Archives for category: Privatization

Since this is a mostly education blog, I have covered the budget debate by focusing on what the GOP is doing to maim public schools and enrich private (especially religious schools). In the past, Republicans were strong supporters of public schools. But the billionaires came along and brought their checkbooks with them.

The rest of the Ugly bill is devastating to people who struggle to get by. Deep cuts to Medicaid, which will force the closure of many rural hospitals. Cuts to anything that protects the environment or helps phase out our reliance on fossil fuels. Well, at least Senator Schumer managed to change the name of the bill, new name not yet determined.

One Republican vote could have sunk the bill. But Senator Murkowski got a mess of pottage.

David Dayen writes in The American Prospect:

Welcome to “Trump’s Beautiful Disaster,” a pop-up newsletter about the Republican tax and spending bill, one of the most consequential pieces of legislation in a generation. Sign up for the newsletter to get it in your in-box.

By the thinnest of margins, the U.S. Senate completed work on the One Big Beautiful Bill Act on Tuesday morning, after Sen. Lisa Murkowski (R-AK) decided that she could live with a bill that takes food and medicine from vulnerable people to fund tax cuts tilted toward the wealthy, as long as it didn’t take quite as much food away from Alaskans.

The new text, now 887 pages, was released at 11:20 a.m. ET. The finishing touches of it, which included handwritten additions to the text, played out live on C-SPAN, with scenes of the parliamentarian and a host of staff members from both parties huddled together.

At the very end, Senate Minority Leader Chuck Schumer knocked out the name “One Big Beautiful Bill Act” with a parliamentary maneuver, on the grounds that it was ridiculous (which is hard to argue). It’s unclear what this bill is even called now, but that hardly matters. The final bill passed 51-50, with Vice President JD Vance breaking the tie.

Murkowski was able to secure a waiver from cost-sharing provisions that would for the first time force states to pay for part of the Supplemental Nutrition Assistance Program (SNAP). In order to get that past the Senate parliamentarian, ten states with the highest payment error rates had to be eligible for the five-year waiver, including big states like New York and Florida, and several blue states as well. 

The expanded SNAP waivers mean that in the short-term only certain states with average or even below-average payment error rates will have to pay into their SNAP program; already, the language provided that states with the lowest error rates wouldn’t have to pay. “The Republicans have rewarded states that have the highest error rates in the country… just to help Alaska, which has the highest error rate,” thundered Sen. Amy Klobuchar (R-MN), offering an amendment to “strike this fiscal insanity” from the bill. The amendment failed along party lines.

The new provision weakens the government savings for the bill at a time when the House Freedom Caucus is calling the Senate version a betrayal of a promise to link spending cuts to tax cuts. But those House hardliners will ultimately have to decide whether to defy Donald Trump and reject the hard-fought Senate package, which only managed 50 votes, or to cave to their president.

In addition, Murkowski got a tax break for Alaskan fishing villages and whaling captains inserted into the bill. Medicaid provisions that would have boosted the federal share of the program for Alaska didn’t get through the parliamentarian; even a handwritten attempt to help out Alaska on Medicaid was thrown out at the last minute. But Murkowski still made off with a decent haul, which was obviously enough for her to vote yes.

All Republicans except for Sens. Rand Paul (R-KY), Thom Tillis (R-NC), and Susan Collins (R-ME) voted for the bill. Tillis and Collins are in the two most threatened seats among Republicans in the 2026 midterm elections; Tillis decided to retire rather than face voters while passing this bill. Paul, a libertarian, rejected the price tag and the increase in the nation’s debt limit that is folded into the bill.

Other deficit hawks in the Senate caved without even getting a vote to deepen the Medicaid cuts. That could be the trajectory in the House with Freedom Caucus holdouts. But the House also has problems with their handful of moderates concerned about the spending slashes in the bill.

The bill was clinched with a “wraparound” amendment that made several changes, including the elimination of a proposed tax on solar and wind energy production that would have made it impossible to build new renewable energy projects. The new changes now also grandfather in tax credits to solar and wind projects that start construction less than a year after enactment of the bill. Even those projects would have to be placed in service by 2027. The “foreign entities of concern” provision was also tweaked to make it easier for projects that use a modicum of components from China to qualify for tax credits.

The bill still phases out solar and wind tax credits rather quickly, and will damage energy production that is needed to keep up with soaring demand. But it’s dialed down from apocalyptic to, well, nearly apocalyptic. And this is going to be another source of anger to the Freedom Caucus, which wanted a much quicker phase-out of the energy tax credits.

The wraparound amendment also doubled the size of the rural hospital fund to $50 billion. The Senate leadership’s initial offer on this fund was $15 billion. Overnight the Senate rejected an amendment from Collins that would have raised the rural hospital fund to $50 billion. Even at that size—which will be parceled out for $10 billion a year for five years—it hardly makes up for nearly $1 trillion in Medicaid cuts, which are permanent. The hospital system is expected to buckle as a result of this legislation, if it passes.

Some taxes, including a tax on third-party “litigation finance,” were removed in the final bill. But an expanded tax break for real estate investment trusts, which was in the House version, snuck into the Senate bill at the last minute.

The state AI regulation ban was left out of the final text after a 99-1 rejection of it in an amendment overnight.

The action now shifts to the House, where in addition to Freedom Caucus members concerned about cost, several moderates, including Reps. David Valadao (R-CA) and Jeff Van Drew (R-NJ), have balked at the deep spending cuts to Medicaid and other programs.

The American Federation of Teachers released a statement by its President Randi Weingarten:

Contact:
Andrew Crook
607-280-6603
acrook@aft.org

AFT’s Weingarten on Senate’s Big, Ugly Betrayal of America’s Working Families

As we prepare to celebrate our independence, the promise of the American dream, of freedom and prosperity for all, is now further out of reach.’

WASHINGTON—AFT President Randi Weingarten issued the following statement after the Senate passed President Trump’s billionaire tax scam:

“This is a big, ugly, obscene betrayal of American working families that was rammed through the Senate in the dead of night to satisfy a president determined to hand tax cuts to his billionaire friends.

“These are tax cuts paid for by ravaging the future: kicking millions off healthcare, closing rural hospitals, taking food from children, stunting job growth, hurting the climate, defunding schools and ballooning the debt. It will siphon money away from public schools through vouchers—which harm student achievement and go mostly to well-off families with kids already in private schools. It’s the biggest redistribution of wealth from the poor to the rich in decades—far worse, to the tune of hundreds of billions of dollars, than the version passed by the House.

“But if you only listened to those who voted yes, you wouldn’t have heard anything like that. You would’ve heard bad faith attempts to rewrite basic laws of accounting so they could assert that the bill won’t grow the deficit. You would’ve heard false claims about what it will do to healthcare and public schools and public services, which are the backbone of our nation.

“The reality is that the American people have rejected, in poll after poll, this bill’s brazen deception. As it travels back to the House and presumably to the president’s desk, we will continue to sound the alarm and let those who voted for it know they have wounded the very people who voted them into office. But it is also incumbent on us to fight forward for an alternative: for working-class tax cuts and for full funding of K-12 and higher education as engines of opportunity and democracy.

“Sadly, as we prepare to celebrate our independence, the promise of the American dream, of freedom and prosperity for all, is now further out of reach.”

 ###


The AFT represents 1.8 million pre-K through 12th-grade teachers; paraprofessionals and other school-related personnel; higher education faculty and professional staff; federal, state and local government employees; nurses and healthcare workers; and early childhood educators.

Stephen Dyer is a public policy expert, a specialist in school finance, and a former legislator in Ohio. He warned 11 years that vouchers would drive the state budget over a fiscal cliff. The court decision a few days ago proves that he was right on target.

Let this be a warning to all the other states that are adopting vouchers (without the consent of the governed, in every case).

He writes:

Proponents have claimed for years that Ohio and U.S. Supreme Court cases from the program’s infancy allows for explosive growth. Judge Jaiza Page warns, “Not so fast.” Just like I did 11 years ago.

Dyer wrote the following 11years ago:

“Overall, the state is sending nearly $144 million to private schools this year. In 2010-2011, that number was $78.85 million — nearly half the amount. Makes you wonder whether the case upholding Ohio’s Vouchers in 2002 would have the same outcome today. Also makes me want to kind of find out.” — Stephen Dyer on 10th Period blog, Jan. 25, 2014

Now he writes:

I guess we found out Tuesday, didn’t we?

To be clear, I had no idea that anyone would actually file a lawsuit against Ohio’s unconstitutional Voucher system when I wrote that on Blogspot 11 years ago (though I really did want someone to do that). But given the Ohio and U.S. Supreme Court’s rulings on vouchers at the turn of the century, I did question whether the state’s explosive funding of vouchers actually was justified under those rulings.

Guess who else agreed with me? Franklin County Judge Jaiza Page. While I focused in 2014 on the 2002 U.S. Supreme Court case Zelman v. Simmons-Harris, Judge Page focused on the 1999 Ohio Supreme Court case Simmons-Harris v. Goff

Goff reached a similar conclusion as Zelman — that given the program’s then-small educational footprint, both in terms of kids and money — it did not interfere with Ohio’s overall ability to educate its public school students, so the program (which at the time only included Cleveland) was ok.

However, when Goff was decided, the Cleveland Voucher Program cost $5.7 million. The just-passed state budget allocated $2.5 billion over the biennium to the current program.

And that’s where voucher proponents got waaaay out over their skis. I realized this 11 years ago. But now, it’s even more obvious. The programs examined by the U.S. and Ohio Supreme Courts at the turn of the century look very different from the current budget hog Judge Page examined.

And she made that factual difference really clear in her ruling:

“As to the thorough and efficient challenge, the court ultimately held, “[w]e fail to see how the School Voucher Program, at the current funding level, undermines the state’s obligation to public education.” (Emphasis added.) Id. From this language, the Court concludes that the Goff court foresaw a renewed challenge to a larger scholarship or voucher program like EdChoice as an unconstitutional state supported system of private schools. Goff warned that a system that does not create but supports nonpublic schools in a way that jeopardizes the thoroughness and efficiency of the State’s system of public schools violates Article VI Section 2 of the Ohio Constitution.”

Added to this is this incredible fact that was brought out in the court case: 

Not a single penny of voucher money goes to a single parent or student. It goes directly to private, mostly religious schools.

Let me repeat that for those of you in the back:

Not a single penny of voucher money goes to a single parent or student. It goes directly to private, mostly religious schools.

That’s right. This whole money-following-the-kid/parental-choice narrative that voucher proponents are still spilling out is complete, utter Grade A Bullshit.

In 1999, the money did go to parents and kids. Page was quite concerned about this payment change because the Ohio Constitution bans state establishment of religious schools. And if state money flows directly to religious schools that rely heavily on taxpayer subsidies (she mentioned that some private schools have 75% or more of their kids on vouchers), that is establishment and unconstitutional.

“By bestowing participating private religious schools with complete control over prospective students’ participation, the “school choice” here is made by the private school, not “as the result of independent decisions of parents and students.””

It’s as if the original creators of the Voucher program carefully crafted the legislation to pass judicial muster. Then when they got a favorable ruling, the gloves came off.

Oh yeah. One more thing: Not a single penny of the nearly $9 billion we will have spent on vouchers since 1997 has ever been audited. So we have no idea how the money on this unconstitutional program has actually been spent.

But I digress.

Luckily for Ohio’s 1.5 million public school kids, Judge Page recognized the program’s current reality rather than voucher proponents’ fictional account.

Just as your friendly neighborhood blogger did 11 years ago.

Not to brag. 

Well, maybe a little!

Matt Barnum and Richard Rubin of The Wall Street Journal describe the harm that Trump’s One Big Ugly Budget Bill will do to public schools.

They wrote:

Republicans’ tax-and-spending megabill would give the school-choice movement a major, long-sought victory—and deliver an unusually generous tax break to wealthy taxpayers.

The bill includes a new way for taxpayers—whether they are parents or not—to direct tax dollars to private-school scholarships instead of the Treasury. There is an extra twist: It could deliver virtually risk-free profits to some savvy investors.

The proposal has excited school-choice advocates, infuriated public school leaders and stunned tax experts.

“Overnight, this would give millions of students access to the school of their choice,” said Tommy Schultz, CEO of the American Federation for Children, an advocacy group pushing the provision. “This is a revolution within the tax code.”

The American Federation for Children is the far-right wing group created by Betsy DeVos to promote charter schools and vouchers.

The incentive is structured as a dollar-for-dollar federal tax credit. Give to a charity known as a scholarship-granting organization and you would get the same amount subtracted from your federal tax bill. 

It is equivalent to redirecting your taxes to a scholarship-granting organization (SGO), with the benefit capped at 10% of adjusted gross income or $5,000, whichever is greater. That is a far better deal than what is offered by normal charitable donations, which generally just reduce your taxable income and only if you itemize deductions….

For people with appreciated stock, the proposal could be even more attractive than a dollar-for-dollar credit, potentially creating net profits. 

Consider someone who bought a stock for $100 that is now worth $1,100. Selling that stock would trigger capital-gains taxes of up to $238. But under the bill, he could donate the $1,100 stock to an SGO. The government would give $1,100 back and he wouldn’t pay capital-gains taxes. 

He could then buy the same $1,100 stock on the open market. The result? He’s better off than when he started, spending nothing to erase a potential capital-gains tax liability. 

“In terms of something that is deeply offensive to basic tax logic, it’s hard to beat this,” said Lawrence Zelenak, a law professor at Duke University who expects donors to line up every Jan. 1 to take advantage. “Unless you actively hate the charity, you would want to do it…”

A federal program would expand private-school tuition subsidies into states such as New York and California that have resisted school choice programs….

The House bill caps credits at $5 billion annually, which would climb by 5% in subsequent years if the program is heavily used. That bill would run from 2026 through 2029. The Senate version released Monday includes $4 billion annually, starting in 2027 but without an expiration date. 

The credit would mark a significant injection of resources to private education as the Trump administration separately seeks to cut federal grants for public schools. Still, it would pale in comparison to funding for public schools, which receive several hundred billion dollars annually, mostly from state and local governments. 

Democrats hope the breadth of the policy changes will prompt the Senate parliamentarian to determine that it’s out of bounds for the budgetary fast-track process Republicans are using.

Public school advocates say the program would benefit better-off families at religious private schools. “The federal government needs to fund the neighborhood school that serves children from every walk of life,” said Sasha Pudelski, a lobbyist with the school superintendents’ association.

Opponents also say the idea has been rejected by voters. In November, three states voted down school-choice ballot measures.

Note: not only were vouchers defeated in three states last November, voters have rejected vouchers in every state referendum since 1967.

The new tax credit could become a model for Congress to direct money to other causes through the tax code, said Carl Davis, research director at the Institute on Taxation and Economic Policy, a progressive group that criticizes the plan.

Civil rights laws prohibit certain forms of discrimination in schools that receive federal funding, but it isn’t likely this would apply to private schools that benefit from the proposed tax credit, said Kevin Welner, a research professor at the University of Colorado Boulder. The House bill includes a provision barring discrimination against students with disabilities in school admissions; the Senate version doesn’t. 

State voucher plans do not bar discrimination in voucher-receiving schools. They can and do discriminate at will. Some require that families are members of their faith. Some bar LGBT students and families. Some bar students with disabilities. Some bar students with low test scores.

Trump’s funding of school choice is the fever dream of Christian nationalists. With one blow, they eliminate the separation of church and state, they get funding for religious schools, and they gut civil rights laws that barred discrimination.

It also permits the revival of school segregation, under the once-discredited banner of school choice. White Southerners who don’t like “race mixing” have dreamed of this day since May 17, 1954.

Elon Musk left Washington, where he enjoyed the exalted status of being Trump’s brain. He returned to Texas, his new home. Where he launched into a Twitter tirade against Trump.

But he left behind a still large contingent of DOGS (Department of Governmental Subsistence).

Who are they?

ProPublica has been tracking them.

In an effort launched shortly after DOGE’s creation, ProPublica has now identified more than 100 private-sector executives, engineers and investors from Silicon Valley, big American banks and tech startups enlisted to help President Donald Trump dramatically downsize the U.S. government.

While Elon Musk has departed the Department of Government Efficiency, the world’s richest man is leaving a network of acolytes embedded inside nearly every federal agency.

At least 38 DOGE members currently work or have worked for businesses run by Musk, ProPublica found in an examination of their resumes and other records. At least nine have invested in Musk companies or own stock in them, a review of available financial disclosure forms shows.

ProPublica found that at least 23 DOGE officials are making cuts at federal agencies that regulate the industries that employed them, potentially posing significant conflicts of interest. One DOGE member tasked with overseeing mass layoffs at the Consumer Financial Protection Bureau, for instance, did so while owning stock in companies the agency regulated.

At least 12 remain, on paper, employees or advisers of the companies they worked at before DOGE, a review of financial disclosure forms shows. And at least nine continue to receive corporate benefits from their private-sector employers, including health insurance, stock vesting plans or retirement savings programs. These employment agreements could create a situation in which a DOGE staffer would be shaping federal policies that affect their employer.

The people behind DOGE are largely men in their 20s and 30s, most of whom bring no government experience to the task. Many of them previously worked in finance.

ProPublica’s list — the largest of its kind by any news organization — allows readers to gain a comprehensive understanding of the backgrounds of the people assigned to one of the Trump administration’s signature efforts. It comes at a crucial moment, as some of the first-generation DOGE members are leaving the government and a new crop is joining.

“Even though Elon Musk and some of his top officials are shifting their attention to other issues, I see no indication that the DOGE team members who remain will slow down their work to test the legal and ethical boundaries of using technology in the name of improving government services,” said Elizabeth Laird, a director at the nonprofit Center for Democracy & Technology.

While the Trump administration asserts it is the most transparent in history, DOGE operates shrouded by the shadows of bureaucracy.

Many of its staffers have deleted their public profiles, have wiped the internet of their professional backgrounds or were encouraged by leadership not to discuss their work with friends. At the behest of the Trump administration, the Supreme Court halted a court order Friday that would have required DOGE to turn over information to a government watchdog — challenging whether the group will ever be subject to public records requests. The Trump administration has banned DOGE staffers from speaking publicly without approval.

To cast a light on this secretive group, ProPublica began reporting in February on Musk’s influence inside the Trump administration, cataloging who was part of DOGE and how associates of the billionaire tech mogul were taking up senior posts across agencies. Our DOGE tracker, the first such list published by media outlets, is the culmination of hundreds of conversations with sources across government.

Today, we are adding 23 staffers to our tracker, taking the total to 109. They are spread throughout the government, from the Department of Defense to the General Services Administration to the Securities and Exchange Commission.

Open the link to see the list of DOGGIES.

By any measure, Musk failed.

First, he said he would cut $2 trillion from the federal budget. Then, he said he would cut $1 trillion.

Then, he dropped his target to $165 billion.

Even that number is disputed because federal courts keep ruling that DOGS firings should be nullified and workers should return to their jobs. Other “savings” were canceled out by the costs of benefits. By some measures, the DOGS game may have cost money, not saved it.

One thing is certain: the federal deficit will grow after Trump’s first year in office, thanks to tax cuts for the top 1%.

Jan Resseger is a social justice warrior who fights for the underdog. She describes here how Trump’s budget enacts the fever dreams of evangelicals and billionaires. He would change federal aid from its historic purpose–equitable funding–and turn it into school choice, diverting funds from the poorest children to those with ample resources. Since 1965–for 70 years–federal education funding for public schools has enjoyed bipartisan support. Trump ends it.

She writes:

Earlier this week, Education Week‘s Mark Lieberman released a concise and readable analysis of the likely impact for public education of two pieces of federal funding legislation: the “Big, Beautiful” tax and reconciliation bill currently being debated in the U.S. Senate to shape public school funding beginning right now in FY 2025, and also President Trump’s proposed FY 2026 federal budget for public schooling in the fiscal year that begins October 1st.

Trump’s  FY 2026 budget proposal saves Head Start.

Lieberman shares one important piece of positive news about Trump’s treatment of Head Start in next year’s federal budget: “Some programs survived the cut—including Head Start.” In early May, the Associated Press‘s Moriah Balingit reported: “The Trump administration apparently has backed away from a proposal to eliminate funding for Head Start… Backers of the six-decade-old program, which educates more than half a million children from low-income and homeless families, had been fretting after a leaked Trump administration proposal suggested defunding it… But the budget summary… did not mention Head Start. On a call with reporters, an administration official said there would be ‘no changes’ to it.”

Federal funding for U.S. public schools looks bleak.

Lieberman’s assessment of federal public education funding is not so encouraging.  Overall, “The administration is aiming to eliminate roughly $7 billion in funding for K-12 schools in its budget for fiscal 2026, which starts Oct. 1. Several key programs will be maintained at today’s funding level, without an increase: “Flat funding amounts to a de-facto cut given inflation. The administration is proposing to maintain current funding levels for key programs like Title I-A for low-income students ($18.4 billion), the Individuals with Disabilities Education Act, Part B for special education ($14.2 billion) and Perkins grants for K-12 and postsecondary career and technical education ($1.4 billion).”

What has been historically a key purpose of federal public education funding—to compensate for vast inequity in the states’ capacity and the states’ willingness to fund public education—is being compromised.  Lieberman explains that much of federal funding, “is currently geared toward supporting special student populations including English learners, migrants, students experiencing homelessness, Native students, and students in rural schools. Longstanding federal programs that support training for the educator workforce; preparing students for postsecondary education; reinforcing key instructional areas like literacy, civics, and the arts… would disappear. A new K-12 grant program would offer a smaller pool of funds to states and let them decide whether and how to invest in those areas. And for the first time, all federal funding for special education would flow to states through a single funding stream…. Experts view Trump’s budget as part of an effort to roll back a half-century of effort by the federal government to help make educational opportunities more consistent and equitable from state to state and district to district.”

The “Educational Choice for Children Act,” an alarming federal school voucher bill, is hidden inside the “Big Beautiful” bill.

Lieberman worries about the enormous tuition tax credit voucher plan embedded deep in the weeds of the “Big, Beautiful” tax and reconciliation bill now being considered in the U. S. Senate: “Separate from the federal budget process, Congress is currently advancing a massive package of tax changes, including a proposal for a new tax-credit scholarship program that fuels up to $10 billion a year in federal subsidies for private K-12 education. Annual spending on that program could approach the amount the Trump administration is proposing to cut from elsewhere in the education budget.”  The voucher proposal is called the Educational Choice for Children Act (ECCA).

In a separate analysis of the “Big, Beautiful” bill as the House passed it in late May, Lieberman describes this proposed ECCA tuition-tax-credit voucher program: “House lawmakers narrowly approved a sweeping legislative package with $5 billion in annual tax credits that fuel scholarships and related expenses at K-12 private schools. The federal subsidies would come in the form of dollar-for-dollar tax credits for individuals and corporations that donate to largely unregulated state-level organizations that give out scholarship funds for parents to spend on private educational options of their choosing. Any student—even in states that have resisted expanding private school choice—from a family earning less than 300 percent of the area median gross income would be eligible to benefit from a scholarship paid for with a federally refunded donation.”

Lieberman adds: “No other federal tax credit is as generous. The Internal Revenue Service doesn’t currently supply tax credits worth the full donation amount for any cause, as the private school choice scholarship credit would do. The federal government currently offers tax credits on donations for disaster relief, houses of worship, veterans’ assistance groups, and children’s hospitals at roughly 37 percent of the donated amount.  A $10,000 donation to those causes would yield a tax credit of $3,700.  By contrast, under the proposed legislation, if a taxpayer donates $10,000 to a scholarship (voucher)-granting organization, the IRS would give them a tax credit of $10,000.”

The Institute for Taxation and Economic Policy’s Carl Davis explains that because these federal school vouchers are primarily a tax shelter, they might appeal to wealthy people who are not even supporters of school privatization: “The tax plan…  includes a provision granting extraordinarily generous treatment to nonprofits that give out vouchers for free or reduced tuition at private K-12 schools. While the bill significantly cuts charitable giving incentives overall, nonprofits that commit to focusing solely on supporting private K-12 schools would be spared from those cuts and see their donors’ tax incentive almost triple relative to what they receive today. On top of that, the bill goes out of its way to provide school voucher donors who contribute corporate stock with an extra layer of tax subsidy that works as a lucrative tax shelter. Essentially, the bill allows wealthy individuals to avoid paying capital gains tax as a reward for funneling public funds to private schools.” “We estimate the bill would reduce federal tax revenue by $23.2 billion over the next 10 years as currently drafted, or by $67 billion over the next ten years if it is extended beyond its four-year expiration date… As currently drafted, the bill would facilitate $2.2 billion in federal and state capital gains tax avoidance over the next 10 years.”

The Brookings Brown Center on Education Policy’s Jon Valant warns that the vouchers are so deeply buried in the “Big, Beautiful” bill that lots of people would not be aware of the plan’s existence until after it is passed: “The Educational Choice for Children Act (ECCA) continues to move, quietly, towards becoming one of America’s costliest, most significant federal education programs. Now part of the One Big Beautiful Bill, ECCA would create a federal tax-credit scholarship program that’s unprecedented in scope and scale.  It has flown under the radar, though, and remains confusing to many observers…  ECCA’s stealthiness is partly due to the confusing nature of tax-credit scholarship programs. These programs move money in circuitous ways to avoid the legal and political hurdles that confront vouchers.”

Valant explains how tax-credit vouchers work: “Tax-credit scholarship programs like ECCA aren’t quite private school voucher programs, but they’re first cousins. In a voucher program, a government gives money (a voucher) to a family, which the family can use to pay for private school tuition or other approved expenses. With a tax-credit scholarship, it’s not that simple. Governments offer tax credits to individual scholarship granting organizations (SGOs). These SGOs then distribute funds… to families.”

Valant creates a scenario that shows how this tax credit program could help the wealthy and leave out poorer families. A rich donor, Billy, donates $2 million in stock to an SGO: “Billy’s acquaintance, Fred, lives in the same town as Billy, which is one of the wealthiest areas in the United States. In fact, Fred set up the SGO, looking to capture ECCA funds within their shared community… Like Billy, Fred doesn’t particularly care about K-12 public education… It might seem that Fred’s SGO couldn’t distribute funds to families in their ultra-wealthy area, since ECCA has income restrictions for scholarship recipients. That’s not the case. ECCA restricts eligibility to households with an income not greater than 300% their area’s median income. In Fred and Billy’s town, with its soaring household incomes, even multimillionaire families with $500,000 in annual income are eligible… So, Fred is looking to give scholarship money to some wealthy families in his hometown.”

Valant summarizes the result if the “Big, Beautiful” bill is enacted: “This bill would introduce the most significant and costliest new federal education program in decades. It has virtually no quality-control measures, transparency provisions, protections against discrimination, or evidence to suggest that it is likely to improve educational outcomes. It’s very likely to redirect funds from poor (and rural) areas to wealthy areas.”

Jon Valant is doing a great job as Director of the Brown Center on Education Policy at the Brookings Institution in Washington, D. C. He keeps close tabs on federal legislation. What follows is an excellent analysis of Trump’s legislation to use federal funds to underwrite the privatization of federal education funding. The potential for fraud, waste, and abuse is huge, he writes.

He writes:

  • The Educational Choice for Children Act (ECCA) would create a $5 billion federal tax-credit scholarship program through a tax shelter for wealthy individuals.
  • The bill would provide minimally regulated scholarship-granting organizations with a great deal of discretion over how federal education funds are spent.
  • A hypothetical scenario illustrates the possibility of waste, fraud, and discriminatory behaviors.

The Educational Choice for Children Act (ECCA) continues to move, quietly, towards becoming one of America’s costliest, most significant federal education programs. Now part of the One Big Beautiful Bill Act, ECCA would create a federal tax-credit scholarship program that’s unprecedented in scope and scale. It has flown under the radar, though, and remains confusing to many observers.

Recently, a colleague and I showed how ECCA is poised to redistribute funds from poor and rural communities to wealthy and non-rural communities. A study from the Urban Institute drew similar conclusions. Since those pieces were published, ECCA—then a standalone bill—has passed through the House of Representatives and now moves to the Senate. ECCA’s fate remains uncertain, which makes this as good a time as any to examine its potential implications.

How would ECCA work?

ECCA’s stealthiness is partly due to the confusing nature of tax-credit scholarship programs. These programs move money in circuitous ways to avoid the legal and political hurdles that confront vouchers. Tax-credit scholarship programs like ECCA aren’t quite private school voucher programs, but they’re first cousins.  

In a voucher program, a government gives money (a voucher) to a family, which the family can use to pay for private school tuition or other approved expenses. With a tax-credit scholarship, it’s not that simple. Governments offer tax credits to individuals and/or corporations that donate to scholarship-granting organizations (SGOs). These SGOs then distribute funds (“scholarships”) to families.

The U.S. already has 22 tax-credit scholarship programs, but they’re relatively modest, state-level programs. ECCA is different. ECCA would create a massive, federal tax-credit scholarship program, operating across all 50 states, with a current price tag of about $5 billion in the first year (down from $10 billion in the bill’s earlier draft). It offers an extremely generous tax credit. Individuals get a full, 1:1 tax credit (not just a deduction) for their contributions, which fully offsets their contributions. In other words, these “donors” don’t actually give up any money—hence the quotation marks. On top of that, ECCA allows individuals to donate marketable securities (e.g., stocks) rather than cash. This provides an avenue to treat ECCA as a tax shelter and avoid paying capital gains taxes. More on that in a moment.

Most students would be eligible for a scholarship, with the exception of those from households that earn more than three times their area’s median gross income. (More on that in a moment, too.) The list of qualified expenses covers everything from private school tuition to online educational materials.

Rather than go through all of the bill’s details, let’s take a look at a scenario that illuminates what this program could do. Remarkably, this scenario appears—to my eye, at least—fully compliant with the House bill (even if the characters are a bit overstated).

A hypothetical scenario to illustrate some of ECCA’s risks

A ‘donor’ who benefits from ECCA’s tax shelter

Let’s imagine a billionaire, Billy, who couldn’t care less about K-12 education but cares a whole lot about his own wealth. Billy hears about ECCA from an acquaintance who tells him about how much money Billy could save by “donating” to an SGO. Billy’s adjusted gross income (AGI) was $20 million last year. That means, according to ECCA, that he’s eligible to donate $2 million to an SGO this year (10% of his AGI).

Let’s walk through the math for Billy’s donation. Billy is looking to give $2 million in stock shares to an SGO. He bought these shares a few years ago for $1 million and then they doubled in value. That means that Billy’s earnings are subject to long-term capital gains tax if he sells the stock. With his AGI, that would be 23.8% in federal taxes plus another 4.7% or so in state taxes (depending on where he lives). In other words, if Billy sold the stocks today and kept the funds for himself, he’d owe about $285,000 in combined federal and state taxes on his $1 million in earnings (28.5% of $1 million).

By donating the $2 million in stock to an SGO, not only does Billy get his entire $2 million back as a tax credit; he also dodges those capital gains taxes. He’s a billionaire who is $285,000 wealthier for having made this supposed donation. (For a detailed illustration of how this works—and some nice figures—I’d recommend this piece from the Institute on Taxation and Economic Policy.)

A scholarship-granting organization with extraordinary leeway in how to direct ECCA funds

Now, let’s get back to that SGO. Billy’s acquaintance, Fred, lives in the same town as Billy, which is one of the wealthiest areas in the United States. In fact, Fred set up the SGO, looking to capture ECCA funds within their shared community—and, just maybe, for himself. Like Billy, Fred doesn’t particularly care about K-12 education. He does have a penchant for fraud, though, along with a strong distaste for Republicans.

It might seem that Fred’s SGO couldn’t distribute funds to families in their ultra-wealthy area, since ECCA has income restrictions for scholarship recipients. That’s not the case. ECCA restricts eligibility to households with an income not greater than 300% of their area’s median income. In Fred and Billy’s town, with its soaring household incomes, even multimillionaire families with $500,000 in annual income are eligible. In more modest (and rural) areas, the cutoffs aren’t nearlyso high.

So, Fred is looking to give scholarship money to some wealthy families in his hometown. Notably, ECCA doesn’t limit the amount of money that he can give to any one recipient. ECCA just requires that he provide scholarships to at least two students—who, between them, attend at least two different schools—and that he not earmark the funds for any particular student. Fred offers students $100,000 apiece for supplemental tutoring. That might seem like a lot, but, hey, this is high-end tutoring.

A vendor with little oversight or accountability

In fact, Fred stipulates that the funds must be spent at a new tutoring shop, High-End Tutoring, just created by his buddy, a former teacher. ECCA seems to allow that. ECCA also allows Fred to take a nice cut for himself for running the SGO: 10% of the SGO’s total receipts.

No one really knows the arrangement that Fred and his tutoring friend have, if they have one, because there are hardly any transparency or accountability provisions in ECCA (aside from a requirement to obtain annual financial and compliance audits). We also won’t know if High-End Tutoring provides any educational value, because that’s not part of ECCA either. ECCA’s proponents have claimed there’s accountability to the SGO donors, who want to see their generous donations being put to good use. Billy, though, is enjoying his $285,000 money grab and content to leave Fred alone until it’s time for next year’s donation.

An invitation to discriminate—and an attempt to keep local and state governments from intervening

Fred does have one requirement of his own for High-End Tutoring that he doesn’t need to hide. High-End Tutoring isn’t going to serve any children of Republican parents. All students must complete an attestation form—stating that they and their parents are progressive—before receiving any tutoring services from this publicly funded vendor. Across town, another SGO leader is formally excluding LGBTQ+ children and children of LGBTQ+ parents from their pool of scholarship recipients.

ECCA, in its current form, seems to allow all of this, as objectionable as it may seem. And it’s not just an issue with SGOs funding tutoring companies or other supplemental services. Similar issues could arise with private schools, especially in states without strong anti-discrimination protections.

From hypotheticals to reality

The scenario above might seem ridiculous or caricatured, and to some extent it probably is. But the point is, it’s allowable under the proposed legislation, and we should be realistic about how much fraud, waste, and bad behavior a program like ECCA would invite.

Should we not expect wealthy stockowners to jump at the opportunity to exploit ECCA’s tax shelter? Is it unreasonable to think that many of these wealthy donors will look to benefit their own communities through their donations? Have we not seen bad actors creep in when governments offer large checks with hardly any accountability or strings attached?

This isn’t some tiny, insignificant program either. This is a $5 billion federal program that, because of a “high-use calendar year” provision in ECCA, is almost certain to grow 5% annually. In fact, the cost is likely to be considerably higher than thatdue to the foregone capital gains tax revenue. That’s not quite the size of the behemoth federal K-12 programs—Title I ($18.4 billion in FY 2024) and IDEA ($15.5 billion)—but it’s not all that far off.

And let’s be clear about cost, because ECCA certainly isn’t paid for by the contributions of generous donors. Tax credits are would-be revenue that the IRS is no longer collecting. That money is coming from somewhere else in the budget, whether it’s cuts in education spending, cuts to Medicaid or other social services, tax hikes, or increased debt.

This bill would introduce the most significant and costliest new federal education program in decades. It has virtually no quality-control measures, transparency provisions, protections against discrimination, or evidence to suggest that it’s likely to improve educational outcomes. It’s very likely to redirect funds from poor (and rural) areas to wealthy areas.

And, in its current form, ECCA leaves a whole lot of room for waste, fraud, and abuse.

Secretary of Education Linda McMahon released her budget proposal for next year, and it’s as bad as expected.

Carol Burris, executive director of the Network for Public Education, reviewed the budget and concluded that it shows a reckless disregard for the neediest students and schools and outright hostility towards students who want to go to college.

We know that Trump “loves the uneducated.” Secretary McMahon wants more of them.

Burris sent out the following alert:

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Linda McMahon, handpicked by Donald Trump to lead the U.S. Department of Education, has just released the most brutal, calculated, and destructive education budget in the Department’s history.

She proposes eliminating $8.5 billion in Congressionally funded programs—28 in total—abolishing 10 outright and shoving the other 18 into a $2 billion block grant. That’s $4.5 billion less than those 18 programs received last year.

Tell Congress: Stop McMahon From Destroying Our Public Schools

And it gets worse: States are banned from using the block grant to support the following programs funded by Congress:

  • Aid for migrant children whose families move frequently for agricultural work
  • English Language Acquisition grants for emerging English learners
  • Community schools offering wraparound services
  • Grants to improve teacher effectiveness and leadership
  • Innovation and research for school improvement
  • Comprehensive Centers, including those serving students with disabilities
  • Technical assistance for desegregation
  • The Ready to Learn program for young children

These aren’t just budget cuts—they’re targeted strikes

McMahon justifies cutting support for migrant children by falsely claiming the program “encourages ineligible non-citizens to access taxpayer dollars.” That is a lie. Most migrant farmworkers are U.S. citizens or have H-2A visas. They feed this nation with their backbreaking labor.

The attack continues for opportunity for higher education:

  • Pell Grants are slashed by $1,400 on average; the maximum grant drops from $7,395 to $5,710
  • Federal Work-Study loses $1 billion—an 80% cut
  • TRIO programs, which support college-readiness and support for low-income students, veterans, and students with disabilities, are eliminated
  • Campus child care programs for student-parents are defunded

In all, $1.67 billion in student college assistance is gone—wiped out on top of individual Pell grant cuts. 

Send your letter now

And yet, McMahon increased funding for the federal Charter Schools Program to half a billion dollars for a sector that saw an increase of only eleven schools last year. Meanwhile, her allies in Congress are pushing a $5 billion private school and homeschool voucher scheme through the so-called Educational Choice for Children Act (ECCA).

And despite reducing Department staff by 50%, she only cuts the personnel budget by 10%.

This is not budgeting. It is a war on public education.

This is a blueprint for privatization, cruelty, and the systematic dismantling of opportunity for America’s children.

We cannot let it stand.

Raise your voice. Share this letter: https://networkforpubliceducation.org/tell-congress-dont-let-linda-mcmahon-slash-funding-for-children-college-students-and-veterans-to-fund-school-choice/  Call Congress.

Let Congress know that will not sit silently while they dismantle our children’s future.

Thank you for all you do,

Carol Burris

Network for Public Education Executive Director

On May 10, Dana Goldstein wrote a long article in The New York Times about how education disappeared as a national or federal issue. Why, she wondered, did the two major parties ignore education in the 2024 campaign? Kamala Harris supported public schools and welcomed the support of the two big teachers’ unions, but she did not offer a flashy new program to raise test scores. Trump campaigned on a promise to privatize public funding, promote vouchers, charter schools, religious schools, home schooling–anything but public schools, which he regularly attacked as dens of iniquity, indoctrination, and DEI.

Goldstein is the best education writer at The Times, and her reflections are worth considering.

She started:

What happened to learning as a national priority?

For decades, both Republicans and Democrats strove to be seen as champions of student achievement. Politicians believed pushing for stronger reading and math skills wasn’t just a responsibility, it was potentially a winning electoral strategy.

At the moment, though, it seems as though neither party, nor even a single major political figure, is vying to claim that mantle.

President Trump has been fixated in his second term on imposing ideological obedience on schools.

On the campaign trail, he vowed to “liberate our children from the Marxist lunatics and perverts who have infested our educational system.”Since taking office, he has pursued this goal with startling energy — assaulting higher education while adopting a strategy of neglect toward the federal government’s traditional role in primary and secondary schools. He has canceled federal exams that measure student progress, and ended efforts to share knowledge with schools about which teaching strategies lead to the best results. A spokeswoman for the administration said that low test scores justify cuts in federal spending. “What we are doing right now with education is clearly not working,” she said.

Mr. Trump has begun a bevy of investigations into how schools handle race and transgender issues, and has demanded that the curriculum be “patriotic” — a priority he does not have the power to enact, since curriculum is set by states and school districts.

Actually, federal law explicitly forbids any federal official from attempting to influence the curriculum or textbooks in schools.

Education lawyer Dan Gordon wrote about the multiple laws that prevent any federal official from trying to dictate, supervise, control or interfere with curriculum. There is no sterner prohibition in federal law than the one that keeps federal officials from trying to dictate what schools teach.

Of course, Trump never worries about the limits imposed by laws. He does what he wants and leaves the courts to decide whether he went too far.

Goldstein continued:

Democrats, for their part, often find themselves standing up for a status quo that seems to satisfy no one. Governors and congressional leaders are defending the Department of Education as Mr. Trump has threatened to abolish it. Liberal groups are suing to block funding cuts. When Kamala Harris was running for president last year, she spoke about student loan forgiveness and resisting right-wing book bans. But none of that amounts to an agenda on learning, either.

All of this is true despite the fact that reading scores are the lowest they have been in decades, after a pandemic that devastated children by shuttering their schools and sending them deeper and deeper into the realm of screens and social media. And it is no wonder Americans are increasingly cynical about higher education. Forty percent of students who start college do not graduate, often leaving with debt and few concrete skills.

“Right now, there are no education goals for the country,” said Arne Duncan, who served as President Barack Obama’s first secretary of education after running Chicago’s public school system. “There are no metrics to measure goals, there are no strategies to achieve those goals and there is no public transparency.”

I have been writing about federal education policy for almost fifty years. There are things we have learned since Congress passed the Elementary and Secondary Education Act in 1965. That law was part of President Lyndon B. Johnson’s agenda. Its purpose was to send federal funds to the schools enrolling the poorest students. Its purpose was not to raise test scores but to provide greater equity of resources.

Over time, the federal government took on an assertive role in defending the rights of students to an education: students with disabilities; students who did not speak English; and students attending illegally segregated schools.

In 1983, a commission appointed by President Reagan’s Secretary of Education Terrell Bell declared that American schools were in crisis because of low academic standards. Many states began implementing state tests and raising standards for promotion and graduation.

President George H.W. Bush convened a meeting of the nation’s governors, and they endorsed an ambitious set of “national goals” for the year 2000. E.g., the U.S. will be first in the world by the year 2000; all children will start school ready to learn by 2000. None of the goals–other than the rise of the high school graduation rate to 90%–was met.

The Clinton administration endorsed the national goals and passed legislation (“Goals 2000”) to encourages states to create their own standards and tests. President Clinton made clear, however, that he hoped for national standards and tests.

President George W. Bush came to office with a far-reaching, unprecedented plan called “No Child Left Behind” to reform education by a heavy emphasis on annual testing of reading and math. He claimed that because of his test-based policy, there had been a “Texas Miracle,” which could be replicated on a national scale. NCLB set unreachable goals, saying that every school would have 100% of their students reach proficiency by the year 2014. And if they were not on track to meet that impossible goals, the schools would face increasingly harsh punishments.

In no nation in the world have 100% of all students ever reached proficiency.

Scores rose, as did test-prep. Many untested subjects lost time in the curriculum or disappeared. Reading and math were tested every year from grades 3-8, as the law prescribed. What didn’t matter were science, history, civics, the arts, even recess.

Some schools were sanctioned or even closed for falling behind. Schools were dominated by the all-important reading and math tests. Some districts cheated. Some superintendents were jailed.

In 2001, there were scholars who warned that the “Texas Miracle” was a hoax. Congress didn’t listen. In time the nation learned that there was no Texas Miracle, never had been. But Congress clung to NCLB because they had no other ideas.

When Obama took office in 2009, educators hoped for relief from the annual testing mandates but they were soon disappointed. Obama chose Arne Duncan, who had led the Chicago schools but had never been a teacher. Duncan worked with consultants from the Gates and Broad Foundations and created a national competition for the states called Race to the Top. Duncan had a pot of $5 billion that Congress had given him for education reform.

Race to the Top offered big rewards to states that applied and won. To be eligible, states had to authorize the creation of charter schools (almost every state did); they had to agree to adopt common national standards (that meant the Common Core standards, funded wholly by the Gates Foundation and not yet completed); sign up for one of two federally funded standardized tests (PARCC or Smarter Balanced) ; and agree to evaluate their teachers by the test scores of their students. Eighteen states won huge rewards. There were other conditions but these were the most consequential.

Tennessee won $500 million. It is hard to see what, if anything, is better in Tennessee because of that audacious prize. The state put $100 million into an “Achievement School District,” which gathered the state’s lowest performing schools into a new district and turned them into charters. Chris Barbic, leader of the YES Prep charter chain in Houston was hired to run it. He pledged that within five years, the lowest-performing schools in the state would rank among the top 20% in the state. None of them did. The ASD was ultimately closed down.

Duncan had a great fondness for charter schools because they were the latest thing in Chicago; while superintendent, he had launched a program he called Renaissance 2010, in which he pledged to close 80 public schools and open 100 charter schools. Duncan viewed charters as miraculous. Ultimately Chicago’s charter sector produced numerous scandals but no miracles.

I have written a lot about Race to the Top over the years. It was layered on top of Bush’s NCLB, but it was even more punitive. It targeted teachers and blamed them if students got low scores. Its requirement that states evaluate teachers by student test scores was a dismal failure. The American Statistical Association warned against it from the outset, pointing out that students’ home life affected test scores more than their teachers.

Duncan’s Renaissance 2010 failed. It destroyed communities. Its strategy of closing neighborhood schools and dispersing students encountered growing resistance. The first schools that Duncan launched as his exemplars were eventually closed. In 2021, the Chicago Board of Education voted unanimously to end its largest “school turnaround” program, managed by a private group, and return its 31 campuses to district control. Duncan’s fervent belief in “turnaround” schools was derided as a historical relic.

Race to the Top failed. The proliferation of charter schools, aided by a hefty federal subsidy, drained students and resources from public schools. Charter schools close their doors at a rapid pace: 26% are gone in their first five years; 39% in their first ten years. In addition, due to lax accountability, charters have demonstrated egregious examples of waste, fraud, and abuse.

The Common Core was supposed to lift test scores and reduce achievement gaps, but it did neither. Conservative commentator Mike Petrilli referred to 2007-2017 as “the lost decade.” Scores stagnated and achievement gaps barely budged.

So what have we learned?

This is what I have learned: politicians are not good at telling educators how to teach. The Department of Education (which barely exists as of now) is not made up of educators. It was not in a position to lead school reform. Nor is the Secretary of Education. Nor is the President. Would you want the State legislature or Congress telling surgeons how to do their job?

The most important thing that the national government can do is to ensure that schools have the funding they need to pay their staff, reduce class sizes, and update their facilities.

The federal government should have a robust program of data collection, so we have accurate information about students, teachers, and schools.

The federal government should not replicate its past failures.

What Congress can do very effectively is to ensure that the nation’s schools have the resources they need; that children have access to nutrition and medical care; and that pregnant women get prenatal care so that their babies are born healthy.

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Josh Cowen of Michigan State University read the latest GOP tax bill closely. He explains what it contains for schools. It’s a plan to set up tax havens in every state for the wealthiest Americans. It forces vouchers for religious and private schools into every state, even states that don’t want them. It allows every voucher school to determine its own admissions policy.

It enables discrimination. It enriches those who are already rich.

It is a spike in the heart of public schools, which admit everyone and bring people from different backgrounds together.

Cowen is the author of the recently published book about vouchers, called THE PRIVATEERS: HOW BILLIONAIRES CREATED A CULTURE WAR AND SOLD SCHOOL VOUCHERS.