Ludwig von Mises Institute

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September 1996
Volume 14, Number 9

Now in its seventh year, the school voucher experiment in Milwaukee, Wisconsin, is held up as a model for the nation. But the Milwaukee Parental Choice Program has found itself fighting its own track record as much as the city's public school establishment. The early cascade of hurrahs has slowed in recent days. This is a thankful development, given the sense of racial entitlement that drives this program and other symptoms of voucher fever.

By the late 1980s much had gone wrong in Milwaukee's public schools. Its high schools had among the nation's highest dropout and teen pregnancy rates, and the lowest standardized test scores. "Milwaukee officials have been holding their public schools 'accountable' for years with disastrous results," wrote the Brookings Institution's John Chubb, a prominent "school choice" advocate.

No argument there. A concerned, if seemingly unlikely, coalition of black separatists, libertarians, and religious conservatives sought to improve matters. They argued that low-income parents ought to have the same purchasing power in education as affluent parents.

Leading the charge among the black separatists was Democratic State Assemblywoman Polly Williams, who later became a heroine to the voucher movement. She had sponsored a bill to allow public-school students in her own Milwaukee to attend private schools with state-supplied vouchers.

It seemed a tough sell, especially to those who doubt that more government spending is likely to solve educational problems. But friend and foe alike knew that Williams, who'd coordinated Jesse Jackson's Wisconsin presidential campaigns, was was tough cookie in a fight.

How tough? By 1990 she had ascended to the rank of General of Education in a Black Panther-style militia run by Milwaukee Alderman Michael McGee. McGee and his group were threatening blood in the streets if the city failed to hand over adequate "reparations" to blacks by 1995.

Williams assured the public that McGee was "just talking," but then added ominously, "this country was built on violence." She also made clear that the main purpose of voucher-style reparations was to "help instill the African-American heritage through history and other courses the public schools aren't interested in." One conservative activist--someone who has dealt with her many times--described her to me this way recently: "Polly Williams is a nut who hates whites."

Yet this strange ideology mutated into a close working relationship with white Republicans, starting with Governor Tommy Thompson, under the guise of conservative educational reform. In March 1990 the Wisconsin legislature passed a modified version of her plan, which Thompson signed the next month.

The state would provide low-income parents in Milwaukee with vouchers good for tuition at participating "non-sectarian" private schools within the city. A voucher would be worth roughly $2,500, adjusted each year to reflect state per-pupil aid to city schools.

Almost 1,000 students, or 1 percent of Milwaukee's public school students, would be eligible to receive vouchers (a cap raised in 1994 to 1.5 percent). Up to 49 percent of a participating private school's enrollment could be voucher students, a level later revised upward to 65 percent.

Conservative-movement maestros such as Jack Kemp, Paul Weyrich, and Bill Bennett saw a two-for-one deal. The voucher plan would weaken the educational establishment in the U.S., they thought, and swell the ranks of conservatives within minority groups whose loyalty liberals had taken for granted for too long.

"In 1963, George Wallace stood in the schoolhouse door to block two black students from enrolling in the school of their choice," the Wall Street Journal said (June 27, 1990) in a shameless analogy. "Now, in 1990, [State School Superintendent] Herbert Grover...is openly trying to block a law that will allow 1,000 low-income children in Milwaukee to use vouchers to attend a private school of their choice."

This equivalent analogy would argue that since blacks were once refused entry to all-white hotels, they should now be able to stay in any hotel of their choice without paying. Full-blown "hotel choice," funded by everyone else, is necessary to make up for past oppression.

Nonetheless, in March 1992, well into the program's second year, the Wisconsin Supreme Court approve the plan, and the revolution was on. But the wheels moved slowly. There was no question that parents with vouchers had more choice; less evident was the quality of the schools they were choosing--or whether the schools would even exist once their kids got there.

In the 1995-96 academic year, two schools, Milwaukee Preparatory and Exito Education Center--each opened after the voucher program began--closed their doors. Milwaukee Prep claimed to have 175 students receiving vouchers; but the real number, said sources, was as low as 20. Likewise, Exito reported 174 voucher students and 90 paying students, but in fact had 124 voucher students and no paying students at all. The two schools reportedly owe the state in the neighborhood of $400,000.

To supporters, the problem was that the Wisconsin Supreme Court changed in the rules in midstream. Last summer the court kept an expanded voucher program from taking effect. Only days before, the legislature had voted to authorize up to 7,250 vouchers for that school year, 15,700 for the next, allow the entire student body to receive vouchers, and allow religious schools to participate.

The injunction, which the court upheld this March, played havoc with the projected budgets of many schools, which were based on the new rules. The closings, advocates say, thus were a self-fulfilling prophecy, ammunition for opponents eager to create "proof" that vouchers don't work.

But there's another side to the story. At Milwaukee Prep and Exito, there seemed little difference between running a school and running it into the ground. Exito's director stood accused of passing nearly $50,000 worth of bad checks, dealing drugs, and misappropriating funds. Meanwhile, DPI officials could not fully audit Milwaukee Prep's books because so many of the financial records were missing.

Even before the school closed, several teachers had left, complaining they had not been paid. This wasn't the first time a school had gone belly up. In the very first year, 1990-91, the Juanita Virgil Academy went under. Of the 15 schools in operation at the end of the 1995-96 year, at least two more, say observers, face imminent collapse. The focus ought to be on the students, not the schools, say program advocates. Fair enough. But if the voucher-receiving private schools are doing a better job than the public schools, it's by a thin margin. University of Wisconsin political scientist John Witte, who amassed five years' worth of data, found that performance among low-income students in private schools at best is on par with a control group of low-income kids in public schools. And Witte is no enemy of the program; he supports its continuation.

Supporters of the plan, like Daniel McGroarty, a former Bush White House speechwriter and author of the book, Break These Chains: The Battle for School Choice, argue that this kind of experiment necessarily involves some bad apples. And if this were a real market at work, he might have a point. Schools not meeting the expectations of customers (i.e. parents and students) ought to be faced with the prospect of getting their act together or going out of business. There is risk in any capitalist enterprise.

But contrary to the advocate's slogans, vouchers do not create authentic market competition, but only the pretense. Like public schools, voucher programs are funded by government money, paid to people and institutions because they fit a politically driven eligibility criterion. Vouchers no more create free-market competition than double-entry bookkeeping makes the post office private.

Another indication the program is defective is the civil-rights analogy propagated by conservatives to defend it. Pro-voucher activists have yet to shake the notion that urban black and Hispanic parents have a right to a voucher made of other people's money.

Even if the U.S. Supreme Court upholds the revised voucher plan--a church-state separation issue is involved this time around--there's going to be a lot more Milwaukee-style bad apples. Replicate the program on the national scale and the prospects for an expensive national failure are vastly enhanced.

Republicans fully intend to "go national" with this. Newt Gingrich and Wisconsin's Steve Gunderson were bent on creating annual "scholarships" in Washington, D.C.. Dan Coats of Indiana and John Kasich of Ohio want to spend $3 billion over five years on vouchers in 100 school districts around the country. James Talent of Missouri and J.C. Watts of Oklahoma have proposed $5 billion in federal funds over seven years for up to a half-million school vouchers, a plan endorsed by Bob Dole.

For sheer taxpayer expense, however, the suggestion of Stephen Moore of the Cato Institute takes the first prize: 5 million students get $2,000 in direct tuition subsidies for a total of $10 billion the first year.

The voucher idea, which gained its notoriety as an alternative to public schools, is thus revealed as a full-blown, Washington-run, big-government program, dishing out billions of tax dollars as an entitlement. Polly Williams and the Black Panthers are surely pleased, especially because it's the Republican Party that has been snookered.

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Carl R. Horowitz is the Washington correspondent for Investor's Business Daily

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