Earlier this month, President Donald Trump signed into law a $79 billion budget for the federal Department of Education, a $217 million increase over last year. That amount represents but a fraction of national K–12 education spending. K–12 expenditures consume more public funding than any category of government spending outside major entitlements—about $1 trillion nationally in 2023. New York City alone budgeted $42.8 billion for public schools this year.
The cash infusion may come as a relief to many school districts, but it’s cold comfort for countless American parents, whose children leave school unprepared for adult life. Despite how much we spend, American students’ math and reading scores are virtually unchanged from 2000 levels—still well below proficiency—while chronic absenteeism, teacher attrition, and grade inflation have become routine.
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We spend more every year, but researchers have yet to develop a good way to measure what taxpayers get for their money. Imagine assessing a company only by its operating expenses and ignoring its top and bottom lines—investors would laugh. Per-pupil expenditures can tell what a system costs, but they say nothing about what it delivers. Outcomes without costs is another incomplete measure: two systems that produce similar results are not equally beneficial if one spends twice as much.
In a new Manhattan Institute study, I introduce an Educational Return on Investment (EROI) framework to address this. EROI combines financial inputs with concrete academic milestones—high school graduation, college enrollment, and college completion. The goal is to help taxpayers and policymakers compare how different school systems translate dollars into achievement.
The study tracks per-pupil expenses for students who attended New York high schools from 2013 through 2017. The results are disturbing, even shocking. The city spent on average nearly $400,000 (in 2025 dollars) per public school student over their primary and secondary years. But when K–12 spending is calculated per college enrollee and, more importantly, per eventual college graduate, costs skyrocket. To produce a single college graduate, New York City spent about $1.5 million from grades K–12, excluding postsecondary costs. For every low-income city student that completed college, New Yorkers spent $2.2 million.
More cost-intensive special education students don’t explain these exorbitant sums. Excluding special-education students, it still costs the public school system $1.2 million to produce a general-education college graduate.
Similar patterns appeared across New York State, with or without New York City. Higher spending does not translate into higher achievement.
By contrast, private schools serving similar populations in the same city produce better results at far lower costs. I know, because I was the president of one: Cristo Rey Brooklyn High School—part of the 41-school Cristo Rey Network. The school serves overwhelmingly minority students of all faiths from families of limited means.
Combining Cristo Rey’s results with those of the Catholic Diocese of Brooklyn’s elementary schools (which many Cristo Rey students attended), we get an idea of what a reformed education system could look like. For roughly the same K–12 funding that New York City public schools spent to yield one low-income college graduate, the Brooklyn Diocese/Cristo Rey model produced close to nine such graduates. Put another way, the private model accomplished for about $2.2 million in costs what the public system spent nearly $20 million to achieve.
This sharp contrast between public and private education undermines the tendency of many to place blame for poor public school performance on inadequate funding. To be sure, while reform does not imply that we must defund the public school system, it does require that policymakers of all stripes stop equating spending with success, start measuring what works, and aggressively pursue genuine solutions.
In his inaugural address, New York City Mayor Zohran Mamdani said that many New Yorkers “have been betrayed by the established order,” and that rare moments arise to “transform and reinvent.” No order is more established than New York’s K–12 public school system, and no group more betrayed than its students.
Transforming and reinventing public education should start by requiring EROI reporting alongside per-pupil spending, so that the public can see costs per graduate and per college degree. Recent years have witnessed several states giving families more options by allowing public dollars to follow students, not schools. Unlocking these possibilities in New York and other non-school-choice states would save taxpayer dollars and improve student performance, especially for low-income families.
If Mayor Mamdani truly wants to improve New York City’s affordability, he should recognize that the city’s public schools spend far too much for the results they deliver. He has a genuine chance to transform public education’s value proposition for the city’s students and families. To do so, he must resist the temptation to keep throwing good money after bad.
Photo: skynesher / E+ via Getty Images