Public elementary and secondary schools were one of the last public services state and local governments started to slash, as the consequences of Generation Greed’s future selling policies hit home after the year 2000. State colleges and universities, revenue-producing sports excluded, were one of the first. So one does not find additional cutbacks in public higher education employment in New York, New Jersey and Connecticut or the U.S. as a whole from March 2006 to March 2016, particularly since enrollment – and student debt to pay for college — tended to be on the rise over the those years.
One does find a drop in community college employment, generally classified as local government employment, relative to population from March 2006 to March 2016. More recently, politicians have noticed community colleges, and started to invest in them as an alternative to the four-year colleges increasingly impoverished Americans can no longer afford. Perhaps in the near future community colleges and vocational training will also be seen as an alternative to the last two years of high school, which fiscally collapsing and indebted state and local governments can no longer afford.
In the wake of the Great Recession, the number of people working in public education fell relative to the overall population in much of the country, and inflation-adjusted teacher pay fell in many parts of it. There was only a partial reversal from March 2014 to March 2016, and it was mostly in places where school staffing and pay were already relatively high.
Several factors contributed to the trend. First, in some states were the tax burden was already low relative to the personal income of state residents, it was reduced further by anti-tax ideologues. The result was reductions in public services for the non-elderly across the board, including, in the end, elementary and secondary education. Second, with the large Baby Boom Echo (aka millennial) generation exiting school, and smaller generations entering school, the actual need for school workers fell. But in some places with high and rising taxes the demand for school jobs increased, as other high-compensation alternatives for politically influential college graduates diminished. Third, the cost of retired public employees soared, as a result of past taxpayer underfunding in low-tax right-wing states. And as a result of retroactive pension increases scored by powerful public employee unions in (if by “right-wing” people mean having public policy favor the otherwise advantaged at the expense of those with less power) the other type of right-wing, high-tax states, those generally self-described a “progressive.” A review of the data follows.
Across the country taxpayer pension costs for public schools are soaring, and state and local taxes are being increased while money actually spent on education is being cut to pay for it. You see it in California, where a huge tax increase “for education” went exclusively to pensions, and in Illinois, where the City of Chicago’s schools are on the brink of bankruptcy. You see it in Kansas and Oklahoma. In some cases soaring pension costs are the result of past taxpayers’ unwillingness to fund the pensions teachers had been promised, promised for some in lieu of Social Security, which those teachers will not be eligible to receive. In other cases pension costs are soaring because politically powerful teachers’ unions cut deals with the politicians they controlled to drastically increase pension benefits, beyond what had been promised and funded. In many cases there is a mix of both factors.
New York City happens to be the place where the teachers’ union, the United Federation of Teachers (UFT), is perhaps the most guilty, and taxpayers are the least guilty, with regard to the pension crisis. And it the place where the burden of teacher retirement is the greatest. The result is large class sizes despite extremely high public school spending, and a host of services that New York City children do not receive. With virtually all New York politicians in on the deals that have left the New York City Teachers’ Retirement System (NYC TRS) among the most underfunded in the country, however, there has been a desperate attempt to cover up the damage. So the consequences of retroactive pension increases for NYC teachers (and police officers and firefighters) have shown up not so much in education (and policing and firefighting), but in every other public service in New York. And all of this is under Omerta.
If you live in New York State, there is a lawsuit that claims you have it too good. Your taxes are too low, despite being the highest in the country at the state and local level combined, and too much money is being spent on public services other than public schools, such as mass transit, social services, housing, parks, libraries, everything else. The lawsuit has been filed by the Alliance for Quality Education (AQE), funded in part by the United Federation of Teachers (UFT), New York City’s teachers’ union, and the NYSUT, the New York State teacher’s union. It claims that New York State residents have stolen $billions for people working in New York’s schools each and every year for more than a decade. And that as a result we are getting what we deserve: schools that are so bad that at least in New York City and Syracuse, they violate the state constitution.
Of course the AQE is claiming it is suing “the state,” not the people who live in it. But where would “the state” get the additional $billions that those working in education demand be spent on schools? From higher taxes and lower spending on other things, that’s where. The same place that the additional spending on schools that has happened in the past came from. And note that while the claim is that the schools are bad, there is no admission that perhaps that New Yorkers are being cheated by those who work for the public schools. Instead the assertion is the other way around – that those who work in the schools are being cheated by New Yorkers, because they aren’t being given the money they deserve. But how much are the schools getting getting? Let’s go to the Census Bureau’s public education finance data and find out.
Wait until next year! When the U.S. Census Bureau released its 2015 data on public education finance last month, I thought that instructional (ie. teacher) wages and benefits per 20 students in the New York City public schools might exceed $300,000 for that year. But instead it came it came up just short at $297,482. Moreover, total spending per student in the NYC schools also came up just short of Greenwich, Connecticut, at $25,068 compared with $25,737. Thought NYC did spend more per student than Westport ($23,798) or Darien ($20,805).
Those are among the tidbits that can be gleaned from my compilation of this data, for 2015 and (with an adjustment for inflation) 2005. As is my custom, I’m going to provide the spreadsheets now, think about them for a while, and then provide my analysis and express my opinion. The data presented includes revenues and expenditures per student, by category, for the U.S., New York City and other regions of New York State, selected other states, and every school district in New York and New Jersey. In some cases with and without an adjustment for the higher cost of living on the Northeast corridor, which reduces the value of school spending here compared with the U.S. average. A discussion of where the data comes from and how it was tabulated (mostly copied from last year) and links to the new spreadsheets, follow.
I was upset that a summary table that showed how much NYC spends on the largest government functions, including debt service and pensions, and how much of this is funded by locally-raised money, was removed from NYC’s “Budget Summary” documents.
But there is good news. The table, albeit without a column for spending by agency on judgments and claims and without a comparison with prior years, is back in a more detailed document that came out later, the latest “Message of the Mayor,” page 81.
And that allowed me to easily update the tables and charts I produced last year comparing FY2014, Mayor Bloomberg’s last budget year, with FY 2017, as proposed. A spreadsheet with the tables and charts for FY 2007, FY 2014 and FY 2018 as proposed is attached below.
But in the rest of this post, I’d like to review the “Unsaid” about Detroit’s bankruptcy and New York City’s recovery from the 1970s, and their relevance to NYC today. Because in my view, despite all that was written and said about those two past events, few have identified the most important reasons why they actually happened.
About a month ago, the U.S. Bureau of Labor Statistics released 2016 annual average employment data from the monthly Current Employment Survey. It isn’t the most detailed information with regard to local government, but it is the most timely, so I once again put together a series of charts showing the trends.
The data shows that after a period of austerity, local government employment is rising again in New York State. The increases are not large, and in New York City local government employment is still rising more slowly than private sector employment. But in the Rest of New York State the increase in the ratio of private employment to local government has halted. Moreover, elementary and secondary school employment, which soared in the Rest of New York State under former Governor George Pataki’s “everybody onto the payroll to get a pension” policies, is rising again despite (at least according to the latest data I’ve seen) falling school enrollment. And in New York City, private sector (but presumably mostly Medicaid-funded) home health care employment has soared at a pace and to a level that raises questions about what the heck is going on.