Pell Grants vs. PreK-12 Programs?

by Reihan Salam

Claire McCann and Jason Delisle warn that spending on Pell Grants, a program that by definition benefits college students (and higher education institutions), might crowd-out spending on PreK-12 programs, which potentially benefit a much larger class of young people:

Under the stimulus bill, Title I funding for disadvantaged PreK-12 students grew by $10 billion.  Special education state grants under Part B of the Individuals with Disabilities Education Act (IDEA) nearly doubled, with an extra $11.3 billion, in addition to the program’s regular 2009 appropriation of $11.5 billion. And the Pell Grant program for low-income college students got a $15.6 billion add-on to its 2009 appropriation of $17.3 billion.

Since then, lawmakers have boosted the U.S. Department of Education’s budget overall by a healthy sum (especially when compared with other agencies), up from $59.2 billion in fiscal year 2008 to $68.1 billion in 2012. Amidst that healthy increase, however, lawmakers kept Title I funding and IDEA funding essentially flat.

What explains the overall funding increase? A big part of it went to Pell Grants. But there is more to the explanation. After the stimulus money had run out for other education programs, lawmakers approved four additional years of emergency supplemental funding for Pell Grants, which coincided with a separate increase to an entitlement funding stream for the program that started in 2008. The result may be the largest funding increase for any federal education program in history—while other programs remained flat.

The rejoinder to my framing of what is happening, or rather what might happen in the future, is that Pell Grants can grow rapidly and funding for PreK-12 can grow rapidly as well, perhaps by shifting resources from defense expenditures or by raising the tax burden on high-earners. I’m skeptical of this view, but it is widely held.

I will say, however, that the case for financial aid that is restricted to low-income students is much stronger than the case for tax incentives that benefit all students, for reasons Andrew Gillen outlines in his stimulating theoretical paper “Introducing Bennett Hypothesis 2.0.”

The Agenda

NRO’s domestic-policy blog, by Reihan Salam.