The stimulus dilemma

Full-day kindergarten may have its merits. So does allowing more days for teacher development or, in districts particularly hard hit by the recession, reducing the number of planned furlough days.

But whatever Utah school districts decide to do with their share of federal education stimulus money this year, they need to understand that they probably won't get the same money again next year. To put it in terms familiar to many people, if you inherit money from a relative, it isn't wise to use that money as a down payment on a purchase that will require you to make regular payments into the future. One-time money should be used for one-time expenses only. Anything else, particularly in the case of public education, would obligate taxpayers for future payments that could require tax increases.

The problem with this stimulus money (the overall total was $26 billion, of which $101 million will be sent to Utah) is that it is earmarked specifically to fund education jobs. It is meant to provide one-time money for ongoing needs. It is, in other words, specifically designed to promote fiscal irresponsibility.

It would be hard to argue that public education doesn't need more teachers, or that school districts wouldn't benefit from not having to conduct layoffs. But a one-time fix does not solve budget problems; it merely pushes them another year down the road. In the process, it expends another $26 billion the federal government can't afford.

Perhaps economic conditions will have improved next year to the point where revenues will cover new ongoing costs. Given current projections, however, that is unlikely. In any event, school districts would be better off making difficult decisions today, then deciding how best to grow when conditions improve.

In Utah's case, much of the stimulus, perhaps half, likely will be used to cover budget deficits remaining from the fiscal year that ended in July. The Utah State Office of Education has cautioned districts to use the rest of the money wisely, given that they probably won't have it to spend next year.

Many Americans seem to be catching on to the fallacy of stimulus spending. To date, the Obama and Bush administrations have pumped about $1.2 trillion of direct federal spending into the economy, with little positive gain in return. Unemployment remains stubbornly high. The best way to stimulate the economy is to encourage private-sector investment. If investors regain confidence and if businesses have more money with which to expand, tax revenues will increase. Then schools can rehire teachers with confidence, knowing they can fund the jobs permanently.

Used wisely, this one-time education stimulus could provide some benefit, but it won't solve any problems.