One constant cry in the debate over educational reform is that we must save our public schools. But proponents of that argument assume that a public school system must be exactly what we have today: schools clustered in districts governed by centralized bureaucracies that oversee every detail of what goes on in individual schools, from budgets to personnel to curricula. That's like saying that our steel industry should center on open-hearth furnaces and giant corporations rather than the nimble mini-mills that have largely superseded them. Let's agree, for argument, that a public school system is a good thing: but why should it look just like it does today—which is what it looked like 50 years ago?

There's nothing sacrosanct, after all, about the current structure of our public education system. Its roots go back to the nineteenth century, when a geographical community would club together to hire and pay a teacher and later, when things got more complicated, would tax property to provide a local school and then appoint or elect a few people to a small board that would oversee it and hire its teacher. As the communities grew into towns and cities, it seemed logical to expand the governing mechanisms already in place. Tiny school boards slowly swelled into today's bloated and dysfunctional school districts, responsible for running not one but 5 or 25 or 50 schools.

If we want to save the public schools, we mustn't confuse the ideal of public education—that every child has the right to a good K-12 education at public expense—with any particular system, including the one we've got. Surely we can come up with a modernized definition of public education fit for a new millennium. In Arizona, where I'm Superintendent of Public Instruction, that's just what we're trying to achieve. Our new approach, aimed at shifting power from bureaucrats to students and families, has three key, equally essential parts: student-centered funding, parental choice, and tough, objectively measurable, standards.

Start with student-centered funding. In Arizona, we've all but replaced an older and more typical system, in which school districts assess and use local property taxes to fund schools, with one in which the state raises the money (including for capital construction) through a statewide tax, straps an equal amount of it to each student's back, and releases it only when he walks into the school of his choice.

For some conservatives, a state-run financing system instead of the local property-tax model seems counterintuitive. Aren't we undermining the bedrock conservative value of local control? But if local control means school district control, we shouldn't hesitate to use state policy to undermine it, just as 20 years ago, British prime minister Margaret Thatcher used state power to weaken the socialist-run local councils that threatened her popular free-market reforms. What we aim to do in our state is to devolve authority down to the level of the individual school and the individual family.

Especially in a place like Arizona, the traditional school district is one of the biggest obstacles to improving the public schools. Today's district is a rigid command-and-control system that offers dissatisfied parents no choices except, if they don't like the district school, to send their kids to private school or to home-school them. Moreover, like the Soviet Union with its five-year plans, the districts do a poor job of management, for the reason F. A. Hayek pointed out: command-and-control systems suffer from an information deficit. How can a distant district office bureaucrat know how to run a school better than the principals and teachers who work there? Too often, the district just lays down a single set of policies to govern all its schools, imposing one-size-fits-all curricula and disciplinary policies on schools that may have very different needs. The system also seems impervious to reform from within. In my experience, those who join district boards, even those who start out reform-minded, eerily become co-opted and wind up defending the system tooth and nail. It's just like watching Invasion of the Body Snatchers.

If you need an additional reason to abolish the traditional property-tax funding system, consider this: it's unfair. Funding education through local property taxes is deeply regressive. It lets rich districts spend more per pupil, at much lower tax rates, than poor districts. After all, a rich district's citizens who pay $3,000 per year on their $300,000 houses are paying 10 percent in taxes; the poor district's citizens who pay $1,200 on their $100,000 houses are paying 12 percent.

Our student-centered funding system is more equitable, for two reasons. First, each child receives roughly the same amount of educational funds (except disabled kids, who get more). Second, since the state tax is the funding source, taxpayers bear burdens more proportional to their wealth. But parents who want to donate extra to their local school—for an art teacher or a librarian, say—can subtract up to $200 of that donation from their state income tax.

The equal funding per pupil in Arizona isn't perfect, however. The school district still gets in the way, allocating the per-pupil funds to its various schools rather than leaving the money inseparably attached to the individual student. Say a school is "worth" $3 million because of the number of students its no-nonsense principal and its back-to-basics phonics instruction have attracted. The district might give it only $2 million, taking $500,000 for itself and sending the rest to the floundering group-hug school up north, which is losing students in droves. There's no way to track for sure how the district divvies up the funds. In November, though, Arizonans likely will vote in favor of a ballot measure that boosts school funding but also traces funds right to the school a student attends instead of stopping short at the district level. Publicized, this information will pressure districts to make sure the money goes where it should go.

Once you have student-centered funding, you can easily create a competitive educational marketplace, which will reward good schools for their success and let poor ones languish and go out of business, if parents are able to choose among public schools. In 1994, the state legislature (of which I was then a member) gave parents just that power, with two important laws. It passed an open enrollment law, so that students could attend any district public school in the state if it still had room after neighborhood kids signed up. Even more important, the Arizona School Improvement Act allowed for the creation of charter schools that operate free from school-district control, dictate their own instructional programs, and make their own personnel decisions (including hiring talented non-union and uncertified teachers who lack ed-school degrees). This law passed as a compromise between proponents of a more radical school-voucher system and defenders of the command-and-control school-district system.

Thanks to the charter law, Arizona now has an educational marketplace with more, and more meaningful, public school choice than any other state in the nation. Since 1994, we've seen more than 400 charter schools blossom, serving approximately 50,000 students, roughly 6 percent of our public school population. There's now a charter school within commuting distance of almost every school district in Arizona.

The reason so many charter schools sprouted in Arizona so quickly is that, once again, we bypassed the school districts. The early charter movement floundered a decade ago because most states forced schools to obtain charters from local school boards. No surprise that charters weren't springing up fast: this would be like Burger King asking for permission to sell Whoppers in the local McDonald's. There's just not going to be any enthusiasm to help out the competition. To encourage the formation of charter schools, we gave two state bodies—the Board of Education and a governor-appointed State Board for Charter Schools—the power to grant 25 charters a year each, completely independent of districts (which also have the power to grant charters, whether they want it or not). We also let individual charters open multiple campuses. Last year, three of the bigger schools ran more than 40 campuses, all told.

Finally, we made it easy to get a charter. The charter organizers propose a contract that lays out the school's goals, financial plan, and personnel practices. The school must guarantee that it will be open to all students, including those with special needs. If approved, the school then receives funding directly from the state for each student it enrolls—a funding scheme that could (and should) extend to vouchers for private schools in the future. The charter contract runs 15 years, but the chartering agent can revoke it at any time for academic failure or financial mismanagement. And then it's up to the school to be good enough to attract and keep enough pupils to stay in business.

Many of the charters that have sprung up since 1994 have back-to-basics curricula, signaling a powerful reaction against the district schools' faddish educational philosophies and vapid teaching. One of the best basics schools is the Tempe Preparatory Academy, founded in 1996 by a group of college professors. Tempe Prep is Arizona's second-highest- achieving public school, with only a Tucson magnet school that, unusually, is allowed to select its students based on academic ability beating it out. Tempe Prep is a gift to its students. I don't think it would exist if not for the charter possibility.

Reading the school's mission statement, you suddenly find yourself a million miles away from ed-school jargon. "Using a 'Great Books' approach," the statement reads, the school's purpose "is to educate your child in the best tradition of American education. . . . Each student will learn how to reason correctly, express him/herself articulately" and "value the virtue of self-discipline and integrity."

What's so fascinating about Tempe Prep isn't just its magnificent curriculum of Homer, Chaucer, and Montaigne, but the fact that, like lots of charters, it doesn't require its teachers to be certified or ed-school-educated. Instead, the school boasts an impressive staff of instructors who hold advanced degrees in their subject areas—just like a first-rate private school. Tempe Prep's breathtaking success gives weight to the seemingly obvious, but too often ignored, truth that effective teaching depends mostly on a teacher's knowledge of the instructional material, not on possessing an education degree.

About two-thirds of Arizona's charter secondary schools target "at risk" kids, who often drop out of uninspiring district schools. That's not surprising: many of these kids came from inner-city districts where low-performing schools make the need for a charter-school alternative greatest. The most successful of the "at risk" charters is the Flagstaff Arts and Leadership Academy, founded by former Arizona Teacher of the Year Karen Butterfield. Her immediate purpose in launching the charter was to save a group of troubled but artistically gifted high school students languishing in her old district school. Stoically braving her former colleagues' hostility—they saw her new endeavor as disloyal to their shared school-district experience—Butterfield hired a strong staff of demanding teachers and set up a few ramshackle, portable buildings on the grounds of the local museum to welcome the tiny first class of students.

Flagstaff's academically challenging environment and disciplined arts program show what good a content-rich public education can achieve, even with seemingly lost kids. One time dropouts now found themselves pursuing high-level mathematics and classical literature along with a full arts curriculum. The charter's students consistently rank among the highest academic achievers in the state. When I asked one of the teachers why they were succeeding with these kids where the district schools fail, he responded, "Nobody had ever asked the students to read and comment on Dostoevsky before."

Not all our experiences with charter schools have been so positive. Given that 30 percent of new small businesses fail, I've often consoled myself that our having had to close a dozen charter schools out of 400 is pretty good. But it's never fun to close a school—it's bad for the students and bad for public education as a whole. Far better to shut down a school, though, than to let a poorly performing or fraudulent enterprise continue—and in theory this principle would hold true of a poorly performing district school, too.

One of the toughest closures brought an end to one of Arizona's first and most beloved charter schools: Phoenix's Citizen 2000, founded in 1995 by an energetic African-American educator, Lawndia White Venerable. The new charter soon gained a first-rate reputation for its demanding coursework and disciplined classrooms among the predominantly black families who enrolled their kids there. Unfortunately, though Citizen 2000's academic program remained outstanding, the school's management came under fire for overstating its enrollment in order to bring in more state funds. In 1997, after the school had lost its charter, a grand jury indicted Venerable and her sister Loretha Johnson, the school's assistant principal, on 31 counts of theft, fraud, and misuse of some $200,000 in public money.

Charter critics have pointed to Citizen 2000 to heap scorn on the whole idea of parental choice and a market-based approach to public education. But the critics ignored a far more important story: the large number of parents who remained loyal to a school they strongly suspected of shady business dealings, because, as one mother put it, "For the first time, my child is treated as she would be in a private school. Everybody knows her name, and she is expected to do her work." For these parents, Citizen 2000 offered their kids an unparalleled academic experience. Nearly all of them enrolled their children in other charter schools after we closed Citizen 2000's doors. Liberty in school selection is addictive.

All three of these schools began as dreams of educators tired of the mediocrity and failure of the school-district system. Indeed, the charter school pioneers in Arizona were the fed-up parents and frustrated teachers who knew public schools could achieve a much higher standard of excellence. I once had a conversation with a group of such teachers who had left their positions as leaders of their local union to start a charter. These were wonderful people, delightfully obnoxious about their mission: they would use whatever lever they could to get the control in the classroom they felt they needed. Many of these missionaries, a recent survey shows, took out second mortgages or went without salaries to keep their charters open during the tough early going, when they didn't have many students or much money. To save money, some plucky charters used parents as lawyers and janitors and maintenance workers. If you wanted an example of Tocqueville's American spirit of association, here it was, in spades.

In a second wave, four national for-profit charter companies have opened schools in the state. These firms have several advantages the missionaries don't always possess. They've already got stable financing, they have a developed and tested educational approach, and they market themselves well in the surrounding communities.

One of the best, Advantage Schools Inc., opened in a poor section of Phoenix in 1996. Advantage's educational method is "Direct Instruction," which relies on scripted lessons and student recitation—old-fashioned stuff. If you walked into an early-grade Advantage reading lesson, you'd hear a teacher read a passage from a book and then ask the class to read it back to her. In math, it works the same way. Teacher: "Two plus two is four. What is two plus two?" Children: "Four." A major long-term research project identified Direct Instruction as the most effective teaching method among all those it surveyed. Few public school educators are comfortable with it, though, since it is so strict, and it offends the "child-as-discoverer" orthodoxy prevalent in today's schools.

Parents love it, however, and the students' academic results far exceed their performance in district schools. In Arizona, Advantage's student population has rocketed from just over 200 in their first year to more than 1,000 four years later. A large number of these students are Hispanics who initially lack English proficiency. Before it brings these kids into the English-language classrooms, Advantage puts them through an intensive English program that has most of them proficient by the end of six months. This approach differs dramatically from the typical bilingual-ed program, whose defenders claim it takes up to ten years for a student to become proficient enough to enter an English classroom.

Like many charters, the school is orderly and disciplined, a real selling point for parents concerned with school safety and outraged by anarchic district-school classrooms. I'm a huge fan of Advantage's attendance enforcer, who leaves the school every day to track down any children who don't show up. She's not a mild woman, and as a parent myself, I've often pondered how I would react if she came knocking at my door wondering why my kids weren't in school—scared, probably. Her imposing presence sends a powerful message to parents and students: this school cares about educating its children.

We'd love it if Advantage opened more campuses in Arizona, but the firm has chosen to expand in those states that pay more per pupil than we do. Because of Arizona's low operational funding of $4,700 per pupil, we now find ourselves on the losing end of an increasingly competitive national market for charter schools. If the November school bill passes, though, we'll be in a better position to compete.

How are charters doing academically? As a group, their average performance is on par with district schools, with early signs that students may be progressing faster in the charters. Individually, charter schools tend to group at the extremes, producing some of the best and worst performances in the state—though good performances far outpace poor ones.

If the students are doing well, so are charter teachers, who feel more empowered in charter schools. According to a recent study of Arizona's "desert bloom" published in Phi Delta Kappan magazine, almost two-thirds of teachers in Arizona's charter elementary schools reported they had high levels of influence over curricula, compared with just a quarter in district schools. Charter teachers also tend to have much closer relationships with colleagues, principals, and parents than their district counterparts, the study reports.

Charter schools not only give parents a wider range of choices. By drawing students and money out of district schools, they pressure the rest of the system to become more accountable. Two districts lost huge numbers of students to charters. The Mesa Unified District, the biggest in the state, lost 7 percent of its enrollment—5,000 kids. Students fled the smaller Flagstaff District at an even more rapid rate, with 10 percent of them enrolling in charters.

The first response of Arizona's school districts to their new rivals was to try to discredit them. We heard a lot about "uncredentialed and unaccountable" charter schools, and some district officials reportedly spread rumors that charter operators were racist in order to cut off potential minority support.

The next reaction—far more encouraging—was for the district schools that were losing students to charters to try to understand why. Some particularly hard-hit districts, like Roosevelt in inner-city Phoenix, wrote letters to parents to discover their reasons for removing their children. Another Phoenix district actually sent teachers and administrators into the homes of parents who had removed their kids to find out why they were so unhappy with district schools. Mesa Unified even had staff researchers travel to the state education department to pore over charter proposals—"checking up on the competition," as the Phi Delta Kappan study put it.

It took a few years for these lessons to kick in. But now, in a third reaction, district schools are adopting many of the educational models that drew parents to charters, including back-to-basics curricula. By returning to phonics instruction, the Queen Creek District won back a third of the students it lost to a charter school. Mesa Unified lost many of its Mormon students to a charter, because the district refused to enlarge a back-to-basics magnet school that Mormon parents loved. To stem the flow of students out of the district, Mesa eventually relented, and opened a new "three R's" magnet school.

Fourth, district schools have begun to market themselves more aggressively. Schools now advertise in the paper, on the radio, even in movie theaters. The need to recruit students couldn't be clearer. Of course, to recruit effectively, you must have a good product to sell. We believe the presence of competition is a principal reason we've seen statistically significant improvements in reading, writing, and math scores in the public schools in each of the past three years.

If Arizona funds students, not districts, and has freed schools from district control, what's left for the school district to do? Defenders say that districts create economies of scale, letting a group of schools buy supplies in bulk or contract with vendors at a better rate. But this is no longer true. By turning to Internet vending auctions, a single 200-member school can these days get the same breaks as a huge district. A more sensible role for districts—if we even retained them—would be to function as corporate boards of directors do, overseeing schools in which, say, they had placed inspirational leaders who got to hire and fire staff and set their own agendas. Otherwise, the district board would stay out of the way. So in effect you'd have a system of relatively autonomous individual schools—some wholly independent charter schools and some with the loose oversight of a district board.

The third part of our new model of public education is tough, objective standards and mandatory state testing. As for standards, the market will drive schools to attain educational excellence only if we have a clear idea of what excellence is. When I first became superintendent, Arizona's standards for reading, writing, and math came up to my waist. There wasn't a teacher in Arizona who could understand them. When there aren't any clear standards, however, education succumbs to the latest ed-school fluff: self-esteem, diversity, gender equity, you name it. We simplified and revised the standards and made some of them non-negotiable. All kindergarteners now receive phonics instruction, for example.

Testing is crucial. By 2004, Arizona high school kids will have to pass AIMS—the Arizona Instrument to Measure Standards test—in order to get a diploma. AIMS forces schools to teach students what they need to know to thrive in today's economy. High school kids will have to pass all three parts of the test: reading, writing, and math. It's not fluff. On the reading test for fiction, they'll need to show they can interpret meaning, analyze character, and understand the use of figurative language. For non-fiction, they'll have to make connections and appropriate generalizations and sum up succinctly what they've read. To pass the writing exam, they'll have to write a narrative with complex characters, with a plot structure and a point of view, and they'll have to do it grammatically. In math, they'll have to know logic, algebra, geometry, data analysis and probability, and measurement.

Arizona will include the results of the test in the report cards we issue on all the state's public schools. The report cards include, in addition to scores of standardized tests, a school's personnel information, educational philosophy, and the number of crimes committed in the school (if any). The publicity the report cards attract will put pressure on schools with poor scores to shape up. And the reports will help parents make rational decisions when they choose a public school for their children.

Student-centered funding, parental choice, and tough standards—what more do you need to make a public education system that serves all students well? It's what we are moving toward in Arizona, and it's a far cry from what exists now in the rest of the nation.


City Journal is a publication of the Manhattan Institute for Policy Research (MI), a leading free-market think tank. Are you interested in supporting the magazine? As a 501(c)(3) nonprofit, donations in support of MI and City Journal are fully tax-deductible as provided by law (EIN #13-2912529).

Further Reading

Up Next