One of the tough issues that Eliot Spitzer must face after (almost certainly) getting sworn in as New York’s next governor will be the final judgment by the state’s court of appeals in the 13-year-old Campaign for Fiscal Equity v. New York lawsuit. Based on its past rulings, the high court, which heard arguments in Albany in October, probably will hold that Gotham is entitled to almost $5 billion a year in extra state funding for its schools—close to the amount that the trial court ordered last year.

This outcome will give Spitzer a huge political migraine. On the one hand, the forces that backed the CFE lawsuit—the teachers’ union, the education-industry interests, the New York City
Democrats—represent the heart of Spitzer’s liberal political base and wait eagerly for a big payoff. On the other hand, the billions in higher taxes needed to pay for the increased funding for the city’s schools will make it impossible for Spitzer to fulfill his campaign promise to rescue the state from its looming fiscal crisis. To complicate his life further, other urban school districts are poised to make their own financial claims on the state, based on this new legal precedent. The CFE plaintiffs conceded in oral arguments before the high court that the total bill to the state from all the districts’ claims would be at least $8 billion.

Even if Spitzer could find the money, there’s no reason to think that it would improve educational opportunities for schoolchildren. From its inception, this suit operated on the false premise that a court can determine the exact level of school spending that will magically produce a quality education for all. In fact, the theory that more money leads to academic improvement not only has been exhaustively refuted in courtroom testimony; it also has had a real-world test as the CFE case wound through the courts over the last 13 years. During that period, spending on Gotham’s schools doubled, but student test scores and graduation rates stayed flat.

Certainly, Eliot Spitzer knows all the reasons why this case has been a perversion of the judicial process, why it has nothing to do with education improvement, and why it poses a grave threat to the state’s fiscal future. After all, it was Attorney General Spitzer, acting as the state’s lawyer, who noted that the court started down a perilous path when it decided that a single sentence in the state constitution, requiring New York to provide a “system of free common schools,” allowed it to substitute its judgment about school funding for that of the legislative and executive branches. In their final pleadings before the court of appeals, the attorney general’s lawyers vigorously argued—persuasively, in my view—that the case law didn’t support the plaintiffs’ claim that a state court could force the legislature and governor to earmark a specific amount of money for any budget category, including education.

Thus, even though the high court will likely rule that New York City should get more money for its schools, it may yet stop short of ordering the legislature and governor to appropriate a specified sum. Such a ruling would be an unprecedented breach in the hallowed doctrine of the separation of powers. This is a politically attuned court, and plunging into such uncharted waters—possibly provoking a constitutional crisis—would be extremely risky. Questions addressed to the CFE lawyers by some of the justices during oral arguments suggested that they were troubled by the implications of ordering the other two branches of government to appropriate an exact dollar amount for any government service. The better part of valor, the justices might reason, would be to give the new governor and legislature some leeway to work out the exact dollar amount of a settlement with the plaintiffs and the city.

Given the considerable political capital that his probable landslide victory will give him, along with his credibility with the various interest groups supporting the CFE, Governor Spitzer then might be able to lessen to some degree the damage to all the state’s taxpayers from this misbegotten lawsuit. It would be a very small consolation at the end of a 13-year march of legal folly that has only diverted attention from the serious work of school reform.


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