January 13, 2009

Why Tax Cuts for Teachers Are Harmful

Posted by Aaron Tang at 6:44PM

• 1 comment
• Email
• Print
• Reprints
• Share

These days, it's not too rare of an occasion when you unfold your morning newspaper (ok... more likely when you open up your web-browser to your newspaper homepage) and scroll down to see a headline that makes you cringe. Rising unemployment numbers, falling stock values. Violence and death in the Gaza strip, in Iraq, in Afghanistan. Corporate scandals and Ponzi schemes. Tax cuts for teachers.

Wait, what?

Some background: yesterday's NY Times Column by the highly esteemed writer and political commentator Thomas Friedman ran under the headline "Tax Cuts for Teachers," and among the many ideas he puts forward in the column is the exact proposal suggested in the headline.

And now my admission: I intended no sarcasm or sleight of hand when I included that headline in a list of news topics that make me cringe. (Ok, ok, I obviously didn't intend to equate the idea of cutting teacher taxes with the sheer magnitude of the problems raised in the other headlines in the above list, but I do mean that it was a bad headline - if only because Friedman's article raises much more eloquent and well-thought out ideas than the tax cuts).

Cutting taxes for teachers is a horrible idea for two primary reasons, despite what would likely be its moderate impact of encouraging more people to enter the teaching profession.

The first reason why cutting taxes for teachers is a bad idea is that there are far better ways to use the lost tax revenues to further the vital goal of increasing the entry of high quality professionals into teaching. We're talking about real money after all; eliminating income taxes for all teachers could cost somewhere in the ballpark of $20 billion / year (according to respected education analyst Kevin Carey), and increase the average annual teacher salary by somewhere around $6,000.

To be sure, this will necessarily attract some people to consider teaching as a profession, but there are better ways to use the $20 billion: namely, to spend that money in a more targeted fashion to hire new teachers in hard-to-staff fields like math and science, in hard-to-staff districts with higher levels of low-income and minority children, and to pay teachers who aren't just entering the profession but who are actually doing a good job at it as well.

What do I mean by that? For starters, Friedman's basic cut-taxes-for-all-teachers proposal would reward our nation's oldest teachers and those who have the most advanced degrees. This means that a first year teacher making $35,000 (the average annual starting salary) would stand to get something like a $3,500 tax break, while an older teacher making $65,000 a year would stand to receive a disproportionate $10,000 break. Setting aside the fact that research and common experience both indicate that neither of these two factors have much influence on how much students actually learn, ask yourself this: if you were considering entering the teaching profession, under which of the two salary schedules below would you be more likely to make the jump?

Package #A: You start out at $38,500 and maxed out at $75,000 only after 30 years of teaching regardless of how hard you worked or how well your students learned.

Package #B: You start out at $45,000 and can earn up to $75,000 after only a few years if your students make great strides in the subjects that you teach.

Mr. Friedman prefers package A; I think that more people are likely to consider teaching and their incentives are more aligned with what's best for kids under package B. (Full disclosure: it might cost more than $20 billion / year to implement package B if a large number of teachers go above and beyond the call of duty and bring about exceptional student learning in their classrooms - a tradeoff that I am more than eager to make).

There's a second problem with cutting taxes for teachers, and this problem is political. Namely, what about the argument for cutting teacher taxes is so special that it can't be raised (equally effectively) for nurses, firefighters, policemen, doctors? Opening up the treasury to well-meaning educators through a tax cut may strike a harmonious tone in the minds of most Americans, but the tone will grow ever so discordant when most Americans make the logical analytical step: my job is important too, shouldn't I be entitled to some of that tax relief? In other words, what on its face appears to be an easy political sell would, in practice, end up nothing of the sort.

Finally, out of fairness to Mr. Friedman, I have to point out that I think the broad idea behind his recent column is absolutely, 100% correct: in our rush to stimulate the economy today, we can't only invest in "shovel-ready" projects because these projects are band-aids (albeit the highly-necessary kind of band-aid, not the touchy-feely kind). We also need to address the root causes of the problem in America's economy, and no issue is more fundamental in that respect than improving our schools. I just happen to disagree over whether cutting taxes for teachers is a good way to bring about that improvement.