 1% dropout rate, while the RCSD had a 52% graduation and 22% dropout rate (p. 961). Contrary to the fundamental assumption among education policy makers that parity in per-pupil spending will lead to equitable educational outcomes, the large gap between Pittsford and Rochester’s graduation and dropout rates imply equal funding is not enough to close achievement gaps between high- and low-poverty schools. In order to support a well-educated public and improve society for all, all students should have a quality education.

Because each state or local municipality determines the tax rates for their jurisdiction region and the portion of tax revenues that is invested into public education, educational funding varies drastically by region. In the majority of states, local property taxes make up the majority of the revenue that goes to local schools. Additional state funding varies by state, as some states give a flat rate of aid to all districts regardless of need while others provide aid depending on how much need each district has. This has allowed some states to provide extra educational funding to districts with higher levels of low-income students or ELL students; however, the Education Trust (2022) reports that none of the states included in their study have been able to give districts equal or extra funding to their schools with the most students of color, students from low-income backgrounds, and English language learners (p. 11). Most states focus on the needs of one particular group of these students, such as California which concentrates state funding aid to high poverty school districts and doesn’t prioritize additional funding to districts with a large concentration of ELL students or students of color. Therefore, in every state, at least one group of historically disadvantaged students receives less state funding than other school districts which contradicts the underlying assumption that public education should give every student an equal opportunity to receive adequate education.

While some states and districts achieved school funding parity, in other cases, the funding disparities are so great that even additional state aid is not nearly enough to allow high poverty school districts to be up to par with spending levels of low poverty school districts. Baker (2014) highlights the example of districts near Chicago, Illinois, which is persistently one of “the most fiscally disadvantaged large urban districts in the nation,” to demonstrate that the City of Chicago School District receives about half of its total revenue from state aid but is still spending over US$10,000 less per pupil than the most wealthiest school district nearby (p. 12). The Chicago-area schools demonstrate the drastic impact that income and racial segregation in housing patterns has on the educational experiences of students.

As the Education Trust clearly states, “local revenue is mainly derived from local property taxes, which is inherently inequitable” (p. 12). For many centuries, racial segregation in the U.S. was supported by legislation and in recent history, communities of color were still denied access to live in certain neighborhoods due to redlining and economic discrimination from banks providing housing loans. Thus, housing inequality still has a very significant impact on how much communities with majority historically disadvantaged students are able to raise to support their local school districts. Many states still fail to recognize the influence of discriminatory social systems on the limited ability of low-income districts to be able increase funding to an equal level. States like Michigan give additional state aid funding to all school districts, which doesn’t help close the gap of funding disparities and actually serves to increase the school revenue gap by an additional $5,000 between the highest poverty districts and the lowest poverty districts (Baker, 2014, p. 17). The increasing wealth gap in the U.S. may even further the gap between wealthy and low-income school district spending.

Kang (2021) suggests that parents purchase good public education like a private good through investing in properties that are in a good, well-funded school district (p. 965). Parents’ willingness to pay for a good public education results in wealthier parents choosing to pay higher property taxes and housing prices in exchange for a better quality education for their children. In this sense, education is becoming less of a public good and more of private good that people can purchase, which may be concerning because students who have been historically disadvantaged will most likely not have the means to “purchase” a good public education. The privatization of education will make it even more difficult for lower income students to catch up to the academic achievement levels of their more affluent peers because they don’t have the same resources to invest in their education. However, as a public good, education should not be a resource that students have to pay for or compete by proxy in the housing market.

Some argue that historically disadvantaged students can still attend better quality schools through government scholarships to private schools or charter schools (Lueken and Shuls, 2019). Though this is a good solution, the schools that students are opting not to attend will still continue to be underfunded and be at a disadvantage resource-wise. Typically, only a limited number of students are able to have school choice due to restraints in funding available, so other students who remain at these schools will still be disadvantaged. In the best interest of all society, all school districts should be providing a good education regardless of the community they are located in. Instead of parents buying into the inequitable school funding system, parents can help by joining parent associations at schools and advocating at their district and state’s school board meetings to bring attention to providing all schools with equal funding.

Unfortunately, since inequality and disparities persist in so many other aspects of American society besides education and property wealth, the prospects of lower-income schools with a large proportion of historically disadvantaged students achieving adequate funding for their needs is quite small. As Baker (2014) argues, “while local taxation decisions play some role in increasing disparities, districts disadvantaged by savage inequalities really have no way to dig themselves out, no matter how high they might try to tax themselves” (p. 8). Now lower income families are finding it increasingly difficult to achieve upward mobility due to the growing income gap (Lu, 2020). Additionally, Black, Latinx, and lower-income populations are more likely to face barriers in access to social capital, higher education, job opportunities, and availability to be active advocates for their students (Kocchar and Moslimani, 2023). Because historically disadvantaged students face these additional systemic barriers, they arguably need more educational opportunities to give them an equal opportunity in their future as their more affluent and advantaged counterparts. Inequity is embedded systemically in American society so it becomes even more important for state governments to do more to intervene to offset funding inequities that historically disadvantaged students would not be able to face.

Some argue that even with state funding finance reform to provide additional funding for schools in need, historically disadvantaged students still will not be able to catch up to their peers. Blake (2014) even raised concerns about more affluent school districts increasing their spending on schools to outspend disadvantaged school districts if states increased funding to schools with more need (p. 32). As long as wealth disparities persist, students of more affluent backgrounds that have historically been advantaged by public education systems will continue to have higher academic achievement rates because their parents have more power in the form of wealth and ability to invest in their education. If we want schools to be funded equitably for a sustainable period of time, the government needs to have more intervention than just providing all schools equal funding. Economic reforms should establish more regulation of the distribution of wealth and opportunities to economic resources so that there aren’t such drastic disparities among wealthy and lower income families. Furthermore, educational funding is just one part of the solution of creating more equitable educational outcomes for all American students. Education policymakers must intervene on other factors such as having fair access to effective teachers and curriculums and making it more feasible for families of students of historically disadvantaged backgrounds to have a voice for their students.

As Grubb (2009) stated “dollar bills do not educate children. Teachers with particular instructional approaches, principals capable of instructional leadership, schools with supportive climates, and many other resources do” (p. 52). Progressive school funding reforms haven’t been enough to close the achievement gap, suggesting that education leaders should create additional education reforms to improve academic achievement for historically disadvantaged groups. In his review of educational reform strategies, Schmoker (2009) argued that engaging educational practices, such as frequently having purposeful classroom discussions, and coherent, high quality curricula with monitored implementation had the most positive impact on closing the achievement gap. Goldstein (2018) emphasizes the importance of lower-achieving students learning alongside their high-achieving peers for improving standardized test score performance, implying the need for more heterogeneous school districts which may be achieved by reducing wealth and housing inequality. Increasing school funding alone won’t be enough to achieve the equitable educational outcome education leaders desire, and reform efforts should also be aimed at improving educational quality and experiences especially for historically disadvantaged students.

References

Baker, B. D. (2014). America’s Most Financially Disadvantaged School Districts and How They Got That Way: How State and Local Governance Causes School Funding Disparities. In Policy File. Center for American Progress.

Goldstein, D. (2018). Educators Turn to Programs for Top Students to Narrow the ‘Excellence Gap.’ New York Times (Online).

Grubb, W. Norton. (2009) The Money Myth: School Resources, Outcomes, and Equity. New York: Russell Sage Foundation

Kang, E. (2022). Whose money matters in public education: A “public” good that parents purchase. Policy Futures in Education, 20(8), 960–985. https://doi.org/10.1177/14782103211034348

Lafortune, J., Rothstein, J., & Schanzenbach, D. W. (2016). School Finance Reform and the Distribution of Student Achievement. In Policy File. Institute for Policy Research, Northwestern University.

Lu, M. (2020, September 2). How has social mobility in the U.S. changed in recent decades? World Economic Forum. https://www.weforum.org/agenda/2020/09/social-mobility-upwards-decline-usa-us-america-economics/

Lueken, M. F., & Shuls, J. V. (2019). The Future of K-12 Funding: How States Can Equalize Opportunity and Make K-12 Funding More Equitable. EdChoice.

Miller, C. L. (2018, January). The Effect of Education Spending on Student Achievement. In Proceedings. Annual Conference on Taxation and Minutes of the Annual Meeting of the National Tax Association (Vol. 111, pp. 1–121). National Tax Association.Chicago

Pew Research Center. (2023, December 4). 2. Wealth gaps across racial and ethnic groups. Pew Research Center; Pew Research Center. https://www.pewresearch.org/2023/12/04/wealth-gaps-across-racial-and-ethnic-groups/

The Education Trust. (2022). Equal Is Not Good Enough: An Analysis of School Funding Equity across the U.S. and within Each State. In ERIC. https://files.eric.ed.gov/fulltext/ED626472.pdf

Wenglinsky, H. (1997). How Money Matters: The Effect of School District Spending on Academic Achievement. Sociology of Education, 70(3), 221–237. https://doi.org/10.2307/2673210

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